Exhibit 10.73
Portions of this document have been
redacted pursuant to a confidential treatment request and filed
separately with the Securities and Exchange Commission.
Redacted portions have been replaced with
“*****”.
EMPLOYMENT
AGREEMENT
THIS EMPLOYMENT AGREEMENT
(“Agreement”) is made on this 15th day of May, 2009, by
and between AVI BioPharma, Inc., an Oregon corporation, with its
principal office at 4575 SW Research Way, Suite 200, Corvallis,
Oregon, (“ Company ”), and Paul Medeiros, 700
Mixsell Street, Easton, Pennsylvania 18042 (“ Employee
”).
RECITALS:
The Company desires to hire the
Employee as Senior Vice President Business Development and Chief
Business Officer and the Employee desires to accept such position
under the terms and conditions stated herein.
NOW, THEREFORE, in consideration of
the mutual benefits contained herein, the sufficiency of which the
parties acknowledge, the parties hereby agree as
follows:
AGREEMENT:
1.
Employment Term.
The term of employment (“
Term ”) shall commence on the Effective Date and shall
continue until the first anniversary of the Effective Date, unless
extended as provided below or terminated in accordance with
Section 12 below. This Agreement establishes an “at
will” employment relationship, as such term is defined and
used under Oregon law, between the Company and the Employee.
Employee shall commence employment not later than May 19, 2009 (the
“ Effective Date ”). Failure to do so shall be
grounds for immediate termination for Cause , as such term
is defined in Section 12 hereof. Notwithstanding anything to
the contrary herein, unless sooner terminated in accordance with
the terms hereof, this Agreement shall annually automatically renew
for additional one-year terms unless one party notifies the other
party in accordance with Section 13 hereof of its intention
not to renew, such notice to be delivered not less than 90 days
before the term ends. For purposes of this Agreement, the
non-renewal of the Agreement by the Company shall constitute a
termination of Employee’s employment by the Company other
than for Cause.
2.
Duties.
Employee shall be employed as Senior
Vice President Business development and Chief Business Officer and
shall have such duties as are customarily associated with that
position, including overall responsibility for development and
execution of strategies and tactics for transactions, alliances,
mergers and acquisitions that are agreed with the Corporate
Executive Team and CEO, and such other duties as may be assigned to
him from time to time by the Company’s Chief Executive
Officer (“ CEO ”). Employee shall be a direct
report of the CEO. Employee shall devote substantially all of his
business time to the service of the Company throughout the Term.
Employee and
Company acknowledge and agree that (i) Employee
may hold certain offices within certain entities as agreed by the
CEO and set forth on Exhibit A to this Agreement, (ii)
Employee’s devotion of reasonable amounts of time in such
capacities, so long as it does not interfere with his performance
of services hereunder, shall not conflict with the terms of this
Agreement, and (iii) Exhibit A may be amended from time to
time by agreement of the parties rendered in writing.
3.
Compensation.
(a)
Base Compensation . During the Term the Company shall
compensate the Employee at an initial annual salary of Three
Hundred Fifteen Thousand Dollars ($315,000.00), payable in
accordance with the Company’s payroll practices in effect
from time to time, and less amounts required to be withheld under
applicable law and requested to be withheld by the Employee (as
increased from time to time, “Base Compensation”). The
Employee’s Base Compensation shall be subject to review for
potential increase (but not decrease) on an annual basis. Except as
otherwise provided in this Agreement, the Base Compensation shall
be prorated for any period of service less than a full
month.
(b)
Bonus . For each fiscal year of the Company that ends during
the Term, the Employee shall be eligible for an annual bonus of up
to 25% of Employee’s Base Compensation, which bonus shall be
paid in the normal cycle of payment of executive bonuses (which
bonus payment shall occur in the first quarter of the fiscal year
following the fiscal year with respect to which the bonus is
earned) and upon achievement and satisfaction of goals and
objectives (“Goals and Objectives”) established upon
mutual agreement of the CEO, Employee and the Compensation
Committee of the Company’s Board. Such goals shall be
established concurrently with the goals and objectives of the
Company’s other senior executives. Notwithstanding anything
to the contrary herein, Employee’s bonus for 2009 will be a
guaranteed $50,000 and in order to receive any bonus under this
Section 3(b) Employee must be an employee of the Company at
the time of the bonus payout.
(c)
Equity Compensation .
(i)
On the Effective Date, the Employee will be granted options to
purchase Four Hundred Thousand (400,000) shares of the
Company’s common stock (the “Options”) under the
Company’s 2002 Equity Incentive Plan (the “Plan”)
(a copy of which is attached as Exhibit B ), with an
exercise price at the fair market value of the Company common stock
on the date Effective Date. Subject to accelerated vesting or
termination as set forth herein, the Standard Options shall vest in
equal annual installments over three (3) years measured from the
Effective Date.
(ii)
In addition, on the Effective Date, Employee will be issued One
Hundred Thousand (100,000) shares of restricted stock under the
Plan (the “Restricted Shares”). The Restricted Shares
shall vest as follows:
2
through the first anniversary of the
Effective Date (a) in a pro rata basis *****; and (b) 100% upon any
Change of Control. By way of illustration and not limitation,
*****
(iii)
The exercise price of the Options and all other terms and
conditions associated with the Options and Restricted Shares shall
be determined in accordance with the Plan and grants (the forms of
which are annexed hereto as Exhibit C and Exhibit D ,
respectively). To the maximum extent possible, the Options shall be
Incentive Stock Options.
(d)
Additional Compensation . Within 10 business days of the
Effective Date, the Company will pay the Employee a $100,000
sign-on bonus. Should the Employee separate from the Company prior
to the one year anniversary of the Effective Date for reasons of
termination for Cause or voluntary termination by the Employee
other than for Good Reason, this sign-on bonus is refundable to
Company in full.
4.
Expenses.
The Company will reimburse Employee
for all expenses reasonably incurred by him in discharging his
duties for the Company, conditioned upon Employee’s
submission of written documentation in support of claimed
reimbursement of such expenses, and consistent with the
Company’s expense reimbursement policies in effect from time
to time. The Company will reimburse the Employee in 2010 up to One
Hundred Twenty Thousand Dollars ($120,000) for reasonable expenses
incurred in 2009 and 2010 to relocate Employee, Employee’s
spouse and parts of Employee’s and Employee’s
Spouse’s household in a manner compatible with
Employee’s duties hereunder to the Company’s
headquarters location (“Facility Location”), including
the reasonable and customary costs of selling his Pennsylvania
residence (but not vacant home carrying costs), shipment of
personal effects to the Facility Location, and the customary
closing costs associated with the purchase of a residence in the
Facility Location. In addition, Company shall reimburse Employee
(or pay on Employee’s behalf) rent and related living
expenses, not to exceed $2,500 per month in the aggregate and up to
six (6) months in duration, for temporary living arrangements and
up to $5,000 for reasonable attorneys’ fees incurred in
negotiation of this Agreement.
3
5.
Benefits.
Subject to eligibility requirements,
Employee shall be entitled to participate in such benefits plans
and programs as adopted by the Company from time to time and shall
be eligible for paid vacation of four (4) business weeks (20
business days) annually; provided, however, if Employee does not
use all available vacation in any given year, Employee may
roll-over up to one business week (5 business days) to the
following year, the parties intending that Employee shall have a
maximum of five (5) business weeks (25 business days) of paid
vacation in any calendar year following 2009. Notwithstanding
anything to the contrary herein, Employee shall receive 15 days
paid vacation in 2009, available as of the Effective Date. Without
limiting the foregoing, subject to eligibility requirements,
Employee shall be covered by any “directors and
officers” insurance and “errors and omissions”
insurance policies obtained by the Company.
6.
Confidentiality.
As a condition to employment under
this Agreement, Employee and the Company shall enter into the
Non-Disclosure Agreement in the form attached hereto as Exhibit
E . The provisions of this Section 6 shall survive
termination of this Agreement and term of employment.
7.
Non-competition and Non-solicitation.
(a)
For a period of one (1) year in the case of the payment of
severance equal to 12 months Base Compensation and for a period of
two (2) years in the case of the payment of severance equal to 24
months Base Compensation, in both instances as provided in
Section 12 below, Employee shall not directly or indirectly
engage in or have any ownership interest in, or participate in the
financing, operation, management or control of, any person, firm,
corporation or business listed on Exhibit F (as such shall
be amended in the event that the Company enters into a material
transaction with an entity not listed on Exhibit F and as
shall be amended from time to time by mutual consent of Employee
and the Company); provided, however, that this provision
shall not prohibit Employee from owning up to five percent (5%) of
any class of outstanding bonds, preferred stock or shares of common
stock of any such entity or from employment with any institute of
higher learning.
(b)
For a period of two (2) years following termination of employment
with the Company for any reason, except with the express written
consent of the Company, Employee agrees to refrain from directly or
indirectly recruiting, hiring or assisting anyone else to hire, or
otherwise counseling to discontinue employment with the Company,
any person then employed by the Company or its subsidiaries or
affiliates; provided, however, nothing herein shall prevent
Employee from providing, in accordance with Company policy, details
regarding the employment history of any such person or providing an
employment reference with respect to such person.
4
(c)
In the event that the provisions of this Section 7 should
ever be deemed to exceed the duration or geographic limitations or
scope permitted by applicable law, then such provisions shall be
reformed to the maximum time or geographic limitations or scope, as
the case may be, permitted by applicable laws.
(d)
The provisions of this Section 7 shall survive termination
of this Agreement and the term of employment.
8.
Covered Work.
(a)
All rights, title and interest to any Covered Work that Employee
makes or conceives (whether alone or with others) while employed by
the Company, belong to the Company. This Agreement operates as an
actual assignment of all rights in Covered Work to the Company.
“Covered Work” means products and Inventions that
relate to the actual or anticipated business of the Company or any
of its subsidiaries or affiliates, or that result from or are
suggested by a task assigned to Employee or work performed by
Employee on behalf of the Company or any of its subsidiaries or
affiliates, or that were developed in whole or in part on the
Company time or using the Company’s equipment, supplies or
facilities. “Inventions” mean ideas, improvements,
designs, computer software, technologies, techniques, processes,
products, chemicals, compounds, materials, concepts, drawings,
authored works or discoveries, whether or not patentable or
copyrightable, as well as other newly discovered or newly applied
information or concepts. Attached hereto as Exhibit G is a
description of any product or Invention in which Employee had or
has any right, title or interest, which is not included within the
definition of Covered Work or which is otherwise excluded from the
restrictions set forth in this Section 8 .
(b)
Employee shall promptly reveal all information relating to Covered
Work and Confidential Information to an appropriate officer of the
Company and shall cooperate with the Company, and execute such
documents as may be necessary, in the event that the Company
desires to seek copyright, patent or trademark protection
thereafter relating to same.
(c)
In the event that the Company requests that Employee assist in
efforts to defend any legal claims to patents or other right, the
Company agrees to reimburse Employee for any reasonable expenses
Employee may incur in connection with such assistance. This
obligation to reimburse shall survive termination of this Agreement
and the term of employment.
(d)
The provisions of this Section 8 shall survive termination
of this Agreement and the term of employment.
5
9.
Return of Inventions, Products and Documents.
Employee acknowledges and agrees
that all Inventions, all products of the Company and all originals
and copies of records, reports, documents, lists, drawings,
memoranda, notes, proposals, contracts and other documentation
related to the business of the Company or containing any
information described in this Section 9 shall be the sole
and exclusive property of the Company and shall be returned to the
Company immediately upon termination of Employee’s employment
with the Company or upon the written request of the
Company
