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Exhibit 10.1
AGREEMENT, RELEASE AND WAIVER
Gregory L. Weaver, who is a resident of the State of Washington
("Executive") and Nastech Pharmaceutical
Company Inc. with offices at 3450 Monte
Villa Parkway, Bothell, Washington 98021
(the "Company") for good and valuable
consideration, the receipt and sufficiency
of which is hereby acknowledged have
reached the following Agreement:
1. The termination
of Executive's employment is effective September
7, 2005 (the "Date of Termination")
pursuant to Executive's resignation of
employment.
2. (a)
Subject to the
provisions of Section 4 below, the Company
shall pay Executive $140,000 as
severance.
(b) Payments to be
made to Executive pursuant to Section 2(a)
above shall be paid in monthly installments
at the rate of $23,333 per month for
a six (6) month period. The first (1st) payment shall be
made once this
Agreement becomes irrevocable pursuant to
Section 13 below with further payments
to be made on a monthly basis thereafter
commencing thirty (30) days after the
first (1st) payment date.
3. (a)
Both the Company and
Executive agree that the terms of
Executive's Change-In-Control and Severance
Agreement with the Company dated
July 31, 2002 (the "Change-In-Control and
Severance Agreement"), are superseded
in their entirety by the terms of this
Agreement and that the Change-In-Control
and Severance Agreement is cancelled.
(b) Except as set
forth in this Section 3(b), any stock option
grant agreement pursuant to which Executive
has been granted options to purchase
shares of the Company shall remain in
effect or expire in accordance with the
terms of the applicable grant agreement and
any rights Executive may have after
Executive's termination of employment with
respect thereto shall be measured
based on Executive's Date of Termination.
The stock options
granted to
Executive pursuant to the Nastech
Pharmaceutical Company Inc. 2002 Stock Option
Plan (the "Stock Option Plan") and pursuant
to a stock option agreement between
the Company and Executive dated September
10, 2003, which are scheduled to vest
on September 10, 2005 are hereby converted
from incentive stock options to
non-qualified stock options and shall vest
on September 10, 2005 during the
Consulting Period (as defined below).
(c) In the event
Executive obtains alternate employment during
the period that severance is being paid to
Executive, payment of severance
benefits shall continue and not be offset
or reduced.
(d) The Company will
deduct from all severance payments made to
Executive pursuant to Section 2(a) above,
any outstanding travel or other
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advances and all federal, state and local
withholding taxes and other deductions
which the Company is required by law to
make from wage payments to employees.
(e)
Executive shall be eligible to elect medical continuation
coverage for Executive and his immediate
family under applicable law ("COBRA").
The Company shall pay the employer portion
of Executive's medical costs as if
Executive were still an active employee
until the earlier of the date Executive
becomes eligible for medical coverage under
the plan, program or policy of a new
employer or the date Executive is no longer
eligible for severance payments
hereunder.
(f) The
Company shall pay up to $5,000.00 directly to an
outplacement agency of Executive's choice
upon receipt of an invoice(s) (which
may be addressed to Executive) for
outplacement services.
(g) The
Company shall pay Executive a lump sum amount equal
to and in full satisfaction of the
Company's obligation to pay Executive for
accrued but unused paid time off ("PTO")
pursuant to the Company's records. At
this juncture, the Company records reflect
Executive has accrued one hundred
fifty-seven (157) hours of unused PTO.
(h) By
executing this Agreement both the Company and
Executive hereby acknowledge and agree that
the payments made to Executive and
benefits provided to Executive are in full
satisfaction of any amounts owed by
the Company to Executive and that Executive
is not entitled to any bonus
payments, and no events which may occur
after the execution of this Agreement
shall increase the Company's liability to
Executive.
4. As a
condition of Executive's entitlement to receive severance
hereunder Executive agrees that for the
period commencing on September 7, 2005
and ending on December 7, 2005 ("Consulting
Period"), Executive will become a
consultant for the Company. At the Company's request, during
the Consulting
Period Executive shall from time-to-time
meet with the Company's executives,
accounting personnel, and/or
representatives and provide them with advice,
information and services, regarding
accounting and financial matters involving
the Company. During the Consulting Period,
Executive shall provide such
information, cooperate with the Company,
and render such services faithfully and
to the best of Executive's abilities.
Executive recognizes
that payments to be
made to Executive pursuant to Section 2(a)
above and Executive's ability to vest
in the September 10, 2005 tranch of options
(described in Section 3(b) above)
are conditioned on Executive fully
cooperating with the Company pursuant to the
provision of this Section 4.
5. Executive
acknowledges and accepts the payments and benefits
described under Section 2 and Section 3
above as full satisfaction and discharge
of any and all amounts owed to Executive
under this Agreement or otherwise,
including without limitation any accrued
but unpaid vacation days.
6. (a)
Pursuant to the terms
of this Agreement, Executive shall
not be bound by a covenant not to compete
with the Company.
However, Executive
shall
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not during the one (1) year period
following Executive's termination of
employment hire or attempt to hire f
