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EXHIBIT 10.10
EXECUTIVE
SEVERANCE BENEFITS AGREEMENT
THIS EXECUTIVE SEVERANCE BENEFITS AGREEMENT (the "AGREEMENT") is entered
into this _____ day of ___________, 2000 (the "Effective Date"), between
_______________ ("EXECUTIVE") and VIROLOGIC, INC. (the "COMPANY"). This
Agreement is intended to provide Executive with the compensation and benefits
described herein upon the occurrence of specific events. Certain capitalized
terms used in this Agreement are defined in Article 5.
The Company and Executive hereby agree as follows:
ARTICLE 1
SCOPE OF AND CONSIDERATION FOR THIS AGREEMENT
1.1 Executive is currently employed by the Company.
1.2 The Company and Executive wish to set forth the compensation and
benefits which Executive shall be entitled to receive in the event Executive's
employment with the Company is terminated under the circumstances described
herein following a Change in Control.
1.3 The duties and obligations of the Company to Executive under this
Agreement shall be in consideration for Executive's past services to the
Company, Executive's continued employment with the Company, and Executive's
execution of a release in accordance with Section 3.1.
1.4 This Agreement shall supersede any other agreement relating to cash
severance benefits, health benefits in the event of Executive's severance from
employment with the Company following a Change in Control.
ARTICLE 2
SEVERANCE BENEFITS
2.1 SEVERANCE BENEFITS. A Covered Termination (as defined in Article 4)
entitles Executive to receive the benefits set forth in Section 2.2.
2.2 SEVERANCE PAYMENT. Executive shall receive a severance payment equal
to twelve (12) months of his Base Salary plus the amount of the bonus the
Executive received during the year prior to the Covered Termination. Such amount
shall be subject to all required tax withholding and shall be paid in a lump sum
upon Executive's compliance with Section 3.1 herein.
2.3 MITIGATION. Except as otherwise specifically provided herein,
Executive shall not be required to mitigate damages or the amount of any payment
provided under this Agreement by seeking other employment or otherwise, nor
shall the amount of any payment provided for under this Agreement be reduced by
any compensation earned by Executive as a result of
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employment by another employer or by any retirement benefits received by
Executive after the date of the Covered Termination.
ARTICLE 3
LIMITATIONS AND CONDITIONS ON BENEFITS
3.1 RELEASE PRIOR TO PAYMENT OF BENEFITS. Upon the occurrence of a
Covered Termination, and prior to the payment of any benefits under this
Agreement on account of such Covered Termination, Executive shall execute a
release (the "Release") in the form attached hereto and incorporated herein as
Exhibit A. Such Release shall specifically relate to all of Executive's rights
and claims in existence at the time of such execution and shall confirm
Executive's obligations under the Company's standard form of proprietary
information and inventions agreement. It is understood that, as specified in the
applicable Release, Executive has a certain number of calendar days to consider
whether to execute such Release, and Executive may revoke such Release within
seven (7) calendar days after execution. In the event Executive does not execute
such Release within the applicable period, or if Executive revokes such Release
within the subsequent seven (7) day period, no benefits shall be payable under
this Agreement, and this Agreement shall be null and void.
3.2 TERMINATION OF BENEFITS. Benefits under this Agreement shall
terminate immediately if the Executive, at any time, violates any proprietary
information or confidentiality obligation to the Company.
3.3 NON-DUPLICATION OF BENEFITS. Executive is not eligible to receive
benefits under this Agreement more than one time.
ARTICLE 4
DEFINITIONS
For purposes of the Agreement, the following terms are defined as
follows:
4.1 "BASE SALARY" means Executive's annual base salary as in effect
during the last regularly scheduled payroll period immediately preceding the
Covered Termination.
4.2 "BOARD" means the Board of Directors of the Company.
4.3 "CAUSE" means that, in the reasonable determination of the Company
or, in the case of the Chief Executive Officer, the Board, Executive:
(a) has willfully or recklessly, and repeatedly failed to
satisfactorily perform the Executive's job duties, after being given written
notice of the failure to perform and an opportunity to cure such deficiency;
(b) has committed an act that materially injures the business of the
Company;
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(c) has misappropriated property belonging to the Company or has
violated any of his proprietary information or confidentiality obligations to
the Company; or
(d) has been convicted of a felony involving moral turpitude that is
likely to inflict or has inflicted material injury on the business of the
Company.
4.4 "CHANGE IN CONTROL" means
(a) a sale or other disposition of all or substantially all of the
assets of the Company;
(b) a merger or consolidation in which the Company is not the
surviving entity and in which the stockholders of the Company immediately prior
to such consolidation or merger own less than fifty percent (50%) of the
surviving entity's voting power immediately after the transaction;
(c) a reverse merger in which the Company is the surviving entity
but the shares of Common Stock outstanding immediately preceding the merger are
converted by virtue of the merger into other property, whether in the form of
securities, cash or otherwise, and in which the stockholders of the Company
immediately prior to such reverse merger own less than fifty percent (50%) of
the Company's voting power immediately after the transaction;
(d) after the Listing Date as defined in the Company's Equity
Incentive Plan, an acquisition by any person, entity or group within the meaning
of Section 13(d) or 14(d) of the Exchange Act, or any comparable successor
provisions (excluding any employee benefit plan, or related trust, sponsored or
maintained by the Company or subsidiary of the Company or other entity
controlled by the Company) of the beneficial ownership (within the meaning of
Rule 13d-3 promulgated under the Exchange Act, or comparable successor rule) of
securities of the Company representing at least fifty percent (50%) of the
voting power entitled to vote in the election of Directors; or
(e) in the event that the individuals who, as of the date of
adoption of the Plan, are members of the Company's Board (the "Incumbent
Board"), cease for any reason to constitute at least fifty percent (50%) of the
Board. (If the election, or nomination for election by the Company's
stockholders, of any new Director is approved by a vote of at least fifty
percent (50%) of the Incumbent Board, such new Director shall be considered to
be a member of the Incumbent Board in the future.)
4.5 "COMPANY" means ViroLogic, Inc. or, following a Change in Control,
the surviving entity resulting from such transaction.
4.6 "CONSTRUCTIVE TERMINATION" means the occurrence of any of the
following events without the Executive's express written consent:
(a) a change in Executive's responsibilities which represents
material adverse change from the Executive's responsibilities as in effect at
any time within ninety (90) days preceding the effective date of a Change in
Control or at any time thereafter, or the assignment to Executive of any duties
or responsibilities which are materially and adversely inconsistent with
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the Executive's duties and responsibilities in effect at any time within ninety
(90) days preceding the effective date of a Change of Control or at any time
thereafter;
(b) a material reduction by the Company in Executive's overall
compensation package [or any failure to pay Executive any compensation or
benefits to which Executive is entitled within fifteen (15) days of the date
due;
(c) the Company's relocation of Executive to any place outside a
fifty (50) mile radius of the Executive's current worksite, except for
reasonably required travel on the business of the Company and/or its affiliates
which is not materially greater than such travel requirements prior to the
effective date of the Change of Control. a relocation of Executive's business
office to a location more than twenty (20) miles from the location at which
Executive performs duties as of the effective date of the Change in Control;
(d) the failure by the Company to: (i) continue in effect (without
reduction in benefit level and/or reward opportunities) any material
compensation or employee benefit plan in which the Executive was participating
at any time within ninety (90) days preceding the effective date of a Change in
Control or at any time thereafter, unless such plan is replaced with a plan that
provides substantially equivalent compensation or benefits to Executive (it
being understood that changes to any such plans necessitated by the need to
conform Executive's and the Company's other employees', as a whole, compensation
and benefits packages to those of the surviving corporation and/or acquiror (as
applicable) shall not alone constitute Constructive Termination unless such
changes result in a material reduction in Executive's overall annual
compensation package as described in subsection (B) above), or (ii) provide
Executive with compensation and benefits, in the aggregate, at least
substantially similar (in terms of benefit levels and/or reward opportunities)
to those provided for under each other employee benefit plan, program and
practice in which the Executive was participating at any time within ninety (90)
days preceding the effective date of a Change in Control or at any time
thereafter;
(e) a material breach by the Company of any provision of this
Agreement, unless such breach is cured within fifteen (15) days following notice
by the Executive of such breach; or
(f) any failure by the Company to obtain the assumption of this
Agreement by the surviving corporation and/or acquiror (as applicable) of the
Company.
4.7 "COVERED TERMINATION" means an Involuntary Termination Without Cause
or a Constructive Termination within three (3) months prior to or twenty-four
(24) months following the effective date of a Change in Control.
4.8 "INVOLUNTARY TERMINATION WITHOUT CAUSE" means Executive's dismissal
or discharge other than for Cause. The termination of Executive's employment as
a result of Executive's death or disability will not be deemed to be an
Involuntary Termination Without Cause.
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ARTICLE 5
GENERAL PROVISIONS
5.1 EMPLOYMENT STATUS; EMPLOYMENT AGREEMENT SUPERCEDED. This Agreement
does not constitute a contract of employment or impose upon Executive any
obligation to remain as an employee, or impose on the Company any obligation (i)
to retain Executive as an employee, (ii) to change the status of Executive as an
at-will employee, or (iii) to change the Company's policies regarding
termination of employment. In the event of any conflict between the provisions
of this Agreement and the provisions of any other previously existing
employment, severance or other similar agreement, then the provisions of this
Agreement shall govern.
5.2 NOTICES. Any notices provided hereunder must be in writing, and such
notices or any other written communication shall be deemed effective upon the
earlier of personal delivery (including personal delivery by facsimile) or the
third day after mailing by first class mail, to the Company at its primary
office location and to Executive at Executive's address as listed in the
Company's payroll records. Any payments made by the Company to Executive under
the terms of this Agreement shall be delivered to Executive either in person or
at the address as listed in the Company's payroll records.
5.3 SEVERABILITY. Whenever possible, each provision of this Agreement
will be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or any other jurisdiction, but this Agreement will be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provisions had never been contained herein.
5.4 WAIVER. If either party should waive any breach of any provisions of
this Agreement, he or it shall not thereby be deemed to have waived any
preceding or succeeding breach of the same or any other provision of this
Agreement.
5.5 ARBITRATION. Unless otherwise prohibited by law or specified below,
all disputes, claims and causes of action, in law or equity, arising from or
relating to this Agreement or its enforcement, performance, breach, or
interpretation shall be resolved solely and exclusively by final and binding
arbitration held in San Diego County, California through Judicial Arbitration &
Mediation Services/Endispute ("JAMS") under the then existing JAMS arbitration
rules. However, nothing in this section is intended to prevent either party from
obtaining injunctive relief in court to prevent irreparable harm pending the
conclusion of any such arbitration. Each party in any such arbitration shall be
responsible for its own attorneys' fees, costs and necessary disbursement;
provided, however, that in the event one party refuses to arbitrate and the
other party seeks to compel arbitration by court order, if such other party
prevails, it shall be entitled to recover reasonable attorneys' fees, costs and
necessary disbursements. Pursuant to California Civil Code Section 1717, each
party warrants that it was represented by counsel in the negotiation and
execution of this Agreement, including the attorneys' fees provision herein.
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5.6 COMPLETE AGREEMENT. This Agreement, including Exhibit A, constitutes
the entire agreement between Executive and the Company and is the complete,
final, and exclusive embodiment of their agreement with regard to this subject
matter, wholly superseding all written and oral agreements with respect to cash
severance benefits and health benefits to Executive in the event of employment
termination other than any outstanding loans by the Company to Executive. It is
entered into without reliance on any promise or representation other than those
expressly contained herein.
5.7 AMENDMENT OR TERMINATION OF AGREEMENT. This Agreement may be changed
or terminated only upon the mutual written consent of the Company and Executive.
The written consent of the Company to a change or termination of this Agreement
must be signed by an executive officer of the Company after such change or
termination has been approved by the Board.
5.8 COUNTERPARTS. This Agreement may be executed in separate
counterparts, any one of which need not contain signatures of more than one
party, but all of which taken together will constitute one and the same
Agreement.
5.9 HEADINGS. The headings of the Articles and Sections hereof are
inserted for convenience only and shall not be deemed to constitute a part
hereof nor to affect the meaning thereof.
5.10 SUCCESSORS AND ASSIGNS. This Agreement is intended to bind and
inure to the benefit of and be enforceable by Executive, and the Company, and
any surviving entity resulting from a Change in Control and upon any other
person who is a successor by merger, acquisition, consolidation or otherwise to
the business formerly carried on by the Company, and their respective
successors, assigns, heirs, executors and administrators, without regard to
whether or not such person actively assumes any rights or duties hereunder;
provided, however, that Executive may not assign any duties hereunder and may
not assign any rights hereunder without the written consent of the Company,
which consent shall not be withheld unreasonably.
5.11 CHOICE OF LAW. All questions concerning the construction, validity
and interpretation of this Agreement will be governed by the law of the State of
California, without regard to such state's conflict of laws rules.
5.12 NON-PUBLICATION. The parties mutually agree not to disclose
publicly the terms of this Agreement except to the extent that disclosure is
mandated by applicable law or to respective advisors (e.g., attorneys,
accountants).
5.13 CONSTRUCTION OF AGREEMENT. In the event of a conflict between the
text of the Agreement and any summary, description or other information
regarding the Agreement, the text of the Agreement shall control.
IN WITNESS WHEREOF, the parties have executed this Agreement on the
Effective Date written above.
VIROLOGIC, INC. [EXECUTIVE]
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By:
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Name:
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Title:
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Exhibit A: Release
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EXHIBIT A
RELEASE
Certain capitalized terms used in this Release are defined in the
Executive Severance Benefits Agreement (the "Agreement") which I have executed
and of which this Release is a part.
I hereby confirm my obligations under the Company's proprietary
information and inventions agreement.
I acknowledge that I have read and understand Section 1542 of the
California Civil Code which reads as follows: "A GENERAL RELEASE DOES NOT EXTEND
TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT
THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY
AFFECTED HIS SETTLEMENT WITH THE DEBTOR." I hereby expressly waive and
relinquish all rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to my release of any claims I may
have against the Company.
Except as otherwise set forth in this Release, I hereby release, acquit
and forever discharge the Company, its parents and subsidiaries, and their
officers, directors, agents, servants, employees, shareholders, successors,
assigns and affiliates, of and from any and all claims, liabilities, demands,
causes of action, costs, expenses, attorneys fees, damages, indemnities and
obligations of every kind and nature, in law, equity, or otherwise, known and
unknown, suspected and unsuspected, disclosed and undisclosed (other than any
claim for indemnification I may have as a result of any third party action
against me based on my employment with the Company), arising out of or in any
way related to agreements, events, acts or conduct at any time prior to the date
I execute this Release, including, but not limited to: all such claims and
demands directly or indirectly arising out of or in any way connected with my
employment with the Company or the termination of that employment, including but
not limited to, claims of intentional and negligent infliction of emotional
distress, any and all tort claims for personal injury, claims or demands related
to salary, bonuses, commissions, stock, stock options, or any other ownership
interests in the Company, vacation pay, fringe benefits, expense reimbursements,
severance pay, or any other form of disputed compensation; claims pursuant to
any federal, state or local law or cause of action including, but not limited
to, the federal Civil Rights Act of 1964, as amended; the federal Age
Discrimination in Employment Act of 1967, as amended ("ADEA"); the federal
Employee Retirement Income Security Act of 1974, as amended; the federal
Americans with Disabilities Act of 1990; the California Fair Employment and
Housing Act, as amended; tort law; contract law; statutory law; common law;
wrongful discharge; discrimination; fraud; defamation; emotional distress; and
breach of the implied covenant of good faith and fair dealing; provided,
however, that nothing in this paragraph shall be construed in any way to release
the Company from its obligation to indemnify me pursuant to the Company's
indemnification obligation pursuant to agreement or applicable law.
I acknowledge that I am knowingly and voluntarily waiving and releasing
any rights I may have under ADEA. I also acknowledge that the consideration
given under the Agreement
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for the waiver and release in the preceding paragraph hereof is in addition to
anything of value to which I was already entitled. I further acknowledge that I
have been advised by this writing, as required by the ADEA, that: (A) my waiver
and release do not apply to any rights or claims that may arise on or after the
date I execute this Release; (B) I have the right to consult with an attorney
prior to executing this Release; (C) I have twenty-one (21) days to consider
this Release (although I may choose to voluntarily execute this Release
earlier); (D) I have seven (7) days following the execution of this Release by
the parties to revoke the Release; and (E) this Release shall not be effective
until the date upon which the revocation period has expired, which shall be the
eighth day after this Release is executed by me.
[EXECUTIVE]
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Date:
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