Exhibit 99.1
DENDREON CORPORATION
EXECUTIVE EMPLOYMENT AGREEMENT
(WASHINGTON STATE)
This Executive Employment Agreement ("AGREEMENT") is entered into as of the
date of the last signature to this Agreement ("EFFECTIVE DATE"), by and between
Dendreon Corporation, a Delaware corporation (the "COMPANY"), and [NAME]
("EMPLOYEE").
The parties agree as follows:
1. EMPLOYMENT. The Company hereby employs Employee as [TITLE], and Employee
hereby accepts such employment, upon the terms and conditions set forth in this
Agreement.
2. DUTIES.
2.1 POSITION. Employee shall perform such duties as are customary for
the position of [TITLE] and any additional duties that [IMMEDIATE SUPERVISOR OR
BOARD] may reasonably prescribe from time to time. Employee shall devote
Employee's full business time and efforts to the performance of Employee's
assigned duties for the Company, provided, however, that Employee may devote
reasonable periods of time to (a) serving on the board of directors of other
corporations subject to the prior approval of the [CEO OR, IN THE CASE OF THE
CEO, THE BOARD], and (b) engaging in charitable or community service activities,
so long as none of the foregoing additional activities materially interfere with
Employee's duties under this Agreement.
2.2 WORK LOCATION. Employee's principal place of work shall be located
in Seattle, Washington, or such other location as the parties may agree upon
from time to time.
3. TERM. The employment relationship pursuant to this Agreement shall begin
on the Effective Date, will be for no specified term, and may be terminated by
Employee or the Company at any time, with or without Cause (as defined in
Section 6), subject to the provisions regarding termination set forth in Section
6.
4. COMPENSATION.
4.1 BASE SALARY. As compensation for Employee's performance of his/her
duties under this Agreement, the Company shall pay Employee a base salary ("BASE
SALARY"), which shall initially equal [__________________] Dollars
($[__________]) per calendar year, payable in accordance with the normal payroll
practices of the Company, less required deductions for state and federal
withholding tax, social security and all other required employment taxes and
payroll deductions. For purposes of Section 6 hereof, Employee's Base Salary
shall be the current Base Salary as of the date of his/her termination of
employment
("Termination Date"). The Base Salary may not be reduced for reasons unrelated
to Employee's performance unless the base salaries of all other employees of the
Company at the Vice President level and above are proportionally reduced.
4.2 INCENTIVE COMPENSATION. Within thirty (30) days after the end of
each calendar year, if the Company and Employee meet specified targets agreed
upon in advance by the Board, Employee shall be entitled to receive a target
bonus of [________] percent ([_____]%) of his/her Base Salary (the "ANNUAL
BONUS") as determined by [THE BOARD IN THE CASE OF SECTION 16 OFFICERS OR THE
BOARD OR ITS DESIGNEE IN THE CASE OF VICE PRESIDENTS], in [ITS/HIS] sole
discretion. Employee must be currently employed by the Company as of the date of
payment of any Annual Bonus in order to be entitled to such payment. If the
Company and Employee do not fully meet such targets, the Company may pay
Employee a bonus of such amount as the [BOARD IN THE CASE OF SECTION 16 OFFICERS
OR THE BOARD OR ITS DESIGNEE IN THE CASE OF VICE PRESIDENTS] deems appropriate
in its sole discretion. Before the beginning of a new bonus year, the Board may,
in its discretion, reduce the percentage of the Annual Bonus applicable to
employees, provided that Employee's Annual Bonus may be reduced only to the
extent that the percentage annual bonuses of all other employees of the Company
at the Vice President level and above are proportionally reduced.
4.3 PERFORMANCE AND COMPENSATION REVIEW. The Employee's performance
will be reviewed no less frequently than annually to determine whether
Employee's salary or other compensation should be modified.
4.4 VACATION. Employee shall be eligible to earn [_______] ([____])
calendar weeks of paid vacation in each year of this Agreement. Vacation will
accrue at the rate of ________ hours per _____, and may be carried over from
year to year up to a maximum cap of 240 hours and in accordance with Company
policy. Additional paid vacation shall accrue in accordance with Company policy
and credit shall be given for employment prior to the date hereof. Any accrued
unused vacation will be cashed out upon termination of employment at Employee's
then current Base Salary rate in accordance with Company policy and applicable
law.
4.5 BENEFITS AND INSURANCE. In addition to the vacation benefits in
Section 4.4 above, Employee shall be entitled to all benefits that the Company
may make generally available from time to time to its employees, subject to the
terms and conditions of the applicable policy or plan, and provided that
Employee understands that he/she will be designated as a key employee for
purposes of any leave granted under the Family and Medical Leave Act.
5. BUSINESS EXPENSES. The Company shall pay, or promptly reimburse,
Employee for all reasonable, out-of-pocket travel and business expenses incurred
in the performance of Employee's duties on behalf of Company for which Employee
submits the required supporting documentation and otherwise fully complies with
the Company's travel and expense reimbursement policy as in effect from time to
time.
-2-
6. SEPARATION OF EMPLOYEE'S EMPLOYMENT.
6.1 TERMINATION FOR CAUSE BY COMPANY. The Company may terminate
Employee's employment at any time for Cause. For purposes of this Agreement,
"CAUSE" is defined as: Employee's continued neglect or failure to perform
his/her duties and responsibilities satisfactorily, after written notice
thereof; willful misconduct by Employee with respect to his/her duties and
responsibilities under this Agreement; conduct which is materially injurious
(monetarily or otherwise) to the Company, including without limitation, misuse
of Company funds or property; unethical business practices or dishonesty related
to the Company's business; any other material breach by Employee of this
Agreement or any noncompetition, nondisclosure and/or invention agreement with
the Company; conviction of a felony or misdemeanor involving moral turpitude; or
any similar or related act or failure to act by Employee which is materially
adversely injurious to the Company. In the event that Employee's employment is
terminated in accordance with this Section 6.1, Employee shall be entitled to
receive, on Employee's first regular payday following his/her Termination Date,
a lump sum payment equal to the following: (i) any portion of Employee's Base
Salary that has been earned but not yet paid as of the Termination Date, and
(ii) any accrued unused vacation as of the Termination Date, all of the
foregoing to be less required withholding. All other Company obligations to
Employee, including but not limited to any bonus as described in Section 4.2 and
Severance (as defined in Section 6.2), will automatically terminate and be
completely extinguished as of the Termination Date.
6.2 TERMINATION WITHOUT CAUSE; CHANGE IN CONTROL.
(a) If the Company terminates Employee's employment without
Cause, or if Employee resigns for Good Reason in accordance with Section 6.3,
then Employee will be entitled to receive, on Employee's first regular payday
following his/her Termination Date, the following:
(i) a lump sum severance payment in an amount equal to
[_______] ([____]) times Employee's then current Base Salary, less required
withholding,
(ii) [_______] ([____]) times the amount of target Annual
Bonus payable to Employee for the then calendar year, less required withholding,
and
(iii) the amounts set forth in paragraph (c) below.
(b) If the Company terminates Employee without Cause, or if
Employee resigns for Good Reason in accordance with Section 6.3, in either case
within twelve (12) months following a Change of Control (as defined in paragraph
(d) below), then Employee will be entitled to receive in lieu of those payments
set forth in Section 6.2(a) above, on Employee's first regular payday following
his/her Termination Date, the following:
(i) a lump sum severance payment in an amount equal to
[_______] ([____]) times Employee's then current Base Salary, less required
withholding,
(ii) [_______] ([____]) times the amount of target Annual
Bonus payable to Employee for the then calendar year, less required withholding,
and
-3-
(iii) the amounts set forth in paragraph (c) below.
(c) In addition to those amounts set forth in paragraphs (a) or
(b) above, as applicable, Employee shall be entitled to (i) payment of all
accrued and unused vacation; (ii) reasonable costs not to exceed $10,000 for
outplacement services provided by a purveyor approved by Company, moving
expenses or any other reemployment cost, upon delivery to the Company of an
itemized invoice for such services provided that such costs are incurred within
[_______] ([____]) months of the Termination Date; (iii) payment by the Company
for continuation of all Health Benefits in effect on the Termination Date and
timely elected by Employee under COBRA, for a period of eighteen (18) months
following the Termination Date, or until Employee is eligible to receive
comparable health benefits from another employer; and (iv) full accelerated
vesting of any and all unvested stock options and restricted stock grants held
by Employee.
(d) "CHANGE OF CONTROL" shall mean the occurrence, in a single
transaction or in a series of related transactions, of one or more of the
following events:
(i) Any Person, as defined under the Securities Exchange Act
of 1934, as amended, becomes the owner of securities of the Company representing
more than fifty percent (50%) of the combined voting power of the Company's
then-outstanding securities other than by virtue of a merger, consolidation or
similar transaction;
(ii) The consummation of a merger, consolidation or similar
transaction that directly or indirectly involves the Company (a "transaction"),
and the stockholders of the Company immediately before consummation of the
transaction do not own immediately after consummation of the transaction,
either: (A) more than fifty percent (50%) of the combined voting power of the
outstanding voting securities of the entity that survives the transaction; or
(B) more than fifty percent (50%) of the combined voting power of the
outstanding voting securities of an entity that owns the surviving entity;
(iii) The stockholders of the Company approve, or the Board
approves, a plan of complete dissolution or liquidation of the Company, or a
complete dissolution or liquidation of the Company otherwise occurs;
(iv) The consummation of a sale, lease or other disposition
of all or substantially all of the consolidated assets of the Company (a
"disposition") that requires approval of Company stockholders under Delaware
corporate law; provided that this paragraph (d)(iv) excludes a disposition to an
entity with respect to which stockholders of the Company own immediately after
the disposition more than fifty percent (50%) of the combined voting power of
the entity's outstanding voting securities; or
(v) The Board ceases to be composed of at least a majority
of Incumbent Directors. "Incumbent Directors" are the current members of the
Board of Directors and any subsequent Board member who was nominated or elected
by a majority vote of the Incumbent Directors then in office.
Notwithstanding the above clauses (i) through (v), a "Change of
Control" shall not have occurred (unless the Board determines otherwise) by
reason of either of the
-4-
following: (A) any corporate reorganization, merger, consolidation, transfer of
assets, liquidating distribution or other transaction entered into solely by and
between the Company and any subsidiary (a "reorganization"), provided the
reorganization was approved by at least two-thirds (2/3) of the Incumbent
Directors (as defined above) then in office and voting; or (B) any of the events
described in clauses (i) through (v) above occurs pursuant to an Insolvency
Proceeding. An "Insolvency Proceeding" means (A) the Company institutes or
consents to the institution of any proceeding under any debtor relief law, makes
an assignment for the benefit of creditors, or applies for or consents to the
appointment of any receiver, trustee, custodian, conservator, liquidator,
rehabilitator or similar officer for the Company or for all or any material part
of the Company's property; or (B) any receiver, trustee, custodian, conservator,
liquidator, rehabilitator or similar officer is appointed without the
application or consent of the Company and the appointment continues undischarged
or unstayed for 60 calendar days; or (C) any proceeding under any debtor relief
law relating to the Company or to all or any material part of the Company's
property is instituted without the consent of the Company and continues
undismissed or unstayed for 60 calendar days, or any order for relief is entered
in any such proceeding.
(e) In the event that any payment to Employee described in
Section 6.2(a) or 6.2(b) shall be deemed at the relevant time to be subject to
Section 409A of the Internal Revenue Code of 1986, as amended (the "Code"), then
such payment shall be made on the later of the date that is six months following
the Termination Date or when due. The payments and benefits to which Employee is
entitled under paragraphs (a) and (b) of this Section are referred to as
"Severance." All other Company obligations to Employee pursuant to this
Agreement will automatically terminate and be completely extinguished as of the
Termination Date.
6.3 RESIGNATION OF EMPLOYEE FOR GOOD REASON. Employee may resign for
"GOOD REASON" upon notice to the Company within thirty (30) days following the
relevant event or condition if any of the following occurs without the
Employee's express consent:
(a) The Board or Company (i) alters Employee's duties, responsibilities or
title resulting in a significant diminution of the Employee's
position, duties, responsibilities or status with the Company or (ii)
reduces Employee's Base Salary, unless the base salaries of all other
employees of the Company at the Vice President level or above are
proportionately reduced; or
(b) The Board or Company transfers or assigns Employee to any location
that is more than fifty (50) miles from the location of Employee's
principal office. Required travel on the Company's business that is
consistent with the business travel obligations of Employee's position
is excluded from this Section.
6.4 RESIGNATION BY EMPLOYEE WITHOUT GOOD REASON. Employee may
voluntarily resign his/her position with the Company without Good Reason at any
time on thirty (30) days' advance written notice. In the event Employee's
resignation is without Good Reason, Employee will be entitled to receive, on
Employee's first regular payday following his/her Termination Date, a lump sum
payment equivalent to the following: (i) the Base Salary then in effect,
prorated to the Termination Date; and (ii) accrued unused vacation as of the
Termination Date, all of the foregoing to be less required withholding. All
other Company obligations to
-5-
Employee pursuant to this Agreement will automatically terminate and be
completely extinguished.
6.5 EMPLOYEE'S EXECUTION OF RELEASE. The payment of Severance pursuant
to Section 6.2, 6.3, or Section 6.6(b) is expressly contingent upon execution by
Employee or his duly authorized representative of a full and general release of
any and all claims against the Company and its officers and directors in the
form reasonably required by the Company.
6.6 TERMINATION UPON DEATH OR DISABILITY.
(a) DEATH. Employee's employment will terminate automatically
upon death of the Employee. In the event of Employee's death, Employee's Base
Salary then in effect, prorated to the Termination Date, and any accrued unused
vacation as of the Termination Date, all of the foregoing to be less required
withholding, shall be paid, on the Employee's first regular payday following
his/her Termination Date, to the beneficiary designated in writing by the
Employee ("Beneficiary") or, if no such Beneficiary is designated, to the
Employee's estate. In addition, (i) the Company will continue the Employee's
Base Salary until the earlier of six months from the Termination Date or the
commencement of death benefits under any existing Company Group Life Insurance
Plan, and (ii) the Company shall fully accelerate vesting of any and all
unvested stock options and restricted stock grants held by Employee.
(b) DISABILITY. In the event that Employee becomes physically or
mentally disabled such that he/she is unable to perform his/her duties for a
period of three (3) consecutive months as determined by a medical professional
("DISABILITY"), the Company may terminate Employee's employment, unless
otherwise prohibited by law. In the event of termination due to Disability,
Employee shall be paid, on the Employee's first regular payday following his/her
Termination Date, a lump sum payment equivalent to Employee's Base Salary then
in effect prorated to Employee's Termination Date, and any accrued unused
vacation as of the Termination Date, all of the foregoing to be less required
withholding. In addition, (i) the Company will continue Employee's Base Salary
(less any short term disability payments Employee receives from the Company)
until the earlier of six (6) months from the Termination Date or the
commencement of Long Term disability payments under any existing Company Long
Term Disability Policy; and (ii) the Company shall fully accelerate vesting of
any and all unvested stock options and restricted stock grants held by Employee.
6.7 BOARD ACTION. The Company agrees to take all actions required by
the Board or otherwise to accelerate Employee's unvested stock options and
restricted stock grants as required by Sections 6.2, 6.3, or 6.6.
6.8 ADJUSTMENT OF PAYMENTS AND BENEFITS. Notwithstanding any provision
of this Agreement to the contrary, if any payment or benefit to be paid or
provided hereunder would be an "Excess Parachute Payment," within the meaning of
Section 280G of the Code, or any successor provision thereto, but for the
application of this sentence, then the payments and benefits to be paid or
provided hereunder shall be reduced to the minimum extent necessary (but in no
event to less than zero) so that no portion of any such payment or benefit, as
so reduced, constitutes an Excess Parachute Payment; provided, however, that the
foregoing reduction shall be made only if and to the extent that such reduction
would result in an increase in the aggregate
-6-
payments and benefits to be provided, determined on an after-tax basis (taking
into account the excise tax imposed pursuant to Section 4999 of the Code, or any
successor provision thereto, any tax imposed by any comparable provision of
state law, and any applicable federal, state and local income taxes). The
determination of whether any reduction in such payments or benefits to be
provided hereunder is required pursuant to the preceding sentence shall be made
at the expense of the Company, if requested by Employee or the Company, by the
Company's independent accountants. The fact that Employee's right to payments or
benefits may be reduced by reason of the limitations contained in this Section
shall not of itself limit or otherwise affect any other rights of Employee under
this Agreement. In the event that any payment or benefit intended to be provided
hereunder is required to be reduced pursuant to this Section, Employee shall be
entitled to designate the payments and/or benefits to be so reduced in order to
give effect to this Section. The Company shall provide Employee with all
information reasonably requested by Employee to permit Employee to make such
designation. In the event that Employee fails to make such designation within 10
business days of his or her receipt of the information requested, the Company
may effect such reduction in any manner it deems appropriate.
7. AGREEMENT NOT TO COMPETE.
7.1 NO EMPLOYMENT WITH, OR CONNECTION TO, COMPETITOR. Employee agrees
that, during the term of his/her employment with the Company and for a period of
[_____], Employee will not, without securing the prior written permission of the
Company:
(a) be employed by, act as an agent for, or consult with or
otherwise perform services for, a Competitor (as defined below); or
(b) own any equity interest in, manage or participate in the
management (as an officer, director, partner, member or otherwise) of, or be
connected in any other manner with, a Competitor, except that this section shall
not restrict Employee from owning less than one percent (1%) of the equity
interests of any publicly held entity.
7.2 NONSOLICITATION OF COMPANY EMPLOYEES AND CUSTOMERS. Employee
agrees that for a period of one (1) year following Employee's Termination Date,
Employee will not, without securing the prior written permission of the Company,
induce or attempt to induce any Employee, officer, director, agent, independent
contractor, consultant, customer, strategic partner, licensor, licensee,
supplier or other service provider of the Company to terminate a relationship
with, cease providing services or products to, or purchasing products or
services from, the Company.
7.3 DEFINITION OF COMPETITOR. The term "COMPETITOR" as used in this
Agreement means any individual or entity that is directly or indirectly engaged
in the development and/or commercialization in the United States of one or more
ex vivo cellular immunotherapies for the therapeutic treatment of cancer, which
ex vivo cellular immunotherapies generate twenty percent (20%) or more of either
the annual gross revenue or worldwide operating expense of such Competitor in
the United States. The term "COMPETITOR" also includes an individual or entity
that is preparing to directly or indirectly engage in the development and/or
commercialization in the United States of ex vivo cellular immunotherapies, if
such ex vivo immunotherapies are anticipated to generate twenty (20%) or more of
either the
-7-
annual gross revenue or annual operating expense of such Competitor in the
United States during the first calendar year of development and/or
commercialization.
7.4 REASONABLENESS OF RESTRICTIONS. The Company and Employee agree
that, in light of all of the facts and circumstances relating to the
relationship that exists and is expected to exist between the Company and
Employee, these restrictions (including, but not limited to, the scope of the
restricted activities, the duration of the restrictions, and the geographic
extent of the restrictions) are fair and reasonably necessary for the protection
of the goodwill and other protectable interests of the Company. If a court or
arbitrator of competent jurisdiction declines to enforce any of these
restrictions, the Company and Employee agree that the restrictions shall be
enforceable to the maximum extent allowed by law.
8. GENERAL PROVISIONS.
8.1 SUCCESSORS AND ASSIGNS. The rights and obligations of Company
under this Agreement shall inure to the benefit of and shall be binding upon the
successors and assigns of the Company. Employee shall not be entitled to assign
any of Employee's rights or obligations under this Agreement.
8.2 WAIVER. Either party's failure to enforce any provision of this
Agreement shall not in any way be construed as a waiver of any such provision,
or prevent that party thereafter from enforcing each and every other provision
of this Agreement.
8.3 SEVERABILITY. In the event any provision of this Agreement is
found to be unenforceable by an arbitrator or court of competent jurisdiction,
such provision shall be deemed modified to the extent necessary to allow
enforceability of the provision as so limited, it being intended that the
parties shall receive the benefits contemplated in this Agreement to the fullest
extent permitted by law. If a deemed modification is not satisfactory in the
judgment of such arbitrator or court, the unenforceable provision shall be
deemed deleted, and the validity and enforceability of the remaining provisions
shall not be affected.
8.4 INTERPRETATION; CONSTRUCTION. The headings set forth in this
Agreement are for convenience only and shall not be used in interpreting this
Agreement. Both parties have participated in the negotiation of this Agreement.
Therefore, the normal rule of construction to the effect that any ambiguities
are to be resolved against the drafting party shall not be employed in the
interpretation of this Agreement.
8.5 NOTICES. Any notice required or permitted by this Agreement shall
be in writing and shall be delivered as follows with notice deemed given as
indicated: (a) by personal delivery when delivered personally; (b) by overnight
courier upon written verification of receipt; (c) by telecopy or facsimile
transmission upon acknowledgment of receipt of electronic transmission; or (d)
by certified or registered mail, return receipt requested, upon verification of
receipt. Notice shall be sent to the addresses set forth below, or such other
address as either party may specify in writing.
8.6 SURVIVAL. Section 6 ("Separation of Employee's Employment"),
Section 7 ("Agreement Not to Compete"), Section 8 ("General Provisions") of this
Agreement shall survive Employee's employment by the Company.
-8-
8.7 ENTIRE AGREEMENT. This Agreement, the Company's stock option plan
and documents reflecting options and restricted stock granted to Employee, the
Proprietary Information and Inventions Agreement entered into by Employee at the
commencement of his employment with the Company, and the Indemnity Agreement
entered into by the Company and Employee, if any, constitute the entire
agreement between the parties relating to this subject matter and supersede all
prior or simultaneous representations, discussions, negotiations, and
agreements, whether written or oral. This Agreement may be amended or modified
only with the written consent of Employee and a duly authorized officer of the
Company. No oral waiver, amendment or modification will be effective under any
circumstances whatsoever.
8.8 INJUNCTIVE RELIEF. Notwithstanding the foregoing, any action
brought by the Company under this Agreement seeking a temporary restraining
order, temporary and/or permanent injunction and/or decree of specific
performance of the terms of this Agreement may be brought in any court of
competent jurisdiction. The Company shall not be required to post a bond as a
condition for the granting of such relief.
8.9 GOVERNING LAW AND VENUE. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Washington as though made
and to be fully performed in that State. Venue for any action arising from this
Agreement shall be exclusively in King County, Washington.
8.10 COMPLIANCE WITH SECTION 409A OF THE CODE. To the extent
applicable, it is intended that this Agreement complies with the provisions of
Section 409A of the Code. This Agreement shall be administered in a manner
consistent with this intent, and any provision that would cause this Agreement
to fail to satisfy Section 409A of the Code shall have no force and effect until
amended to comply with Section 409A of the Code (which amendment may be
retroactive to the extent permitted by Section 409A of the Code and may be made
by the Company without the consent of Employee). In particular, to the extent
Employee becomes entitled to receive a payment or benefit subject to Section
409A upon an event that does not constitute a permitted distribution event under
Section 409A(a)(2) of the Code, then notwithstanding anything to the contrary in
this Agreement, payment will be made to Employee on the earlier of (a)
Employee's "separation from service" with the Company (determined in accordance
with Section 409A); provided, however, that if Employee is a "specified
employee" (within the meaning of Section 409A) and the payment of any amounts
described in this Agreement on account of Employee's "separation from service"
(within the meaning of Section 409A of the Code) would not meet the "short-term
deferral" exemption under Section 409A of the Code (or otherwise qualify for
exemption under Section 409A of the Code), then the Company will pay such
amounts to Employee six months following Employee's "separation from service"
(within the meaning of Section 409A of the Code) or (b) Employee's death.
Notwithstanding the foregoing, the Company shall not be obligated to guarantee
any particular tax result for Employee with respect to any payment or benefit
provided to Employee hereunder, and Employee shall be responsible for any taxes
imposed on Employee in connection with any such payment or benefit.
-9-
THE PARTIES TO THIS AGREEMENT HAVE READ THIS AGREEMENT AND FULLY UNDERSTAND EACH
AND EVERY PROVISION.
[EMPLOYEE]
Dated:
---------------- ----------------------------------------
Address:
----------------------------------------
----------------------------------------
DENDREON CORPORATION
Dated: By:
---------------- ------------------------------------
Its:
-----------------------------------
-10-
