Exhibit 10.2

 

GENERAL RELEASE AND SEPARATION AGREEMENT

 

This General Release and Separation Agreement (hereafter “Agreement”) is entered
into between Christopher Mitchell (the “Executive”), and Accuray Incorporated
(the “Company”), effective on the eighth calendar day following the Executive’s
signature (the “Effective Date”), unless he revokes his acceptance in accordance
with the terms of Section 6(b), below.

 

WHEREAS, the Executive was Senior Vice President, General Counsel of the
Company, pursuant to the terms of an employment offer letter dated May 3, 2007
(the “Employment Agreement”);

 

WHEREAS, the Executive resigned effective September 11, 2008; and

 

WHEREAS, the Company and the Executive now wish to document the termination of
their employment relationship and fully and finally to resolve all matters
between them;

 

THEREFORE, in exchange for the good and valuable consideration set forth herein,
the adequacy of which is specifically acknowledged, the Executive and the
Company hereby agree as follows:

 

1.                                       RESIGNATION OF EMPLOYMENT.  THE
EXECUTIVE CONFIRMS HIS RESIGNATIONS OF HIS EMPLOYMENT AND OF HIS POSITION AS AN
OFFICER OF THE COMPANY EFFECTIVE SEPTEMBER 11, 2008 (THE “RESIGNATION DATE”). 
THE PARTIES HEREBY ACKNOWLEDGE AND AGREE THAT THE EXECUTIVE’S RESIGNATION OF
EMPLOYMENT CONSTITUTES A “SEPARATION FROM SERVICE” FROM THE COMPANY WITHIN THE
MEANING OF SECTION 409A(A)(2)(A)(I) OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (THE “CODE”), AND TREASURY REGULATION SECTION 1.409A-1(H) (A “SEPARATION
FROM SERVICE”).  AS OF THE RESIGNATION DATE, THE EMPLOYMENT AGREEMENT SHALL
AUTOMATICALLY TERMINATE AND BE OF NO FURTHER FORCE AND EFFECT, AND NEITHER THE
COMPANY NOR THE EXECUTIVE SHALL HAVE ANY FURTHER OBLIGATIONS THEREUNDER, EXCEPT
AS EXPRESSLY PROVIDED HEREIN.  NOTWITHSTANDING THE FOREGOING, THE COMPANY SHALL
BE OBLIGATED TO EXECUTIVE FOR SEVERANCE PAYMENTS AND CONTINUATION OF BENEFITS AS
CONTEMPLATED BY SECTION 8 OF THE EMPLOYMENT AGREEMENT AND AS SET FORTH IN
SECTION 3 BELOW.

 

2.                                       Payment of Accrued Wages and Expenses. 
The Executive acknowledges receipt, on the Resignation Date, of an amount equal
to all accrued wages through the Resignation Date, including accrued, unused
vacation and/or paid time off, less applicable taxes and other authorized
withholding.  The Executive shall be promptly reimbursed for all expenses
incurred by him on behalf of the Company, and submitted on or before October 31,
2008 for reimbursement in accordance with the Company’s expense reimbursement
policies.   The Executive also acknowledges receipt of his bonus for the
Company’s 2008 fiscal year.

 

3.                                       Cash Severance Benefits and COBRA
Premiums.  The Executive agrees that, except as set forth in this Agreement, he
is entitled to no additional pay or benefits in conjunction with the termination
of his employment.  Subject to Section 22(b) of this Agreement, ten days
following the Effective Date of this Agreement, the Company shall pay to the
Executive, in a lump-sum, cash severance in the gross amount of $286,713.70 (two
hundred eighty-six thousand,

 

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seven hundred thirteen dollars and seventy cents) (the “Severance Payment”),
which the parties acknowledge and agree represents the amount of the “Severance
Payment” calculated under, and as defined in, Section 8(a) of the Employment
Agreement, consisting of eight months’ base salary ($173,334.20), target bonus
at 50% of the Executive’s base salary for a period of eight months ($86,667.10),
and pro-rated bonus for the current fiscal year at target ($26,712.40).  The
Severance Payment shall be paid net of applicable taxes and other authorized
withholding.  In addition, in the event that the Executive elects to continue
healthcare coverage pursuant to the Consolidated Omnibus Budget and
Reconciliation Act  (“COBRA”) for himself, his spouse and his children, as
applicable and to the extent eligible, the Company shall pay the Executive’s
COBRA premiums for the period commencing on the date on which the Executive’s
Company-sponsored healthcare coverage would otherwise terminate (absent COBRA)
and ending on the earlier to occur of the eight (8) month anniversary of such
date or the expiration of the period during which the Executive would be
entitled to continuation coverage under COBRA absent this provision.

 

4.                                       Stock Options and Restricted Stock
Units.  The Executive acknowledges that as of the Resignation Date, the
Executive was vested in Stock Options and Restricted Stock Units (“RSUs”) as
reflected in the report attached as Exhibit A hereto.  The Executive further
acknowledges that vesting in the Stock Options and RSUs ceased on the
Resignation Date, and all Stock Options and RSUs not then vested were cancelled
and forfeited as of that date.  Except as specifically set forth herein, the
Executive’s rights with respect to Stock Options and RSUs issued to him are
governed by the Stock Option and Restricted Stock Unit Agreements entered into
between the Executive and the Company, and the applicable Company equity
incentive plan(s) and Notice(s) of Grant.

 

5.                                       Outplacement Assistance and Executive
Coaching Services.  The Company will pay for outplacement assistance for the
Executive in an amount not to exceed $10,000 (ten thousand dollars), provided
that the Executive receives such outplacement assistance on or before
December 31, 2010.  Outplacement assistance shall be provided by Challenger Gray
and Christmas.  The Executive shall continue to have access to executive
coaching through Anthony Smith, to the extent that such services were purchased
by the Company on his behalf prior to the Resignation Date, provided that the
Executive receives such executive coaching on or before December 31, 2010.

 

6.                                       General Release of Claims by the
Executive.

 

(a)                                  The Executive, on behalf of himself and his
executors, heirs, administrators, representatives and assigns, hereby agrees to
release and forever discharge the Company and all predecessors, successors and
their respective parent corporations, affiliates, related, and/or subsidiary
entities, and all of their past and present investors, directors, shareholders,
officers, general or limited partners, executives, attorneys, agents and
representatives, and executive benefit plans in which the Executive is or has
been a participant by virtue of his employment with the Company, from any and
all claims, debts, demands, accounts, judgments, rights, causes of action,
equitable relief, damages, costs, charges, complaints, obligations, promises,
agreements, controversies, suits, expenses, compensation, responsibility and
liability of every kind and character whatsoever (including attorneys’ fees and
costs), whether in law or equity, known or

 

2

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unknown, asserted or unasserted, suspected or unsuspected (collectively,
“Claims”), which the Executive has or may have had against such entities based
on any events or circumstances arising or occurring on or prior to the date
hereof or on or prior to the Resignation Date, arising directly or indirectly
out of, relating to, or in any other way involving in any manner whatsoever the
Executive’s employment by the Company or the separation thereof, and any and all
claims arising under federal, state, or local laws relating to employment,
including without limitation claims of wrongful discharge, breach of express or
implied contract, fraud, misrepresentation, defamation, or liability in tort,
claims of any kind that may be brought in any court or administrative agency,
any claims arising under Title VII of the Civil Rights Act of 1964, the Age
Discrimination in Employment Act, the Americans with Disabilities Act, the Fair
Labor Standards Act, the Executive Retirement Income Security Act, the Family
and Medical Leave Act, and similar state or local statutes, ordinances, and
regulations, including, without limitation, the California Family Rights Act,
the California Fair Employment and Housing Act and the California Labor Code.

 

Notwithstanding the generality of the foregoing, the Executive does not release
the following claims and rights:

 

(i)                                     Claims for unemployment compensation or
any state disability insurance benefits pursuant to the terms of applicable
state law;

 

(ii)                                  Claims to continued participation in
certain of the Company’s group benefit plans pursuant to the terms and
conditions of the federal law known as COBRA;

 

(iii)                               The Executive’s right to bring to the
attention of the Equal Employment Opportunity Commission claims of
discrimination; provided, however, that the Executive does release his right to
secure damages for any alleged discriminatory treatment;

 

(iv)                              The Executive’s rights under the
Indemnification Agreement between Company and Executive and under applicable law
(including California Labor Code Section 2802), the General Corporation Law of
Delaware and the Company’s D&O policy to seek indemnity for acts committed, or
omissions, within the course and scope of the Executive’s employment duties; and

 

(v)                                 Claims for breach of this Separation
Agreement.

 

(b)                                 In accordance with the Older Workers Benefit
Protection Act of 1990, the Executive acknowledges that he is aware of the
following:

 

(i)                                     This Section and this Agreement are
written in a manner calculated to be understood by the Executive.

 

3

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(ii)                                  The waiver and release of claims under the
ADEA contained in this Agreement does not cover rights or claims that may arise
after the date on which the Executive signs this Agreement.

 

(iii)                               This Agreement provides for consideration in
addition to anything of value to which the Executive is already entitled.

 

(iv)                              The Executive has been advised to consult an
attorney before signing this Agreement.

 

(v)                                 The Executive has been granted forty-five
(45) days after he is presented with this Agreement to decide whether or not to
sign this Agreement.  If the Executive executes this Agreement prior to the
expiration of such period, he does so voluntarily and after having had the
opportunity to consult with an attorney, and hereby waives the remainder of the
forty-five (45) day period.

 

(vi)                              The Executive has the right to revoke this
general release within seven (7) days of signing this Agreement.  In the event
this general release is revoked, this Agreement will be null and void in its
entirety, and the Executive will not receive the benefits of this Agreement.

 

If the Executive wishes to revoke this agreement, he must deliver written notice
stating that intent to revoke, in accordance with the notice provisions of
Section 17 of this Agreement, on or before 5:00 p.m. on the seventh (7th) day
after the date on which the Executive signs this Agreement.

 

7.                                       The Company’s Release of Claims. The
Company voluntarily releases and discharges the Executive and his heirs,
successors, administrators, representatives and assigns from all Claims which it
may have against the Executive as the result of his employment or the
discontinuance of his employment and that are based upon facts known, or which
in the exercise of reasonable diligence should have been known, to the Company’s
Board of Directors.  Notwithstanding the foregoing, nothing herein shall release
or discharge any Claim by the Company against the Executive, or the right of the
Company to bring any action, legal or otherwise, against the Executive as a
result of any failure by him to perform his obligations under this Agreement, or
as a result of any acts of intentional misconduct or recklessness (including,
but not limited to, fraud, embezzlement, misappropriation, or other
malfeasance).

 

8.                                       Waiver of Rights Under California Civil
Code Section 1542.  The Company and the Executive acknowledge that they have
been advised of and are familiar with the provisions of California Civil Code
Section 1542, which provides as follows:

 

“A general release does not extend to claims which the creditor does not know or
suspect to exist in his or her favor at the time of executing the release, which
if known by him or her must have materially affected his or her settlement with
the debtor.”

 

Being aware of said code section, the Company and the Executive hereby expressly
waive any rights they may have thereunder, as well as under any other statutes
or common law principles of similar effect; provided, however, that such waiver
is not intended to affect claims expressly

 

4

--------------------------------------------------------------------------------

 

preserved under the terms of the parties’ respective releases.

 

9.                                       Nondisparagement.  The Executive agrees
that neither he nor anyone acting by, through, under or in concert with him
shall disparage or otherwise communicate negative statements or opinions about
the Company, its Board members, officers, executives or business.  The Company
agrees that neither its Board members nor officers shall disparage or otherwise
communicate negative statements or opinions about the Executive.

 

10.                                 Restrictive Covenants.  The Executive
acknowledges his continuing obligations, pursuant to Section 10(a), (b) and
(d) of the Employment Agreement.

 

11.                                 Cooperation.  The Executive agrees to give
reasonable cooperation, at the Company’s request, in any pending or future
litigation or arbitration brought against the Company and in any investigation
that the Company or any government entity may conduct.    The Company shall
reimburse the Executive for all out of pocket expenses reasonably incurred by
him in compliance with this Section 11.

 

12.                                 Executive’s Representations and Warranties. 
The Executive represents and warrants that:

 

(a)                                  He has been paid all wages owed to him by
the Company, including all accrued, unused vacation and/or paid time off, as of
the date of execution of this Agreement;

 

(b)                                 As of the date of execution of this
Agreement, he has not sustained any injuries for which he might be entitled to
compensation pursuant to California’s Workers Compensation law;

 

(c)                                  The Executive has not initiated any
adversarial proceedings of any kind against the Company or against any other
person or entity released herein, nor will he do so in the future, except as
specifically allowed by this Agreement.

 

13.                                 Confidential Information; Return of Company
Property.

 

(a)                                  The Executive hereby expressly confirms his
continuing obligations to the Company pursuant to Section 10(a) of the
Employment Agreement, and pursuant to the Employee Invention Assignment and
Confidentiality Agreement executed by the Executive, a copy of which is attached
as Exhibit B and incorporated herein by reference.

 

(b)                                 The Executive shall deliver to the Company
within five days of the Resignation Date, all originals and copies of
correspondence, drawings, manuals, letters, notes, notebooks, reports, programs,
plans, proposals, financial documents, or any other documents concerning the
Company and its customers’, business plans, marketing strategies, products,
processes or business of any kind, and all originals and copies of documents
that contain proprietary information or trade secrets of the Company that are in
the possession or control of the Executive or his agents or representatives.

 

5

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(c)                                  The Executive shall return to the Company
within five days of  the Resignation Date all equipment of the Company in his
possession or control.  Notwithstanding the foregoing, the Executive will be
permitted to retain the personal computer (Panasonic Toughbook laptop computer)
provided by the Company for Executive’s use, which laptop computer the parties
agree has a depreciated value of $1,200 (one thousand two hundred dollars). 
Notwithstanding the foregoing, the Company shall be permitted to retain the
laptop computer for such time as is reasonably necessary to remove from it all
Company information and software.

 

14.                                 Taxes.  To the extent any taxes may be
payable by the Executive for the benefits provided to him by this Agreement
beyond those withheld by the Company, the Executive agrees to pay them himself
and to indemnify and hold the Company and the other entities released herein
harmless for any tax claims or penalties, and associated attorneys’ fees and
costs, resulting from any failure by him to make required payments.

 

15.                                 In the Event of a Claimed Breach.  All
controversies, claims and disputes arising out of or relating to this Agreement,
including without limitation any alleged violation of its terms, shall be
resolved by final and binding arbitration before a single neutral arbitrator in
San Jose, California, in accordance with the applicable dispute resolution
rules of the Judicial Arbitration and Mediation Service (“JAMS”). The
arbitration shall be commenced by filing a demand for arbitration with JAMS
within 60 (sixty) days after the filing party has given notice of such breach to
the other party.  The arbitrator shall have authority to award the prevailing
party attorneys’ fees and expert fees, if any.  Notwithstanding the foregoing,
it is acknowledged that it will be impossible to measure in money the damages
that would be suffered if the parties fail to comply with any of the obligations
imposed on them under Sections 13(a) and (b) hereof, and that in the event of
any such failure, an aggrieved person will be irreparably damaged and will not
have an adequate remedy at law.  Any such person shall, therefore, be entitled
to injunctive relief, including specific performance, to enforce such
obligations, and if any action shall be brought in equity to enforce any of the
provisions of Sections 13(a) and (b) of this Agreement, neither of the parties
hereto shall raise the defense that there is an adequate remedy at law.

 

16.                                 Choice of Law.  This Agreement shall in all
respects be governed and construed in accordance with the laws of the State of
California, including all matters of construction, validity and performance,
without regard to conflicts of law principles.

 

17.                                 Notices.  All notices, demands or other
communications regarding this Agreement shall be in writing and shall be
sufficiently given if either personally delivered or sent by facsimile or
overnight courier, addressed as follows:

 

(a)                                  If to the Company:

 

Accuray Incorporated

Attn:  Euan Thomson, CEO

1310 Chesapeake Terrace

Sunnyvale, CA  94089

Phone:  408-716-4600

Fax:  408-716-4747

 

6

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(b)                                 If to the Executive:

 

Christopher Mitchell

15 Emerald Lake Place

Emerald Hills, CA  94062

Phone:  650-703-7549

 

18.                                 Severability.  Except as otherwise specified
below, should any portion of this Agreement be found void or unenforceable for
any reason by a court of competent jurisdiction, the parties intend that such
provision be limited or modified so as to make it enforceable, and if such
provision cannot be modified to be enforceable, the unenforceable portion shall
be deemed severed from the remaining portions of this Agreement, which shall
otherwise remain in full force and effect.  If any portion of this Agreement is
so found to be void or unenforceable for any reason in regard to any one or more
persons, entities, or subject matters, such portion shall remain in full force
and effect with respect to all other persons, entities, and subject matters. 
This paragraph shall not operate, however, to sever the Executive’s obligation
to provide the binding release to all entities intended to be released
hereunder.

 

19.                                 Understanding and Authority.  The parties
understand and agree that all terms of this Agreement are contractual and are
not a mere recital, and represent and warrant that they are competent to
covenant and agree as herein provided.

 

20.                                 Integration Clause.  This Agreement, the
Employment Agreement, and the Employee Invention Assignment and Confidentiality
Agreement contain the entire agreement of the parties with regard to the matters
referenced herein and supersede any prior agreements as to such matters. This
Agreement may not be changed or modified, in whole or in part, except by an
instrument in writing signed by the Executive and the Chief Executive Officer of
the Company.   The Indemnification Agreement between the Company and the
Executive shall not be affected by the existence of this Agreement, including
this Section 20 hereof, and shall remain in full force and effect.

 

21.                                 Execution in Counterparts.  This Agreement
may be executed in counterparts with the same force and effectiveness as though
executed in a single document.

 

22.                                 Section 409A of the Code.

 

(a)                                  The payments and benefits under this
Agreement are intended to be exempt from the application of Section 409A of the
Code.  To the extent applicable, this Agreement shall be interpreted in
accordance with Section 409A of the Code and Department of Treasury Regulations
and other interpretive guidance issued thereunder.  Notwithstanding any
provision of this Agreement to the contrary, if the Company determines that any
such compensation or benefits payable under this Agreement may be subject to
Section 409A of the Code and related Department of Treasury guidance, the
Company may, with the Executive’s prior written consent, adopt such amendments
to this Agreement or adopt other policies and procedures (including amendments,
policies and procedures with retroactive effect), or take any other actions,
that the Company

 

7

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determines are necessary or appropriate to (i) exempt the compensation and
benefits payable under this Agreement from Section 409A of the Code and/or
preserve the intended tax treatment of such compensation and benefits, or
(ii) comply with the requirements of Section 409A of the Code and related
Department of Treasury guidance.

 

(b)                                 Notwithstanding anything to the contrary in
this Agreement, no payment or benefits, including without limitation the amount
payable under Section 3 hereof, shall be paid to the Executive during the six
(6) month period following the Executive’s Separation from Service if the
Company determines that paying such amount at the time or times indicated in
this Agreement would be a prohibited distribution under
Section 409A(a)(2)(B)(i) of the Code.  If the payment of any such amount is
delayed as a result of the previous sentence, then on the first business day
following the end of such six (6) month period (or such earlier date upon which
such amount can be paid under Section 409A of the Code without resulting in a
prohibited distribution, including as a result of the Executive’s death), the
Company shall pay the Executive a lump-sum amount equal to the cumulative amount
that would have otherwise been payable to the Executive during such period.

 

(c)                                  To the extent permitted under Section 409A
of the Code, any separate payment or benefit under this Agreement or otherwise
shall not be deemed “nonqualified deferred compensation” subject to Section 409A
and the six (6) month delay requirement under 409A(a)(2)(B)(i) of the Code to
the extent provided in the exceptions in Treasury Regulation
Section 1.409A-1(b)(4), Section 1.409A-1(b)(9) or any other applicable exception
or provision of Section 409A of the Code.

 

(d)                                 To the extent that any reimbursements or
corresponding in-kind benefits provided to the Executive under this Agreement,
including, without limitation under Section 2 or Section 11 hereof, are deemed
to constitute compensation to the Executive, such amounts shall be paid or
reimbursed reasonably promptly, but not later than December 31 of the year
following the year in which the expense was incurred.  The amount of any such
payments or expense reimbursements in one year shall not affect the expenses or
in-kind benefits eligible for payment or reimbursement in any other taxable
year, and the Executive’s right to such payments or reimbursement of any such
expenses shall not be subject to liquidation or exchange for any other benefit.

 

8

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The parties have carefully read this Agreement in its entirety; fully understand
and agree to its terms and provisions; and intend and agree that it is final and
binding on all parties.

 

IN WITNESS WHEREOF, and intending to be legally bound, the parties have executed
the foregoing on the dates shown below.

 

CHRISTOPHER MITCHELL

 

ACCURAY INCORPORATED

 

 

 

 

 

 

/s/ Christopher D. Mitchell

 

/s/ Euan Thomson

Christopher Mitchell

 

Euan Thomson

 

 

Title: Chief Executive Officer

 

 

 

 

 

 

Date

Oct. 24, 2008

 

Date

10-27-08

 

 

 

 

 

 

 

 

 

 

/s/ Darren J. Milliken

 

 

Associate General Counsel

 

 

Accuray Incorporated

 

 

10-27-08

 

9

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Exhibit A

 

 

Accuray Incorporated

  Closing Statement

ID: 20-8370041

 

1310 Chesapeake Terrace

 

Sunnyvale, CA 94089

Termination Date:        9/11/2008

 

 

Christopher Mitchell

ID: 758

15 Emerald Lake Place

 

Emerald Hills, CA United States 94062

 

 

Exercisable Options

 

Number

 

Grant
Date

 

Plan/
Type

 

Price ($)

 

Shares
Granted

 

Shares
Exercised

 

Shares
Exercisable

 

Vesting
Stop Date

 

Total
Price

 

Last Date
To Exercise

 

00002056

 

02/29/08

 

2007/NQ

 

10.36000

 

30,000.00

 

0.00

 

5,000.00

 

9/11/2008

 

$

51,800.00

 

12/11/08

 

00002184

 

08/29/08

 

2007/NQ

 

8.25000

 

30,000.00

 

0.00

 

1,250.00

 

9/11/2008

 

$

10,312.50

 

12/11/08

 

00001533

 

05/25/07

 

2007/NQ

 

24.14000

 

73,432.00

 

0.00

 

26,686.80

 

9/11/2008

 

$

644,219.35

 

12/11/08

 

00001532

 

05/25/07

 

2007/ISO

 

24.14000

 

16,568.00

 

0.00

 

3,313.00

 

9/11/2008

 

$

79,975.82

 

12/11/08

 

 

 

 

 

TOTALS

 

 

 

150,000.00

 

0.00

 

36,249.80

 

 

 

$

786,307.67

 

 

 

 

Releasable Restricted Stock Awards

 

Number

 

Grant
Date

 

Plan/
Type

 

Price ($)

 

Shares
Granted

 

Shares
Released

 

Shares
Releasable

 

Shares
Cancelled

 

00001526

 

05/25/07

 

2007/RSU

 

0.00000

 

10,000.00

 

2,500.00

 

0.00

 

7,500.00

 

00002064

 

02/29/08

 

2007/RSU

 

0.00000

 

5,000.00

 

0.00

 

0.00

 

5,000.00

 

00002186

 

08/29/08

 

2007/RSU

 

0.00000

 

2,500.00

 

0.00

 

0.00

 

2,500.00

 

 

 

 

 

TOTALS

 

 

 

17,500.00

 

2,500.00

 

0.00

 

15,000.00

 

 

1

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Exhibit B

 

Initials: Employee /s/ CM

Accuray /s/ PV

Page 1 of 7

 

[g264821ksi001.jpg]

 

EMPLOYEE INVENTION ASSIGNMENT AND
CONFIDENTIALITY AGREEMENT

 

In consideration of, and as a condition of my employment with Accuray, Inc., a
California corporation (“Accuray”),I hereby represent to, and agree with Accuray
as follows:

 

1.                                      Effective Date. I understand that this
Agreement shall take effect on the date I begin work with Accuray (“Effective
Date”).

 

2.                                      Purpose of Agreement. I understand that
Accuray is engaged in a continuous program of research, development, production
and marketing in connection with its business and that it is critical for
Accuray to preserve and protect its “Proprietary Information” (as defined in
Section 8 below), its rights in “Inventions” (as defined in Section 3 below) and
in all related intellectual property rights. Accordingly, I am entering into
this Employee Invention Assignment and Confidentiality Agreement (this
“Agreement”) as a condition of my employment with Accuray, whether or not I am
expected to create inventions of value for Accuray.

 

3.                                      Disclosure of Inventions. I will
promptly disclose in confidence to Accuray all ideas, writings, discoveries,
inventions, improvements, designs, original works of authorship, formulas,
processes, compositions of matter, computer software programs, databases, mask
works and trade secrets that I make or conceive of or first reduce to practice
or create, either alone or jointly with others, during the period of my
employment, whether or not in the course of my employment, and whether or not
patentable, copyrightable or protectable as trade secrets (the “Inventions”). I
agree to maintain adequate and current written records on the development of all
Inventions.

 

4.                                      Work for Hire; Assignment of Inventions.
I acknowledge and agree that any copyrightable works prepared by me within the
scope of my employment are “works for hire” under the Copyright Act and that
Accuray will be considered the author and owner of such copyrightable works. I
agree that all Inventions that (i) are developed using equipment, supplies,
facilities or trade secrets of Accuray, (ii) result from work performed by me
for Accuray, or (iii) relate to Accuray’s business or actual or demonstrably
anticipated research and development (the “Assigned Inventions”), will be the
sole and exclusive property of Accuray. I hereby irrevocably assign, and agree
to assign, the Assigned Inventions to Accuray.

 

5.                                      Labor Code Section 2870 Notice. I have
been notified and understand that the provisions of Sections 3 and 4 of this
Agreement do not apply to any Assigned Invention that qualifies fully under the
provisions of Section 2870 of the California Labor Code, which states as
follows:

 

ACCURAY CONFIDENTIAL

 

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Initials: Employee /s/ CM

Accuray /s/ PV

Page 2 of 7

 

ANY PROVISION IN AN EMPLOYMENT AGREEMENT WHICH PROVIDES THAT AN EMPLOYEE SHALL
ASSIGN, OR OFFER TO ASSIGN, ANY OF HIS OR HER RIGHTS IN AN INVENTION TO HIS OR
HER EMPLOYER SHALL NOT APPLY TO AN INVENTION THAT THE EMPLOYEE DEVELOPED
ENTIRELY ON HIS OR HER OWN TIME WITHOUT USING THE EMPLOYER’S EQUIPMENT,
SUPPLIES, FACILITIES, OR TRADE SECRET INFORMATION EXCEPT FOR THOSE INVENTIONS
THAT EITHER: (1) RELATE AT THE TIME OF CONCEPTION OR REDUCTION TO PRACTICE OF
THE INVENTION TO THE EMPLOYER’S BUSINESS, OR ACTUAL OR DEMONSTRABLY ANTICIPATED
RESEARCH OR DEVELOPMENT OF THE EMPLOYER; OR (2) RESULT FROM ANY WORK PERFORMED
BY THE EMPLOYEE FOR THE EMPLOYER. TO THE EXTENT A PROVISION IN AN EMPLOYMENT
AGREEMENT PURPORTS TO REQUIRE AN EMPLOYEE TO ASSIGN AN INVENTION OTHERWISE
EXCLUDED FROM BEING REQUIRED TO BE ASSIGNED UNDER CALIFORNIA LABOR CODE
SECTION 2870(a), THE PROVISION IS AGAINST THE PUBLIC POLICY OF THIS STATE AND IS
UNENFORCEABLE.

 

Accordingly, I acknowledge that Inventions set forth in Schedule A (“Employee’s
Disclosure”) are excluded from the operation of this Agreement. [NOTE: We
recommend getting a record of all Inventions developed prior to employment with
Accuray to avoid any ambiguity or argument as to what was developed during the
period of employment.]

 

6.                                      Assignment of Other Rights. In addition
to the foregoing assignment of Assigned Inventions to Accuray, I hereby
irrevocably transfer and assign to Accuray: (i) all worldwide patents, patent
applications, copyrights, mask works, trade secrets and other intellectual
property rights, including but not limited to rights in databases, in any
Assigned Inventions, along with any registrations of or applications to register
such rights; and (ii) any and all “Moral Rights” (as defined below) that I may
have in or with respect to any Assigned Inventions. I also hereby forever waive
and agree never to assert any and all Moral Rights I may have in or with respect
to any Assigned Inventions, even after termination of my work on behalf of
Accuray. “Moral Rights” mean any rights to claim authorship of or credit on an
Assigned Inventions, to object to or prevent the modification or destruction of
any Assigned Inventions, or to withdraw from circulation or control the
publication or distribution of any Assigned Inventions, and any similar right,
existing under judicial or statutory law of any country or subdivision thereof
in the world, or under any treaty, regardless of whether or not such right is
denominated or generally referred to as a “moral right.”

 

7.                                      Cooperation. At Accuray’s request and
expense, I will, during the term of my employment and thereafter, cooperate with
and assist Accuray, and perform such further acts and execute, acknowledge and
deliver to Accuray such further documents, as Accuray may deem necessary or
advisable in order to obtain, establish, perfect, maintain, evidence, enforce or

 

ACCURAY CONFIDENTIAL

 

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otherwise protect any of the rights, title and interests assigned, transferred,
conveyed, or licensed (or intended to be assigned, transferred, conveyed, or
licensed) to Accuray under this Agreement, or otherwise carry out the intent and
accomplish the purposes of this Agreement. Without limiting the generality of
the foregoing, to the extent permitted by applicable law, I hereby appoint
Accuray as my attorney-in-fact (which appointment is coupled with an interest),
with full power of substitution and delegation, with the right (but not the
obligation) to perform any such acts and to execute, acknowledge and deliver any
such documents on my behalf.

 

8.                                      Proprietary Information. I understand
that my employment by Accuray creates a relationship of confidence and trust
with respect to any information of a confidential or secret nature that may be
disclosed to me by Accuray or a third party that relates to the business of
Accuray or to the business of any parent, subsidiary, affiliate, customer or
supplier of Accuray or any other party to which Accuray owes a duty of
confidentiality, whether or not labeled or identified as proprietary or
confidential, and including any copies, portions, extracts and derivatives
thereof, except to the extent that I can prove that such information or
materials (i) are or become generally known to the public through lawful means
and through no act or omission of mine; (ii) were part of my general knowledge
prior to my employment by Accuray; or (iii) are disclosed to me without
restriction by a third party who rightfully possesses the information and is
under no duty of confidentiality with respect thereto (the “Proprietary
Information”). Such Proprietary Information includes, but is not limited to,
Assigned Inventions, marketing plans, product plans, business strategies,
financial information, forecasts, personnel information, customer lists and
data, and domain names. Except as disclosed on Schedule A to this Agreement, I
have no knowledge of Accuray’s business or Proprietary Information, other than
information I have learned from Accuray in the course of being hired and
employed

 

9.                                      Confidentiality.  At all times, both
during my employment and after its termination, I will keep and hold all such
Proprietary Information in strict confidence and trust. I agree to maintain at
my work station and/or any other place under my control only such Proprietary
information that is necessary to carry out my responsibilities as an employee of
Accuray. I agree to return to the appropriate person or location or otherwise
properly dispose of Proprietary Information once that necessity no longer
exists. I also agree not to make copies or otherwise reproduce Proprietary
Information except to the extent necessary to carry out my, responsibilities as
an employee of Accuray. [Note: Placing these restrictions on the location and
reproduction of certain proprietary information helps to establish the
employer’s efforts to “maintain the secrecy of” of this information, a required
element for trade secrets status under the Uniform Trade Secrets Act. Cal. Civ.
Code section 3426.1(d)(2).] I understand that avoiding loss or theft of
Proprietary Information is an important part of my duties. 1 will not allow any
other person to use my office access card or computer passwords, without prior
managerial approval. I will only use secure networks established by Accuray when
using Proprietary Information. I will not use or disclose any Proprietary
Information without the prior written consent of Accuray, except as may be
necessary to perform my duties as an employee of Accuray for the benefit of
Accuray.

 

10.                               Termination. Upon termination of my employment
with Accuray, I will promptly deliver to Accuray all documents and materials of
any nature pertaining to my work

 

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with Accuray and, upon Company request, will execute a document confirming my
agreement to honor my responsibilities contained in this Agreement. I will not
take with me or retain any documents or materials or copies thereof containing
any Proprietary Information. I agree that after the termination of my employment
with Accuray, I will not enter into any agreement that would cause me to violate
any of my obligations under this Agreement and will inform any subsequent
employers of my obligations under this Agreement.

 

11.                               Survival. The terms and conditions of this
Agreement and my obligations hereunder shall survive any termination of my
employment with Accuray and any expiration or termination of any employment or
other agreement between Accuray and me, and such terms and conditions shall
remain in full force and effect as set forth herein.

 

12.                               No Breach of Prior Agreement. I represent that
my performance of all the terms of this Agreement and my duties as an employee
of Accuray will not breach any invention assignment, proprietary information,
confidentiality or similar agreement with any former employer or other party. I
represent that I will not bring with me to Accuray or use in the performance of
my duties for Accuray any documents or materials or intangibles of a former
employer or third party that are not generally available to the public or have
not been legally transferred to Accuray. Except as disclosed on Schedule A, 1 am
aware of no prior agreements between me and any other person or entity
concerning propriety information, creations, or proprietary rights.

 

13.                               Efforts; Duty Not to Compete. I understand
that my employment with Accuray requires my undivided attention and effort. As a
result, during my employment, I will not, without Accuray’s express written
consent, engage in any other employment or business that (i) directly competes
with the current or future business of Accuray; (ii) uses any Accuray
information, equipment, supplies, facilities or materials; or (iii) otherwise
conflicts with Accuray’s business interest and causes a disruption of its
operations.

 

14.                               Notification. I hereby authorize Accuray to
notify third parties, including, without limitation, customers and actual or
potential employers, of the terms of this Agreement and my responsibilities
hereunder.

 

15.                               Non-Solicitation of Employees/Consultants.
During my employment with Accuray and for a period of one (1) year thereafter, I
will not directly or indirectly solicit away employees or consultants of Accuray
for my own benefit or for the benefit of any other person or entity.

 

16.                               Non-Solicitation of Suppliers/Customers.
During and after the termination of my employment with Accuray, I will not
directly or indirectly solicit or otherwise take away customers or suppliers of
Accuray if, in so doing, I access, use or disclose any trade secrets or
proprietary or confidential information of Accuray. I acknowledge and agree that
the names and addresses of Accuray’s customers and suppliers, and all other
confidential information related to them, including their buying and selling
habits and special needs, whether created or obtained by, or disclosed to me
during my employment, constitute trade secrets of Accuray.

 

ACCURAY CONFIDENTIAL

 

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17.                               Name & Likeness Rights. I hereby authorize
Accuray to use, reuse, and to grant others the right to use and reuse, my name,
photograph, likeness (including caricature), voice, and biographical
information, and any reproduction or simulation thereof, in any form of media or
technology now known or hereafter developed (including, but not limited to,
film, video and digital or other electronic media), both during and after my
employment, for whatever purposes Accuray deems necessary.

 

18.                               Remedies. I recognize that nothing in this
Agreement is intended to limit any remedy of Accuray under any law concerning
trade secrets or other Proprietary Rights. I recognize that my violation of this
Agreement could cause Accuray irreparable harm and acknowledge that Accuray may
have the right to apply to any court of competent jurisdiction for an order
restraining any breach or threatened breach of this Agreement.

 

19.                               Governing Law; Severability. This Agreement
will be governed by and construed in accordance with the laws of the State of
California, without giving effect to its laws pertaining to conflict of laws. If
any provision of this Agreement is determined by any court or arbitrator of
competent jurisdiction to be invalid, illegal or unenforceable in any respect,
such provision will be enforced to the maximum extent possible given the intent
of the parties hereto. If such clause or provision cannot be so enforced, such
provision shall be stricken from this Agreement and the remainder of this
Agreement shall be enforced as if such invalid, illegal or unenforceable clause
or provision had (to the extent not enforceable) never been contained in this
Agreement.

 

20.                               Counterparts. This Agreement may be executed
in any number of counterparts, each of which when so executed and delivered will
be deemed an original, and all of which together shall constitute one and the
same agreement.

 

21.                               Entire Agreement. This Agreement and the
documents referred to herein constitute the entire agreement and understanding
of the parties with respect to the subject matter of this Agreement, and
supersede all prior understandings and agreements, whether oral or written,
between or among the parties hereto with respect to the specific subject matter
hereof.

 

22.                               Amendment and Waivers. This Agreement may be
amended only by a written agreement executed by each of the parties hereto. No
amendment of or waiver of, or modification of any obligation under this
Agreement will be enforceable unless set forth in a writing signed by the party
against which enforcement is sought. For Accuray, any such writing must be
signed by one of the following: CEO, CFO or General Counsel. Any amendment
effected in accordance with this section will be binding upon all parties hereto
and each of their respective successors and assigns. No delay or failure to
require performance of any provision of this Agreement shall constitute a waiver
of that provision as to that or any other instance. No waiver granted under this
Agreement as to any one provision herein shall constitute a subsequent waiver of
such provision or of any other provision herein, nor shall it constitute the
waiver of any performance other than the actual performance specifically waived.

 

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23.                               Successors and Assigns; Assignment. I
acknowledge and agree that my obligations hereunder are personal, and that I
shall have no right to assign, transfer or delegate and shall not assign,
transfer or delegate or purport to assign, transfer or delegate this Agreement
or any of my rights or obligations hereunder. This Agreement and any rights and
obligations of Accuray hereunder may be freely assigned, transferred or
delegated by Accuray. Any assignment, transfer or delegation in violation of
this Article 23 shall be null and void. Subject to the foregoing restrictions on
assignments, transfers and delegations, this Agreement shall inure to the
benefit of Accuray and its affiliates, officers, directors, agents, successors
and assigns; and shall be binding on me and my heirs, devisees, spouses, agents,
legal representatives and successors

 

24.                               “At Will” Employment. I understand that this
Agreement does not constitute a contract of employment or obligate Accuray to
employ me for any stated period of time. I understand that I am an “at will”
employee of Accuray and that my employment can be terminated at any time, with
or without notice and with or without cause, for any reason or for no reason, by
either Accuray or myself. I acknowledge that any statements or representations
to the contrary are ineffective, unless put into a writing signed by Accuray. I
further acknowledge that my participation in any stock option or benefit program
is not to be construed as any assurance of continuing employment for any
particular period of time.

 

I REPRESENT THAT I HAVE READ THIS AGREEMENT, AND THAT I FULLY UNDERSTAND ALL OF
ITS TERMS AND CONDITIONS; I HAVE EXECUTED THIS AGREEMENT WITHOUT COERCION OR
DURESS OF ANY KIND.

 

IN WITNESS WHEREOF, the parties have signed this Agreement as of the Effective
Date.

 

ACCURAY, INC.:

 

EMPLOYEE:

 

 

 

 

 

 

By:

/s/ Paul A. Vagadori

 

/s/ Christopher D. Mitchell

 

 

Signature

 

 

 

Name:

Paul A. Vagadori

 

Christopher D. Mitchell

 

 

Name (Please Print)

 

 

 

 

Title:

Sr. Director, HR

 

 

 

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SCHEDULE A

 

EMPLOYEE’S DISCLOSURE

 

1. Proprietary Information. Except as set forth below, I acknowledge that at
this time I know nothing about the business or Proprietary Information of
Accuray, other than the following information I have learned from Accuray in the
course of being hired:

 

 

 

2. Previous Creations. Except for the items set forth below, there is nothing
that I wish to exclude from the operation of this Agreement:

 

 

 

3. Prior Agreements. Except as set forth below, I am aware of no prior
agreements between me and any other person or entity concerning proprietary
information, creations or proprietary rights (of the nature described in
Section 2 above) (attach copies, or summary of terms, of all agreements in your
possession):

 

 

Date:

 

 

 

 

Christopher D. Mitchell

 

Employee Name

 

 

 

/s/ Christopher D. Mitchell

 

Employee Signature

 

ACCURAY CONFIDENTIAL

 

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