Exhibit 10.1

 

[XCYTE THERAPIES, INC. COMPANY LETTERHEAD]

 

June 14, 2004

 

Larry Romel

767 El Granada Boulevard

Half Moon Bay, CA 94019

 

Dear Larry:

 

On behalf of Xcyte Therapies, Inc. (the “Company”), I am pleased to offer you
the full time position of Vice President, Clinical Operations and Project
Management of the Company. Speaking for myself, as well as the other members of
the Company’s team, we are all very impressed with your credentials and we look
forward to your future success in this position.

 

The terms of your new position with the Company are as set forth below:

 

1. Position.

 

a. You will become the Vice President, Clinical Operations and Project
Management of the Company, working out of the Company’s headquarters office in
Seattle. You will report to the Company’s Chief Business Officer, Robert
Kirkman.

 

b. You agree to the best of your ability and experience that you will at all
times loyally and conscientiously perform all of the duties and obligations
required of and from you pursuant to the express and implicit terms hereof, and
to the reasonable satisfaction of the Company. During the term of your
employment, you further agree that you will devote all of your business time and
attention to the business of the Company, the Company will be entitled to all of
the benefits and profits arising from or incident to all such work services and
advice, you will not render commercial or professional services of any nature to
any person or organization, whether or not for compensation, without the prior
written consent of the Company’s Board of Directors, and you will not directly
or indirectly engage or participate in any business that is competitive in any
manner with the business of the Company. Nothing in this letter agreement will
prevent you from -accepting speaking or presentation engagements in exchange for
honoraria or from serving on boards of charitable organizations, or from owning
no more than one percent (1%) of the outstanding equity securities of a
corporation whose stock is listed on a national stock exchange.

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2. Start Date. Subject to fulfillment of any conditions imposed by this letter
agreement, you will commence this new position with the Company on a mutually
agreed upon date.

 

3. Proof of Right to Work. For purposes of federal immigration law, you will be
required to provide to the Company documentary evidence of your identity and
eligibility for employment in the United States. Such documentation must be
provided to us within three (3) business days of your date of hire, or our
employment relationship with you may be terminated.

 

4. (a) Compensation. You will be paid a monthly salary of $ 16,500.00, which is
equivalent to $198,000.00 on an annualized basis. Your salary will be payable in
two equal payments per month pursuant to the Company’s regular payroll policy
(or in the same manner as other similarly situated employees of the Company).
Your base salary will be reviewed annually as part of the Company’s normal
salary review process.

 

(b) Relocation Assistance. You will be eligible to receive reimbursement of
transportation, accommodation and meals for a three-day/two-night house hunting
trip for you and your spouse, as applicable, to be made prior to your start
date. Reimbursement will be made on actual receipts and submission of a properly
documented expense report.

 

You will also be eligible for reimbursement of transportation for yourself, your
spouse and dependents to Seattle (direct, one-way coach class airfare or mileage
for the most direct route from point of origin to point of destination) and for
the movement of up to 15,000 lbs of household goods, and storage of those goods
for a maximum of 45 days, and movement of one vehicle to the Seattle, Washington
area.

 

In addition, you are eligible to receive reimbursement of up to 45 days of
temporary housing costs (corporate housing or non-permanent apartment/house
rental) for you and your immediate family in the Seattle, Washington area, not
to exceed a total of $4,500 for yourself solely or $6,500 for you and your
family.

 

You will also receive a lump-sum relocation allowance $8,250.00, equal to half
of your monthly salary (subject to applicable withholding taxes) to be paid as
soon as practicable following your start date. No expense reporting is required
for this allowance.

 

You will be required to reimburse us for all monies paid to you or on your
behalf for the purpose of relocation assistance on a one-year pro rata basis if
you voluntarily terminate your employment with us before completing one year of
continuous employment with us.

 

5. Stock Options.

 

a. Initial Grant. In connection with the commencement of your employment, the
Company will recommend that the Board of Directors grant you an option to
purchase 30,000 shares of the Company’s Common Stock (“Option”) with an exercise
price equal to the fair market value on the date of the grant, which will be as
soon as practicable after your Start Date. This Option will vest (and be
exercisable) at the rate of 25% of the shares on the twelve (12) month

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anniversary of your Vesting Commencement Date (as defined in the your stock
option agreement, which date will be your Start Date, as defined above) and the
remaining Option will vest monthly thereafter at the rate of 1/48 of the total
number of shares per month. Vesting will, of course, depend on your continued
employment with the Company. The Option will be an incentive stock option to the
maximum extent allowed by the tax code and will be subject to the terms of a
Company stock option plan and the stock option agreement between you and the
Company.

 

b. Subsequent Option Grants. Subject to the discretion of the Company’s Board of
Directors, you may be eligible to receive additional grants of stock options or
purchase rights from time to time in the future, on such terms and subject to
such conditions as the Board of Directors shall determine as of the date of any
such grant.

 

6. Benefits.

 

a. Insurance Benefits. The Company will provide you with the opportunity to
participate in the standard benefits plans currently available to other
similarly situated employees, including medical, dental, vision and life
insurance, subject to any eligibility requirements imposed by such plans. You
should note that Xcyte Therapies might modify salaries and benefits from time to
time, as it deems necessary.

 

b. Vacation; Sick Leave. You will be entitled to 12 days paid vacation per
calendar year, pro-rated for the remainder of this calendar year, in your first
year of service. Vacation accrues according to the following schedule: 8.00
hours per month in the first year of service, with such accrual capped at 180
hours. Vacation may not be taken before it is accrued. In addition, you will be
entitled to take up to 10 days sick leave per calendar year, pro-rated for the
remainder of this calendar year.

 

c. Company Policies. As an employee, you will be expected to abide by Company
rules and regulations. Your commencement of employment with the Company is
contingent upon the execution and delivery to an officer of the Company, of an
acknowledgment that you have read and understand the Company’s rules and
regulations, which will be provided to you in an employee handbook.

 

7. Proprietary Information and Inventions Agreement. Your acceptance of this
offer and commencement of employment with the Company is contingent upon the
execution, and delivery to an officer of the Company, of the Company’s
Proprietary Information and Inventions Agreement, a copy of which is enclosed
for your review and execution (the “Confidentiality Agreement”) as Exhibit A,
prior to or on your Start Date.

 

8. Confidentiality of Terms. You agree to follow the Company’s strict policy
that employees must not disclose, either directly or indirectly, any
information, including any of the terms of this agreement, regarding salary,
bonuses, or stock purchase or option allocations to any person, including other
employees of the Company; provided, however, that you may discuss such terms
with members of your immediate family and any legal, tax or accounting
specialists who provide you with individual legal, tax or accounting advice.

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9. At-Will Employment. Your employment with the Company will be on an “at will”
basis, meaning that either you or the Company may terminate your employment at
any time for any reason or no reason, without further obligation or liability.

 

10. Separation Benefits. Employee shall be entitled to receive separation
benefits upon termination of employment only as set forth in this Section 10;
provided, however, that in the event Employee is entitled to any severance pay
under a Company-sponsored severance pay plan, any such severance pay to which
Employee is entitled under such severance pay plan shall reduce the amount of
severance pay to which Employee is entitled pursuant to this Section 10. In all
cases, upon termination of employment Employee will receive payment for all
salary and unused vacation accrued as of the date of Employee’s termination of
employment and Employee’s benefits will be continued under the Company’s then
existing benefit plans and policies in accordance with such plans and policies
in effect on the date of termination and in accordance with applicable law or as
provided for herein.

 

(a) Voluntary Resignation. If Employee voluntarily elects to terminate
Employee’s employment with the Company, Employee shall not be entitled to any
severance benefits.

 

(b) Termination for Cause. If the Company or its successor terminates Employee’s
employment for Cause, then Employee shall not be entitled to receive any
separation benefits.

 

(c) Involuntary Termination. If Employee’s employment is terminated by the
Company or its successor under circumstances that constitute an Involuntary
Termination, provided Employee signs a general release of claims in
substantially the form attached hereto as Exhibit B, Employee shall receive (i)
continued payment of his then current base salary until the date that is three
(3) months from Employee’s Involuntary Termination, subject to applicable
withholding taxes, and paid in accordance with the Company’s normal payroll
schedule commencing after Employee’s execution of the general release of claims,
and (ii) reimbursement for his expenses incurred in continuing his medical
insurance for himself and his dependents under the Consolidated Omnibus Budget
Reconciliation Act of 1984, as amended (“COBRA”), as applicable, for a period of
three (3) months following the commencement of such COBRA continuation coverage,
provided Employee makes a timely election for and continues to be eligible for
such continued coverage.

 

(d) Termination by Reason of Death or Disability. In the event that Employee’s
employment with the Company terminates as a result of Employee’s death or his
inability to perform the essential functions of his position with or without
reasonable accommodation on account of a mental or physical disability, Employee
or Employee’s estate or representative, as applicable, will receive all salary
and unpaid vacation accrued as of the date of Employee’s employment termination
and any other benefits payable under the Company’s then existing benefit plans
and policies in accordance with such plans and policies in effect on the date of
termination and in accordance with applicable law.

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(e) Definition of “Involuntary Termination”. For purposes of this Agreement,
Employee shall be considered to have been terminated under circumstances that
constitute Involuntary Termination if he is terminated by the Company or its
successor without Cause (other than on account of death or disability).

 

(f) Definition of “Cause”. For purposes of this Agreement, “Cause” for
Employee’s termination will exist at any time after the happening of one or more
of the following events:

 

(i) Employee’s failure to cure, within 30 days after written notice thereof from
the Company, his failure to substantially perform his duties hereunder or gross
negligence in the performance thereof, or failure to follow Company policy as
set forth from time to time or to follow the legal directives of the Company, so
long as such directives are not inconsistent with the Employee’s position and
duties and this Agreement;

 

(ii) Employee’s act of fraud or embezzlement, or of dishonesty or other
misconduct that materially damages the Company, including conviction of a
felony;

 

(iii) Employee’s incurable willful breach of any material provision of the
Confidentiality Agreement (as defined in Section 7 above), including without
limitation, Employee’s theft or other misappropriation of the Company’s
proprietary information.

 

[Signature Page Follows]

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We are all delighted to be able to extend you this offer and look forward to
working with you. To indicate your acceptance of the Company’s offer, please
sign and date this letter in the space provided below and return it to me, along
with a signed and dated copy of the Confidentiality Agreement. This letter,
together with the Confidentiality Agreement, set forth the terms of your
employment with the Company and supersede any prior representations or
agreements, whether written or oral. This letter may not be modified or amended
except by a written agreement, signed by the Company and by you.

 

Very truly yours,   ACCEPTED AND AGREED: XCYTE THERAPIES, INC.   LARRY ROMEL By:
 

/s/ Ronald J. Berenson

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/s/ Larry Romel

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        Signature Title:   CEO & President   6/15/04         Date