Exhibit 10.2

 

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September 23, 2015

Mr. Robert Azelby

[omitted]

Dear Bob:

I am pleased to offer you a position with Juno Therapeutics, Inc. (the
“Company’’) as Executive Vice President, Chief Commercial Officer, reporting to
Hans Bishop, President and Chief Executive Officer, effective as of November 1,
2015 (the “Start Date”). Commencing on the Start Date, and during your
employment with the Company, you will receive an annual base salary of $415,000,
which will be paid semi-monthly in accordance with the Company’s normal payroll
procedures. As an employee, you also will be eligible to participate in the
employee benefit plans maintained by the Company of general applicability to
other employees of the Company.

You will be offered the opportunity to earn an annual incentive bonus (the
“Bonus”) with a target equal to 40% of your annual base salary (the “Target”)
upon attainment of certain performance objectives (the “Performance Objectives”)
to be determined by the Board of Directors of the Company (the “Board”), which
Bonus will be prorated in 2015 based on the portion of the year served as an
employee. The achievement of such objectives will be determined by the Board.
Your Bonus, if earned, will be paid by the later of (i) the fifteenth (15th) day
of the third (3rd) month following the close of the Company’s fiscal year in
which the bonus is earned or (ii) March 15 following the calendar year in which
the Bonus is earned.

In addition, subject to the execution and delivery of this letter by you and by
the Company, the Company will recommend that the Board grant you (i) an option
award to purchase 200,000 shares of the Company’s Common Stock (the “Option
Award”) and (ii) a restricted stock unit award for 38,640 shares of the
Company’s Common Stock (the “RSU Award”). The recommended Option Award would
vest and become exercisable as to 25% of the shares subject thereto on the one
(1) year anniversary of the Start Date and as to an additional 1/48 of the
shares subject thereto on each monthly anniversary thereafter, subject to your
continuing to be a service provider of the Company through the applicable
vesting dates. The recommended RSU Award would vest such that 100% of the shares
will vest on the first anniversary of the Start Date, subject to your continuing
to be a service provider of the Company through that vesting date.

The Option Award and RSU Award would each be subject to the terms and conditions
of the Company’s 2014 Equity Incentive Plan (the “Plan”) and an award agreement
thereunder. The Option Award would have an exercise price per share equal to the
fair market value per share of the Company’s Common Stock on the date of the
grant of such award, as such fair market value is determined in accordance with
the Plan. The RSU Award agreement would provide that a sufficient number of
shares would be automatically sold from such RSU Award, in an arrangement
intended to be in compliance with Rule 10b5-l under the Securities Exchange Act
of 1934 (the “Exchange Act”), at the vest date to cover the Company’s required
withholding obligations with respect to the vesting of the RSU Award on such
date, and the proceeds of such sale would be provided to the Company for
purposes of such withholding.

Should you accept the Company’s offer of employment, the Company will pay you a
signing bonus of $800,000 less applicable withholding taxes, on the first
payroll date after your Start Date, or on a date after your Start Date that is
mutually agreed upon between you and the Company. You will be obliged to pay
back to the Company (i) 100% of the amount of the signing bonus if, and only if,
you resign from your employment with the Company without Good Reason on or
before the first anniversary of your Start Date, or (ii) 50% of the signing
bonus if you resign from your employment with the Company without Good Reason at
any time between the first anniversary of your Start Date and the second
anniversary of your Start Date.

 

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You will be expected to base your employment with the Company in Seattle,
Washington. To assist in your relocation, the Company will reimburse you for
reasonable expenses you incur to make this transition, including but not limited
to moving expenses, travel expenses, and temporary accommodation expenses
related to you and your immediate family relocating to Seattle, and with your
commute to Seattle prior to such relocation (collectively, “Relocation
Expenses”), up to a maximum aggregate reimbursement of $200,000, which amount
may be adjusted by mutual consent. Relocation Expenses must be substantiated in
writing (by valid receipts or any other reasonable method of invoicing, showing
proof of payment for an eligible relocation or commuting cost), which evidence
must be submitted to the Company (or, if instructed by the Company, the
Company’s third party relocation vendor) within thirty (30) days after any such
Relocation Expense is incurred. The Relocation Expenses will only be reimbursed
to you if you are an employee of the Company on the date of reimbursement or
payment by the Company. The Company will also gross up your income for the
amount (if any) required to be withheld by the Company for federal income taxes
with respect to reimbursed Relocation Expenses. The Company will not gross up
your income for any state income taxes for which you might have obligations
prior to your move to the State of Washington, and you will be responsible for
making any required income tax payments to such state directly.

During your employment, you shall be authorized to incur reasonable documented
expenses in the performance of your duties. The Company shall reimburse you for
all such expenses promptly after the presentation by you of itemized
documentation reflecting such expenditures, all in accordance with the Company’s
procedures and policies as adopted and in effect from time to time.

You should be aware that your employment with the Company will be for no
specified period and will constitute at-will employment. As a result, you are
free to resign at any time, for any reason or for no reason. Similarly, the
Company is free to conclude its employment relationship with you at any time,
with or without cause, and with or without notice. We request that, in the event
of resignation, you give the Company at least two (2) weeks’ notice. The date
you cease providing services for the Company shall be the “Termination Date,”
provided, however, that, in the event you provide the Company with notice of
resignation, the Termination Date shall be the effective date set forth in such
notice, unless the you and the Company agree otherwise in writing.

If the Company terminates your employment other than for Cause, death or
Disability, or if you terminate your employment for Good Reason, then you will
be entitled to receive, subject to your executing and delivering to the Company,
after such termination of employment, a written general release and, if desired
by the Company, a consulting agreement that requires you to provide reasonable
transition services for a period of up to nine (9) months, provided that such
agreement shall not expect or require you to perform services that would
preclude the termination of your employment from being a “separation from
service” from the Company within the meaning of Section 409A of the Internal
Revenue Code of 1986, as amended (the “Code”) and shall provide for payment of
your reasonable out-of-pocket expenses incurred in providing the transition
service, each in forms reasonably satisfactory to the Company (collectively,
the “Release”), that become effective and irrevocable by the sixtieth (60th) day
following your termination of employment (the “Release Deadline Date”),
(i) continuing payments of severance pay (less applicable withholding taxes) for
a period of twelve (12) months to be paid periodically in accordance with the
Company’s normal payroll policies at a rate equal to the sum of your monthly
base salary rate, in each case as in effect immediately prior to your
termination (but without taking into account any reduction of your base salary
in breach of this letter), (ii) a pro-rata Bonus, which shall be calculated by
multiplying the percentage of the Bonus year that has elapsed through the
Termination Date by the greater of (A) your Target; or (B) your progress toward
meeting the Performance Objectives applicable to the current Bonus year pro
rated based on the fraction of the year elapsed through the Termination Date,
provided that if such termination occurs between the beginning of a calendar
year and the date on which a Bonus earned during the prior year has been paid,
you will not forfeit any Bonus you have earned during that prior year but will
be paid the prior year’s Bonus in an amount determined by the Board pursuant to
the Company’s ordinary operation of its annual incentive program, (iii) if you
elect continuation coverage pursuant to the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended (“COBRA”) for you and your eligible
dependents within the time period prescribed pursuant to COBRA, the Company will
reimburse you for the COBRA premiums for such coverage (at the coverage levels
in effect immediately prior to your termination) pursuant to the Company’s
normal expense reimbursement policy until the earlier of (A) a period of nine
(9) months from the last date of employment of you with the Company, or (B) the
date upon which you and/or your eligible dependents become covered under similar
plans; provided, however, if the Company determines in its sole discretion that
it cannot provide the COBRA benefits without potentially violating applicable
law

 

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(including, without limitation, Section 2716 of the Public Health Service Act),
the Company will in lieu thereof provide to you a taxable monthly payment in an
amount equal to the monthly COBRA premium that you would be required to pay to
continue your group health coverage in effect on the date of your termination of
employment (which amount will be based on the premium for the first month of
COBRA coverage), which payments will be made regardless of whether you elect
COBRA continuation coverage; and (iv) solely in the event of a Change in Control
(as defined in the Plan), if the Company terminates your employment other than
for Cause, death or Disability, or if you terminate your employment for Good
Reason, within the period that is three (3) months prior to or twelve
(12) months following such Change in Control, and you execute a Release that
becomes effective and irrevocable by the Release Deadline Date, all of the
outstanding unvested Option Award and RSU Award will vest as of the later of
(i) the Change in Control or (ii) your termination of employment, as applicable.

Notwithstanding anything to the contrary under this letter, if at any time the
Company determines in its sole discretion that it cannot provide the payments
contemplated by the preceding sentence without violating applicable law
(including, without limitation, Section 2716 of the Public Health Service Act),
you will not receive such payment or any further reimbursements for COBRA
premiums, provided, however, that if the Company does determine that it cannot
provide any such payments or reimbursements, it will provide you a written
notice of that determination and its corresponding legal analysis no later than
15 days following the date on which the contemplated payment would otherwise be
due. Notwithstanding the foregoing, if the Release does not become effective and
irrevocable by the Release Deadline Date, you will forfeit any right to
severance payments or other separation benefits under this letter. In no event
will severance payments or other separation benefits be paid or provided until
the Release actually becomes effective and irrevocable. Except as required by
the following paragraph, if the Release becomes effective by the Release
Deadline Date, severance payments and other separation benefits under this
letter will commence on the Release Deadline Date. Except as required by the
following paragraph, any installment payments that would have been made to you
during the period from the date of your termination of employment through the
date the Release becomes effective and irrevocable but for the preceding
sentence will be paid to you on the Release Deadline Date, and the remaining
payments will be made as provided in this letter.

Notwithstanding anything to the contrary in this letter, any severance payments
or benefits under this letter that would be considered deferred compensation
(the “Deferred Payments”) under Section 409A of the Internal Revenue Code (as it
has been and may be amended from time to time) (the “Code”) and any regulations
and guidance that has been promulgated or may be promulgated from time to time
thereunder (“Section 409A”) will not be paid until you have experienced a
“separation from service” within the meaning of Section 409A. Additionally, if
you are a “specified employee” within the meaning of Section 409A at the time of
your separation from service, then the Deferred Payments that would otherwise be
due to you on or within the six (6) month period following your separation from
service but for this paragraph, will accrue during such six (6) month period and
will become payable in a lump sum payment on the date six (6) months and one
(1) day following the date of your termination (such rule, the “Six Month Delay
Rule”). All subsequent Deferred Payments following the application of the Six
Month Delay Rule, if any, will be payable in accordance with the payment
schedule applicable to each payment. It is the intent of this letter to comply
with the requirements of Section 409A so that none of the severance payments
will be subject to the additional tax imposed under Section 409A, and any
ambiguities or ambiguous terms herein will be interpreted to so comply. Each
payment and benefit payable under this letter is intended to constitute a
separate payment for purposes of Section 1.409A-2(b)(2) of the Treasury
Regulations.

If your employment hereunder is terminated, you are not required to seek other
employment or to attempt in any way to reduce any amounts payable to you by the
Company. Further, the amount of any payment or benefit provided for hereunder
shall not be reduced by any compensation earned by you as a result of your
employment by another employer, by retirement benefits, or otherwise.

For purposes of this letter, “Cause” means (i) a willful act of dishonesty made
by you in connection with your responsibilities as an employee, (ii) your
conviction of, or plea of nolo contendere to, a felony or any crime involving
fraud, embezzlement or any other act of moral turpitude, or a material violation
of federal or state law by you that the Board reasonably determines has had or
will have a material detrimental effect on the Company’s reputation or business;
(iii) your gross misconduct (as defined under the Revised Code of Washington
50.04.294(4)); (iv) your willful and material unauthorized use or disclosure of
any proprietary information or trade secrets of the Company or any other party
to whom you owe an obligation of nondisclosure as a result of your relationship
with the Company; (v) your willful breach of any material obligations under any
written agreement or covenant with the Company; or (vi) your continued
substantial failure to perform your employment duties (other than as a result of

 

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your physical or mental incapacity) after you have received a written demand of
performance from the Board that specifically sets forth the factual basis for
the Board’s determination that you have not substantially performed your duties
and have failed to cure such non-performance to the Board’s reasonable
satisfaction within thirty (30) business days after receiving such notice. For
purposes of this paragraph, no act or failure to act shall be considered willful
unless it is done in bad faith and without reasonable intent that the act or
failure to act was in the best interest of the Company or required by law. Any
act, or failure to act, based upon authority or instructions given to you
pursuant to a resolution duly adopted by the Board or based on the advice of
counsel for the Company will be conclusively presumed to be done or omitted to
be done by you in good faith and in the best interest of the Company.

For purposes of this letter, “Disability” means: (i) an inability to engage in
any substantial gainful activity by reason of any medically determinable
physical or mental impairment which can be expected to result in death or can be
expected to last for a continuous period of not less than twelve (12) months; or
(ii) receipt of income replacement benefits for a period of not less than three
(3) months, by reason of any medically determinable physical or mental
impairment which can be expected to last for a continuous period of not less
than twelve (12) months, under an accident and health plan covering employees of
the Company.

For purposes of this letter, “Good Reason” means your resignation within thirty
(30) days following expiration of any Company cure period (discussed below)
following the occurrence of one or more of the following, without your written
consent: (i) a material reduction in your base salary (in which case, severance
for a resignation shall be based upon your base salary prior to the reduction);
(ii) a material diminution of your duties, responsibilities or reporting lines;
(iii) a change in the location of your employment of more than fifty (50) miles;
or (iv) the Company’s material breach of the terms of this letter (which shall
include the failure of the Board to substantially grant the Option Award and/or
RSU Award described on pages 1 and 2 of this letter) or any other material
written agreement or covenant with you related to your provision of services to
the Company. You will not resign for Good Reason without first providing the
Company with written notice of the acts or omissions constituting the grounds
for Good Reason within ninety (90) days of the initial existence of the grounds
for Good Reason and a reasonable cure period of not less than thirty (30) days
following the date of such notice (during which the grounds have not been
cured).

You acknowledge and agree that you will disclose to the Company any and all
agreements that may affect your eligibility to be employed by the Company or
limit the manner in which you may be employed. It is the Company’s understanding
that any such agreements will not prevent you from performing the duties of your
position and you represent that such is the case. Please notify the Company
immediately if this is not the case. Similarly, you agree not to bring any third
party confidential information to the Company, including that of any former
employer, and that in performing your duties for the Company you will not in any
way utilize any such information.

You agree that, during the term of your employment with the Company, you will
not, without the prior written consent of the Company, engage in any other
employment, occupation, consulting or other business activity directly related
to the business in which the Company is now involved or becomes involved during
the term of your employment.

As a Company employee, you will be expected to abide by the Company’s rules and
standards. Specifically, you will be required to sign an acknowledgment that you
have read and that you understand the Company’s rules of conduct and other
policies which are included or referenced in “The People Pact” (the Company’s
employee handbook), which the Company will provide to you. To the extent that
policies set forth in The People Pact conflict with those set forth in this
offer letter, the offer letter shall control.

You are also required to sign and comply with an At Will Employee Agreement, in
the form attached as Exhibit A hereto, which requires, among other provisions,
the assignment of patent rights to any invention made during your employment at
the Company, and non-disclosure of Company proprietary information. To the
extent that provisions set forth in the At Will Employee Agreement conflict with
those set forth in this offer letter, the offer letter shall control.

In the event of any dispute or claim relating to or arising out of our
employment relationship, you and the Company agree that (i) any and all disputes
between you and the Company shall be fully and finally resolved by binding
arbitration, (ii) both you and the Company are waiving and hereby waive any and
all rights to a jury trial but

 

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all court remedies will be available in arbitration, (iii) all disputes shall be
resolved by a neutral arbitrator acceptable to you and the Company who shall
issue a written opinion, and (iv) the Company shall pay all the arbitration
fees, except an amount equal to the filing fees you would have paid had you
filed a complaint in a court of law. Please note that we must receive your
signed At Will Employee Agreement by the Start Date or the terms and provisions
of this letter shall terminate.

The Company will recommend to the Board that you be deemed an “executive
officer” of the Company within the meaning of item 401(b) of Regulation S-K
under the Securities Act of 1933 and for purposes of Section 16 under the
Exchange Act. In such event, you will become subject to Section 16 of the
Exchange Act, including reporting requirements for transactions in the Company’s
equity securities. In order to enable the Company to assist you with fulfilling
such reporting requirements, you will be asked to sign and deliver the
Section 16 power of attorney attached hereto as Exhibit B. The Company will also
offer you the opportunity to enter into an indemnification agreement with the
Company for your benefit, on the Company’s standard form of indemnification
agreement for its directors and officers, as filed with the Securities and
Exchange Commission.

To accept the Company’s terms of employment described herein, please sign and
date this letter in the space provided below and return it to the Company by
September 25, 2015. This letter and the At Will Employee 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 Chief Executive
Officer of the Company and you.

We look forward to working with you at Juno Therapeutics, Inc.

 

Sincerely,

/s/ Hans Bishop

Hans Bishop Chief Executive Officer, Juno Therapeutics, Inc.

 

Agreed to and accepted: Signature: /s/ Robert Azelby                        
Printed Name: Robert Azelby Date: Sept 28, 2015

 

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