Exhibit 10.23

 

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April 24, 2015

 

Scott Salka

14778 El Rodeo Court

Rancho Santa Fe, CA 92067

 

Dear Scott:

 

We are pleased to confirm our offer of employment with Ampliphi Biosciences
Corporation (the “Company”), in the position of Chief Executive Officer.

 

Position. As Chief Executive Officer, you will be responsible for managing the
day to day operations and strategy of the Company and you will report directly
to the Board of Directors of the Company. In addition, you will be appointed to
the Board of Directors upon your commencement of employment. You agree to devote
your full business time and attention to your work for the Company. Except upon
the prior written consent of the Board of Directors, you will not, during your
employment with the Company, (i) accept or maintain any other employment, or
(ii) engage, directly or indirectly, in any other business activity (whether or
not pursued for pecuniary advantage) that might interfere with your duties and
responsibilities as a Company employee or create a conflict of interest with the
Company. However, the Company agrees that you may continue to serve in the
capacity of Chief Executive Officer of Aspyrian Therapeutics, Inc. (“Aspyrian”)
for a period of up to six (6) months from the date of this letter, provided that
you seek to wind-down such activities and such activities do not interfere with
your duties and responsibilities as a Company employee or create a conflict of
interest with the Company. In addition, the Company agrees that you can continue
to serve on the Board of Directors of Aspyrian so long as such activities do not
interfere with your duties and responsibilities as a Company employee or create
a conflict of interest with the Company.

 

Salary. Your initial base salary will be $425,000 per year, less applicable
withholdings. Your salary will be reviewed from time to time by the Board of
Directors or its compensation committee, and may be adjusted in the sole
discretion of the Board of Directors or its compensation committee.

 

Bonus. You will be eligible to earn an annual performance bonus based on
achievement of Company performance objectives to be established by the Board of
Directors or its compensation committee, which for 2015 will be substantially as
set forth in the Company’s communications to investors regarding plans for the
year, as previously provided to you. For 2015, your annual target performance
bonus will equal 40% of your base salary, although the amount of any payment
will be dependent upon actual performance as determined by the Board of
Directors or its compensation committee. You must be employed by the Company
through the date on which bonuses are paid in order to be eligible to receive a
bonus. In order to receive a 2015 bonus, you also must have terminated your
relationship with Aspyrian Therapeutics, Inc. in accordance with this letter
agreement, and your bonus for 2015 will be pro-rated for the partial year of
service.

 

 

US: 4870 Sadler Rd. Suite 300, Glen Allen, VA 23060

AU: Unit 7 27 Dale Street, Brookvale 2100 NSW

 

  

 

 

Scott Salka

Page 2 of 5

 

Equity Award. Promptly after the earlier of (i) the completion by the Company of
a reverse stock split that results in the Company having additional authorized
but unissued shares of Common Stock and (ii) an increase in the number
authorized but unissued shares of Common Stock, in either case, which results in
the number of authorized but unissued shares of Common Stock equaling or
exceeding the number of shares available for issuance under the Company’s 2013
Stock Incentive Plan (the “Plan”) at the time of such increase, the Board of
Directors will grant you an option to purchase a number of shares of Common
Stock of the Company equal to four percent (4%) of the then current fully
diluted number of shares of Common Stock (assuming conversion or exercise of all
outstanding convertible or exercisable securities, and including shares
available for issuance pursuant to the Plan). The exercise price of such option
will be the fair market value on the date of grant, as determined by the Board
of Directors. The options shall vest with respect to one-third of the total
number of shares on the date of achievement of each milestone or as otherwise
set forth on Exhibit A. Vesting will depend on your continued employment with
the Company on the date on which vesting would occur. If the milestones set
forth in (a) on Exhibit A do not occur by the date specified in such section,
the option shall terminate with respect to the shares that would have otherwise
vested on the attainment of such milestone. The option shall be subject to the
terms and conditions of the Plan and the option agreement to be entered between
you and the Company. The Company agrees that it will take such actions as are
reasonably required so that the conditions set forth in (i) or (ii) above are
satisfied.

 

Benefits: You will be eligible to participate in the benefits made generally
available by the Company to its senior executives, in accordance with the
benefit plans established by the Company, and as may be amended from time to
time in the Company’s sole discretion.

 

At-Will Employment; Severance: The Company is an “at-will” employer.
Accordingly, either you or the Company may terminate the employment relationship
at any time, with or without advance notice, and with or without cause. Upon any
termination of your employment, you will be deemed to have resigned, and you
hereby resign, from the Company’s Board of Directors and from all offices and
directorships then held with the Company or any subsidiary. In the event the
Company terminates your employment without Cause,1 or you terminate your
employment for Good Reason,2 you will be eligible to receive an amount equal to
twelve (12) months of your base salary, payable in the form of salary
continuation (“Severance Pay”). Your eligibility for this Severance Pay is
conditioned upon your execution of a release of claims in a form provided by the
Company (the “Release”) within forty-five (45) days following your termination
date and non-revocation of the Release during any applicable statutory
revocation period. If you comply with these conditions, the Severance payments
will commence on the sixtieth (60th) day following your termination date. In
order to be eligible for any Severance Pay, you also must have terminated your
relationship with Aspyrian Therapeutics, Inc. in accordance with this letter
agreement.

 

 

1 For purposes of this paragraph, “Cause” means (1) your gross negligence or
willful failure substantially to perform your duties and responsibilities to the
Company or deliberate violation of a Company policy; your commission of any act
of fraud, embezzlement or dishonesty against the Company or any other willful
misconduct that has caused or is reasonably expected to result in material
injury to the Company; your 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; or (iv) your willful breach of any of your obligations under any
written agreement or covenant with the Company, including without limitation
your obligation to cease serving as Chief Executive Officer of Aspyrian
Therapeutics, Inc. within six (6) months from the date of this letter, and that
such activities do not interfere with your duties and responsibilities as a
Company employee or create a conflict of interest with the Company.

2 For the purposes of this paragraph, “Good Reason” means the occurrence at any
time of any of the following without your prior written consent: (a) removal
from the position of Chief Executive Officer with respect to the Company
resulting in the material diminution in your authority, duties or
responsibilities (other than a mere change in title following any merger or
consolidation of the Company with another entity); (b) the assignment of duties
or responsibilities materially inconsistent with those customarily associated
with the position of Chief Executive Officer or a material diminution of your
position, authority, duties or responsibilities (other than a mere change in
title following any merger or consolidation of the Company with another entity);
(c) a material reduction in your overall compensation, including your base
salary and potential to earn incentive or equity compensation; or (d) any
willful failure or willful breach by the Company of any of the material
obligations of this Agreement. For purposes of this subsection, no act, or
failure to act, on the Company’s part shall be deemed “willful” unless done, or
omitted to be done, by the Company not in good faith and without reasonable
belief that the Company’s act, or failure to act, was in the best interest of
the Company. You may terminate your employment under this Agreement for Good
Reason at any time on or prior to the 180th day after the initial occurrence of
any of the foregoing Good Reason events; provided, however, that, within ninety
(90) days of any such events having first occurred, you shall have provided the
Company with notice that such event(s) have occurred and afforded the Company
thirty (30) days to cure same.

 

 

US: 4870 Sadler Rd. Suite 300, Glen Allen, VA 23060

AU: Unit 7 27 Dale Street, Brookvale 2100 NSW

 

  

 

 

Scott Salka

Page 3 of 5

 

Taxes: All amounts paid under this letter shall be paid less all applicable
state and federal tax withholdings (if any) and any other withholdings required
by any applicable jurisdiction or authorized by you. Notwithstanding any other
provision of this letter whatsoever, the Company, in its sole discretion, shall
have the right to provide for the application and effects of Section 409A of the
Code (relating to deferred compensation arrangernents) and any related
administrative guidance issued by the Internal Revenue Service. The Company
shall have the authority to delay the payment of any amounts under this
Agreement to the extent it deems necessary or appropriate to comply with Section
409A(a)(2)(B)(i) of the Code (relating to payments made to certain “key
employees” of publicly-traded companies); in such event, any such amount to
which you would otherwise be entitled during the six (6), month period
immediately following your termination of employment with the Company will be
paid in a lump sum on the date six (6) months and one (1) day following the date
of your termination of employment with the Company (or the next business day if
such date is not a business day), provided that you have complied with the
requirements for such payment. You shall be treated as having a termination of
employment under this Agreement only if such termination meets the requirements
of a “separation from service” as that term is defined in Section
409A(a)(2)(A)(i) of the Internal Revenue Code of 1986, as amended (the “Code”)
and Treas. Regs. Section l.409A-1(h), and as amplified by any other official
guidance. This Agreement is intended to comply with the provisions of Code
Section 409A; provided, however, that the Company makes no representation that
the amounts payable under this Agreement will comply with Code Section 409A and
makes no undertaking to prevent Code Section 409A from applying to amounts
payable under this Agreement or to mitigate its effects on any deferrals or
payments made under this Agreement.

 

Entire Agreement. Please let us know of your decision to join the Company by
signing a copy of this offer letter and returning it to us not later than May 1,
2015. This letter sets forth our entire agreement and understanding regarding
the terms of your employment with the Company and supersedes any prior
representations or agreements, whether written or oral. This letter may not be
modified in any way except in a writing signed by a duly authorized member of
the Company’s Board of Directors and you. It shall be governed by California
law, without regard to principles of conflicts of laws. Your employment is
contingent upon your execution of the Company’s Proprietary Information and
Invention Assignment Agreement.

 

 

US: 4870 Sadler Rd. Suite 300, Glen Allen, VA 23060

AU: Unit 7 27 Dale Street, Brookvale 2100 NSW

 

  

 

 

Scott Salka

Page 4 of 5

 

Sincerely,       /s/ Jeremy Curnock Cook   Jeremy Curnock Cook   Chairman of the
Board of Directors       ACCEPTED AND AGREED:       /s/ Scott Salka   Scott
Salka       28Apr15   Date  

 

 

US: 4870 Sadler Rd. Suite 300, Glen Allen, VA 23060

AU: Unit 7 27 Dale Street, Brookvale 2100 NSW

 

  

 

 

Scott Salka

Page 5 of 5

Exhibit A

 

Option Vesting Milestones

 

(a)The date on or before June 30, 2016, when the Company shall have secured at
least $20 million in capital after the start of your employment, either through
financings, licenses, grants or other means, to fund the Company’s operations
according to a plan approved by the Board of Directors into the second quarter
of 2018.

 

(b)The date on which the Company shall have completed one Phase 1 human clinical
trial of its phage products (delivery of final trial report) and had the first
patient dosing of a second human clinical trial, in the same or a different
indication, as determined by the Board of Directors.

 

(c)With respect to one-third of the total number of shares subject to your
option (the “Vesting Shares”), the option shall vest with respect to 25% of the
Vesting Shares on the one-year anniversary of the start of your employment with
the Company, and thereafter with respect to 1/48th of the total number of
Vesting Shares on each monthly anniversary of the start of your employment with
the Company.

 

 

US: 4870 Sadler Rd. Suite 300, Glen Allen, VA 23060

AU: Unit 7 27 Dale Street, Brookvale 2100 NSW