exv10w38





Exhibit 10.38



Genitope Corporation




Performance Incentive Plan




1. Introduction.




     The Genitope Corporation Performance Incentive Plan (the “Plan”) was established effective
April 1, 2008 (the “Effective Date”). The purpose of the Plan is to incentivize and reward key
employees of Genitope Corporation (the “Company”) for remaining employed with the Company and
achieving targeted business objectives critical to the preservation and maximization of the
Company’s value.



2. Benefits and Requirements.




     Employees invited by the Board of Directors or a member thereof to participate in the Plan
(“Eligible Employees”) will be eligible to receive incentive benefits on the terms set forth below.



     2.1 Notice Period/Objectives.



     On or prior to the Effective Date, Eligible Employees were given 60-days’ advance notice of
their termination of employment pursuant to the federal Worker Adjustment and Retraining
Notification Act (the “WARN Act”) and analogous state law provisions (the “Notice Period”).



     Shortly after the commencement of the Notice Period, each Eligible Employee will be issued
specific written performance objectives for such Eligible Employee to achieve during the Notice
Period (the “Objectives”). The Objectives include short-term tasks and other deliverables critical
to protecting the Company’s assets and maximizing its overall value to the creditors and
stockholders of the Company.



     2.2 Benefits.



     If an Eligible Employee achieves the Objectives during the longer of the Notice Period or the
period during which an Eligible Employee remains an employee of the Company (as determined by the
Board of Directors of the Company in its reasonable, good faith assessment), the Eligible Employee
shall receive, subject to Section 2.3 hereof, the following benefits (collectively, the “Incentive
Benefits”): (A) a lump sum payment equal to three (3) months of the Eligible Employee’s base
salary as of the Effective Date, less applicable payroll withholdings and deductions; and (B)
either (i) Company-paid COBRA premiums sufficient to maintain the employee’s current level of
health (i.e., medical, dental and vision) insurance coverage (including coverage for any covered
spouse, domestic partner or other dependent) for three (3) months after the employee’s employment
terminates (the “COBRA Premiums”) or (ii) if the Eligible Employee is not eligible for
COBRA coverage, or the Company’s election, a cash payment equal to the amount of the COBRA
Premiums, less applicable payroll withholdings and deductions (the “Additional Cash Payment”). To
receive the COBRA Premiums, in addition to all other requirements under the Plan, the Eligible
Employee must be enrolled in one or more of



 









 





the Company’s group health insurance plans as of the Effective Date and, after termination of
employment, must timely elect to continue such coverage pursuant to the governing COBRA laws.



     2.3 Release Requirement.



     As a precondition to receiving any Incentive Benefits, the Eligible Employee must sign a
release of claims in the substantially the form attached hereto as Exhibit A (the “Release
Agreement”) and allow the Release Agreement to become effective by its terms. All cash Incentive
Benefits will be paid to the Eligible Employee within three (3) business days after the Release
Agreement becomes effective (which shall be the eighth day after it is signed by the Eligible
Employee).



     2.4 Early Completion.



     Objectives are to be taken on aggressively and accomplished as soon as reasonably practicable.
To motivate Eligible Employees to do so, Incentive Benefits will become available to each Eligible
Employee promptly following a determination by the Board of Directors of the Company in its
reasonable, good faith assessment that such Eligible Employee has completed his/her Objectives.
Accordingly, if the Board of Directors determines that an Eligible Employee has achieved his/her
Objectives within the first 30 days of the Notice Period, the employee will be given the Release to
execute and will be paid the Incentive Benefits within three (3) business days after the Release
becomes effective. Thereafter, such Eligible Employee will receive only his/her base salary and
benefits (or pay in lieu thereof) for the remainder of the Notice Period (to the extent required by
the WARN Act and/or other applicable laws) or until such earlier date on which the employee elects
to resign his/her employment.



     To the extent not previously assessed, the Board of Directors will assess whether each
Eligible Employee has achieved his/her Objectives promptly following termination of the Notice
Period. If the Board of Directors determines that an Eligible Employee has achieved his/her
Objectives, the employee will be given the Release to execute and will be paid the Incentive
Benefits within three (3) business days after the Release becomes effective. Thereafter, such
Eligible Employee will receive only his/her base salary and benefits (or pay in lieu thereof) until
such date on which the employee elects to resign his/her employment or the employee’s employment is
terminated by the Company.



     If the Board of Directors determines that an Eligible Employee has not achieved his/her
Objectives during the Notice Period but such employee continues to be an employee of the Company
thereafter, the Board of Directors will assess whether such Eligible Employee has achieved his/her
Objectives no later than promptly following termination of his/her employment. If the Board of
Directors determines that the Eligible Employee has achieved his/her Objectives, the employee will
be given the Release to execute and will be paid the Incentive Benefits within three (3) business
days after the Release becomes effective.



3. Directors’ and Officers’ Liability Insurance.



     The Company will maintain directors’ and officers’ liability insurance or “tail” coverage at
coverage levels and on other terms that are reasonable in light of the Company’s



 









 





circumstances, as such coverage, levels and terms are determined by the Board of Directors of
the Company in its sole discretion.



4. No Other Bonus, Incentive or Severance Pay Entitlements.



     This Plan supersedes and replaces in their entirety all other plans, policies, programs,
practices or agreements made or maintained by the Company (in writing, orally or implied by a
course of conduct) relating to or concerning bonus, incentive or severance pay, including but not
limited to, the 2007 Genitope Corporation Annual Incentive Bonus Plan, and all individual
agreements, arrangements, plans, promises or representations, oral or written, concerning bonus,
incentive or severance pay. Each Eligible Employee participating in the Plan therefore
acknowledges and agrees that, as of the Effective Date: (a) he/she will not receive any bonus,
incentive, or severance pay from the Company other than as provided under this Plan; (b) he/she
has no bonus, incentive, or severance rights or entitlements other than those set forth in this
Plan; and (c) in the extent that an Eligible Employee had (or claims to have had) any pre-existing
promise or agreement with respect to the payment of bonus, incentive, or severance compensation,
all rights with respect to such claims, promises and agreements are waived in exchange for the
benefits available under the Plan; provided, however, that the foregoing acknowledgement and
agreement shall be void and of no effect in the event that the Company breaches or fails to perform
its obligations under this Plan with respect to such Eligible Employee and as provided in Section 5
below. For avoidance of doubt, nothing in this Plan shall override, modify or amend the Company’s
equity incentive plans.



5. Bankruptcy-Related Risks.




     As of the Effective Date, the Company faces serious business and financial challenges, which
could force the Company to file for bankruptcy protection at some time in the future. The Company
cannot predict what impact a bankruptcy filing would have on this Plan or on Eligible Employees’
rights to receive or retain Incentive Benefits provided hereunder. If a bankruptcy were filed,
Incentive Benefits payable under this Plan could be stopped and a bankruptcy estate representative
may attempt to recover amounts already paid. Accordingly, the Company cannot make any
representation, guarantee or warranty about the impact a bankruptcy filing would have on this Plan.
Eligible Employees should seek independent advice about such matters. An Eligible Employee’s
acknowledgement and agreement in Section 4 hereof shall be void and of no effect in the event that
the Company becomes subject to bankruptcy protection and, in connection therewith, fails to perform
its obligations under this Plan with respect to such Eligible Employee or Incentive Benefits paid
under this Plan are recovered by a bankruptcy estate representative.



6. Amendment.




     The Company reserves the right to amend or terminate this Plan or the benefits provided
hereunder at any time; provided, however, that no amendment that adversely impacts
an Eligible Employee’s rights or entitlements shall be effective unless agreed to in a writing
signed by the Eligible Employee.



7. No Implied Employment Contract.



 









 





     This Plan shall not be deemed (i) to give any employee the right to be retained in the employ
of the Company or (ii) to interfere with the right of the Company to discharge any employee at any
time, with or without cause.



8. Entire Agreement. 



     This Plan, together with Exhibit A and each Eligible Employee’s written Objectives
(collectively, the “Incentive Agreement”), constitutes the complete, final and exclusive embodiment
of the entire agreement between the Company and such Eligible Employee with respect to bonus,
incentive or severance pay or benefits, and the Incentive Agreement supersedes and replaces any
prior agreement, arrangement, plan, promise or representation, written or oral, regarding such
matters. This Plan will be construed, administered and enforced in accordance with the laws of the
State of California. If any provision of this Plan is determined to be invalid or unenforceable,
in whole or in part, this determination will not affect any other provision of this Agreement and
the provision in question will be modified so as to be rendered enforceable to the extent allowed
by law.



       This Plan will become effective as to an Eligible Employee upon delivery to the
Company of the Eligible Employee’s signature hereto on or prior to April 8, 2008.



	 	 	 	 	 
	 	Genitope Corporation

 	 
	 	By:  	/s/ Gregory Ennis
 	 
	 	 	 	 
	 	 	Title:  	Director 	 
	 


Acceptance:



I understand and agree to the terms set forth above.




	 	 	 	 
	Eligible Employee’s Name:

	 	 	 
	 	 	 	 
	Signature:

	 	 	 
	 	 	 	 
	Date:

	 	 	 





 









 





Exhibit A




RELEASE AGREEMENT




     I understand and agree completely to the terms set forth in the Genitope Corporation
Performance Incentive Benefit Plan (the “Plan”).



     I understand that this Release Agreement (the “Release”), together with the Plan, constitutes
the complete, final and exclusive embodiment of the entire agreement between Genitope Corporation
(the “Company”) and me with regard to the subject matter hereof. I am not relying on any promise
or representation by the Company that is not expressly stated therein. Certain capitalized terms
used in this Release are defined in the Plan.



     In exchange for the payment of Incentive Benefits in cash or available funds and other
consideration to be provided to me pursuant to the Plan, I hereby generally and completely release
the Company and its current and former directors, officers, employees, shareholders, partners,
agents, attorneys, predecessors, successors, parent and subsidiary entities, insurers, affiliates,
and assigns from any and all claims, liabilities and obligations, both known and unknown, that
arise out of or are in any way related to events, acts, conduct, or omissions occurring prior to my
signing this Release. This general release includes, but is not limited to: (a) all claims arising
out of or in any way related to my employment with the Company or the termination of that
employment; (b) all claims related to my compensation or benefits from the Company, including
claims for salary, bonuses, commissions, vacation pay, expense reimbursements, severance pay,
fringe benefits, stock, stock options, or any other ownership interests in the Company; (c) all
claims for breach of contract or and breach of the implied covenant of good faith and fair dealing;
(d) all tort claims, including claims for fraud, defamation, emotional distress, and discharge in
violation of public policy; and (e) all federal, state, and local statutory claims, including
claims for discrimination, harassment, retaliation, attorneys’ fees, or other claims arising under
the federal Civil Rights Act of 1964 (as amended), the federal Americans with Disabilities Act of
1990, and the federal Age Discrimination in Employment Act of 1967 (as amended) (“ADEA”).
Notwithstanding the foregoing, I am not releasing the Company hereby from any obligation to
indemnify me pursuant to the Certificate of Incorporation or Bylaws of the Company, any valid
indemnification agreement with the Company, applicable law or applicable directors’ and officers’
liability insurance. Also excluded from this Release are claims for salary, accrued and unused PTO
and expense reimbursements that become due and payable to me in the ordinary course of my
employment or the termination thereof after the execution of this Release. Further, nothing in
this Release shall prevent me from filing, cooperating with, or participating in any proceeding
before the Equal Employment Opportunity Commission, the Department of Labor, or any local fair
employment practices agency, except that I hereby acknowledge and agree that I shall not recover
any monetary benefits in connection with any such proceeding. I also acknowledge that, as of the
date I sign this Release, I have received all leaves of absence and leave benefits and protections
for which I am eligible, and have not suffered any on-the-job injury for which I have not already
filed a claim.




 









 





     I acknowledge that I am knowingly and voluntarily waiving and releasing any rights I may have
under the ADEA (“ADEA Waiver”). I also acknowledge that the consideration given for the ADEA
Waiver is in addition to anything of value to which I was already entitled. I further acknowledge
that I have been advised by this writing, as required by the ADEA, that: (a) my ADEA Waiver does
not apply to any rights or claims that arise after the date I sign this Release; (b) I should
consult with an attorney prior to signing this Release; (c) I have twenty-one (21) days to consider
this Release (although I may choose to voluntarily sign it sooner); (d) I have seven (7) days
following the date I sign this Release to revoke the ADEA Waiver; and (e) the ADEA Waiver will not
be effective until the date upon which the revocation period has expired unexercised, which will be
the eighth day after I sign this Release.



     I acknowledge that I have read and understand Section 1542 of the California Civil Code which
reads 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.” I hereby expressly waive
and relinquish all rights and benefits under that section and any law of any jurisdiction of
similar effect with respect to my release of any claims hereunder.



     I acknowledge that to become effective, I must sign and return this Release to the Company so
that it is received not later than twenty-one (21) days following the date it is provided to me.



	 	 	 	 
	 	Signature:

	 	 
	 	 	 	 
	 	Print Name:

	 	 
	 	 	 	 
	 	Date: