EXHIBIT
10.20


 


BIOMEDICINES


 


23 November 1999


 


 


PERSONAL AND CONFIDENTIAL


 


Curtis L. Scribner, M.D.


 


Dear Doctor Scribner:


 


On behalf of the Board of Directors of BioMedicines, Inc. (the “Company”),
I would like to offer you the position of Vice President Regulatory Affairs. In
this capacity you will report to me.


 


In your role as Vice President Regulatory Affairs, you will have
principal responsibility for planning and directing the regulatory activities
for all Company projects and for:


 


•           establishing
a regulatory affairs infrastructure that is both cost-effective and appropriate
to the Company’s needs at any given time


•           the hiring
and subsequent management of personnel in your group(s)


•           selecting
and managing external vendors for those projects whose regulatory aspects are
performed in whole or in part externally


•           evaluating
potential product acquisitions for the Company


•           participating
in partnering discussions, for in- or out-licensing


•           contributing
to safety management practices and activities for the Company


•           helping to
ensure compliance with good scientific practices in all areas for which you are
responsible or to which you may contribute


•           accurate
and timely budgetary planning and execution.


 


In your role as Vice President you will also be a member of the Company’s
Senior Management Team with joint responsibility for recommending Company
strategy to the Board as well as setting Company policies.


 


The Board has also directed me to indicate to you its particular desire
that you will contribute creatively, constructively and cordially to the
success of your colleagues and fellow members of the Senior Management Team. I
share this view regarding the importance of such cooperative activities and
would indicate that the Board also believes that all Company officers should be
evaluated on the basis of both individual and cooperative achievements. I think
that you will influence every aspect of developmental and commercial activities
for the Company. I believe that your contributions to your colleagues in
Development will be singularly influential.


 


This letter will serve to confirm the terms of your employment with BioMedicines,
such employment to begin on 17 January 2000 or earlier, by mutual agreement.
If the terms discussed below are acceptable to you, please sign this confirmation
letter where indicated and return it to me, retaining a copy for your records.


 


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1.             COMPENSATION.


 


(a)           SALARY,
PERFORMANCE BONUS EXPENSE REIMBURSEMENTS, SIGN-ON BONUS, MOVING ALLOWANCE AND
HOME LOAN. You will be paid a monthly salary of $16,250.00. You will be
eligible for a cash bonus of up to twenty percent (20%) of your annual base
pay. Changes in base pay or the payment of bonuses are made at the discretion
of the Board upon receipt of recommendations from the Compensation Committee.
Currently, salary payments are made twice a month. In addition, all reasonable
business expenses will be reimbursed so long as they are incurred in the
ordinary course of business and consistent with the then-applicable Company policies.


 


A one-time moving expense allowance of $20,000 will be paid. A one-time
sign-on bonus of $40,000 will also be paid if you respond favorably to this
offer within seven (7) days of receiving same. Should you not remain an
employee for at least 12 months, however, the sign-on bonus and moving expense
allowance must be repaid to the company prorata at the rate of 1/12th of the
total of $60,000 for each partial or full month of service less than 12 months.


 


The company will provide to you on a one-time basis a loan of up to one
hundred twenty-five thousand dollars ($125,000) with a term of one year and at
an interest rate of the prevailing rate for fixed-rate, first mortgages at the
time of the loan. Payments on the loan shall be due monthly. However, each
interest payment shall be forgiven when due subject to continued satisfactory
employment with the Company. In addition, in the event that the unpaid
principal balance shall not be otherwise due and payable at the end of the
first one-year term, then the loan may be extended for a second one-year period
subject, however, to continued satisfactory employment with the Company. The
loan shall be secured with a second mortgage on the property that you may
choose to acquire. Only the original first mortgage may be senior to this
second mortgage held by the Company, and the sum of the amount of the first
mortgage and the actual amount of the loan from the Company may not exceed the
purchase price of the property purchased using the loan from the Company. The
unpaid principal balance of this loan shall be due and payable


 


•           sixty (60)
days from the date that you sell your current residence;


•           sixty (60)
days from the date that you voluntarily cease to be a full-time employee of the
Company or are dismissed for cause;


•           upon the
sale of the property on which the second mortgage is held by the Company; or


•           in the
event that you declare personal bankruptcy.


 


Other terms and conditions typical for such loans may also apply.


 


(b)           STOCK
OPTIONS. It will be recommended that you receive an option to purchase up to
one hundred thirty thousand (130,000) shares of common stock, such number and
related purchase price to be formally approved by the Board of Directors at the
sole discretion of the Board.


 


It is anticipated that eighty thousand (80,000) shares of this grant,
if approved, will vest at the rate of approximately 2.083% per month (i.e., 25%
per year), subject to the condition that vesting


 


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for the first 12 months will occur only after you have satisfactorily
completed 12 months of employment (i.e., options on 20,000 shares will vest
only on the first anniversary of your employment). Thereafter, vesting will
occur monthly as noted above. Options on these eighty thousand shares shall be
identified as “time-based options.”


 


It is anticipated that up to fifty (50,000) thousand shares will become
eligible for vesting according to the following general schedule*:


 


•           substantive
contribution to a successful United States (U.S.) Investigational New Drug
Application (IND) filing defined as regulatory approval to begin clinical
testing - 5,000 shares


•           substantive
contribution to drug development such that the Board approves the initiation of
phase III testing in the United States - 5,000 shares


•           substantive
contribution to the acceptance of a U.S. New Drug Application (NDA) for filing
- 15,000 shares


•           substantive
contribution to the approval of a U.S. NDA - 20,000 shares


•           inventing
a new use for a product such that a new patent application is filed in the
United States and assigned to Company - 10,000 shares


•           co-inventing
with another Company employee a new use for a product such that a new patent
application is filed in the United States and assigned to Company - 5,000
shares


•           issuance
of a U.S. patent assigned to the Company and for which you are an inventor -
10,000 shares


•           for patent
applications or patents it is understood that such grants will apply only once
per invention


•           identifying
a new product licensing opportunity and then contributing substantially to the
inlicensing of said product into the Company’s portfolio - 25,000 shares


 


Options on these fifty thousand shares shall be identified as “event-based
options.”


 










* Upon achievement of the goals stated above, vesting shall be made
retroactive to the date of your initial full-time employment with the Company.


 


The strike price of both the time-based and event-based options shall
be $0.225 per share.


 


In the event that, outside the U.S., the equivalent of a U.S. IND is
filed, phase III testing begins, a marketing application is filed or approved,
then 50% of the number of shares identified above shall become eligible for
vesting with the remaining 50% becoming eligible when the related event occurs
in the U.S.


 


Other terms, or terms that become applicable after the date of this
letter, will appear either in the BioMedicines Stock Option Plan of which you
will receive a copy in the event you accept this offer or in a separate communication
to you from the Company.


 


Please note that in the event of a stock split or “reverse split” the
number of options and the option price may be adjusted.


 


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Subject to the sole discretion of the Board, you may also be eligible
to receive additional options from time to time during your continued
satisfactory employment with the Company. In this event, the number of options
and any conditions of the grant(s) shall be communicated to you.


 


(c)           HEALTH
BENEFITS. Health insurance coverage for you will be provided under the Company’s
group health plan. You will be entitled to all health and medical benefits as
are provided to other employees. In addition, you will be entitled to
participate in the Company’s 401k plan and all other sponsored employee benefit
plans as and when they are adopted by BioMedicines.


 


(d)           VACATION,
HOLIDAYS AND SICK LEAVE. You will receive three (3) weeks of paid vacation per
year as described in the Company’s Policy Manual. You are encouraged to plan
for and to take, under appropriate circumstances, the vacation time to which
you are entitled. Sick leave and holidays will be provided in accordance with
the Company’s policies, which will be announced from time to time.


 


2.             TERMINATION.
You or the Company may terminate the employment relationship at any time, for
any reason, with or without good cause.


 


3.             NON-COMPETE
REQUIREMENTS AND OUTSIDE ACTIVITIES. You agree that, while serving as an
employee of the Company, you will not engage in any activity which is
competitive with the Company and will give your sole and only loyalty to the Company.
It is understood that buying and selling of securities of any public company
does not constitute a violation of this agreement. An investment in a private
company other than, or not affiliated with, the Company may be construed as a
violation of this non-compete clause unless you have received the prior approval
of the Board of Directors or Chief Executive Officer of the Company, as appropriate.
It is understood that any reasonable obligations that you may have to assist or
cooperate with a previous employer in legal proceedings, in the issuance of
patents or prosecution of patent applications, or in compliance with requests
from governmental authorities do not constitute violations of this agreement,
provided that these obligations are not fulfilled on Company time and do not
adversely impact in a material way the performance of your current duties to
the Company.


 


4.             PROPRIETARY
INFORMATION AND INVENTIONS AGREEMENT. Your acceptance of this offer is
contingent upon the execution of the Company’s Proprietary Information and
Inventions Agreements, copies of which are enclosed for your review and execution.


 


5.             ARBITRATION. Any
controversy between the parties hereto involving the construction or
application of any terms, covenants or conditions of this Agreement, or any
claims arising out of or relating to this Agreement or the breach thereof or
with your employment with the Company or any termination of that employment,
except with respect to prejudgment remedies, will be submitted to and settled
by final and binding arbitration in San Francisco, California, in accordance
with the Model Employment Dispute Resolution Rules of the American Arbitration
Association (the “Rules”) then in effect, any arbitrator shall be selected
pursuant to such Rules


 


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and judgment upon the award rendered by the arbitrators may be entered
in any court having jurisdiction thereof.


 


Please note that the offer is conditional until proof of eligibility
for employment in California according to all applicable local, state, and
federal laws.


 


To accept this offer, please sign in the space below within seven (7)
days of the date of this offer, indicating your acceptance and agreement to the
terms contained herein. No amendment or modification of the terms of this
letter will be valid unless made in writing and signed by you and an authorized
officer of the Company.


 


On a personal note, I’ve enjoyed talking with you and believe that your
broad-based skills will significantly affect how we proceed day-to-day and long
term. I also believe that I will be able to turn to you for creative problem solving,
and I am particularly confident that your negotiating skills will help everyone.


 


It is my hope that you will accept this offer and take a leading role
in the management of BioMedicines.


 


 


	
   

  	
  Yours, sincerely

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Mark Moran, M.D.

  
	
   

  	
  Chief Executive Officer

  



 


Accepted by:


 


 


	
  /s/ Curtis L. Scribner

  	
   

  
	
  Curtis Scribner, M.D.

  
	
   

  
	
  November 26, 1999

  	
   

  
	
  Date

  



 


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PROPRIETARY INFORMATION AND
INVENTIONS AGREEMENT


 


23 November, 1999


 


BioMedicines, Inc.


1301 Marina Village Parkway Suite 200


Alameda, CA 94501


 


Gentlemen:


 


The Following confirms an agreement between me and BioMedicines, Inc.,
a Delaware corporation (the “Company,” which term includes the Company’s subsidiaries,
successors and assigns), which is a material part of the consideration for my
employment by the Company:


 


1.             “Proprietary
Information” is information that was or is developed by, became or becomes
known by, or was or is assigned or otherwise conveyed to the Company, and which
has commercial value in the Company’s business. Proprietary Information
includes, without limitation, trade secrets, financial information, product
plans, customer lists, marketing plans and strategies, forecasts and other
business information, improvements, inventions, business strategies, formulas,
product ideas, works of authorship, processes, copyrightable or patentable
material, schematics, biological material (including cell lines, antibodies,
c-DNAs, antisense nucleotides, proteins, vectors, new chemical entities, media,
reagents and related materials) and techniques for their handling and use,
computer programs, algorithms, techniques, schematics, know-how and data, and
any other confidential or proprietary information of the Company or its
customers or clients which I have been, or may be exposed to, or have learned or
may learn of from time to time in connection with or as a result of my capacity
as a consultant to the Company or during the term of this Agreement.
Proprietary Information shall not include information that is through no
improper action or inaction by me, generally available to the public. I understand
that my employment creates a relationship of confidence and trust between me
and the Company with respect to Proprietary Information of the Company or its
customers which may be learned by me during the period of my employment.


 


2.             In consideration of
my employment by the Company and the compensation received by me from the
Company from time to time, I hereby agree as follows:


 


(a)           All
Proprietary Information and all patents, copyrights, trade secret rights, and
other rights (including throughout, without limitation, any extensions,
renewals, continuations or divisions of any of the foregoing) in connection
therewith shall be the sole property of the Company. I hereby assign to the
Company any rights I may have or acquire in such Proprietary Information. At
all times, both during my employment by the Company and after its termination,
I will keep in confidence and trust and will not use or disclose any
Proprietary Information or anything relating to it without the written consent
of the Company, except as may be necessary in the ordinary course of performing
my duties to the Company.


 


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(b)           In
the event of the termination of my employment by me or by the Company for any
reason, I shall return all documents, records, apparatus, equipment and other
physical property, or any reproduction of such property, whether or not
pertaining to Proprietary Information, furnished to me by the Company or
produced by myself or others in connection with my employment, to the Company
immediately as and when requested by the Company.


 


(c)           I
will promptly disclose to the Company, or any persons designated by it, all “Inventions,”
which includes all improvements, inventions, formulas, ideas, works of
authorship, processes, computer programs, algorithms, techniques, schematics,
know-how and data, whether or not patentable, made or conceived or reduced to
practice or developed by me, either alone or jointly with others, during the
term of my employment and for three (3) months thereafter. To the extent the
Company does not have rights therein hereunder, such disclosure shall be
received by the Company in confidence and does not extend the assignment made
in Section (e) below.


 


(d)           During
the term of my employment and for one (1) year thereafter, I will not encourage
or solicit any employee of the Company to leave the Company for any reason or
to devote less than all of any such employee’s efforts to the affairs of the
Company, provided that the foregoing shall not affect any responsibility I may
have as an employee of the Company with respect to the bona fide hiring and
firing of Company personnel.


 


(e)           I
agree that all Inventions which I make, conceive, reduce to practice or develop
(in whole or in part, either alone or jointly with others) during my employment
shall be the sole property of the Company to the maximum extent permitted by Section 2870
of the California Labor Code, a copy of which is attached herewith, and to the
extent permitted by law shall be “works made for hire.” The Company shall be
the sole owner of all patents, copyrights, trade secret rights, and other
intellectual property or other rights in connection therewith. I hereby assign
to the Company any rights I may have or acquire in such Inventions. I agree to
perform, during and after my employment, all acts deemed necessary or desirable
by the Company to permit and assist it, at the Company’s expense, in obtaining
and enforcing patents, copyrights, trade secret rights or other rights on such
Inventions and/or any other Inventions I have or may at any time assign to the
Company in any and all countries. Such acts may include, but are not limited
to, execution of documents and assistance or cooperation in legal proceedings.
With respect to any and all matters arising out of or relating to my employment
or consultancy with the Company, I hereby irrevocably designate and appoint the
Company and its duly authorized officers and agents, as my agents and
attorneys-in-fact to act for and in my behalf and instead of me, to execute and
file any applications or related filings and to do all other lawfully permitted
acts to further the prosecution and issuance of patents, copyrights, trade
secret rights or other rights thereon with the same legal force and effect as
if executed by me.


 


(f)            I
attach hereto a complete list of all Inventions or improvements to which I
claim ownership and/or that I desire to remove from the operation of this
Agreement, and I covenant that such list is complete. If no such list is attached
to this Agreement, I represent that I have no such Inventions and improvements
at the time of signing this Agreement. I understand that any such list shall
not contain information that breaches an obligation of confidentiality with a
former employer.


 


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(g)           I
represent that my performance of all the terms of this Agreement will not
breach any agreement or obligation to keep in confidence proprietary information
acquired by me in confidence or in trust prior to my employment by the Company.
I have not entered into, and I agree I will not enter into, any agreement
either written or oral in conflict herewith or in conflict with my employment
with the Company.


 


3.             In consideration of
the foregoing, the Company agrees that it will not request as part of my
employment that I divulge or make use of confidential information of any of my
former employers that has commercial value to the former employer who developed
such information.


 


4.             This Agreement shall
be effective as of the first day of my employment by the Company, and shall be
binding upon me, my heirs, executors, assigns, and administrators and shall
inure to the benefit of the Company, its subsidiaries, successors and assigns.


 


 


Accepted and Agreed to:


 


 


	
  Dated: 

  	
  November 25, 1999

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ Curtis L. Scribner

  	
   

  	
  By:

  	
   /s/
  Mark Moran

  	
   

  
	
  Curtis Scribner, M.D.

  	
   

  	
  Mark Moran, M.D.

  
	
   

  	
   

  	
  Chief Executive Officer

  
	
   

  	
   

  	
  BioMedicines, Inc.

  



 


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EXHIBIT A


 


1.             The following is a
complete list of all inventions or improvements relevant to the subject matter
of my employment by BioMedicines, Inc. (the “Company”) that have been made or
conceived or first reduced to practice by me alone or jointly with others prior
to my employment by the Company that I desire to remove from the operation of
the Company’s Proprietary Information and Inventions Agreement.


 


ý            No
inventions or improvements.


 


2.             I propose to bring to
my employment the following materials and documents of a former employer:


 


ý            No
materials or documents.


 


 


	
  /s/ Curtis L. Scribner

  	
   

  
	
  Curtis Scribner, M.D.

  



 


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EXHIBIT B


 


SECTION 2870. APPLICATION OF PROVISION PROVIDING THAT EMPLOYEE
SHALL ASSIGN OR OFFER TO ASSIGN RIGHTS IN INVENTION TO EMPLOYER.


 


(a)           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.


 


(2)           Result
from any work performed by the employee for the employer.


 


(b)           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
subdivision (a), the provision is against the public policy of this state and
is unenforceable.


 


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