Exhibit 10.30


 


May 14, 2009


 


Darren J.
Milliken


12989
Del Valle Court


Los
Altos Hills, CA 94022


 


Re: EMPLOYMENT TERMS


 


Dear
Darren,


 


Accuray
Incorporated (the “Company”) is
pleased to extend this offer of employment as the Senior Vice
President, General Counsel and Corporate Secretary on the terms and
conditions set forth in this letter (the “Agreement”),
effective as of May 6, 2009 (the “Effective
Date”).


 


1.                         TERM.  The employment relationship between you and
the Company will be at-will.  You and the
Company will have the right to terminate the employment relationship at any
time and for any reason whatsoever, with or without cause, and without any
liability or obligation except as may be expressly provided herein.


 


The
term of this agreement (the “Term”) shall be
two (2) years, measured from the Effective Date. Upon the expiration of
this Agreement the provisions contained herein, with the exception of Change of
Control provisions, shall have no further force or effect and your employment,
if extended at the sole discretion of the Company, will continue to be at-will
and any terms associated with such employment shall be embodied in a written
employment agreement signed by both parties.


 


The
term of the Change of Control provisions provided for in this Agreement (the “Change of Control Term”) shall be three (3) years,
measured from the Effective Date; however should the Company and employee enter
into a new agreement after the Term expires the Change of Control provisions
shall also automatically terminate and be superseded by the terms in such new
agreement.


 


2.                         POSITION,
DUTIES AND RESPONSIBILITIES.  During the Term of this Agreement, the
Company will employ you, and you agree to be employed by the Company, as the
Senior Vice President, General Counsel and Corporate Compliance Officer.  In this capacity you will have such duties
and responsibilities as are normally associated with such position and will
devote your full business time and attention to serving the Company in such
position.  Your duties may be changed
from time to time by the Company, consistent with your position.  You will report to the Chief Executive Officer of the Company, and
will work full-time at our principal offices located at 1310 Chesapeake
Terrace, Sunnyvale, California 94089 (or any other location the Company may
utilize as its principal offices), except for travel to other locations as may
be necessary to fulfill your responsibilities.


 


	
  EXECUTIVE
  EMPLOYMENT AGREEMENT –STD 11.26.08

  	
  ACCURAY CONFIDENTIAL

  
	
  DARREN
  J. MILLIKEN – 05.14.09

  	
   

  



 


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3.                         BASE
COMPENSATION.  During the
Term, the Company will pay you a base salary of two
hundred thirty five thousand dollars ($235,000)
per year, less payroll deductions and all required withholdings, payable in
accordance with the Company’s normal payroll practices and prorated for any
partial month of employment.  Your base
salary may be subject to increase pursuant to the Company’s policies as in
effect from time to time.


 


4.                         ANNUAL
BONUS.  In addition to the base salary
set forth above, during the Term, you will be eligible to participate in the
Company’s executive bonus plan applicable to similarly situated executives of
the Company.  The amount of your annual
bonus will be based on the attainment of performance criteria established and
evaluated by the Company in accordance with the terms of such bonus plan as in
effect from time to time, provided that, subject to the terms of such bonus
plan, your target (but not necessarily maximum) annual bonus shall be fifty percent (50%) of your base salary
actually paid for such year.


 


In
accordance with the terms of such bonus plan, payment of each bonus shall be
made in a single lump-sum cash payment not later than the last day of the
applicable two and one-half (2 1⁄2) month short-term deferral period with respect
to such bonus payment, within the meaning of Treasury Regulation Section 1.409A-1(b)(4).


 


5.                         STOCK OPTIONS.  As an added incentive, we will recommend to
the Compensation Committee of the Board of Directors that you be granted an
option (the “Option”) to purchase twenty-five
thousand (25,000) shares of Accuray common stock
at a per share exercise price equal to the fair market value of a share of our
common stock on the date of the grant, as determined in accordance with the
Accuray Incorporated 2007 Incentive Award Plan (the “Incentive
Plan”).   The grant of the
Option is subject to and conditioned on approval of the grant and its terms by
the Compensation Committee, and will be made as soon as practicable following
the Effective Date.  Subject to your
continued employment with the Company, the Option shall vest and become
exercisable over a four (4) year period, with 1/48th of the shares subject
thereto vesting in equal monthly installments on each monthly anniversary of
the date of grant. The Option will be subject to the terms and conditions of
the Incentive Plan and a stock option agreement in a form prescribed by
Accuray, which you will be required to sign as a condition to receiving the
Option (the “Option Agreement”).


 


6.                         BENEFITS
AND PAID TIME OFF.  During the
Term, you will be eligible to participate in all incentive, savings and
retirement plans, practices, policies and programs maintained or sponsored by
the Company from time to time which are applicable to other similarly situated
executives of the Company, subject to the terms and conditions thereof.  During the Term, you will also be eligible
for standard benefits, such as medical, vision and dental insurance, paid time
off, and holidays to the extent applicable generally to other similarly
situated executives of the Company, subject to the terms and conditions of the
applicable Company plans or policies. 
The benefits described in this Section 6 will be subject to change
from time to time as deemed appropriate and necessary by the Company.


 


7.                        TERMINATION
OF EMPLOYMENT.


 


(a)              If prior to the
termination of this Agreement, you incur a “separation from service” (within
the meaning of Section 409A(a)(2)(A)(i) of the Internal Revenue Code
of 1986, as amended (the “Code”), and
Treasury Regulation Section 1.409A-1(h)) (“Separation
from Service”) by reason of (i) a termination of your
employment by the Company other than for Cause (as defined below), death or
disability, or (ii) a termination of your employment by you for Good
Reason (as defined below), and provided that you execute a general release of
claims in a form


 


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prescribed
by the Company (the “Release”)
within twenty-one (21) days (or, if required by applicable law, forty-five (45)
days) after the date of such Separation from Service (the “Separation
Date”) and you do not revoke such Release, and further subject to Section 16(b) below,
then, in addition to any other accrued amounts payable to you through the
Separation Date (including any earned but unpaid bonus), (1) the Company
will, no later than thirty (30) days after the Separation Date, pay you a
lump-sum severance payment (the “Severance Payment”)
in an amount equal to six (6) months of your annual base salary as in
effect immediately prior to the Separation Date, additionally provided that you
properly elect COBRA continuation coverage, the Company will pay the COBRA
premium for health care coverage for you and your partner and children, as applicable
and to the extent eligible (the “Severance Benefits”),
for the six (6) month period immediately following the Separation Date,
but in no event longer than the period of time during which you would be
entitled to continuation coverage under Section 4980B of the Code absent
this provision.  The Company will also
provide you with outplacement assistance in accordance with its then current
policies and practices with respect to outplacement assistance for other similarly
situated executives of the Company.


 


(b)             If a Change in
Control (as defined in Exhibit A hereto) occurs during the Change
of Control Term and, within the twelve (12) month period immediately following
the effective date of the Change in Control, you incur a Separation from
Service by reason of (i) a termination of your employment by the Company
other than for Cause, death or disability, or (ii) a termination of your
employment by you for Good Reason, then, subject to Section 16(b) below,
and provided that you execute a general release of claims in a form prescribed
by the Company (the “Release”)
within twenty-one (21) days (or, if required by applicable law, forty-five (45)
days) after the date of such Separation from Service (the “Separation
Date”) and you do not revoke such Release, and further subject to Section 16(b) below,
then, in addition to any other accrued amounts payable to you through the
Separation Date (including any earned but unpaid bonus), (1) the Company
will, no later than thirty (30) days after the Separation Date, pay you a
lump-sum severance payment (the “Severance Payment”)
in an amount equal to the sum of (x) twenty-four (24) months of your
annual base salary as in effect immediately prior to the Separation Date plus (y) 100%
of your target annual bonus for the fiscal year of the Company in which such
Separation from Service occurs, and (2) provided that you properly elect
COBRA continuation coverage, the Company will pay the COBRA premium for health
care coverage for you and your spouse and children, as applicable and to the
extent eligible (the “Severance Benefits”),
for the twenty-four (24) month period immediately following the Separation
Date, but in no event longer than the period of time during which you would be
entitled to continuation coverage under Section 4980B of the Code absent
this provision.  In addition to the
amounts payable to you pursuant to this paragraph (b) of this Section 7,
each of your then outstanding options to purchase shares of the Company’s
common stock shall become fully vested and exercisable immediately prior to the
Separation Date.  The Company will also
provide you with outplacement assistance in accordance with its then current
policies and practices with respect to outplacement assistance for other
similarly situated executives of the Company. 
For clarity, under Change of Control this paragraph (b) shall be in
lieu of any similar payments or benefits described above in paragraph (a) of
this Section 7.


 


(c)              Notwithstanding the
foregoing, your right to receive the payments and benefits set forth in this Section 7
is conditioned on and subject to your execution and non-revocation of the
Release. In no event shall you or your estate or beneficiaries be entitled to
any of the payments or benefits set forth in this Section 7 upon any
termination of your employment by reason of your total and permanent disability
or your death.


 


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(d)             For purposes of this letter:


 


i)             “Cause” shall mean (i) your commission of a felony, (ii) your
commission of a crime involving moral turpitude or your commission of any other
act or omission involving dishonesty, disloyalty, breach of fiduciary duty or
fraud with respect to the Company or any of its subsidiaries or any of their
customers or suppliers, or (iii) your failure to perform the normal and
customary duties of your position with the Company as reasonably directed by
the Company, provided, that any of the acts or omissions described in the
foregoing clauses (i), (ii) or (iii) are not cured to the Company’s
reasonable satisfaction within thirty (30) days after written notice thereof is
given to you; and


 


ii)          “Good Reason”
shall mean the occurrence of any one or more of the following events without
your prior written consent:  (i) a
material diminution by the Company of your duties and responsibilities
hereunder; (ii) a material change in the geographic location at which you
must perform services under this letter, provided that in no event will a
change to a location within a 35 mile radius of the Company’s Sunnyvale
corporate headquarters be deemed material for purposes of this clause; or (iii) a
material diminution by the Company of your annual base salary, each as in
effect on the date hereof or as the same may be increased from time to time;
provided, however, that a termination of your employment by you shall only
constitute a termination for “Good Reason” hereunder if (a) you provide
the Company with written notice setting forth the specific facts or
circumstances constituting Good Reason within thirty (30) days after the
initial existence of such facts or circumstances, (b) the Company has
failed to cure such facts or circumstances within thirty (30) days after
receipt of such written notice, and (c) the Separation Date occurs no
later than seventy-five (75) days after the initial occurrence of the event
constituting Good Reason.


 


8.                         CODE SECTION 280G.


 


(a)              In the event it shall be
determined that any payment or distribution to you or for your benefit which is
in the nature of compensation and is contingent on a change in the ownership or
effective control of the Company or the ownership of a substantial portion of
the assets of the Company (within the meaning of Section 280G(b)(2) of
the Code), whether paid or payable pursuant to this letter or otherwise (a “Payment”), would constitute a “parachute
payment” under Section 280G(b)(2) of the Code and would be subject to
the excise tax imposed by Section 4999 of the Code (together with any
interest or penalties imposed with respect to such excise tax, the “Excise Tax”), then the Payments shall be
reduced to the extent necessary so that no portion thereof shall be subject to
the excise tax imposed by Section 4999 of the Code but only if, by reason
of such reduction, the net after-tax benefit received by you shall exceed the
net after-tax benefit received by you if no such reduction was made. The
specific Payments that shall be reduced and the order of such reduction shall
be determined so as to achieve the most favorable economic benefit to you, and
to the extent economically equivalent, the Payments shall be reduced pro rata,
all as determined by the Company in its sole discretion. For purposes of this Section 8(a),
“net after-tax benefit” shall mean (i) the Payments which you receive or
are then entitled to receive from the Company that would constitute “parachute
payments” within the meaning of Section 280G of the Code, less (ii) the
amount of all federal, state and local income taxes payable with respect to the
Payments calculated at the maximum marginal income tax rate for each year in
which the Payments shall be paid to you (based on the rate in effect for such
year as set forth in the Code as in effect at the time of the first payment of
the foregoing), less (iii) the amount of Excise Taxes imposed with respect
to the Payments.


 


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(b)             All determinations required
to be made under this Section 8 shall be made by such nationally
recognized accounting firm as may be selected by the Audit Committee of the
Board of Directors of the Company as constituted immediately prior to the
change in control transaction (the “Accounting
Firm”), provided,
that the Accounting Firm’s determination shall be made based upon “substantial
authority” within the meaning of Section 6662 of the Code.  The Accounting Firm shall provide its
determination, together with detailed supporting calculations and
documentation, to you and the Company within 15 business days following the
date of termination of your employment, if applicable, or such other time as
requested by you (provided that you reasonably believe that any of the Payments
may be subject to the Excise Tax) or the Company.  All fees and expenses of the Accounting Firm
shall be borne solely by the Company.


 


9.                         RESTRICTIVE
COVENANTS.


 


(a)              As a condition of your
employment with the Company, you agree that during the Term and thereafter, you
will not directly or indirectly disclose or appropriate to your own use, or the
use of any third party, any trade secret or confidential information concerning
the Company or its subsidiaries or affiliates (collectively, the “Company Group”) or their businesses,
whether or not developed by you, except as it is required in connection with
your services rendered for the Company. 
You further agree that, upon termination of your employment, you will
not receive or remove from the files or offices of the Company Group any
originals or copies of documents or other materials maintained in the ordinary
course of business of the Company Group, and that you will return any such
documents or materials otherwise in your possession.  You further agree that, upon termination of
your employment, you will maintain in strict confidence the projects in which
any member of the Company Group is involved or contemplating.


 


(b)             You further
agree that during the Term and continuing
through the first anniversary of the date of termination of your employment,
you will not directly or indirectly solicit, induce, or encourage any employee,
consultant, agent, customer, vendor, or other parties doing business with any
member of the Company Group to terminate their employment, agency, or other
relationship with the Company Group or such member or to render services for or
transfer their business from the Company Group or such member and you will not
initiate discussion with any such person for any such purpose or authorize or
knowingly cooperate with the taking of any such actions by any other individual
or entity.


 


(c)              While employed
by the Company, you agree that you will not engage in any business activity in
competition with any member of the Company Group nor make preparations to do
so.


 


(d)             Upon the
termination of your relationship with the Company, you agree that you will
promptly return to the Company, and will not take with you or use, all items of
any nature that belong to the Company, and all materials (in any form, format,
or medium) containing or relating to the Company’s business.


 


(e)              In recognition of the facts
that irreparable injury will result to the Company in the event of a breach by
you of your obligations under Sections 9(a), (b), (c) or (d) above,
that monetary damages for such breach would not be readily calculable, and that
the Company would not have an adequate remedy at law therefore, you
acknowledge, consent and agree that in the event of such breach, or the threat
thereof, the Company shall be entitled, in addition to any other legal remedies
and damages available, to specific performance thereof and to temporary


 


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and permanent injunctive relief (without the necessity of posting a
bond) to restrain the violation or threatened violation of such obligations by
you.


 


10.                   COMPANY
RULES AND REGULATIONS.  As
an employee of the Company, you agree to abide by Company policies, procedures,
rules and regulations as set forth in the Company’s Employee Handbook,
Code of Conduct and Ethics, or as otherwise promulgated.  In addition, as a condition of your
employment, you will be required to complete, sign, return, and abide by the
Employee Confidentiality and Inventions Agreement.


 


11.                   WITHHOLDING.  The Company may withhold from any amounts
payable under this letter such federal, state, local or foreign taxes as shall
be required to be withheld pursuant to any applicable law or regulation.


 


12.                   ARBITRATION.  Except as set forth in Section 9(e) above,
any disagreement, dispute, controversy or claim arising out of or relating to
this letter or the interpretation of this letter or any arrangements relating
to this letter or contemplated in this letter or the breach, termination or
invalidity thereof shall be settled by final and binding arbitration
administered by JAMS/Endispute in Santa Clara County, California in accordance
with the then existing JAMS/Endispute Arbitration Rules and Procedures for
Employment Disputes.  Except as provided
herein, the Federal Arbitration Act shall govern the interpretation,
enforcement and all proceedings.  The
arbitrator shall apply the substantive law (and the law of remedies, if
applicable) of the state of California, or federal law, or both, as applicable,
and the arbitrator is without jurisdiction to apply any different substantive
law.  The arbitrator shall have the
authority to entertain a motion to dismiss and/or a motion for summary judgment
by any party and shall apply the standards governing such motions under the
Federal Rules of Civil Procedure. 
Judgment upon the award may be entered in any court having jurisdiction
thereof.  Each party shall pay his or its
own attorneys’ fees and expenses associated with such arbitration to the extent
permitted by applicable law.


 


13.                   ENTIRE
AGREEMENT.  As of the
Effective Date, this letter constitutes the final, complete and exclusive
agreement between you and the Company with respect to the subject matter hereof
and replaces and supersedes any and all other agreements, offers or promises,
whether oral or written, made to you by any member of the Company Group.


 


14.                   SEVERABILITY.  Whenever possible, each provision of this
letter will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this letter is held to be invalid,
illegal or unenforceable in any respect under any applicable law or rule in
any jurisdiction, such invalidity, illegality or unenforceability will not
affect any other provision of this letter, but such invalid, illegal or
unenforceable provision will be reformed, construed and enforced so as to
render it valid, legal, and enforceable consistent with the intent of the
parties insofar as possible.


 


15.                   ACKNOWLEDGEMENT.  You
hereby acknowledge (a) that you have consulted with or have had the
opportunity to consult with independent counsel of your own choice concerning
this letter, and have been advised to do so by the Company, and (b) that
you have read and understand this letter, are fully aware of its legal effect,
and have entered into it freely based on your own judgment.


 


16.                   SECTION 409A OF THE CODE.


 


(a)              The compensation and
benefits payable under this letter are not intended to constitute “nonqualified
deferred compensation” within the meaning of Section 409A of the
Code.  Notwithstanding any provision of
this letter to the contrary, in the event that the Company determines that any
payments or benefits payable hereunder may be subject to Section 409A of


 


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the Code, the Company may (without any obligation to do so or to
indemnify you for failure to do so) adopt such amendments to this letter or
take any other actions that the Company determines are necessary or appropriate
to (a) exempt such payments and benefits from Section 409A of the
Code in order to preserve the intended tax treatment of such payments or
benefits, or (b) comply with the requirements of Section 409A of the
Code and thereby avoid the application of penalty taxes thereunder.  To the extent that any payments or benefits
under this letter are deemed to be subject to Section 409A of the Code,
this letter will be interpreted in accordance with Section 409A of the
Code and Department of Treasury Regulations and other interpretive guidance
issued thereunder.


 


(b)             Notwithstanding anything to
the contrary in this letter, no compensation or benefits, including without
limitation any severance payments or benefits payable under Section 7
above, shall be paid to you during the six (6)-month period following your
Separation from Service to the extent that paying such amounts at the time or
times indicated in this letter would result in a prohibited distribution under Section 409A(a)(2)(b)(i) of
the Code.  If the payment of any such
amounts is delayed as a result of the previous sentence, then on the first
business day following the end of such six (6)-month period (or such earlier date upon which such amount can be
paid under Section 409A of the Code without resulting in a prohibited
distribution, including as a result of your death), the Company shall pay you a lump-sum amount equal to the
cumulative amount that would have otherwise been payable to you during such
six-month period.


 


(c)              To the extent that any
reimbursements or corresponding in-kind benefits provided to you under this
letter are deemed to constitute compensation to you, such amounts will be paid
or reimbursed reasonably promptly, but not later than December 31 of the
year following the year in which the expense was incurred.  The amount of any such payments or expense
reimbursements in one year will not affect the expenses or in-kind benefits
eligible for payment or reimbursement in any other taxable year, and your right
to such payments or reimbursement of any such expenses will not be subject to
liquidation or exchange for any other benefit.


 


[SIGNATURE PAGE FOLLOWS]


 


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Please
confirm your agreement to the foregoing by signing and dating the enclosed
duplicate original of this letter in the space provided below for your
signature and returning it to us in the enclosed, self-addressed stamped
envelope.  Please retain one
fully-executed original for your files.


 


 


	
   

  	
  Sincerely,

  
	
   

  	
   

  
	
   

  	
  ACCURAY INCORPORATED,

  
	
   

  	
  a
  Delaware Corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Euan S. Thomson, Ph.D

  
	
   

  	
  Name:

  	
  Euan
  Thomson, Ph.D.

  
	
   

  	
  Title:

  	
  President &
  Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
  Accepted
  and Agreed,

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/
  Darren J. Milliken

  	
   

  	
   

  
	
  Name:

  	
  Darren
  J. Milliken

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Date:

  	
  5/18/09

  	
   

  	
   

  



 


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EXHIBIT
A


 


For purposes of this letter,
“Change in Control” means and includes
each of the following:


 


(a)                            A transaction
or series of transactions (other than an offering of the Company’s common stock
to the general public through a registration statement filed with the
Securities and Exchange Commission) whereby any “person” or related “group” of “persons”
(as such terms are used in Sections 13(d) and 14(d)(2) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”))
(other than the Company, any of its subsidiaries, an employee benefit plan
maintained by the Company or any of its subsidiaries or a “person” that, prior
to such transaction, directly or indirectly controls, is controlled by, or is
under common control with, the Company) directly or indirectly acquires
beneficial ownership (within the meaning of Rule 13d-3 under the Exchange
Act) of securities of the Company possessing more than 50% of the total
combined voting power of the Company’s securities outstanding immediately after
such acquisition; or


 


(b)                           During any
period of two consecutive years, individuals who, at the beginning of such
period, constitute the Board together with any new director(s) (other than
a director designated by a person who shall have entered into an agreement with
the Company to effect a transaction described in clause (a) or clause (c) hereof)
whose election by the Board or nomination for election by the Company’s
stockholders was approved by a vote of at least two-thirds of the directors
then still in office who either were directors at the beginning of the two-year
period or whose election or nomination for election was previously so approved,
cease for any reason to constitute a majority thereof; or


 


(c)                            The
consummation by the Company (whether directly involving the Company or
indirectly involving the Company through one or more intermediaries) of (x) a
merger, consolidation, reorganization, or business combination or (y) a
sale or other disposition of all or substantially all of the Company’s assets
in any single transaction or series of related transactions or (z) the
acquisition of assets or stock of another entity, in each case other than a
transaction:


 


(i)                                     Which results
in the Company’s voting securities outstanding immediately before the
transaction continuing to represent (either by remaining outstanding or by
being converted into voting securities of the Company or the person that, as a
result of the transaction, controls, directly or indirectly, the Company or
owns, directly or indirectly, all or substantially all of the Company’s assets
or otherwise succeeds to the business of the Company (the Company or such
person, the “Successor Entity”)) directly or
indirectly, at least a majority of the combined voting power of the Successor
Entity’s outstanding voting securities immediately after the transaction, and


 


(ii)                                  After which no
person or group beneficially owns voting securities representing 50% or more of
the combined voting power of the Successor Entity; provided, however, that no person or group shall be treated for
purposes of this clause (c)(ii) as beneficially owning 50% or more of
combined voting power of the Successor Entity solely as a result of the voting
power held in the Company prior to the consummation of the transaction; or


 


(d)                                 The Company’s
stockholders approve a liquidation or dissolution of the Company.


 


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