James Pennington Employment Offer Letter




			
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	 	EXHIBIT 10.15

  

			
	 February 1, 2004
	 	[GRAPHIC]

  
 James Pennington, MD 
 4 Toledo Drive 
 Lafayette, CA 94549 
  
 Dear Jim, 
  
 CoTherix, Inc. (the “Company”) is pleased to offer you employment on the following terms: 
  
 1. Position. Your initial title will be Executive Vice President,
Chief Medical Officer, and you will initially report to the Company’s Chairman & CEO. This is a full-time position. By signing this letter agreement, you confirm to the Company that you have no contractual commitments or other legal
obligations that would prohibit you from performing your duties for the Company. 
  
 2. Cash Compensation. The company will pay you a starting salary at the rate of $250,000 per year, payable in accordance with the Company’s standard payroll schedule. In addition, to the extent that the
Company establishes an incentive bonus plan for its officers, you will be eligible to participate in such incentive bonus plan. The bonus (if any) will be awarded based on objective or subjective criteria established by the Company’s Chief
Executive Officer and approved by the Company’s Board of Directors. You are also eligible to receive the following bonuses: 
  

	 	•	$50,000 sign-on bonus payable within 30 days after your first day of employment with the Company (“Sign-On Bonus”). If you are terminated by the Company for Cause (as
defined below) or you resign for any reason with the first 12 months of employment with the Company, you must re-pay this $50,000 Sign-On Bonus in full within 30 days after the date of your employment termination and you agree that such amount may
be offset against any wage payment or accrued vacation payment otherwise payable to you by the Company and agree that you will sign any agreements required by the Company to consent to such offset. 

  

	 	•	$25,000 bonus payable within 30 days after the signing of a license agreement for an additional compound (“License Bonus”) 

  

	 	•	$25,000 bonus payable within 30 days after the effectiveness of CoTherix’s initial public offering of its common stock (“IPO Bonus”). 

  









 Within the exception of the Sign-On Bonus, Licensed Bonus and IPO Bonus, the incentive bonus for any
fiscal year (if any) will be paid after the Company’s books for that year have been close and will be paid only if you are employed by the Company at the time of payment. The determinations of the Company’s Board of Directors with respect
to any of your bonuses will be final and binding. 
  
 3.
Employment Benefits. As a regular employee of the Company you will be eligible to participate in all Company-sponsored benefits. In addition, you will be entitled to paid vacations in accordance with the Company’s vacation policy, as in
effect from time to time. 
  
 4. Stock Options. Subject to
the approval of the Company’s Board of Directors or its Compensation Committee, you will initially be granted an option to purchase 258,830 shares of the Company’s Common Stock. Subject to the approval of the Company’s Board of
Directors or its Compensation Committee, in the event the Company completes its second closing of its Series C Preferred Stock financing for the purchase and sale of an additional $15 M worth of Series C Preferred Stock your will be granted an
additional option to purchase 65,218 shares of the Company’s Common Stock. Subject to the approval of the Company’s Board of Directors or its Compensation Committee, in the event that the Company completes its third closing of its Series C
Preferred Stock financing for the purchase and sale of additional $10 M worth of Series C Preferred Stock, you will be granted an additional option to purchase 43,478 shares of the Company’s Common stock. The exercise price per share of each
option will be equal to the fair market value per share of the Company’s Common Stock on the date each option is granted. Each option will be subject to the terms and conditions applicable to options granted under the Company’s 2000 Stock
Plan (the “Plan”), as described in the Plan and the applicable Stock Option agreement. Each option will be immediately exercisable, but the unvested portion of the purchased shares will be subject to repurchase by the Company at the
exercise price in the event that your service terminates for any reason before you vest in the shares. You will vest in 25% of the option shares after 12 months of continuous service, and the balance will vest in equal monthly installments over the
next 36 months of continuous service, as described in the applicable Stock Option Agreement. 
  
 If the Company is subject to a Change in Control before your service with the Company terminates and you are subject to an Involuntary Termination (as defined below within 12 months after that Change in Control, then
the vested percentage of your option shares will be determined by adding another 12 months to the actual period of service that you have completed with the Company. This vesting acceleration will only apply to the options described in the
immediately preceding paragraph that were granted before the effective date of the Involuntary Termination. 
  
 For all purposes under this letter agreement, “ Involuntary Termination” means either (a) involuntary discharge by the Company for reasons other
that Cause or (b) voluntary resignation following (i) a change in your position with the Company that materially reduces your level of authority or responsibility, (ii) a reduction in your base 

  









 
salary by more than 10% or (iii) receipt of notice that your principal workplace will be relocated more than 30 miles. 
  
 For all purposes under this letter agreement, “Cause” means (a) an
unauthorized use or disclosure of the Company’s confidential information or trade secrets, which use or disclosure causes material harm to the Company, (b) a material breach of any agreement between you and the Company, (c) a material failure
to comply with the Company’s written policies or rules, (d) conviction of, or plea of “guilty” or “no contest” to, a felony under the laws of the United States or any state thereof, (e) gross negligence or willful misconduct
or (f) a continued failure to perform assigned duties after receiving written notification of such failure from the Company’s Board of Directors. The foregoing, however, is not an exclusive list of all acts or omissions that the Company may
consider as grounds for discharging you without Cause. 
  
 5.
Severance Pay. If the Company terminates your employment for any reason other than Cause, then the Company will continue to pay your base salary for a period of 6 months following the termination of your employment and you will become vested
in an additional number of option shares, as if you provided an additional 6 months of service following your employment termination date. Your base salary will be paid at the rate in effect at the time of the termination of your employment and in
accordance with the Company’s standard payroll procedures. Additionally, your COBRA premiums will be paid by the Company for a period of 6 months following the termination of your employment. The vesting acceleration described in this Section 5
will only apply to the options described in the first paragraph of Section 4 that were granted before the effective date of the employment termination. However, this Section 5 will not apply unless you (a) resign as a member of the Boards of
Directors of the Company and all of its subsidiaries, to the extent applicable, (b) sign a general release of claims (in a form prescribed by the Company) of all known and unknown claims that you may then have against the Company or persons
affiliated with the Company and (c) have returned all Company property. 
  
 6. Proprietary Information and Inventions Agreement. Like all Company employees, you will be required, as a condition of your employment with the Company, to sign the Company’s standard Proprietary Information and Inventions
Agreement, a copy of which is attached hereto as Exhibit A. 
  
 7. Employment Relationship. Employment with the Company is for no specific period of time. Your employment with the Company will be “at will,” meaning that either you or the Company may terminate your employment at any time
and for any reason, with or without Cause. Any contrary representations that may have been made to you are superseded by this letter agreement. This is the full and complete agreement between you and the Company on this term. Although your job
duties, title, compensation and benefits, as well as the Company’s personnel policies and procedures, may change from time to time, the “at will” nature of your employment may only be changed in an express written agreement signed by
you and a duly authorized officer of the Company (other than you). 
  









 8. Outside Activities. While you render services to the Company, you agree that you will not
engage in any other employment, consulting or other business activity without the prior written consent of the Company. While you render services to the Company, you also will not assist any person or entity in competing with the Company, __
preparing to compete with the Company or in hiring any employees or consultants of the Company. 
  
 9. Withholding Taxes. All forms of compensation referred to in this letter agreement are subject to reduction to reflect applicable withholding and
payroll taxes and other deductions required by law. 
  
 10.
Entire Agreement. This letter agreement supersedes and replaces any prior agreements representations or understandings, whether written, oral or implied, between you and the Company. 
  
 11. Arbitration. You and the Company agree to waive any rights to a
trial before a judge or jury and agree to arbitrate before a neutral arbitrator any and all claims or disputes arising out of this letter agreement and any and all claims arising from or relating to your employment with the Company, including (but
not limited to) claims against any current or former employee, director or agent of the Company, claims of wrongful termination, retaliation, discrimination, harassment, breach of contract, breach of the covenant of good faith and fair dealing,
defamation, invasion of privacy, fraud, misrepresentation, constructive discharge or failure to provide a leave of absence, or claims regarding commissions, stock options or bonuses, infliction of emotional distress or unfair business practices.

  
 The arbitrator’s decision must be written and must
include the findings of fact and law that support the decision. The arbitrator’s decision will be final and binding on both parties, except to the extent applicable law allows for judicial review of arbitration awards. The arbitrator may award
any remedies that would otherwise be available to the parties if they were to bring the dispute in court. The arbitration will be conducted in accordance with the National Rules for the Resolution of Employment Disputes of the American Arbitration
Association; provided, however that the arbitrator must allow the discovery authorized by the California Arbitration Act or the discovery that the arbitrator deems necessary for the parties to vindicate their respective claims or defenses. The
arbitration will take place in San Mateo County or, at your option, the county in which you primarily worked with the Company at the time when the arbitrable dispute or claim first arose. 
  
 You and the Company will share the costs of arbitration equally, except that
the Company will bear the cost of the arbitrator’s fee and any other type of expense or cost that you would not be required to bear if you were to bring the dispute or claim in court. Both the Company and you will be responsible for their own
attorneys’ fees, and the arbitrator may not award attorneys’ fees unless a statute or contract at issue specifically authorizes such an award. 
  









 The foregoing notwithstanding, this arbitration provision does not apply to (a)
workers’ compensation or unemployment insurance claims or (b) claims concerning the ownership, validity, infringement, misappropriation, disclosure, misuse or enforceability of any confidential information, patent right, copyright, mask work,
trademark or any other trade secret or intellectual property held or sought by either you or the Company (whether or not arising under the Proprietary Information and Inventions Agreement between you and the Company). 
  
 If an arbitrator or court or competent jurisdiction (the
“Neutral”) determines that any provision of this arbitration provision is illegal or unenforceable, then the Neutral shall modify or replace the language of this arbitration provision with a valid and enforceable provision, but only to the
minimum extent necessary to render this arbitration provision legal and enforceable. 
  
 * * * * * 
  
 We
hope that you will accept our offer to join the Company. You may indicate your agreement with these terms and accept this offer by signing and dating both the enclosed duplicate original of this letter agreement and the enclosed Proprietary
Information and Inventions Agreement and returning them to me. This offer, if not accepted, will expire at the close of business on February 2, 2004. As required by law, your employment with the Company is contingent upon your providing legal proof
of your identity and authorization to work in the United States. Your employment is also contingent upon your starting work with the Company on or before February 9, 2004. 
  
 If you have any questions, please call me at 650-486-2102. 
  

			
	Very truly yours,
	
	COTHERIX, INC.
		
	 	 	 /s/ Donald J. Santel

	 	 	

	 By:
	 	 Donald J. Santel

	 Title:
	 	 President & COO



  
 I have read and accept this
employment offer: 
  

	
	
	 /s/ James E. Pennington

	

	 Signature of James E. Pennington, MD


  
 Dated: February 2, 2004 
  









 Attachment 
  
 Exhibit A: Proprietary Information and Inventions Agreement 
  

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