Document:

Exhibit 10.1

 

[Green Mountain Coffee Roasters, Inc. Letterhead]

 

December 13, 2012

 

Howard Malovany

Green Mountain Coffee Roasters

33 Coffee Lane

Waterbury, VT 05676

 

Re:  Transition Agreement with Green Mountain Coffee Roasters, Inc.

 

Dear Howard:

 

Green Mountain Coffee Roasters, Inc. (“Company”), and you have agreed that you will transition from the Company and its affiliates on the terms set forth in this transition agreement.

 

1.                                      Employment Period; Termination Date.

 

A.                                    Employment Period.

 

1.                                      You will continue in your role as Vice President, Corporate General Counsel and Secretary (or Chief Legal Officer, Corporate General Counsel & Secretary) of the Company, with all the rights and obligations thereof, and you will continue to report directly to the Company’s President and Chief Executive Officer, from the date you sign this transition agreement until March 31, 2013 (the “Transition Date”), subject to earlier termination as provided herein; provided that, if a successor Chief Legal Officer and/or Corporate General Counsel (or person of equivalent title) is appointed who commences employment prior to the Transition Date, your position as an officer of the Company will terminate upon the first day of employment of such successor (and your employment will continue in support of the transition to such successor), subject to the terms of this transition agreement.

 

2.                                      Subject to earlier termination as provided below, at the close of business on the Transition Date, you will terminate your service as an employee of the Company, and such termination shall be deemed an involuntary termination not for cause, except as provided in Section 3.  You will be deemed to have resigned from all your officer, director, and committee positions with the Company and all its affiliates and the Green Mountain Coffee Roasters Foundation (the “Foundation”) as of the date your service as an officer of the Company ends.  (The period of time between the date hereof and the Transition Date (or earlier Termination Date, as defined below) is hereinafter referred to as the “Employment Period”).

 

3.                                      During the Employment Period you may terminate your employment and your services at any time for any reason, subject to the notice provision below.  During the Employment Period the Company may terminate you only for gross misconduct.

 

4.                                      Your termination date (“Termination Date”) is the last day that you perform services as an employee of the Company.  In no event will your Termination Date be later than March 31, 2013.  The occurrence of your Termination Date will also terminate the

 

 

Employment Period.  For avoidance of doubt, your Termination Date will be the Transition Date unless you previously die or voluntarily terminate your employment, or unless the Company terminates you for gross misconduct.

 

2.                                      Duties and Compensation.

 

A.                                    Employment duties.  During the Employment Period, you will continue to perform your duties as assigned from time to time by the Company’s President and Chief Executive Officer, faithfully, with the utmost loyalty, to the best of your abilities and in the best interests of the Company, and you shall devote your full business time to the business of the Company.  If your role as an officer of the Company ceases prior to the Transition Date as a result of the Company hiring a replacement Chief Legal Officer and General Counsel, after you cease such role, you shall report to the successor Chief Legal Officer General Counsel.

 

B.                                    Compensation. Subject to your execution of releases as provided in Section 7, and to your continued compliance with Section 8,

 

1.                                      Base Salary.  During the Employment Period, the Company will continue to pay you a base salary at the gross annual rate of $368,000 (“Base Salary”).  The Base Salary shall be paid in accordance with the Company’s normal payroll practices.

 

2.                                      Pro Rata Annual Incentive.  During the Employment Period, you will continue your participation in the Company’s Short Term Incentive Plan (“STIP”) in accordance with its terms during the Company’s fiscal year ending in 2013 (“FY 2013”).  You shall be entitled to a pro rata portion of the annual incentive for FY 2013 under the STIP, in an amount equal to the amount payable based on actual performance if you had remained an employee throughout FY 2013, multiplied by a fraction (the “Pro-Ration Fraction”) the numerator of which is the number of days of your employment in FY 2013 prior your Termination Date, and the denominator of which is 365, paid at the same time as other recipients receive their annual incentive payments for FY 2103 (the “Pro-Rata 2013 Annual Incentive”).

 

3.                                      Benefit Plans.

 

a)                                     During the Employment Period, you will continue to be eligible to participate in the Company’s employee benefit plans (including the 401(k) plan, employee stock purchase plan, group medical and dental plans, and fringe benefits), and to receive fringe benefits and reimbursement of appropriate business expenses, all in accordance with Company plans and policies, as they may be in effect from time to time.

 

b)                                     As of the earlier of the Transition Date or your Termination Date, you will no longer to be eligible to participate in employee benefit plans (including 401(k), employee stock purchase plan, group medical and dental plans, or fringe benefits), and your participation therein shall cease.

 

c)                                      COBRA Payments.  Subject to your having timely elected under the federal law known as “COBRA” to continue participation in the Company’s group medical and dental plans for yourself and those individuals who were your eligible dependents immediately prior to the earlier of the Transition Date or your Termination Date, and subject to your making the required payments of the

 

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applicable COBRA premium, the Company will make monthly payments (“COBRA Payments”) in an amount equal to the difference between the monthly cost of such COBRA continuation coverage and the premium cost to you of participation in such group medical and dental plans had you remained in active employment. Provided you continue to pay the applicable COBRA premiums, such monthly COBRA Payments shall continue until the earlier of (a) 12 months from the earlier of the Transition Date or your Termination Date or (b) the date you (or in the case of your dependents, your dependents) become eligible for coverage under the medical and/or dental plan of another employer (or in the case of your dependents, cease to be eligible for COBRA continuation coverage);

 

4.                                      Options and RSUs.  During the Employment Period you will continue to vest in your options and restricted stock units (“RSUs”) in accordance with their terms, as amended from time to time, except as otherwise provided herein.  For the avoidance of doubt, your provision of services hereunder through the Termination Date, regardless of role, shall be deemed “Employment” for purposes of the Company’s 2006 Incentive Plan (“2006 LTI Plan”) and any awards granted thereunder.  As of your Termination Date (whenever occurring), your outstanding options and RSUs will be treated as provided under the terms of the respective award agreement (as amended from time to time) for an involuntary termination other than for Cause, except as otherwise herein provided.  You shall not be eligible for “Retirement” treatment under such agreements.

 

5.                                      During the Employment Period you will continue to be eligible for reimbursement of appropriate business expenses in accordance with Company policies, as they may be amended from time to time.

 

6.                                      If your employment ends on the Transition Date, the Company will continue to pay your Base Salary, in accordance with the Company’s normal payroll practices for the period from the Transition Date through March 31, 2014, except as otherwise provided herein.

 

C.                                    Effective the date of this transition agreement,

 

1.                                      Your participation in the Green Mountain Coffee Roasters, Inc. Change In Control Severance Benefit Plan shall cease;

 

2.                                      You will not participate in the STIP for fiscal years ending after FY 2013; and

 

3.                                      You will not be eligible for new or additional awards under the 2006 LTI Plan, including awards for FY 2013.

 

3.                                      Early Termination.

 

A.                                    You may terminate your employment hereunder at any time by written notice to the Chief Executive Officer of the Company.  Your Termination Date shall be the date stated in such notice, but not earlier than 30 days after delivery of such notice to the Chief Executive Officer of the Company.  The Company’s sole obligation to you in the event of such termination shall be to pay you the Accrued Obligations (as defined in Section 5),  to the extent not previously paid, and your options and RSUs shall be treated as provided in their respective grant agreements, as amended from time to time, except as otherwise provided herein.

 

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B.                                    The Company may terminate you for gross misconduct any time, effective immediately upon written notice.  The Company acknowledges that as of the date of this Agreement it is not aware of circumstances that would constitute your gross misconduct.  The date of such notice shall be the Termination Date.  The Company’s sole obligation to you in the event of such termination shall be to pay you the Accrued Obligations (as defined in Section 5), to the extent not previously paid.  Your equity awards shall thereupon be forfeited, whether or not vested, to the extent not previously exercised or settled, and shall be subject to Section 10.B.

 

C.                                    In the event your services are terminated by your death prior to the Transition Date, the date of your death shall be the Termination Date and the Company will pay or provide your designated beneficiary (or if none, your estate) with the following, provided your designated beneficiary (or, if none, your executor) duly executes and does not revoke the Supplemental Release described in Section 7.B.:

 

1.                                      The Accrued Obligations, to the extent not previously paid;

 

2.                                      In lieu of your Pro Rata 2013 Annual Incentive, a lump sum payment in respect of your FY 2013 STIP, in an amount equal to your target FY 2013 STIP multiplied by the Pro Ration Fraction, which shall be paid not more than 30 business days after your death; and

 

3.                                      Treatment of your equity as described in the applicable grant agreement (as amended from time to time) in the event of termination of employment by death, except as otherwise provided herein.

 

4.                                      Death after Termination Date.  If your death occurs after your Termination Date  but prior to the date you have received all payments to which you are entitled under Section 2.B.6., the Company’s sole obligation to your designated beneficiary (or if none, your estate) will be (a) to accelerate the remaining such payments and to pay them in a lump sum as soon as administratively practical after your death, but in no event more than 30 business days after your death, and (b) if not previously paid, to pay your Pro Rata 2013 Annual Incentive at the time and in the form described in Section 2.B.2.

 

5.                                      Accrued Obligations.  Whether or not you sign a Supplemental Release as provided in Section 7.B., the Company will pay or provide you the following (collectively, the “Accrued Obligations”):

 

A.                                    Within five (5) business days after your Termination Date, the Company will pay you any earned but unpaid Base Salary through your Termination Date.

 

B.                                    The Company will reimburse any unreimbursed business expenses existing on your Termination Date, in accordance with the Company’s normal reimbursement policies and practices.

 

C.                                    Effective as of the earlier of the Transition Date or your Termination Date, you may elect to continue group medical and dental coverage under the federal law known as “COBRA,” if and to the extent you are eligible to do so.

 

D.                                    Within 5 days after the earlier of the Transition Date or your Termination Date, the Company will pay you any earned but unused vacation time as determined in accordance with the Company’s policies then in effect.

 

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E.                                     You will be entitled to your vested account balance under and subject to the terms and provisions of the Company’s 401(k) Plan, and any amount to which you may be entitled under the terms of the Company’s employee stock purchase plan, as amended.

 

6.                                      Change in Control.

 

A.                                    After your Termination Date.  If there should occur a change in control of the Company (as defined in the Company’s Change in Control Severance Benefit Plan) that qualifies as a change in ownership of the Company or a change in effective control of the Company, or as a change in the ownership of a substantial portion of the assets of the Company under Treasury Regulation 1.409A-3(i)(5)(v), (vi), or (vii) (a “409A CIC”) after your Termination Date, the Company’s sole obligations to you will be, subject to the last sentence of this Section 6.A., to provide the following:  (i) to accelerate the payment of any remaining payments to which you may be entitled as of the date of the 409A CIC under Section 2.B.6.  and to pay them in a lump sum within five (5) business days after the 409A CIC, and (ii) if the 409A CIC occurs after your Termination Date and prior to the end of the applicable performance period under the FY 2013 STIP, then no amount shall be payable under Section 2.B.2., and you shall be entitled to a lump sum payment equal to the amount that would have been paid to you in respect of the FY 2013 STIP had you remained employed until the date of the 409A CIC pursuant to the relevant transaction documents, if any, multiplied by the Pro-Ration Fraction, such amount payable not later than five (5) business days after the 409A CIC.  For avoidance of doubt, a change in control of the Company that is not a 409A CIC shall not affect the timing of payments hereunder.

 

B.                                    On or Before your Termination Date.  If there should occur a 409A CIC and your Termination Date has not previously occurred, then the date of the 409A CIC shall be your Termination Date; and you shall be paid the Accrued Obligations not later than five (5) business days after the 409A CIC, to the extent not previously paid.  In addition, provided you sign and do not revoke the Supplemental Release as described in Section 7.B. and subject to your continued compliance with Section 8, the Company will pay or provide the following, in lieu of the amounts and form of payment applicable under Sections 2.B.6, 2.B.2., and/or 2.B.4., as applicable:

 

a)                                     Remaining payments.  In a lump sum not later than five (5) business days after the date of the 409A CIC, an amount equal to the sum of the remaining unpaid amounts under Section 2.B.6.;

 

b)                                     FY 2013 STIP.  To the extent no amount relating to your STIP for FY 2013 has previously been paid, an amount equal to your target annual bonus under the STIP for FY 2013 multiplied by the Pro Ration Fraction, in a lump sum not later than five (5) business days after the 409A CIC; and

 

c)                                      Options and RSUs.  Your options and RSUs to the extent not previously settled, will be treated as provided in the documents and instruments effecting the 409A CIC; provided that if the options and RSUs are not assumed by the acquiror or survivor in the transaction, your unvested equity shall become fully vested immediately prior to the CIC so that you have an opportunity to exercise any outstanding options and participate in the 409A CIC transaction the same as any common shareholder with respect to your option shares.

 

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7.                                      Release; Supplemental Releases.

 

A.                                    Release.  The effectiveness of this transition agreement is contingent on your timely execution and non-revocation of a release and waiver of claims in the form attached hereto as Appendix A (“Release”).  If you do not timely execute the Release or if you revoke it, then you will be deemed to have involuntarily terminated your employment and your service with the Company and its affiliates as of the date of this transition agreement.  In that case, this transition agreement shall be null and void, and any payments of compensation or provision of benefits after the date of this transition agreement and the last date for non-revocation of the Release shall be deemed made pursuant to the terms of your January 8, 2009 employment letter from the Company.

 

B.                                    Supplemental Releases.  As a condition of receiving any benefits other than the Accrued Obligations after your Termination Date, you agree to execute within 21 days after your Termination Date and not revoke, a separate supplemental release and waiver of claims in the form attached hereto as Appendix B (“Supplemental Release”).

 

C.                                    No Payments until Release Irrevocable.  Payments and benefits conditioned upon the execution and nonrevocation of the Release or Supplemental Release shall not be made or commence, notwithstanding any other provision of this transition agreement to the contrary, prior to the expiration of the revocation period for the Release or Supplemental Release, as applicable.  Upon the expiration of the applicable revocation period for the Release or Supplemental Release, any payments or benefits so postponed shall be cumulated and paid the day after the expiration of such revocation period; provided you have not revoked the Release or Supplemental Release.

 

8.                                      Confidentiality; Restrictive Covenants.

 

A.                                    Need for Restrictive Covenants.  You acknowledge that, as a senior executive of the Company, you have and, prior to the Termination Date, will acquire and have access to, and have and will, prior to the Termination Date, continue to develop substantial and intimate knowledge of, the Company’s Confidential Information, as defined below, and that you have and will, prior to the Termination Date, also continue to develop a unique and comprehensive familiarity with the Company and the business conducted by the Company and its affiliates, which you would not have otherwise had but for your employment with the Company, and which you acknowledge are valuable assets of the Company.  Accordingly, in consideration of the foregoing and of entering into this transition agreement, you agree to undertake the obligations set forth in Sections 8.B., C. and D.,  which you acknowledge are reasonably designed to protect the legitimate business interests of the Company, without unreasonably restricting your post-employment employment opportunities.  These obligations are in addition to and not in lieu of ethical obligations to which you may be subject as an attorney for the Company, its affiliates, and the Foundation.

 

B.                                    Confidentiality.  You acknowledge that you have and, prior to the Termination Date, will continue to have access to Confidential Information of the Company, its affiliates, and the Foundation. All Confidential information is of irreplaceable value to the Company, its affiliates, and the Foundation.  Except as required to perform your responsibilities for the Company, its affiliates, or the Foundation, to comply with law or regulation, or as authorized in writing in advance by the Chief Executive Officer of the Company, you will not, at any time, use, disclose or take any action which may result in the use or disclosure of any Confidential Information.  “Confidential Information” means all confidential and proprietary information of the Company or its affiliates, and includes, but is not limited to actual and prospective customer and client lists and pricing information, business plans, programs and tactics, research and development information, personnel information, and all other information unique to the Company and not readily available to the public, including designs, improvements, inventions, formulas, compilations, methods,

 

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strategies, capabilities, forecasts, software programs, processes, know-how, data, operating methods and techniques, and all business costs, profits, vendors, markets, sales, products, marketing, sales or other financial or business information, and any modifications or enhancements of any of the foregoing.

 

C.                                    Restrictive Covenants.  You agree and covenant not to, without the explicit written permission of the Chief Executive Officer of the Company:

 

1.                                      contribute your knowledge, directly or indirectly, in whole or in part, as an employee, officer, owner, manager, advisor, consultant, agent, partner, director, shareholder, volunteer, intern or in any other similar capacity to an entity engaged in the same or similar business as of March 31, 2013 as the Company and its affiliates anywhere in the United States for a period of 12 months following your Termination Date;

 

2.                                      directly or indirectly, solicit, hire, recruit, attempt to hire or recruit, or induce the termination of employment of any employee of the Company or its affiliates for 12 months following your Termination Date; or

 

3.                                      directly or indirectly, solicit, contact (including, but not limited to, e-mail, regular mail, express mail, telephone, fax, instant message, or tweet) attempt to contact or meet with any current customer of the Company or any of its affiliates for purposes of offering or accepting goods or services similar to or competitive with those currently offered by the Company or any of its affiliates for a period of 12 months following your Termination Date.

 

D.                                    Nondisparagement.  You agree (a) not to make issue, circulate, publish or utter any statement, whether written or oral, to any third party or take any action or cause or assist another person to do so, which is intended to or would reasonably have the effect of being false or of disparaging, defaming, criticizing, holding in a negative light or reflecting adversely upon the Company (including its current and former parents, subsidiaries, affiliates, successors, assigns, directors, officers, shareholders, employees, agents, products, services or practices, and the Foundation), and (b) not to publish, comment upon or disseminate any statements suggesting or accusing the Company, any of its affiliates or the Foundation, or any of their respective agents, employees or officers of any misconduct or unlawful behavior. The Company agrees to direct its executive officers (a) not to make issue, circulate, publish or utter any statement, whether written or oral, to any third party or take any action or cause or assist another person to do so, which is intended to or would reasonably have the effect of being false or of disparaging, defaming, criticizing, holding in a negative light or reflecting adversely upon you, and (b) not to publish, comment upon or disseminate any statements suggesting or accusing you of any misconduct or unlawful behavior.  Notwithstanding the foregoing, you and the Company’s executive officers may give truthful and non-malicious testimony if properly subpoenaed to testify under oath, and truthfully and non-maliciously cooperate in investigations by governmental or regulatory authorities.  You agree to direct all inquiries from prospective employers, the media or, after your Termination Date, governmental or regulatory authorities or opposing counsel to the Company’s Chief Legal Officer.

 

E.                                     Company Property.  As soon as practicable following your Termination Date, you will return to the Company all keys, key cards, Confidential Information, documents, manuals, computers, computer programs, flash drives, CDs, diskettes or other recording media, customer lists, notebooks, reports and other written or graphic materials, including all copies thereof and whether in electronic form or otherwise, relating in any way to the Company’s business and

 

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prepared by your or obtained by your from the Company, its customers or suppliers during the course of your provision of services to the Company.  You covenant that you will retain no copies of any such material.

 

F.                                      Remedies on Breach.  In the event of a breach or, with respect to (3) below, threatened breach of any of the foregoing covenants,

 

1.                                      Any unvested portion of your outstanding options and restricted stock units shall be forfeited effective as of the date of such breach, unless sooner terminated by operation of another term or condition of this transition agreement or the applicable plan; and

 

2.                                      Any amounts due to be paid under Section 2.B.  shall be forfeited as of the date of such breach; and

 

3.                                      The Company shall be entitled to seek, in addition to other available remedies, a temporary or permanent injunction or other equitable relief against such breach or threatened breach from any court of competent jurisdiction, without the necessity of showing any actual damages or that money damages would not afford an adequate remedy, and without the necessity of posting any bond or other security.  Such equitable relief shall be in addition to, and not in lieu of, legal remedies, monetary damages or other available forms of relief.

 

9.                                      Litigation and Regulatory Cooperation.  You agree to reasonably cooperate with the Company and its affiliates after the Transition Date in the defense or prosecution of any claims or actions now in existence or which may be brought in the future against or on behalf of the Company or any of its affiliates that relate to events or occurrences that transpired during the time you provided services to the Company, including but not limited to pending matters, whether asserted as litigation, threatened litigation, an internal investigation or complaint, or any investigation or review by any foreign, federal, state or local regulatory authority.  Your full cooperation in connection with such claims or actions shall include, but not be limited to, being available at reasonable times and reasonable places to (a) meet with and provide truthful and accurate information to counsel for the Company and its affiliates as part of the Company’s investigation of such matters, (b) meet with governmental officials to provide accurate and truthful information on behalf of the Company or an affiliate, (c) prepare for discovery or trial, and (d) act as a witness on behalf of the Company or any affiliate and provide truthful testimony as may be required.  In scheduling your time to prepare for such meetings and conferences, and any appearances for discovery or trial, the Company shall take into account your personal and professional obligations and shall use reasonable efforts to minimize interference with any other employment obligations that you may have, provided that you shall also use reasonable efforts to accommodate the schedule of the Company and its counsel.  You will be entitled, upon delivery of customary supporting documentation, to reimbursement for reasonable out-of-pocket travel expenses approved in advance, and other expenses approved in advance by the Company, including but not limited to reasonable counsel fees and costs you incur in connection with the foregoing.

 

10.                               Additional provisions.

 

A.                                    Withholding; Deductions.  Any payments to you are subject to required withholding and authorized deductions.

 

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B.                                    Recoupment.  Any recoupment provisions in any documents or any Company policy applicable to you shall remain in effect.  In addition, your compensation and awards shall be subject to recoupment by the Company to the extent required to comply with (i) applicable law or regulation or the rules of the stock exchange on which the Company’s common stock is traded or (ii) any applicable Company clawback or recoupment policy as in effect from time to time as required by law.

 

C.                                    Compliance with Section 409A.

 

1.                                      To the extent this transition agreement provides for compensation that is deferred compensation subject to Section 409A, it is intended that you not be subject to the imposition of taxes and penalties (“409A Penalties”) under Section 409A, and this transition agreement shall be construed in accordance with that intent.

 

2.                                      Notwithstanding any other provision in this transition agreement, if as of the date on which you incur a separation from service within the meaning of Section 409A, you are a “specified employee” as determined by the Company, then to the extent any amount payable or benefit provided to you that the Company reasonably determines would be nonqualified deferred compensation within the meaning of Section 409A, for which payment is triggered by your separation from service (other than on account of death), and that under the terms of this transition agreement would be payable on or prior to the six-month anniversary of your separation from service, such payment or benefit shall be delayed until the earlier to occur of (a) the day after the six-month anniversary of such separation from service, or (b) the date of your death.

 

3.                                      With respect to any reimbursements under this transition agreement, such reimbursement shall be made on or before the last day of the calendar year following the calendar you in which the expense was incurred; subject to timely submission of proper substantiation in accordance with the Company’s policies and procedures therefor.

 

4.                                      The amount of any expenses eligible for reimbursement of the amount of any in-kind benefits provided, as the case may be, under this transition agreement during any calendar year shall not affect the amount of expenses eligible for reimbursement or the amount of any in-kind benefits provided during any other calendar year.  The right to reimbursement or to any in-kind benefit pursuant to this transition agreement shall not be subject to liquidation or exchange for any other benefit.

 

5.                                      If under this transition agreement, an amount is to be paid in two or more installments or two or more monthly payments, then for purposes of Code Section 409A, each installment shall be treated as a separate payment.

 

6.                                      If payment of any amount of deferred compensation subject to Section 409A is contingent upon your execution of a release and waiver of claims, and if the period within which you must sign and not revoke the release and waiver of claims would begin in one calendar year and expire in the following calendar year, then any payments contingent on such employment-related action shall be made (or commence) in such following calendar year (regardless of the year of execution of such release) if payment in such following calendar year is required in order to avoid 409A Penalties.

 

7.                                      You acknowledge that notwithstanding this Section 10.C. or any other provision of this transition agreement, the Company and its affiliates are not providing you with any

 

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tax advice with respect to Section 409A or otherwise, and are not making any guarantees or other assurances of any kind to you with respect to the tax consequences or treatment of any amounts paid or payable to you under this transition agreement or your equity award agreements. You are solely responsible for the payment of taxes, including any 409A Penalties.

 

D.                                    Entire Agreement.  This transition agreement constitutes the entire agreement between you and the Company and its affiliates on the subject of any payments and benefits due to you after the date hereof, and supersedes all other prior agreements between you and the Company or its affiliates, except for your options granted on February 9, 2009, March 11, 2010, March 10, 2011, and March 22, 2012, and your Restricted Stock Units granted March 22, 2012, which shall continue to apply (as amended from time to time), except as otherwise provided herein, and are hereby made a part of this transition agreement by reference.  Specifically, but not exclusively, your January 8, 2009 employment letter is superseded in its entirety, and the Green Mountain Coffee Roasters, Inc. Change-in-Control Severance Benefit Plan does not apply to you.  The payments and benefits described in this transition agreement will be the only such payments and benefits you are to receive in connection with the termination of your employment and your separation from service with the Company and its affiliates, and you acknowledge you are not entitled to any additional payments, rights or benefits not otherwise described in this transition agreement.  Any payments, rights or benefits you receive under this transition agreement will not be taken into account for purposes of determining benefits under any employee benefit plan of the Company, except to the extent required by law, or as otherwise expressly provided under the terms of such plan.

 

E.                                     Binding on Successors to the Company; Non-assignment.  This transition agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns.  You shall not assign or otherwise alienate your rights under this transition agreement.

 

F.                                      Governing Law.  The validity, interpretation, construction, and performance of this transition agreement shall be governed by the laws of the State of Vermont without regard to its principles of conflicts of law, and except to the extent preempted by federal law.

 

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G.                                    Severability.  In the event that any one or more of the provisions of this transition agreement shall be or become invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions of this transition agreement shall not be affected thereby, provided that if any portion of the Release or the Supplemental Release shall be or become invalid, illegal or unenforceable in any respect, the Company shall be relieved of its obligations hereunder that are contingent on your execution and non-revocation of the Release or Supplemental Release.

 

	
 
    	
Sincerely,
    
	
 
    	
 
    
	
 
    	
GREEN   MOUNTAIN COFFEE ROASTERS, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Brian P. Kelley
    
	
 
    	
 
    	
Brian P. Kelley, Chief Executive Officer
    
	
 
    	
 
    
	
ACKNOWLEDGED   AND AGREED
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
/s/ Howard Malovany
    	
 
    	
 
    
	
Howard   Malovany
    	
 
    
	
 
    	
 
    
	
Date:   December 13, 2012
    	
 
    
				

 

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Appendix A

Release and Waiver

 

THIS RELEASE is executed by the undersigned (the “Executive’) as of the date indicated below.

 

WHEREAS, the Executive and Green Mountain Coffee Roasters, Inc. (the “Company”) entered into a transition agreement dated December 13, 2012 (the “Transition Agreement”), subject to the Executive’s timely execution and non-revocation of this Release and to his compliance with its terms and the terms of the Transition Agreement;

 

NOW, THEREFORE, in consideration of the Company’s entering into the Transition Agreement and other good and valuable consideration, the Executive agrees as follows:

 

1.                                      Executive irrevocably and unconditionally releases, acquits, and forever discharges the Company and all of its current and former related entities, affiliates, successors, predecessors, assigns, owners, investors, stockholders, partners, members, and employee benefit plans, and all of their directors, officers, employees, agents, representatives, insurers, administrators, attorneys, and all persons acting by, through, under, or in concert with any of them, and the Foundation (collectively “Releasees”), from any and all charges, complaints, claims, liabilities, obligations, promises, agreements, damages, actions, causes of action, suits, rights, demands, costs, losses, debts, and expenses (including attorneys’ fees and costs) of any nature whatsoever, known or unknown, suspected or unsuspected (“Claim” or “Claims”), which Executive now has, owns or holds, or claims to have, own or hold, or which Executive at any time heretofore had, owned or held, or claimed to have had, owned or held, or which Executive at any time hereafter may have, own or hold, or claim to have, own or hold, against any of the Releasees relating to any event, act, or omission that has occurred prior to or as of the date Executive signs this Release.  This Release shall not apply to (a) any of the Company’s obligations under the terms of the Transition Agreement, and (b) Executive’s right to indemnification under the Company’s bylaws and the indemnification agreement between the Company and Executive dated August 10, 2009.

 

2.                                      Without limiting the foregoing, Executive specifically waives and releases all rights, claims (including claims for attorneys’ fees), demands, and causes of action under the Age Discrimination in Employment Act of 1967 (“ADEA”), as amended; Title VII of the Civil Rights Act of 1964, as amended; the Employee Retirement Income Security Act of 1974, as amended; the Rehabilitation Act of 1973, as amended; the Worker Adjustment Retraining and Notification Act; the Americans with Disabilities Act; and any comparable state law, concerning Executive’s relationship and association with any of the Releasees and the creation and termination of such relationship.  Executive acknowledges and understands that the release of claims under the ADEA is subject to special waiver protection under 29 U.S.C. § 626(f).

 

a.                                      In accordance with that section, Executive specifically agrees he is knowingly and voluntarily releasing and waiving any right or claim of discrimination under the ADEA.

 

b.                                      In particular, he acknowledges and understands the following:

 

(i)                                     he is not waiving rights or claims for age discrimination under the ADEA that may arise after the date he signs this Release;

 

(ii)                                  he is not waiving his right to file a complaint or charge with the EEOC or participate in any investigation or proceeding conducted by the EEOC;

 

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(iii)                               he is waiving rights or claims for age discrimination under the ADEA in exchange for entering into the Transition Agreement, which is in addition to anything of value to which he otherwise is entitled;

 

(iv)                              he has been advised to consult with an attorney of his choice before signing this Release, and he has had an opportunity to do so;

 

(v)                                 he has freely and voluntarily entered into this Release without any threat, coercion, or intimidation by any person;

 

(vi)                              he has been given the opportunity to take 21 days to consider whether to sign this Release, although he is not required to wait 21 days; and

 

(vii)                           he will have seven days after the date he signs this Release within which to revoke it, and the Release shall not become effective or enforceable as to any party until that revocation period has expired without revocation of the Release.  Any such revocation shall be in writing and shall be sent to Linda Longo Kazanova, Vice President, Chief Human Resources Officer, at the Company’s headquarters at 33 Coffee Lane, Waterbury, VT 05676.

 

3.                                      The Executive understands that nothing in this Release shall be construed to prohibit him from filing a charge with, or participating in any investigation or proceeding conducted by, the Equal Employment Opportunity Commission, National Labor Relations Board, and/or any federal, state or local agency.  Notwithstanding the foregoing, the Executive hereby waives any and all rights to recover monetary damages in any charge, complaint, or lawsuit filed by him or by anyone else on his behalf based on events occurring prior to the date of this Release.

 

4.                                      Executive expressly acknowledges that this Release is intended to include in its effect, without limitation, all Claims which he does not know or suspect to exist in his favor at the time of execution hereof and that this Release contemplates the extinguishment of any such Claim or Claims.

 

5.                                      Executive agrees that he is bound by the provisions of the Transition Agreement, which are fully incorporated into this Release.

 

6.                                      Executive represents that he has not heretofore assigned or transferred, or purported to assign or transfer, to any person or entity, any Claim or any portion thereof, or interest therein, and he agrees to indemnify, defend and hold Releasees harmless from and against any and all Claims, based on or arising out of any such assignment or transfer, or purported assignment or transfer of any Claims or any portion thereof or interest therein.

 

7.                                      Executive represents and acknowledges that in executing this Release he does not rely and has not relied upon any representation or statement not set forth herein made by any of the Releasees or by any of the Releasees’ agents, representatives, or attorneys with regard to the subject matter, basis, or effect of this Release or otherwise.

 

8.                                      This Release shall be binding upon Executive and upon his respective heirs, administrators, representatives, executors, beneficiaries, successors, and assigns, and shall inure to the benefit of Releasees and each of them, and to their heirs, administrators, representatives, executors, successors, and assigns.

 

2

 

9.                                      This Release is made and entered into in the State of Vermont and shall in all respects be interpreted, enforced, and governed under the laws of the State of Vermont. The language of all parts of this Release shall in all cases be construed as a whole, according to its fair meaning, and not strictly for or against any of the parties.  It is agreed that this Agreement shall be construed with the understanding that both parties were responsible for drafting it.

 

10.                               Capitalized terms used herein and not defined shall have the meanings ascribed to them in the Transition Agreement.

 

11.                               Should any of the provisions of this Release be declared or be determined to be illegal or invalid, the validity of the remaining parts, terms, or provisions shall not be affected thereby, and said illegal or invalid part, term, or provision shall be deemed not to be a part of this Release.

 

12.                               The signed Release must be returned to Linda Longo Kazanova, Vice President, Chief Human Resources Officer, at the Company’s headquarters at 33 Coffee Lane, Waterbury, VT 05676 on or before January 3, 2013.  If Executive does not revoke the Release within seven days after signing it, then the Release will take effect as a legally binding document on the expiration of the seventh day after signing.

 

PLEASE READ CAREFULLY.  THIS RELEASE AND WAIVER INCLUDES A RELEASE OF ALL KNOWN OR UNKNOWN CLAIMS.

 

Executed at South Burlington (city), Vermont (state) this 14th day of December, 2013.

 

	
 
    	
By:
    	
/s/ Howard Malovany
    
	
 
    	
 
    	
Howard Malovany
    

 

Received at South Burlington, Vermont this 14th day of December, 2013.

 

	
Green   Mountain Coffee Roasters, Inc.
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/ Linda Longo Kazanova
    	
 
    
	
Printed   Name: Linda Longo Kazanova
    	
 
    
	
Title:   Vice President, Chief Human Resources Officer
    	
 
    
			

 

3

 

Appendix B

 

Supplemental Release and Waiver

 

THIS SUPPLEMENTAL RELEASE is executed by the undersigned (the “Executive’) as of the date indicated below.

 

WHEREAS, the Executive and Green Mountain Coffee Roasters, Inc. (the “Company”) entered into a transition agreement dated December 13, 2012 (the “Transition Agreement”), under which Executive is entitled to certain payments and benefits following his Termination Date (as defined in the Transition Agreement), subject to the Executive’s timely execution and non-revocation of this Supplemental Release and to his compliance with its terms; and

 

WHEREAS, a the Termination Date has occurred;

 

NOW, THEREFORE, in consideration of the payments and provision of benefits as provided in the Transition Agreement, and other good and valuable consideration, the Executive agrees as follows:

 

1.                                      Executive irrevocably and unconditionally releases, acquits, and forever discharges the Company and all of its current and former related entities, affiliates, successors, predecessors, assigns, owners, investors, stockholders, partners, members, and employee benefit plans, and all of their directors, officers, employees, agents, representatives, insurers, administrators, attorneys, and all persons acting by, through, under, or in concert with any of them, and the Foundation (collectively “Releasees”), from any and all charges, complaints, claims, liabilities, obligations, promises, agreements, damages, actions, causes of action, suits, rights, demands, costs, losses, debts, and expenses (including attorneys’ fees and costs) of any nature whatsoever, known or unknown, suspected or unsuspected (“Claim” or “Claims”), which Executive now has, owns or holds, or claims to have, own or hold, or which Executive at any time heretofore had, owned or held, or claimed to have had, owned or held, or which Executive at any time hereafter may have, own or hold, or claim to have, own or hold, against any of the Releasees relating to any event, act, or omission that has occurred prior to or as of the date Executive signs this Supplemental Release.  This Supplemental Release shall not apply to (a) any of the Company’s obligations under the terms of this Supplemental Release, or (b) Executive’s right to indemnification under the Company’s bylaws and the indemnification agreement between the Company and Executive dated August 10, 2009.

 

2.                                      Without limiting the foregoing, Executive specifically waives and releases all rights, claims (including claims for attorneys’ fees), demands, and causes of action under the Age Discrimination in Employment Act of 1967 (“ADEA”), as amended; Title VII of the Civil Rights Act of 1964, as amended; the Employee Retirement Income Security Act of 1974, as amended; the Rehabilitation Act of 1973, as amended; the Worker Adjustment Retraining and Notification Act; the Americans with Disabilities Act; and any comparable state law, concerning Executive’s relationship and association with any of the Releasees and the creation and termination of such relationship.  Executive acknowledges and understands that the release of claims under the ADEA is subject to special waiver protection under 29 U.S.C. § 626(f).

 

a.                                      In accordance with that section, Executive specifically agrees he is knowingly and voluntarily releasing and waiving any right or claim of discrimination under the ADEA.

 

b.                                      In particular, he acknowledges and understands the following:

 

1

 

(i)                                     he is not waiving rights or claims for age discrimination under the ADEA that may arise after the date he signs this Supplemental Release;

 

(ii)                                  he is not waiving his right to file a complaint or charge with the EEOC or participate in any investigation or proceeding conducted by the EEOC;

 

(iii)                               he is waiving rights or claims for age discrimination under the ADEA in exchange for the payments and benefits under the Transition Agreement, which are in addition to anything of value to which he otherwise is entitled;

 

(iv)                              he has been advised to consult with an attorney of his choice before signing this Supplemental Release, and he has had an opportunity to do so;

 

(v)                                 he has freely and voluntarily entered into this Supplemental Release without any threat, coercion, or intimidation by any person;

 

(vi)                              he has been given the opportunity to take 21 days after his Termination Date to consider whether to sign this Supplemental Release, although he is not required to wait 21 days; and

 

(vii)                           he will have seven days after the date he signs this Supplemental Release within which to revoke it, and the Supplemental Release shall not become effective or enforceable as to any party until that revocation period has expired without revocation of the Supplemental Release.  Any such revocation shall be in writing and shall be sent to Linda Longo Kazanova, Vice President, Chief Human Resources Officer, at the Company’s headquarters at 33 Coffee Lane, Waterbury, VT 05676.

 

3.                                      The Executive understands that nothing in this Supplemental Release shall be construed to prohibit him from filing a charge with, or participating in any investigation or proceeding conducted by, the Equal Employment Opportunity Commission, National Labor Relations Board, and/or any federal, state or local agency.  Notwithstanding the foregoing, the Executive hereby waives any and all rights to recover monetary damages in any charge, complaint, or lawsuit filed by him or by anyone else on his behalf based on events occurring prior to the date of this Supplemental Release.

 

4.                                      Executive expressly acknowledges that this Supplemental Release is intended to include in its effect, without limitation, all Claims which he does not know or suspect to exist in his favor at the time of execution hereof and that this Supplemental Release contemplates the extinguishment of any such Claim or Claims.

 

5.                                      Executive agrees that he shall continue to be bound by the provisions of Sections 8, 9, and 10 of the Transition Agreement, which are fully incorporated into this Supplemental Release.

 

6.                                      Executive represents that he has not heretofore assigned or transferred, or purported to assign or transfer, to any person or entity, any Claim or any portion thereof, or interest therein, and he agrees to indemnify, defend and hold Releasees harmless from and against any and all Claims, based on or arising out of any such assignment or transfer, or purported assignment or transfer of any Claims or any portion thereof or interest therein.

 

7.                                      Executive acknowledges and agrees that, pursuant to the Transition Agreement, he will have received payment for any and all compensation for services rendered through your Termination Date, including all wages or other compensation and all accrued and unpaid vacation pay.  Executive agrees

 

2

 

and understands that the Company has paid him for any reimbursable but unpaid business expenses outstanding on the Termination Date.

 

8.                                      Executive represents and acknowledges that in executing this Supplemental Release he does not rely and has not relied upon any representation or statement not set forth herein made by any of the Releasees or by any of the Releasees’ agents, representatives, or attorneys with regard to the subject matter, basis, or effect of this Supplemental Release or otherwise.

 

9.                                      This Supplemental Release shall be binding upon Executive and upon his respective heirs, administrators, representatives, executors, beneficiaries, successors, and assigns, and shall inure to the benefit of Releasees and each of them, and to their heirs, administrators, representatives, executors, successors, and assigns.

 

10.                               This Supplemental Release is made and entered into in the State of Vermont and shall in all respects be interpreted, enforced, and governed under the laws of the State of Vermont. The language of all parts of this Supplemental Release shall in all cases be construed as a whole, according to its fair meaning, and not strictly for or against any of the parties.  It is agreed that this Agreement shall be construed with the understanding that both parties were responsible for drafting it.

 

11.                               Capitalized terms used herein and not defined shall have the meanings ascribed to them in the Transition Agreement.

 

12.                               Should any of the provisions of this Supplemental Release be declared or be determined to be illegal or invalid, the validity of the remaining parts, terms, or provisions shall not be affected thereby, and said illegal or invalid part, term, or provision shall be deemed not to be a part of this Supplemental Release.

 

13.                               The signed Supplemental Release must be returned to Linda Longo Kazanova, Vice President, Chief Human Resources Officer, at the Company’s headquarters at 33 Coffee Lane, Waterbury, VT 05676 on or before                         .  If Executive does not revoke this Supplemental Release within seven days after signing it, then the Agreement will take effect as a legally binding document on the expiration of the seventh day after signing (the “Effective Date”).

 

PLEASE READ CAREFULLY.  THIS SUPPLEMENTAL RELEASE INCLUDES A RELEASE OF ALL KNOWN OR UNKNOWN CLAIMS.

 

Executed at                                            (city),                                  (state) this                day of                           , 20    .

 

	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Howard Malovany
    

 

Received at South Burlington, Vermont this        day of                      , 20    .

 

	
Green   Mountain Coffee Roasters, Inc.
    	
 
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    
	
Printed   Name: Linda Longo Kazanova
    	
 
    
	
Title:   Vice President, Chief Human Resources Officer
    	
 
    
			

 

3Exhibit 10.2

 

GENERAL RELEASE AND SEPARATION AGREEMENT

 

This General Release and Separation Agreement (hereafter “Agreement”) is entered into between Euan Thomson, Ph. D., (the “Executive”), and Accuray Incorporated (the “Company”), effective on the eighth calendar day following the Executive’s signature (the “Effective Date”), unless he revokes his acceptance in accordance with the terms of Section 7(b), below.

 

WHEREAS, the Executive was President and Chief Executive Officer of the Company, pursuant to the terms of the Amended and Restated Employment Agreement effective October 1, 2011 (the “Employment Agreement”);

 

WHEREAS, the Executive resigned effective October 11, 2012; and

 

WHEREAS, the Company and the Executive now wish to document the termination of their employment relationship and fully and finally to resolve all matters between them;

 

THEREFORE, in exchange for the good and valuable consideration set forth herein, the adequacy of which is specifically acknowledged, the Executive and the Company hereby agree as follows:

 

1.             Resignation of Employment.  The Executive confirms his resignation of his employment and of his position as an officer and member of the Board of Directors (the “Board”) of the Company effective October 11, 2012 (the “Resignation Date”).  The parties hereby acknowledge and agree that the Executive’s resignation of employment constitutes a “separation from service” from the Company 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) (a “Separation from Service”).  As of the Resignation Date, the Employment Agreement shall automatically terminate and be of no further force and effect, and neither the Company nor the Executive shall have any further obligations thereunder, except as expressly provided herein.  Notwithstanding the foregoing, the Company shall be obligated to Executive for severance payments and continuation of benefits as contemplated by Section 7 of the Employment Agreement and as set forth in Section 4 below.

 

2.             Consulting Relationship.  In consideration of the Executive’s promises herein, the Company will enter into a consulting relationship with the Executive for a period of six months commencing the day after the Effective Date of this Agreement on the terms set forth in Exhibit A hereto.

 

3.             Payment of Accrued Wages and Expenses.  The Executive acknowledges receipt, on the Resignation Date, of an amount equal to all accrued wages through the Resignation Date, including accrued, unused vacation and/or paid time off, less applicable taxes and other authorized withholding (apart from the Executive’s bonus for the current fiscal year, which will be paid in accordance with the terms of this Agreement). The Executive shall also be promptly reimbursed for all expenses incurred by him on behalf of the Company, so long as they are submitted for reimbursement on or before December 1, 2012, and they are in accordance with the Company’s expense reimbursement policies.

 

4.             Cash Severance Benefits and COBRA Premiums.   The Executive agrees that, except as set forth in this Agreement, he is entitled to no additional pay or benefits in conjunction with the termination of his employment.  Subject to Section 23(b) of this Agreement, the Company shall pay to the Executive, in a lump-sum, cash severance in the gross amount of $1,159,666 (the “Severance Payment”), which the parties acknowledge and agree represents the amount of the “Severance Payment”

 

 

calculated under, and as defined in, Section 7 of the Employment Agreement, consisting of:

 

	
a.
    	
 
    	
Salary:
    	
 
    	
$
    	
530,500.00
    
	
b.
    	
 
    	
Bonus:
    	
 
    	
$
    	
530,500.00
    
	
c.
    	
 
    	
Health   Benefit:
    	
 
    	
$
    	
98,666.00
    

 

The Severance Payment shall be paid net of applicable taxes and other authorized withholdings.

 

5.             Stock Options and Restricted Stock Units.  The Executive acknowledges that as of the Resignation Date, the Executive was vested in Stock Options and Restricted Stock Units (“RSUs”) as reflected in the report attached as Exhibit B hereto. As provided in Section 7(a) of the Employment Agreement, the unvested stock options and RSUs previously granted to the Executive that would have vested within twelve (12) months after the Termination Date shall become immediately vested and are included in Exhibit B hereto.  Except as specifically set forth herein, the Executive’s rights with respect to Stock Options and RSUs issued to him are governed by the Stock Option and Restricted Stock Unit Agreements entered into between the Executive and the Company, and the applicable Company equity incentive plan(s) and Notice(s) of Grant.

 

6.             Outplacement Assistance.  The Company will pay for executive outplacement assistance for a period of up to twelve (12) months after the Effective Date of this Agreement, provided that the Executive uses the Company’s outplacement service provider.   The Company’s outplacement service provider will bill the Company directly, and there is no cash value to this benefit.

 

7.             General Release of Claims by the Executive.

 

(a)           The Executive, on behalf of himself and his executors, heirs, administrators, representatives and assigns, hereby agrees to release and forever discharge the Company and all predecessors, successors and their respective parent corporations, affiliates, related, and/or subsidiary entities, and all of their past and present investors, directors, shareholders, officers, general or limited partners, executives, attorneys, agents and representatives, and executive benefit plans in which the Executive is or has been a participant by virtue of his employment with the Company, from any and all claims, debts, demands, accounts, judgments, rights, causes of action, equitable relief, damages, costs, charges, complaints, obligations, promises, agreements, controversies, suits, expenses, compensation, responsibility and liability of every kind and character whatsoever (including attorneys’ fees and costs), whether in law or equity, known or unknown, asserted or unasserted, suspected or unsuspected (collectively, “Claims”), which the Executive has or may have had against such entities based on any events or circumstances arising or occurring on or prior to the date hereof or on or prior to the Resignation Date, arising directly or indirectly out of, relating to, or in any other way involving in any manner whatsoever the Executive’s employment by the Company or the separation thereof, and any and all claims arising under federal, state, or local laws relating to employment, including without limitation claims of wrongful discharge, breach of express or implied contract, fraud, misrepresentation, defamation, or liability in tort, claims of any kind that may be brought in any court or administrative agency, any claims arising under Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the Americans with Disabilities Act, the Fair Labor Standards Act, the Employee Retirement Income Security Act, the Family and Medical Leave Act, and state or local statutes, ordinances, and regulations, including, without limitation, the California Family Rights Act, the California Fair Employment and Housing Act and the California Labor Code.

 

Notwithstanding the generality of the foregoing, the Executive does not release the following claims and rights:

 

 

(i)            Claims for unemployment compensation or any state disability insurance benefits pursuant to the terms of applicable state law;

 

(ii)           Claims to continued participation in certain of the Company’s group benefit plans pursuant to the terms and conditions of the federal law known as COBRA;

 

(iii)          The Executive’s right to bring to the attention of the Equal Employment Opportunity Commission claims of discrimination; provided, however, that the Executive does release his right to secure damages for any alleged discriminatory treatment;

 

(iv)          The Executive’s rights under the Indemnification Agreement between Company and Executive and under applicable law (including California Labor Code Section 2802), the General Corporation Law of Delaware and the Company’s D&O policy to seek indemnity for acts committed, or omissions, within the course and scope of the Executive’s employment duties; and

 

(v)           Claims for breach of this Separation Agreement.

 

(b)           In accordance with the Older Workers Benefit Protection Act of 1990, the Executive acknowledges that he is aware of the following:

 

(i)            This Section and this Agreement are written in a manner calculated to be understood by the Executive.

 

(ii)           The waiver and release of claims under the ADEA contained in this Agreement does not cover rights or claims that may arise after the date on which the Executive signs this Agreement.

 

(iii)          This Agreement provides for consideration in addition to anything of value to which the Executive is already entitled.

 

(iv)          The Executive has been advised to consult an attorney before signing this Agreement.

 

(v)           The Executive has been granted twenty one (21) days after he is presented with this Agreement to decide whether or not to sign this Agreement.  If the Executive executes this Agreement prior to the expiration of this 21-day period, he does so voluntarily and after having had the opportunity to consult with an attorney, and hereby waives the remainder of the period.

 

(vi)          The Executive has the right to revoke this general release within seven (7) days of signing this Agreement.  In the event this general release is revoked, this Agreement will be null and void in its entirety, and the Executive will not receive the benefits of this Agreement.

 

If the Executive wishes to revoke this agreement, he must deliver written notice stating that intent to revoke, in accordance with the notice provisions of Section 18 of this Agreement, on or before 5:00 p.m. on the seventh (7th) day after the date on which the Executive signs this Agreement.

 

8.             The Company’s Release of Claims. Nothing herein shall release or discharge any Claim by the Company against the Executive, or the right of the Company to bring any action, legal or

 

 

otherwise, against the Executive as a result of any failure by him to perform his obligations under this Agreement, or as a result of any acts of intentional misconduct or recklessness (including, but not limited to, fraud, embezzlement, misappropriation, or other malfeasance).

 

9.             Waiver of Rights Under California Civil Code Section 1542.  The Company and the Executive acknowledge that they have been advised of and are familiar with the provisions of California Civil Code Section 1542, which provides 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.”

 

Being aware of said code section, the Company and the Executive hereby expressly waive any rights they may have thereunder, as well as under any other statutes or common law principles of similar effect; provided, however, that such waiver is not intended to affect claims expressly preserved under the terms of the parties’ respective releases.

 

10.          Nondisparagement.  The Executive agrees that neither he nor anyone acting by, through, under or in concert with him shall disparage or otherwise communicate negative statements or opinions about the Company, its Board members, officers, executives or business.  The Company agrees that neither its Board members nor executive officers shall disparage or otherwise communicate negative statements or opinions about the Executive.

 

11.          Restrictive Covenants.  The Executive acknowledges his continuing obligations, pursuant to Section 9(a), (b) and (d) of the Employment Agreement and under the Employee Invention Assignment and Confidentiality Agreement to which he is a party.

 

12.          Cooperation.  The Executive agrees to give reasonable cooperation, at the Company’s request, in any pending or future litigation or arbitration brought against the Company and in any investigation that the Company or any government entity may conduct.    The Company shall reimburse the Executive for all out of pocket expenses reasonably incurred by him in compliance with this Section 12.  For his part, Executive agrees to submit a reimbursement for such out of pocket expenses within thirty (30) days after they have been incurred.

 

13.          Executive’s Representations and Warranties.  The Executive represents and warrants that:

 

(a)           He has been paid all wages owed to him by the Company, including all accrued, unused vacation and/or paid time off, as of the date of execution of this Agreement;

 

(b)           As of the date of execution of this Agreement, he has not sustained any injuries for which he/she might be entitled to compensation pursuant to California’s Workers Compensation law;

 

(c)           The Executive has not initiated any adversarial proceedings of any kind against the Company or against any other person or entity released herein, nor will he do so in the future, except as specifically allowed by this Agreement, and the Executive is not aware of any facts that would support any Claims, any government law or regulation compliance-related violation, or any violation of the Company’s Code of Conduct & Ethics for Employees, Agents and Contractors or Code of Ethics on Interactions with Health Care Professionals.

 

 

14.          Confidential Information; Return of Company Property.

 

(a)           The Executive hereby expressly confirms his continuing obligations to the Company pursuant to Section 9(a) of the Employment Agreement, and pursuant to the Employee Invention Assignment and Confidentiality Agreement executed by the Executive, a copy of which is attached as Exhibit C and incorporated herein by reference.

 

(b)           The Executive shall deliver to the Company within five days of the Resignation Date, all originals and copies of correspondence, drawings, manuals, letters, notes, notebooks, reports, programs, plans, proposals, financial documents, or any other documents concerning the Company and its customers’, business plans, marketing strategies, products, processes or business of any kind, and all originals and copies of documents that contain proprietary information or trade secrets of the Company that are in the possession or control of the Executive or his agents or representatives.

 

(c)           The Executive shall return to the Company within five days of the Resignation Date all equipment of the Company in his possession or control. The Executive may however keep his Company-issued laptop computer and cellular phone if within five (5) days of the Resignation Date the Executive provides these items to the Company to remove all Company licensed software and confidential information before transfer of ownership.

 

15.          Taxes.  To the extent any taxes may be payable by the Executive for the benefits provided to him by this Agreement beyond those withheld by the Company, the Executive agrees to pay them himself and to indemnify and hold the Company and the other entities released herein harmless for any tax claims or penalties, and associated attorneys’ fees and costs, resulting from any failure by him to make required payments.

 

16.          In the Event of a Claimed Breach.  All controversies, claims and disputes arising out of or relating to this Agreement, including without limitation any alleged violation of its terms, shall be resolved by final and binding arbitration before a single neutral arbitrator in San Jose, California, in accordance with the applicable dispute resolution rules of the Judicial Arbitration and Mediation Service (“JAMS”). The arbitration shall be commenced by filing a demand for arbitration with JAMS within 60 (sixty) days after the filing party has given notice of such breach to the other party.  The arbitrator shall have authority to award the prevailing party attorneys’ fees and expert fees, if any.  Notwithstanding the foregoing, it is acknowledged that it will be impossible to measure in money the damages that would be suffered if the parties fail to comply with any of the obligations imposed on them under Sections 14(a) and (b) hereof, and that in the event of any such failure, an aggrieved person will be irreparably damaged and will not have an adequate remedy at law.  Any such person shall, therefore, be entitled to injunctive relief, including specific performance, to enforce such obligations, and if any action shall be brought in equity to enforce any of the provisions of Sections 14(a) and (b) of this Agreement, neither of the parties hereto shall raise the defense that there is an adequate remedy at law.

 

17.          Choice of Law.  This Agreement shall in all respects be governed and construed in accordance with the laws of the State of California, including all matters of construction, validity and performance, without regard to conflicts of law principles.

 

18.          Notices.  All notices, demands or other communications regarding this Agreement shall be in writing and shall be sufficiently given if either personally delivered or sent by facsimile, electronic mail, or overnight courier, addressed as follows:

 

 

(a)           If to the Company:

 

Accuray Incorporated

Attn:  General Counsel

1310 Chesapeake Terrace

Sunnyvale, California  94089

Fax:  408-716-4747

 

(b)           If to the Executive:

 

Euan Thomson, Ph. D.

17150 Los Robles Way

Los Gatos, California 95030

Email: euan_thomson@comcast.net

 

19.          Severability.  Except as otherwise specified below, should any portion of this Agreement be found void or unenforceable for any reason by a court of competent jurisdiction, the parties intend that such provision be limited or modified so as to make it enforceable, and if such provision cannot be modified to be enforceable, the unenforceable portion shall be deemed severed from the remaining portions of this Agreement, which shall otherwise remain in full force and effect.  If any portion of this Agreement is so found to be void or unenforceable for any reason in regard to any one or more persons, entities, or subject matters, such portion shall remain in full force and effect with respect to all other persons, entities, and subject matters.  This paragraph shall not operate, however, to sever the Executive’s obligation to provide the binding release to all entities intended to be released hereunder.

 

20.          Understanding and Authority.  The parties understand and agree that all terms of this Agreement are contractual and are not a mere recital, and represent and warrant that they are competent to covenant and agree as herein provided.

 

21.          Integration Clause.  This Agreement, the Employment Agreement, and the Employee Invention Assignment and Confidentiality Agreement contain the entire agreement of the parties with regard to the matters referenced herein and supersede any prior agreements as to such matters. This Agreement may not be changed or modified, in whole or in part, except by an instrument in writing signed by the Executive and the Chief Executive Officer of the Company.   The Indemnification Agreement between the Company and the Executive shall not be affected by the existence of this Agreement, including this Section 21 hereof, and shall remain in full force and effect.

 

22.          Execution in Counterparts.  This Agreement may be executed in counterparts with the same force and effectiveness as though executed in a single document.

 

23.          Section 409A of the Code.

 

(a)           The payments and benefits under this Agreement are intended to be exempt from the application of Section 409A of the Code.  To the extent applicable, this Agreement shall be interpreted in accordance with Section 409A of the Code and Department of Treasury Regulations and other interpretive guidance issued thereunder.  Notwithstanding any provision of this Agreement to the contrary, if the Company determines that any such compensation or benefits payable under this Agreement may be subject to Section 409A of the Code and related Department of Treasury guidance, the Company may, with the Executive’s prior written consent, adopt such amendments to this Agreement or adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, that the Company determines are necessary or appropriate to (i) exempt the compensation and benefits payable under this Agreement from Section 409A of the Code and/or

 

 

preserve the intended tax treatment of such compensation and benefits, or (ii) comply with the requirements of Section 409A of the Code and related Department of Treasury guidance.

 

(b)           Notwithstanding anything to the contrary in this Agreement, no payment or benefits, including without limitation the amount payable under Section 4 hereof, shall be paid to the Executive during the six (6) month period following the Executive’s Separation from Service if the Company determines that paying such amount at the time or times indicated in this Agreement would be a prohibited distribution under Section 409A(a)(2)(B)(i) of the Code.  If the payment of any such amount 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 the Executive’s death), the Company shall pay the Executive a lump-sum amount equal to the cumulative amount that would have otherwise been payable to the Executive during such period.

 

(c)           To the extent permitted under Section 409A of the Code, any separate payment or benefit under this Agreement or otherwise shall not be deemed “nonqualified deferred compensation” subject to Section 409A and the six (6) month delay requirement under 409A(a)(2)(B)(i) of the Code to the extent provided in the exceptions in Treasury Regulation Section 1.409A-1(b)(4), Section 1.409A-1(b)(9) or any other applicable exception or provision of Section 409A of the Code.

 

(d)           To the extent that any reimbursements or corresponding in-kind benefits provided to the Executive under this Agreement, including, without limitation under Section 4 or Section 12 hereof, are deemed to constitute compensation to the Executive, such amounts shall 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 shall not affect the expenses or in-kind benefits eligible for payment or reimbursement in any other taxable year, and the Executive’s right to such payments or reimbursement of any such expenses shall not be subject to liquidation or exchange for any other benefit.

 

The parties have carefully read this Agreement in its entirety; fully understand and agree to its terms and provisions; and intend and agree that it is final and binding on all parties.

 

IN WITNESS WHEREOF, and intending to be legally bound, the parties have executed the foregoing on the dates shown below.

 

	
EUAN   THOMSON, Ph.D.
    	
 
    	
ACCURAY   INCORPORATED
    
	
 
    	
 
    	
 
    
	
/s/   Euan Thomson
    	
 
    	
/s/   Darren J. Milliken
    
	
 
    	
 
    	
 
    
	
Euan   Thomson
    	
 
    	
Darren   J. Milliken
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Senior   Vice President, General Counsel
    
	
 
    	
 
    	
 
    
	
Date:   Oct 27, 2012
    	
 
    	
Date:   Oct 27, 2012
    

 

 

Exhibit A

 

Form of Consulting Agreement

 

See Exhibit 10.3

 

 

Exhibit B

 

List of Vested Stock options and RSUs as of Resignation Date

 

	
 
    	
Accuray   Incorporated
    	
 
    	
 
    
	
Personnel Grant Status
    	
ID: 20-8370041
    	
File:
    	
Optstmt
    
	
 
    	
1310 Chesapeake Terrace
    	
Date:
    	
10/19/2012
    
	
 
    	
Sunnyvale, CA 94089
    	
Time:
    	
1:29:11PM
    

 

AS OF 10/11/2012

 

Euan Thomson

17150 Los Robles Way

Los Gatos, CA United States 95030

 

A W A R D S

 

	
 
    	
 
    	
Grant
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
Next Deferral
    	
 
    
	
Number
    	
 
    	
Date
    	
 
    	
Plan
    	
 
    	
Type
    	
 
    	
Granted
    	
 
    	
Price
    	
 
    	
Released
    	
 
    	
Vested
    	
 
    	
Cancelled
    	
 
    	
Unvested
    	
 
    	
Deferred
    	
 
    	
Release Date
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
00003036
    	
 
    	
8/31/2010
    	
 
    	
2007
    	
 
    	
RSU
    	
 
    	
38,300.00
    	
 
    	
$
    	
0.00000
    	
 
    	
19,150.00
    	
 
    	
19,150.00
    	
 
    	
0.00
    	
 
    	
19,150.00
    	
 
    	
0.00
    	
 
    	
 
    	
 
    
	
00004058
    	
 
    	
9/30/2011
    	
 
    	
2007
    	
 
    	
RSU
    	
 
    	
32,000.00
    	
 
    	
$
    	
0.00000
    	
 
    	
8,000.00
    	
 
    	
8,000.00
    	
 
    	
0.00
    	
 
    	
24,000.00
    	
 
    	
0.00
    	
 
    	
 
    	
 
    
	
P0004102
    	
 
    	
9/30/2011
    	
 
    	
2007
    	
 
    	
PSU
    	
 
    	
56,000.00
    	
 
    	
$
    	
0.00000
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
56,000.00
    	
 
    	
0.00
    	
 
    	
 
    	
 
    
	
P0004130
    	
 
    	
9/30/2011
    	
 
    	
2007
    	
 
    	
PSU
    	
 
    	
56,000.00
    	
 
    	
$
    	
0.00000
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
56,000.00
    	
 
    	
0.00
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
182,300.00
    	
 
    	
 
    	
 
    	
27,150.00
    	
 
    	
27,150.00
    	
 
    	
0.00
    	
 
    	
155,150.00
    	
 
    	
0.00
    	
 
    	
 
    	
 
    

 

S T O C K  O P T I O N S

 

	
 
    	
 
    	
Grant
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Number
    	
 
    	
Date
    	
 
    	
Plan
    	
 
    	
Type
    	
 
    	
Granted
    	
 
    	
Price
    	
 
    	
Exercised
    	
 
    	
Vested
    	
 
    	
Cancelled
    	
 
    	
Unvested
    	
 
    	
Outstanding
    	
 
    	
Exercisable
    	
 
    
	
00000446
    	
 
    	
3/28/2002
    	
 
    	
1998
    	
 
    	
ISO
    	
 
    	
437,499.00
    	
 
    	
$
    	
0.75000
    	
 
    	
437,499.00
    	
 
    	
437,499.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    
	
00000447
    	
 
    	
3/28/2002
    	
 
    	
1998
    	
 
    	
NQ
    	
 
    	
162,501.00
    	
 
    	
$
    	
0.75000
    	
 
    	
162,501.00
    	
 
    	
162,501.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    
	
00000540
    	
 
    	
7/9/2003
    	
 
    	
1998
    	
 
    	
ISO
    	
 
    	
15,833.00
    	
 
    	
$
    	
0.75000
    	
 
    	
15,833.00
    	
 
    	
15,833.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    
	
00000603
    	
 
    	
8/27/2003
    	
 
    	
1998
    	
 
    	
NQ
    	
 
    	
560,000.00
    	
 
    	
$
    	
0.75000
    	
 
    	
317,899.00
    	
 
    	
560,000.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
242,101.00
    	
 
    	
242,101.00
    	
 
    
	
00000632
    	
 
    	
3/16/2004
    	
 
    	
1998
    	
 
    	
ISO
    	
 
    	
22,500.00
    	
 
    	
$
    	
1.40000
    	
 
    	
22,500.00
    	
 
    	
22,500.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    
	
00000702
    	
 
    	
8/10/2004
    	
 
    	
1998
    	
 
    	
ISO
    	
 
    	
91,399.00
    	
 
    	
$
    	
2.50000
    	
 
    	
91,399.00
    	
 
    	
91,399.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    
	
00000703
    	
 
    	
8/10/2004
    	
 
    	
1998
    	
 
    	
NQ
    	
 
    	
208,601.00
    	
 
    	
$
    	
2.50000
    	
 
    	
0.00
    	
 
    	
208,601.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
208,601.00
    	
 
    	
208,601.00
    	
 
    
	
00000783
    	
 
    	
5/12/2005
    	
 
    	
1998
    	
 
    	
ISO
    	
 
    	
2,500.00
    	
 
    	
$
    	
3.50000
    	
 
    	
0.00
    	
 
    	
2,500.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
2,500.00
    	
 
    	
2,500.00
    	
 
    
	
00000788
    	
 
    	
11/7/2005
    	
 
    	
1998
    	
 
    	
ISO
    	
 
    	
20,833.00
    	
 
    	
$
    	
4.38000
    	
 
    	
0.00
    	
 
    	
20,833.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
20,833.00
    	
 
    	
20,833.00
    	
 
    
	
00000789
    	
 
    	
11/7/2005
    	
 
    	
1998
    	
 
    	
NQ
    	
 
    	
137,167.00
    	
 
    	
$
    	
4.38000
    	
 
    	
0.00
    	
 
    	
137,167.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
137,167.00
    	
 
    	
137,167.00
    	
 
    
	
00000919
    	
 
    	
4/5/2006
    	
 
    	
1998
    	
 
    	
ISO
    	
 
    	
2,500.00
    	
 
    	
$
    	
6.73000
    	
 
    	
0.00
    	
 
    	
2,500.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
2,500.00
    	
 
    	
2,500.00
    	
 
    
	
00000996
    	
 
    	
8/23/2006
    	
 
    	
1998
    	
 
    	
ISO
    	
 
    	
8,755.00
    	
 
    	
$
    	
9.50000
    	
 
    	
0.00
    	
 
    	
8,755.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
8,755.00
    	
 
    	
8,755.00
    	
 
    
	
00001559
    	
 
    	
8/31/2007
    	
 
    	
2007
    	
 
    	
NQ
    	
 
    	
40,000.00
    	
 
    	
$
    	
28.47000
    	
 
    	
0.00
    	
 
    	
40,000.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
40,000.00
    	
 
    	
40,000.00
    	
 
    
	
00001560
    	
 
    	
8/31/2007
    	
 
    	
2007
    	
 
    	
NQ
    	
 
    	
135,000.00
    	
 
    	
$
    	
13.83000
    	
 
    	
0.00
    	
 
    	
135,000.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
135,000.00
    	
 
    	
135,000.00
    	
 
    
	
00002062
    	
 
    	
2/29/2008
    	
 
    	
2007
    	
 
    	
NQ
    	
 
    	
40,000.00
    	
 
    	
$
    	
10.36000
    	
 
    	
0.00
    	
 
    	
40,000.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
40,000.00
    	
 
    	
40,000.00
    	
 
    
	
00002178
    	
 
    	
8/29/2008
    	
 
    	
2007
    	
 
    	
NQ
    	
 
    	
140,000.00
    	
 
    	
$
    	
8.25000
    	
 
    	
0.00
    	
 
    	
140,000.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
140,000.00
    	
 
    	
140,000.00
    	
 
    
	
00002546
    	
 
    	
2/27/2009
    	
 
    	
2007
    	
 
    	
NQ
    	
 
    	
40,000.00
    	
 
    	
$
    	
4.67000
    	
 
    	
0.00
    	
 
    	
37,500.00
    	
 
    	
0.00
    	
 
    	
2,500.00
    	
 
    	
40,000.00
    	
 
    	
37,500.00
    	
 
    
	
00002629
    	
 
    	
8/31/2009
    	
 
    	
2007
    	
 
    	
NQ
    	
 
    	
160,000.00
    	
 
    	
$
    	
6.41000
    	
 
    	
0.00
    	
 
    	
120,000.00
    	
 
    	
0.00
    	
 
    	
40,000.00
    	
 
    	
160,000.00
    	
 
    	
120,000.00
    	
 
    
	
00002945
    	
 
    	
1/29/2010
    	
 
    	
2007
    	
 
    	
NQ
    	
 
    	
40,000.00
    	
 
    	
$
    	
5.94000
    	
 
    	
0.00
    	
 
    	
27,500.00
    	
 
    	
0.00
    	
 
    	
12,500.00
    	
 
    	
40,000.00
    	
 
    	
27,500.00
    	
 
    
	
00003035
    	
 
    	
8/31/2010
    	
 
    	
2007
    	
 
    	
NQ
    	
 
    	
75,000.00
    	
 
    	
$
    	
6.58000
    	
 
    	
0.00
    	
 
    	
37,500.00
    	
 
    	
0.00
    	
 
    	
37,500.00
    	
 
    	
75,000.00
    	
 
    	
37,500.00
    	
 
    
	
00003404
    	
 
    	
1/31/2011
    	
 
    	
2007
    	
 
    	
NQ
    	
 
    	
40,000.00
    	
 
    	
$
    	
8.56000
    	
 
    	
0.00
    	
 
    	
17,500.00
    	
 
    	
0.00
    	
 
    	
22,500.00
    	
 
    	
40,000.00
    	
 
    	
17,500.00
    	
 
    
	
00004031
    	
 
    	
9/30/2011
    	
 
    	
2007
    	
 
    	
NQ
    	
 
    	
80,000.00
    	
 
    	
$
    	
4.01000
    	
 
    	
0.00
    	
 
    	
20,000.00
    	
 
    	
0.00
    	
 
    	
60,000.00
    	
 
    	
80,000.00
    	
 
    	
20,000.00
    	
 
    
	
C0000540
    	
 
    	
7/9/2003
    	
 
    	
1998
    	
 
    	
NQ
    	
 
    	
24,167.00
    	
 
    	
$
    	
0.75000
    	
 
    	
5,000.00
    	
 
    	
24,167.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
19,167.00
    	
 
    	
19,167.00
    	
 
    
	
C0000632
    	
 
    	
3/16/2004
    	
 
    	
1998
    	
 
    	
NQ
    	
 
    	
17,500.00
    	
 
    	
$
    	
1.40000
    	
 
    	
0.00
    	
 
    	
17,500.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
17,500.00
    	
 
    	
17,500.00
    	
 
    
	
C0000783
    	
 
    	
5/12/2005
    	
 
    	
1998
    	
 
    	
NQ
    	
 
    	
37,500.00
    	
 
    	
$
    	
3.50000
    	
 
    	
0.00
    	
 
    	
37,500.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
37,500.00
    	
 
    	
37,500.00
    	
 
    
	
C0000919
    	
 
    	
4/5/2006
    	
 
    	
1998
    	
 
    	
NQ
    	
 
    	
37,500.00
    	
 
    	
$
    	
6.73000
    	
 
    	
0.00
    	
 
    	
37,500.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
37,500.00
    	
 
    	
37,500.00
    	
 
    
	
C0000996
    	
 
    	
8/23/2006
    	
 
    	
1998
    	
 
    	
NQ
    	
 
    	
291,245.00
    	
 
    	
$
    	
9.50000
    	
 
    	
0.00
    	
 
    	
291,245.00
    	
 
    	
0.00
    	
 
    	
0.00
    	
 
    	
291,245.00
    	
 
    	
291,245.00
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
2,868,000.00
    	
 
    	
 
    	
 
    	
1,052,631.00
    	
 
    	
2,693,000.00
    	
 
    	
0.00
    	
 
    	
175,000.00
    	
 
    	
1,815,369.00
    	
 
    	
1,640,369.00
    	
 
    

 

1

 

Exhibit C

 

Copy of Executed Employee Invention Assignment and Confidentiality Agreement

 

EMPLOYEE INVENTION ASSIGNMENT AND
 CONFIDENTIALITY AGREEMENT

 

In consideration of, and as a condition of my employment with Accuray Incorporated, a Delaware Corporation (“Accuray”), I hereby represent to, and agree with Accuray as follows:

 

1.             Effective Date.  I understand that this Agreement shall take effect on the date I begin work with Accuray (“Effective Date”).

 

2.             Purpose of Agreement.  I understand that Accuray is engaged in a continuous program of research, development, production and marketing in connection with its business and that it is critical for Accuray to preserve and protect its “Proprietary Information” (as defined in Section 8 below), its rights in “Inventions” (as defined in Section 3 below) and in all related intellectual property rights.  Accordingly, I am entering into this Employee Invention Assignment and Confidentiality Agreement (this “Agreement”) as a condition of my employment with Accuray, whether or not I am expected to create inventions of value for Accuray.

 

3.             Disclosure of Inventions.  I will promptly disclose in confidence to Accuray all ideas, writings, discoveries, inventions, improvements, designs, original works of authorship, formulas, processes, compositions of matter, computer software programs, databases, mask works and trade secrets that I make or conceive of or first reduce to practice or create, either alone or jointly with others, during the period of my employment, whether or not in the course of my employment, and whether or not patentable, copyrightable or protectable as trade secrets (the “Inventions”).  I agree to maintain adequate and current written records on the development of all Inventions.

 

4.             Work for Hire; Assignment of Inventions.  I acknowledge and agree that any copyrightable works prepared by me within the scope of my employment are “works for hire” under the Copyright Act and that Accuray will be considered the author and owner of such copyrightable works.  I agree that all Inventions that (i) are developed using equipment, supplies, facilities or trade secrets of Accuray, (ii) result from work performed by me for Accuray, or (iii) relate to Accuray’s business or actual or demonstrably anticipated research and development (the “Assigned Inventions”), will be the sole and exclusive property of Accuray.  I hereby irrevocably convey, transfer, assign, and agree to assign, all right, title, and interest in the Assigned Inventions to Accuray.

 

 

5.             Labor Code Section 2870 Notice.  I have been notified and understand that the provisions of Sections 3 and 4 of this Agreement do not apply to any Assigned Invention that qualifies fully under the provisions of Section 2870 of the California Labor Code, which states as follows:

 

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; OR (2) RESULT FROM ANY WORK PERFORMED BY THE EMPLOYEE FOR THE EMPLOYER.  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 CALIFORNIA LABOR CODE SECTION 2870(a), THE PROVISION IS AGAINST THE PUBLIC POLICY OF THIS STATE AND IS UNENFORCEABLE.

 

Accordingly, I acknowledge that Inventions set forth in Schedule A (“Employee’s Disclosure”) are excluded from the operation of this Agreement.

 

6.             Assignment of Other Rights.  In addition to the foregoing assignment of Assigned Inventions to Accuray, I hereby irrevocably transfer and assign to Accuray:  (i) all worldwide patents, patent applications, copyrights, mask works, trade secrets and other intellectual property rights, including but not limited to rights in databases, in any Assigned Inventions, along with any registrations of or applications to register such rights; and (ii) any and all “Moral Rights” (as defined below) that I may have in or with respect to any Assigned Inventions.  I also hereby forever waive and agree never to assert any and all Moral Rights I may have in or with respect to any Assigned Inventions, even after termination of my work on behalf of Accuray.  “Moral Rights” mean any rights to claim authorship of or credit on an Assigned Inventions, to object to or prevent the modification or destruction of any Assigned Inventions, or to withdraw from circulation or control the publication or distribution of any Assigned Inventions, and any similar right, existing under judicial or statutory law of any country or subdivision thereof in the world, or under any treaty, regardless of whether or not such right is denominated or generally referred to as a “moral right.”

 

7.             Cooperation.  At Accuray’s request and expense, I will, during the term of my employment and thereafter, cooperate with and assist Accuray, and perform such further acts and execute, acknowledge and deliver to Accuray such further documents, as Accuray may deem necessary or advisable in order to obtain, establish, perfect, maintain, evidence, enforce or otherwise protect any of the rights, title and interests assigned, transferred, conveyed, or licensed (or intended to be assigned, transferred, conveyed, or licensed) to Accuray under this Agreement, or otherwise carry out the intent and accomplish the purposes of this Agreement.  Without

 

 

limiting the generality of the foregoing, to the extent permitted by applicable law, I hereby appoint Accuray as my attorney-in-fact (which appointment is coupled with an interest), with full power of substitution and delegation, with the right (but not the obligation) to perform any such acts and to execute, acknowledge and deliver any such documents on my behalf.

 

8.             Proprietary Information.  I understand that my employment by Accuray creates a relationship of confidence and trust with respect to any information of a confidential or secret nature that may be disclosed to me by Accuray or a third party that relates to the business of Accuray or to the business of any parent, subsidiary, affiliate, customer or supplier of Accuray or any other party to which Accuray owes a duty of confidentiality, whether or not labeled or identified as proprietary or confidential, and including any copies, portions, extracts and derivatives thereof, except to the extent that I can prove that such information or materials (i) are or become generally known to the public through lawful means and through no act or omission of mine; (ii) were part of my general knowledge prior to my employment by Accuray; or (iii) are disclosed to me without restriction by a third party who rightfully possesses the information and is under no duty of confidentiality with respect thereto (the “Proprietary Information”).  Such Proprietary Information includes, but is not limited to, Assigned Inventions, marketing plans, product plans, business strategies, financial information, forecasts, personnel information, customer lists and data, and domain names.  Except as disclosed on Schedule A to this Agreement, I have no knowledge of Accuray’s business or Proprietary Information, other than information I have learned from Accuray in the course of being hired and employed

 

9.             Confidentiality.  At all times, both during my employment and after its termination, I will keep and hold all such Proprietary Information in strict confidence and trust.  I agree to maintain at my work station and/or any other place under my control only such Proprietary Information that is necessary to carry out my responsibilities as an employee of Accuray.  I agree to return to the appropriate person or location or otherwise properly dispose of Proprietary Information once that necessity no longer exists.  I also agree not to make copies or otherwise reproduce Proprietary Information except to the extent necessary to carry out my responsibilities as an employee of Accuray.  I understand that avoiding loss or theft of Proprietary Information is an important part of my duties.  I will not allow any other person to use my office access card or computer passwords, without prior managerial approval.  I will only use secure networks established by Accuray when using Proprietary Information.  I will not use or disclose any Proprietary Information without the prior written consent of Accuray, except as may be necessary to perform my duties as an employee of Accuray for the benefit of Accuray.

 

10.          Termination.  Upon termination of my employment with Accuray, I will promptly deliver to Accuray all documents and materials of any nature pertaining to my work with Accuray and, upon Company request, will execute a document confirming my agreement to honor my responsibilities contained in this Agreement.  I will not take with me or retain any documents or materials or copies thereof containing any Proprietary Information.  I agree that after the termination of my employment with Accuray, I will not enter into any agreement that would cause me to violate any of my obligations under this Agreement and will inform any subsequent employers of my obligations under this Agreement.

 

11.          Survival.  The terms and conditions of this Agreement and my obligations hereunder shall survive any termination of my employment with Accuray and any expiration or

 

 

termination of any employment or other agreement between Accuray and me, and such terms and conditions shall remain in full force and effect as set forth herein.

 

12.          No Breach of Prior Agreement.  I represent that my performance of all the terms of this Agreement and my duties as an employee of Accuray will not breach any invention assignment, proprietary information, confidentiality or similar agreement with any former employer or other party.  I represent that I will not bring with me to Accuray or use in the performance of my duties for Accuray any documents or materials or intangibles of a former employer or third party that are not generally available to the public or have not been legally transferred to Accuray.  Except as disclosed on Schedule A, I am aware of no prior agreements between me and any other person or entity concerning propriety information, creations, or proprietary rights.

 

13.          Efforts; Duty Not to Compete.  I understand that my employment with Accuray requires my undivided attention and effort.  As a result, during my employment, I will not, without Accuray’s express written consent, engage in any other employment or business that (i) directly competes with the current or future business of Accuray; (ii) uses any Accuray information, equipment, supplies, facilities or materials; or (iii) otherwise conflicts with Accuray’s business interest and causes a disruption of its operations.

 

14.          Notification.  I hereby authorize Accuray to notify third parties, including, without limitation, customers and actual or potential employers, of the terms of this Agreement and my responsibilities hereunder.

 

15.          Non-Solicitation of Employees/Consultants.  During my employment with Accuray and for a period of one (1) year thereafter, I will not directly or indirectly solicit away employees or consultants of Accuray for my own benefit or for the benefit of any other person or entity.

 

16.          Non-Solicitation of Suppliers/Customers.  During and after the termination of my employment with Accuray, I will not directly or indirectly solicit or otherwise take away customers or suppliers of Accuray if, in so doing, I access, use or disclose any trade secrets or proprietary or confidential information of Accuray.  I acknowledge and agree that the names and addresses of Accuray’s customers and suppliers, and all other confidential information related to them, including their buying and selling habits and special needs, whether created or obtained by, or disclosed to me during my employment, constitute trade secrets of Accuray.

 

17.          Name & Likeness Rights.  I hereby authorize Accuray to use, reuse, and to grant others the right to use and reuse, my name, photograph, likeness (including caricature), voice, and biographical information, and any reproduction or simulation thereof, in any form of media or technology now known or hereafter developed (including, but not limited to, film, video and digital or other electronic media), both during and after my employment, for whatever purposes Accuray deems necessary.

 

18.          Remedies.  I recognize that nothing in this Agreement is intended to limit any remedy of Accuray under any law concerning trade secrets or other Proprietary Rights.  I recognize that my violation of this Agreement could cause Accuray irreparable harm and

 

 

acknowledge that Accuray may have the right to apply to any court of competent jurisdiction for an order restraining any breach or threatened breach of this Agreement.

 

19.          Governing Law; Severability.  This Agreement will be governed by and construed in accordance with the laws of the State of California, without giving effect to its laws pertaining to conflict of laws.  If any provision of this Agreement is determined by any court or arbitrator of competent jurisdiction to be invalid, illegal or unenforceable in any respect, such provision will be enforced to the maximum extent possible given the intent of the parties hereto.  If such clause or provision cannot be so enforced, such provision shall be stricken from this Agreement and the remainder of this Agreement shall be enforced as if such invalid, illegal or unenforceable clause or provision had (to the extent not enforceable) never been contained in this Agreement.

 

20.          Counterparts.  This Agreement may be executed in any number of counterparts, each of which when so executed and delivered will be deemed an original, and all of which together shall constitute one and the same agreement.

 

21.          Entire Agreement.  This Agreement and the documents referred to herein constitute the entire agreement and understanding of the parties with respect to the subject matter of this Agreement, and supersede all prior understandings and agreements, whether oral or written, between or among the parties hereto with respect to the specific subject matter hereof.

 

22.          Amendment and Waivers.  This Agreement may be amended only by a written agreement executed by each of the parties hereto.  No amendment of or waiver of, or modification of any obligation under this Agreement will be enforceable unless set forth in a writing signed by the party against which enforcement is sought.  For Accuray, any such writing must be signed by one of the following: CEO, CFO or General Counsel.  Any amendment effected in accordance with this section will be binding upon all parties hereto and each of their respective successors and assigns.  No delay or failure to require performance of any provision of this Agreement shall constitute a waiver of that provision as to that or any other instance.  No waiver granted under this Agreement as to any one provision herein shall constitute a subsequent waiver of such provision or of any other provision herein, nor shall it constitute the waiver of any performance other than the actual performance specifically waived.

 

23.          Successors and Assigns; Assignment.  I acknowledge and agree that my obligations hereunder are personal, and that I shall have no right to assign, transfer or delegate and shall not assign, transfer or delegate or purport to assign, transfer or delegate this Agreement or any of my rights or obligations hereunder.  This Agreement and any rights and obligations of Accuray hereunder may be freely assigned, transferred or delegated by Accuray.  Any assignment, transfer or delegation in violation of this Article 23 shall be null and void.  Subject to the foregoing restrictions on assignments, transfers and delegations, this Agreement shall inure to the benefit of Accuray and its affiliates, officers, directors, agents, successors and assigns; and shall be binding on me and my heirs, devisees, spouses, agents, legal representatives and successors

 

24.          “At Will” Employment.  I understand that this Agreement does not constitute a contract of employment or obligate Accuray to employ me for any stated period of time.  I

 

 

understand that I am an “at will” employee of Accuray and that my employment can be terminated at any time, with or without notice and with or without cause, for any reason or for no reason, by either Accuray or myself.  I acknowledge that any statements or representations to the contrary are ineffective, unless put into a writing signed by Accuray.  I further acknowledge that my participation in any stock option or benefit program is not to be construed as any assurance of continuing employment for any particular period of time.

 

I REPRESENT THAT I HAVE READ THIS AGREEMENT, AND THAT I FULLY UNDERSTAND ALL OF ITS TERMS AND CONDITIONS; I HAVE EXECUTED THIS AGREEMENT WITHOUT COERCION OR DURESS OF ANY KIND.

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