Document:

exv10w1

 

Exhibit 10.1

CONTRACT OF EMPLOYMENT

	1.  	Parties

	 	(1)  	Cell Genesys, Inc. of 500 Forbes Blvd., South San Francisco, California
trading in the UK as a place of business (to be formed) (“the Employer”)
	 
	 	(2)  	Robert J. Dow, Dundarach, 1 Craiglockhart Park, Edinburgh, Midlothian EH14
1ER (“the Employee”)

	2.  	Date of Employment
	 
	   	The Employee’s employment commenced on March 1, 2005.
	 
	   	The Employee’s period of continuous employment for the purposes of the Employment Rights
Act 1996 commenced on March 1, 2005.
	 
	3.  	Nature of Employment
	 
	   	The Employee’s job title will be confirmed in writing by the Board of Directors at its
discretion.
	 
	   	The Employee shall carry out such duties as shall from time to time be assigned to him by
the Employer.
	 
	   	The Employee will be expected to report to and liaise with Joe Vallner (“his Line
Manager”).
	 
	   	The Employee agrees that he will spend the whole of his time and attention on the
Employer’s business during normal working hours and that during the term of his employment
with the Employer he will not engage in any other employment, occupation, consulting or
other business activity.
	 
	4.  	Notice of Termination
	 
	   	In order to terminate the employment under this contract the Employee is required to give
to the Employer, and the Employer is required to give to the Employee, the following
periods of written notice:

	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 
	

	 	 	(a)
	 	during the first 12 months of
employment
	 	 	6 months’ notice	 
	 	 	 	 	 	 	 	 
	

	 	 	(b)
	 	after completion of the first 12
months of employment
	 	 	1 week’s notice for every completed
year of continuous employment	 
	 	 	 	 	 	 	 	 

	 	   	The Employer reserves the right to pay the relevant net basic salary in lieu of notice.
	 
	 	   	After notice has been served by the Employer or the Employee the Employer may:

	 	(a)  	require the Employee to carry out no duties; or
	 
	 	(b)  	require the Employee to remain away from the office; or

 

 

	 	(c)  	require the Employee to carry out such duties as the Employer may require
Provided that such duties are of a standard appropriate to the Employee’s job
description.

	 	   	For the avoidance of doubt the Employee shall remain an employee of the Employer during the
notice period and will continue to be bound by the terms of this contract.
	 
	 	5.  	Remuneration
	 
	 	   	The Employee’s gross remuneration will be £200,000 per annum, based on a pounds to dollar
exchange rate of 1.65 pounds to dollars. This exchange rate arrangement will apply to all
cash compensation the employee receives. The annual salary shall be paid monthly in
arrears net of tax and national insurance and shall be deemed to accrue from day to day
based on a 5 day working week.
	 
	 	   	Salaries are normally paid by direct transfer to the Employee’s bank account on the last
day of the month except that, where such day does not fall on a working day, payment will
be made on the prior working day.
	 
	 	   	The Employee’s gross remuneration will remain at its current level until 2007 when it may
be increased at the absolute discretion of the board.
	 
	 	6.  	Expenses
	 
	 	   	The Employee shall be reimbursed all reasonable expenses properly incurred in discharge of
the Employee’s duties in accordance with this contract and subject to any other
instructions or regulations issued by the Employer from time to time. As a pre-condition
of payment, the Employee will be expected to produce vouchers, receipts, or other evidence
of the expenses in respect of which the Employee claims reimbursement.
	 
	 	7.  	Other Benefits
	 
	 	   	In addition to the above remuneration the Employee shall be entitled to:

	 	(a)  	A signing bonus of £48,486 paid in two installments of £24,243 each. The first
installment to be paid upon hire, and the second installment to be paid on the first anniversary
date of hire.
	 
	 	(b)  	A one-time pension contribution of £36,364 to be paid in two installments of £18,182 each.
The first installment to be paid upon hire and the second installment to be paid on the first
anniversary date of hire.
	 
	 	(c)  	An annual payment of £36,364 for office and automobile expenses while
residing in Europe. Payment will be prorated on a monthly basis as appropriate for
the 12-month period in which the employee relocates to the U.S.
	 
	 	(d)  	Reimbursement in the amount of £310 per month for private health insurance coverage.
	 
	 	(e)  	Participation in the Company’s management bonus program in accordance with plan guidelines
from time to time in force.

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	 	(f)  	Benefits provided under the Company’s standard change of control agreement for executive
officers from time to time in force.

	   	To the extent that any of the benefits are taxable the Employee will be responsible for all
those liabilities.
	 
	   	A contracting out certificate is in force in respect of the employment.
	 
	   	Participation in any insurance based benefit (including Private Medical Insurance, Death in
Service and PHI) is subject to the terms and conditions from time to time in force, is
conditional on the Employee satisfying any applicable requirements of the insurer and being
accepted at normal rates of premium and is subject to the Employer’s right to amend, alter
or cease to provide (without compensation) the benefit at any time. The Employer shall
have no liability to pay any benefit to the Employee unless it receives payment from the
insurer.
	 
	   	Nothing in this agreement shall constrain or prevent the Employer from terminating the
Employee’s employment, notwithstanding that the Employee is or may be entitled to receive
benefit payments or other benefits under any PHI Scheme from time to time in force.
	 
	8.  	Place of Work
	 
	   	The Employee’s primary place of work will be at Dundarach, 1 Craiglockhart Place,
Edinburgh, Midlothian EH14 1ER, or such other place within the United Kingdom as the
Employer may reasonably require.
	 
	   	In addition, the Employee will be required to work at such other places as the Employer may
from time to time specify for the performance of the Employee’s duties.
	 
	   	If the Employer requires the Employee to change his residence, the Employer will reimburse
such removal and other incidental expenses as the Employer considers reasonable in the
circumstances. In addition, the Employee shall travel to such parts of the world as the
Employer may direct or authorise. If the Employer requires the Employee to work outside
the United Kingdom for a period of more than one month it will provide him with written
details of any terms and conditions which may apply to that work and his return to the
United Kingdom.
	 
	9.  	Hours of Work
	 
	   	The normal working hours of the Employee will be from 9.00 a.m. to 5.00 p.m. on Mondays to
Fridays. The Employee will be entitled to an hour’s lunch break during each working day.
	 
	   	In addition, the Employee shall be required to work at such other times as the Employer may
reasonably require to meet the needs of the business. The Employee will not receive
additional payment for such further work. The Employee accepts that by signing this
agreement he has agreed that regulation 4(1) of the Working Time Regulations 1998 shall
not apply. The Employee may terminate his agreement to this provision by giving three
month’s notice in writing.

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	10.  	Holidays

	 	(a)  	Annual Holidays
	 
	 	   	The Employee’s annual paid holiday entitlement is 20 working days in each holiday
year. Holiday entitlement will accrue pro-rata to each completed month of
employment.
	 
	 	   	The Employee is required to submit a holiday request form to his Line Manager for
approval for all periods of leave.
	 
	 	   	The holiday year runs from January 1 to December 31.
	 
	 	   	It is permitted to carry forward holiday entitlement from one holiday year to the
next up to a maximum accrual of 30 working days at one time.
	 
	 	   	The Employee must ensure that there is no unnecessary overlapping with the holidays
of other staff who would be responsible for the Employee’s duties whilst he/she is
on holiday.
	 
	 	   	Holiday pay on termination of employment will be calculated by establishing the
number of days holiday accrued in the holiday year up to the date of termination
and subtracting from this the number of days taken during the current holiday year.
The number of days remaining, if any, will be paid.
	 
	 	(b)  	Bank Holidays and Public Holidays
	 
	 	   	In addition to annual holidays the Employee shall be entitled to paid holidays on
all statutory and public holidays together with any additional holidays awarded by
the Employer.

	11.  	Sickness or Injury

	 	(a)  	If the Employee is absent from work due to sickness, he will be entitled to
sick pay of10 working days per year.
	 
	 	(b)  	If the Employee is prevented by sickness from performing his duties properly,
he shall report this fact promptly to his Line Manager on the first day of sickness
together with an estimate of the period of absence envisaged. Any change in the
estimated period of absence must be notified as soon as possible.
	 
	 	   	If the absence continues for more than 5 continuous working days a certificate from
the Employee’s doctor should be submitted explaining the nature of the sickness or
injury.
	 
	 	   	During all periods of absence due to sickness or injury the Employee should keep
the Employer informed as to his/her likely date of return.
	 
	 	   	A Form SC2 (Self Certification of Sickness) is required in all cases of uncertified
sickness.
	 
	 	(c)  	If the Employee is absent for more than 12 weeks in any 12 month period due
to sickness or injury then the Employer is entitled to terminate the employment.

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	12.  	Parental Leave
	 
	   	Employees with the requisite period of service may be entitled to statutory parental leave.
	 
	   	Full details of the relevant regulations and entitlements may be obtained on request from
the Vice President, Human Resources.
	 
	13.  	Retirement
	 
	   	The Employee’s employment shall, unless alternative arrangements are made in writing,
terminate automatically upon the Employee reaching the age of 60. This may be extended by
written consent of the Employer. The exact day on which the Employee is expected to leave
should, however, be agreed at least one month in advance with the Employer.
	 
	14.  	Health and Safety
	 
	   	The Employee is bound to comply with the duties imposed by the Health and Safety at Work
Act 1974 or any substitution thereof or amendment or alteration thereto (“the Act”) and the
Health and Safety Regulations made or to be made under the Act and in particular with the
duties set out under section 7 of the Act which require an employee to:

	 	(a)  	take reasonable care for the health and safety of him or herself and of
others who may be affected by his/her acts or omissions at work;
	 
	 	(b)  	as regards any duty imposed on the Employer or any other person, co-operate
with the Employer so far as is necessary to enable that duty to be performed or
complied with.

	15.  	Grievance Procedure
	 
	   	It is expected that most grievances may be resolved informally. However, if the Employee
wishes to raise a formal grievance relating to his employment he should raise it in the
first instance in writing with his Line Manager setting out the nature of the grievance.
The Line Manager will then invite the Employee to a hearing to discuss the grievance. The
hearing will be scheduled to allow time for the Employer to consider the issues raised.
After the meeting, the Employer will inform the Employee of the decision and of his right
to appeal.
	 
	   	If the grievance is not satisfactorily resolved in this way then the Employee should appeal
the matter in writing to the Vice President, Human Resources. The Vice President, Human
Resources will invite the Employee to an appeal hearing, following which the Vice
President, Human Resources shall communicate that decision in writing to the Employee. The
decision of the Vice President, Human Resources shall be final.
	 
	   	This policy does not form part of the contract of employment, save and only to the extent
expressly required by law. If the Employee wishes, he may be accompanied at either or both
hearings by a colleague or trade union official.
	 
	16.  	Summary Dismissal

	 	(a)  	In the following circumstances, which are intended by way of example only of
what may be regarded as gross misconduct, and not by way of a complete list, the

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	 	   	Employee will be dismissed summarily by written notice to operate from the date of
such notice and the Employee will not be entitled to any further payment under his
terms of employment except such sum as has accrued and is due at the date of
termination:

	 	(i)  	refusing to carry out any proper direction given in the
course of the employment
	 
	 	(ii)  	improperly divulging to any third party any confidential or
non-public information regarding the Employer, its employees or any person
with whom the Employer deals
	 
	 	(iii)  	committing any act or divulging any information which is
contrary to or damages the interests or objectives of the Employer
	 
	 	(iv)  	committing any criminal offence which in the opinion of the
Employer makes the Employee unsuitable for the type of work that the Employee
is employed to do or may reasonably be expected to do or which makes him/her
unacceptable to other employees
	 
	 	(v)  	dishonest conduct
	 
	 	(vi)  	violent, obscene or abusive behaviour towards other employees
or officers of the Employer
	 
	 	(vii)  	serious or wilful breach of the Employee’s duties
	 
	 	(viii)  	attending the Employer’s premises or engaging in the Employer’s business
whilst under the influence of alcohol or unlawful drugs.

	 	(b)  	Any other serious or irreparable act or omission by the Employee may be
regarded as gross misconduct where such act or omission is, in the reasonable opinion
of the Employer likely to (or has) cause(d) serious harm to the business or reputation
of the Employer.

	17.  	Disciplinary Procedure
	 
	   	This disciplinary procedure does not form part of the Employee’s contract of employment
(save and only to the extent that it may from time to time be required to do so by law).
The Employer accepts that it is in the interests of good relations with its staff to ensure
that there is a fair and proper disciplinary procedure.
	 
	   	Any Employee who departs from normally expected standards or who violates the
Employer’s rules will be liable to disciplinary action.

	 	(a)  	The following disciplinary procedure will usually be adopted. The stages
will normally be implemented in order but action may start at any stage in the event
of serious misconduct or an aspect of poor performance that creates a risk to other
employees. At each stage of the procedure, the Employer will set a reasonable

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	 	   	timeframe within which the Employee will be expected to improve their performance or
conduct or remedy any minor breach of contract.
	 
	 	   	At the end of that timeframe, if the Employee’s performance, conduct, etc. has not
met the targets set by the Employer, the next stage of the disciplinary procedure
may be implemented. The Employee accepts that in the case of a senior employee of
the Employer it may not always be appropriate to follow this procedure.

	 	(i)  	On the first occasion that an Employee fails to reach the
standards required, the Employee will receive a formal verbal warning.
	 
	 	(ii)  	If the required improvement is not made, or if the first
offence is considered too serious for a formal verbal warning, the Employee
will receive a formal written warning.
	 
	 	(iii)  	Continued failure to achieve the required improvement, or
further transgressions, will result in a final written warning being issued.
	 
	 	(iv)  	Failure to comply with the conditions of a final written
warning will result in dismissal after the requisite period of notice or
payment of salary in lieu thereof.

	 	   	The following, which are intended by way of example only and not by way of a complete list,
are examples of conduct warranting disciplinary action:

	 	(i)  	poor timekeeping
	 
	 	(ii)  	poor attendance
	 
	 	(iii)  	inadequate or incompetent performance of the Employee’s job
	 
	 	(iv)  	failure to comply with the Employer’s established procedures,
as notified from time to time
	 
	 	(v)  	rudeness or discourtesy to people with whom the Employer
deals or to other employees.

	 	(b)  	If disciplinary action which may lead to disciplinary measures is to be taken
against the Employee (other than suspension under (c) below or issuing of a warning –
where modified procedures may apply), the following procedure will normally apply. The
Employee will receive a letter setting out the alleged conduct or other circumstances
and inviting the Employee to attend a disciplinary hearing. The hearing will be set at
a time and date to allow the Employee time to consider the allegations against
him/her. At the disciplinary hearing (which the Employee must take all reasonable
steps to attend) the Employee will be given the opportunity to respond to the issues
raised. The decision on the hearing will be notified to the Employee after the
hearing, along with details of the right to appeal. The Employee will have the right
to be accompanied to any disciplinary hearing and subsequent appeal by a colleague or
trade union official.
	 
	 	(c)  	The Employer reserves the right to suspend the Employee on full pay pending
investigation where the Employer has reasonable grounds to believe that the Employee’s
continued employment might be prejudicial to the Employer’s business or other
employees.

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	 	(d)  	The Employer reserves the right to exclude the Employee from the premises
during his/her period of notice and shall be under no obligation to provide any work
for the Employee or to assign him/her any duties.
	 
	 	(e)  	If the Employee has outside interests which in the opinion of the Employer
conflict with its interests, the Employee may be asked to leave the service of the
Employer.
	 
	 	(f)  	The Employer reserves the right to suspend the Employee without pay and
benefits as a disciplinary measure.

	 	   	The Employee may appeal against any disciplinary action taken to the Vice President, Human
Resources. The Employee will then be invited to attend an appeal hearing (and must take all
reasonable steps to do so). Following any such appeal, the Employee will be informed of
the outcome.

	18.  	Sexual Harrassment
	 
	   	Cell Genesys, Inc. considers that sexual harassment in the workplace is unacceptable and
will treat all complaints seriously.
	 
	   	An Employee who feels that he/she has been subjected to sexual harassment should raise the
matter with his/her Line Manager under the terms of the grievance procedure set out in
Clause 16 above.
	 
	   	An Employee who is found to be the perpetrator of harassment will be liable to disciplinary
action under the terms of the disciplinary procedure set out in Clause 18 above. The
Employer may exercise its discretion as to the disciplinary measures which will be taken,
depending on the nature of the conduct.
	 
	19.  	Data Protection
	 
	   	The Employee agrees that personal data relating to the Employee (including sensitive
personal data such as medical details) may to the extent that it is reasonably necessary in
connection with the Employee’s employment or the business of the Employer:

	 	(a)  	be collected and held (in hard copy and computer readable form) and processed
by the Employer; and
	 
	 	(b)  	be disclosed to:

	 	(i)  	other employees of the Employer and the Employer’s group
companies;
	 
	 	(ii)  	any other persons as may be reasonably necessary (such as
third party benefit providers or administrators) or as authorised by the
Employee; or
	 
	 	(iii)  	as otherwise required or permitted by law.

	 	   	This consent applies regardless of the country to which the data is to be transferred.
Where the disclosure or transfer is to a destination outside the European Economic Area,
the Employer shall take reasonable steps to ensure that the Employee’s personal data
continues to be adequately protected, though the Employee may no longer have rights under
data protection law.

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	 	   	If the Employee has any queries regarding the Employee’s personal data, these should be
raised with Joe Vallner, President and Chief Operating Officer.

	20.  	Deductions
	 
	   	The Employee consents to the deduction from any sum otherwise payable to the Employee by
reason of his/her employment (or its termination) the value of any claim of whatever nature
and in whatever capacity that the Employer may bona fide have against the Employee,
including but not limited to:

	 	(a)  	Overpayment of wages;
	 
	 	(b)  	Overpayment in respect of expenses incurred by the Employee in carrying out
his duties;
	 
	 	(c)  	Loans which the Employer may from time to time make to the Employee; and
	 
	 	(d)  	Advances on wages which the Employer may from time to time make to the
Employee.

	 	   	The Employee further consents that the Employer has the right to deduct from the employee’s
salary or other sums due to the Employee a sum in respect of accrued holiday entitlement if
at the date of termination of the Employee’s employment he/she has taken in excess of
his/her accrued holiday entitlement.

	21.  	Choice of Law
	 
	   	This contract shall be governed by and construed in accordance with English law and each
party to this contract submits to the non-exclusive jurisdiction of the English courts and
tribunals.

	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Christine McKinley
	

	 	 	 	 
	

	 	Title:
	 	Vice President, Human Resources
	

	 	Date:
	 	February 25, 2005
	 
	 

	 	By:
	 	/s/ Robert J. Dow
	

	 	 	 	 
	

	 	Title:
	 	Senior Vice President,
Medical Affairs
	

	 	Date:
	 	February 25, 2005

9exv10w2

 

Exhibit 10.2

CELL GENESYS, INC.

CHANGE OF CONTROL SEVERANCE AGREEMENT

     This Change of Control Severance Agreement (the “Agreement”) is made and entered into by and
between Robert Dow (“Employee”) and Cell Genesys, Inc. (the “Company”), effective as of the latest
date set forth by the signatures of the parties hereto below (the “Effective Date”).

RECITALS

     A. It is expected that the Company from time to time will consider the possibility of an
acquisition by another company or other change of control. The Board of Directors of the Company
(the “Board”) recognizes that such consideration can be a distraction to the Employee and can cause
the Employee to consider alternative employment opportunities. The Board has determined that it is
in the best interests of the Company and its shareholders for the Company to have the continued
dedication and objectivity of the Employee, notwithstanding the possibility, threat or occurrence
of a Change of Control (as defined below) of the Company.

     B. The Board believes that it is in the best interests of the Company and its shareholders to
provide the Employee with an incentive to continue his employment and to motivate the Employee to
maximize the value of the Company upon a Change of Control for the benefit of its shareholders.

     C. The Board believes that it is imperative to provide the Employee with certain severance
benefits upon the Employee’s termination of employment following a Change of Control which provides
the Employee with enhanced financial security and provides incentive and encouragement to the
Employee to remain with the Company notwithstanding the possibility of a Change of Control.

     D. Certain capitalized terms used in the Agreement are defined in Section 6
below.

     The parties hereto agree as follows:

     1. Term of Agreement. This agreement shall terminate upon the date that all
obligations of the parties hereto with respect to this Agreement have been satisfied.

     2. Term of Employment. The Company and the Employee acknowledge that the Employee’s
employment shall continue until terminated in accordance with clause 4 or 16 of the Contract of
Employment. If the Employee’s employment terminates for any reason, including (without limitation)
any termination prior to a Change of Control, the Employee shall not be entitled to any payments,
benefits, damages, awards or compensation other than as provided under English law or the Contract
of Employment, or as may otherwise be available in accordance with the Company’s established
employee plans and practices or pursuant to other agreements with the Company.

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      3. Severance Benefits.

      (a) Termination Following a Change of Control. If the Employee’s employment terminates
as a result of Involuntary Termination other than for Cause at any time within two (2) years
following a Change of Control, then, subject to Section 5, the Employee shall be entitled to
receive the following severance benefits

               (1) Severance Payment. A cash payment in an amount equal to one hundred percent (100%)
of the Employee’s Annual Compensation;

               (2) Continued Employee Benefits. One hundred percent (100%) Company-paid health,
dental, vision, long-term disability and life insurance coverage as set out in clause 7 of the
Contract of Employment at the same level of coverage as was provided to such employee immediately
prior to the Change of Control (the “Company-Paid Coverage”). If such coverage included the
Employee’s dependents immediately prior to the Change of Control, such dependents shall be covered
at Company expense. Company-Paid Coverage shall continue until the earlier of (i) one year from
the date of termination, or (ii) the date upon which the Employee and his dependents become covered
under another employer’s group health, dental, vision, long-term disability or life insurance plans
that provide the Employee and his dependents with comparable benefits and levels of coverage. For
purpose of Title X of the Consolidated Budget Reconciliation Act of 1985 (“COBRA”), the date of the
“qualifying event” for Employee and his or her dependents shall be the date upon which the
Company-Paid Coverage terminates. The benefits under this section shall be subject always to the
rules of the relevant schemes and the governing law of the country of the provider of any such
benefits.

               (3) Option and Restricted Stock Accelerated Vesting. One Hundred percent (100%) of
the unvested portion of any stock option or restricted stock held by the Employee shall
automatically be accelerated in full so as to become completely vested but shall otherwise continue
to be governed by the terms of the Company’s stock option plan or restricted stock plan under
which the options were granted, together with the stock option or restricted stock agreement
between the Company and the Employee that governs the terms of each stock option or restricted
stock award and, where relevant the joint election agreement between the Company and the Employee.

               (4) Extension of Post-Termination Exercise of Stock Options. The stock options held
by the Employee shall become exercisable for a period of ten years from their original date of
grant by the Company but shall otherwise continue to be governed by the terms of the Company’s
stock option plan under which the options were granted, together with the stock option agreement
between the Company and the Employee that governs the terms of each stock option award and, where
relevant the joint election agreement between the Company and the Employee.

          (b) Timing of Severance Payments. Any severance payment to which the Employee is
entitled under Section 3(a)(1) shall be paid by the Company to the Employee (or to the Employee’s
successors in interest, pursuant to Section 7(b)) in cash and in full, not later than (30) calendar
days following the Termination Date; provided, however, that the Employee shall be permitted to
defer fifty percent (50%) of his severance payment until one year following the Termination Date if
the Employee submits a written election to the Company irrevocably electing such deferral within
seven days of the Termination Date .

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          (c) Voluntary Resignation; Termination For Cause. If the Employee’s employment
terminates by reason of the Employee’s voluntary resignation (and is not an Involuntary
Termination), or if the Employee is terminated for Cause, then the Employee shall not be entitled
to receive a severance or other benefits except for those (if any) as may then be established under
the Contract of Employment or the Company’s then existing severance and benefits plans and
practices or pursuant to other agreements with the Company.

          (d) Long Term Illness; Death. If the Company terminates the Employee’s employment as
a result of the Employee’s Long Term Illness, or such Employee’s employment is terminated due to
the death of the Employee, then the Employee shall not be entitled to receive severance or other
benefits except for those (if any) as may then be established under the Contract of Employment or
the Company’s then existing severance and benefits plans and practices or pursuant to other
agreements with the Company and notwithstanding that the Employee is or may be entitled to benefit
under the terms of the Company’s permanent health insurance scheme.

          (e) Termination Apart from Change of Control. In the event the Employee’s employment
is terminated for any reason, either prior to the occurrence of a Change of Control or after the
twenty-four (24)-month period following a Change of Control, then the Employee shall be entitled to
receive severance and any other benefits only as may then be established under the Contract of
Employment or the Company’s existing severance and benefits plans and practices or pursuant to
other agreements with the Company.

     4. Attorney Fees, Costs and Expenses. The Company shall promptly reimburse the
Employee, on a monthly basis, for the reasonable attorney fees, costs and expenses incurred by the
Employee in connection with any action brought by the Employee to enforce his rights under section
3(a), regardless of the outcome of the action.

     5. Taxation of Payments.

Any payments made to the Employee under this Agreement shall be subject to the prior deduction of
income tax and national insurance contributions or such other applicable withholding or social
security contributions.

     6. Definition of Terms. The following terms referred to in this Agreement shall have
the following meanings:

          (a) Annual Compensation. “Annual Compensation” means an amount equal to the sum of
Employee’s (i) annual Company basic salary at the highest rate in the effect in the twelve months
immediately preceding the Change of Control, and (ii) 100% of the Employee’s annual target bonus as
in effect immediately prior to the Change of Control.

          (b) Cause. “Cause” shall mean either (i) any act of personal dishonesty taken by the
Employee in connection with his responsibilities as an employee and intended to result in
substantial personal enrichment of the Employee, (ii) any circumstance permitting the Company to
terminate the Employee’s employment summarily in accordance with clause 16 of the Contract of
Employment, or (iii) following delivery to the Employee of a written demand for performance from
the Company which describes the basis for the Company’s belief that the Employee has not
substantially performed his duties, continued breaches by the Employee of the Employee’s
obligations to the Company which are demonstrably willful and deliberate on the Employee’s part.

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          (c) Change of Control. “Change of Control” means the occurrence of any of the
following events:

               (i) Any “person” (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange
Act of 1934, as amended) becomes the “beneficial owner” (as defined in Rule 13d-3 under said Act),
directly or indirectly, of securities of the Company representing fifty percent (50%) or more of
the total voting power represented by the Company’s then outstanding voting securities;

               (ii) A change in the composition of the Board occurring within a two-year period, as a result
of which fewer than a majority of the directors are Incumbent Directors. “Incumbent Directors”
shall mean directors who either (A) are directors of the Company as of the date hereof, or (B) are
elected, or nominated for election, to the Board with the affirmative votes (either by a specific
vote or by approval of the proxy statement of Cell Genesys in which such person is named as a
nominee for election as a director without objection to such nomination) of at least a majority of
the Incumbent Directors at the time of such election or nomination;

               (iii) The consummation of a merger or consolidation of the Company with any other corporation,
other than the merger or consolidation which would result in the voting securities of the Company
outstanding immediately prior thereto continuing to represent (either by remaining outstanding or
by being converted into voting securities of the surviving entity or the entity that controls the
Company or controls such surviving entity) at least fifty percent (50%) of the total voting power
represented by the voting securities of the Company or such surviving entity or the voting power
represented by the voting securities of the Company or such surviving entity or the entity that
controls the Company or controls such surviving entity outstanding immediately after such merger or
consolidation; or

               (iv) The consummation of the sale or disposition by the Company of all or substantially all
the Company’s assets.

          (d) Involuntary Termination. “Involuntary Termination” shall mean (i) without the
Employee’s express written consent, a material reduction of the Employee’s duties, title, authority
or responsibilities relative to the Employee’s duties, title, authority or responsibilities as in
effect immediately prior to such reduction, or the assignment to Employee of such reduced duties,
title, authority or responsibilities; (ii) without the Employee’s express written consent, a
material reduction, without good business reasons, of the facilities and prerequisites (including
office space and location) available to the Employee immediately prior to such reduction; (iii) a
reduction by the Company in the base salary of the Employee as in effect immediately prior to such
reduction; (iv) a material reduction by the Company in the kind or level of employee benefits,
including bonuses, to which the Employee was entitled immediately prior to such reduction with the
result that the Employee’s overall benefits package is materially reduced; (v) the relocation of
the Employee to a facility or a location more than twenty-five (25) miles from the Employee’s then
present location, without the Employee’s express written consent; (vi) any purported termination of
employment of the Employee by the Company which is not effected for the reasons stated in section
3(d) or for Cause, or any purported termination for which the grounds relied upon are not valid;
(vii) the failure of the Company to obtain the assumption of this agreement by any successors
contemplated in Section 7(a) below; or (viii) any

4

 

other act or set of facts or circumstances which would, under English law constitute a
constructive dismissal of the Employee.

          (e) Long
Term Illness. “Long Term Illness” shall mean that the Employee has been unable to
perform his duties properly by reason of illness or injury for a period or periods exceeding six
months in any 12 month period or if the Company at any time has reason to believe that because of
any such cause the Employee may be unable properly to perform his duties for a period or periods of
six months or more (over any consecutive 12 month period including past periods of incapacity).

          (f) Termination Date. “Termination Date” shall mean the date on which the Employee’s
employment terminates.

     7. Successor.

          (a) Company’s Successors. Any successor to the Company (whether direct or indirect
and whether by purchase, merger, consolidation, liquidation or otherwise) to all or substantially
all of the Company’s business and/or assets shall assume the obligations under this Agreement and
agree expressly to perform the obligations under this Agreement in the same manner and to the same
extent as the Company would be required to perform such obligations in the absence of a
succession. For all purposes under this Agreement, the term “Company” shall include any successor
to the Company’s business and/or assets which executes and delivers the assumption agreement
described in this Section 7(a) or which becomes bound by the terms of this Agreement by operation
of law.

          (b) Employee’s Successor’s. The terms of this Agreement and all rights of the
Employee hereunder shall inure to the benefit of, and be enforceable by, the Employee’s personal
or legal representatives, executors, administrators, successors, heirs, distributees, devisees and
legatees.

     8. Notice.

          (a) General. Notices and all other communications contemplated by this Agreement
shall be in writing and shall be deemed to have been served when received. In the case of the
Employee, mailed notices shall be addressed to him at the home address which he most recently
communicated to the Company in writing. In the case of the Company, mailed notices shall be
addressed to its corporate headquarters, and all notices shall be directed to the attention of its
Secretary.

          (b) Notice of Termination. Any termination of employment by the Company for Cause or
by the Employee as a result of a voluntary resignation or an Involuntary Termination shall be
communicated by a notice of termination to the other party hereto given in accordance with Section
8(a) of this Agreement. Such notice shall indicate the specific termination provision in this the
Contract of Employment or the Agreementrelied upon, shall set forth in reasonable detail the facts
and circumstances claimed to provide a basis for termination under the provision so indicated, and
shall specify the Termination Date). The failure by the Employee to include in the notice any
fact or circumstance which contributes to a showing of Involuntary Termination shall not waive any
right of the Employee hereunder or preclude the Employee from asserting such fact or circumstance
in enforcing his rights hereunder.

5

 

     9. Miscellaneous Provisions.

          (a) No Duty to Mitigate. The Employee shall not be required to mitigate the amount
of any payment contemplated by this Agreement, nor shall any such payment be reduced by any
earnings that the Employee may receive from any other source.

          (b) Waiver. No provision of this Agreement shall be modified, waived or discharged
unless the modification, waiver or discharge is agreed to in writing and signed by the Employee
and by an authorized officer of the Company (other than the Employee). No waiver by either party
of any breach of, or of compliance with, any condition or provision of this Agreement by the other
party of any breach of, or of compliance with, any condition or provision of this Agreement by the
other party shall be considered a waiver of any other condition or provision or of the same
condition or provision at another time.

          (c) Whole Agreement. No agreements, representations or understandings (whether oral
or written and whether express or implied) which are not expressly set forth in this Agreement
have been made or entered into by either party with respect to the subject matter hereof. This
Agreement represents the entire understanding of the parties hereto with respect to the subject
matter hereof and supersedes all prior arrangements and understandings regarding same.

          (d) Choice of Law. The validity, interpretation, construction and performance of
this Agreement shall be governed by English law save for interpretation of section 6 (c) and 7 (as
applicable)

          (e) Severability. The invalidity or unenforceability of any provision or provisions
of this Agreement shall not affect the validity or enforceability of any other provision hereof,
which shall remain in full force and effect.

          (f) Counterparts. This Agreement may be executed in counterparts, each of which shall
be deemed an original, but all of which together will constitute one and the same instrument.

6

 

     IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case of
the Company by its duly authorized officer, as of the day and year set forth below.

	 	 	 	 	 
	COMPANY

	 	CELL GENESYS, INC.
	 
	

	 	By:
	 	/s/ Stephen A. Sherwin, M.D.
	

	 	 	 	 
	

	 	Title:
	 	Chairman of the Board and Chief
Executive Officer
	

	 	Date:
	 	May 2, 2005
	 
	EMPLOYEE

	 	By:
	 	/s/ Robert J. Dow
	

	 	 	 	 
	

	 	Title:
	 	Senior Vice President, Medical
Affairs
	

	 	Date:
	 	May 2, 2005

7

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