Document:

GALE-2014.09.30-EX10.1

EMPLOYMENT AGREEMENT
This Employment Agreement (this “Agreement”) is made and entered into as of July 28, 2014 (the “Effective Date”) by and between Galena Biopharma, Inc., a Delaware corporation (the “Company”, or “Employer”), and Margaret Kivinski, an individual and resident of the State of California (“Employee”).
WHEREAS, Employer and Employee desire to enter into an employment agreement under which Employee shall serve on a full-time basis as the Company’s Vice President and General Counsel, on the terms set forth in this Agreement, with the term of this Agreement to commence on the Effective Date.
NOW, THEREFORE, upon the above premises, and in consideration of the mutual covenants and agreements hereinafter contained, the parties hereto agree as follows.
1.Engagement.  Effective as of the Effective Date, Employer shall employ Employee, and Employee shall serve, as the Company’s Vice President and General Counsel.  Employee understands that her duties as Vice President and General Counsel may change from time to time during the Term (as herewith defined) in the discretion of Employer’s Board of Directors (hereinafter the “Board”), but such duties shall be consistent with the duties customarily assigned to the General Counsel of a company substantially comparable as of the Effective Date to Employer. As a condition to the Employee’s employment by the Employer, Employee and Employer shall execute the Employee Confidentiality, Non-Competition, and Proprietary Information Agreement, attached hereto as Exhibit 1 and made a part hereof (the “Confidentiality Agreement”).
2.    Duties.  Employee shall perform faithfully, diligently and to the best of her ability all duties assigned to her by the Board.  Employee shall perform the services contemplated under this Agreement in accordance with the policies established by and under the direction of the Board.  Employee shall have such corporate power and authority as shall reasonably be required to enable her to discharge her duties under this Agreement.  Employee’s services hereunder shall be rendered at the Company’s offices, except for travel to the Company’s offices and elsewhere when and as required in the performance of Employee’s duties hereunder.
3.    Time and Efforts.  Employee shall devote all of her business time, efforts, attention and energies to Employer’s business and the discharge of her duties hereunder.  Notwithstanding the foregoing, except as otherwise agreed to in writing, Employee shall have the right to perform such incidental services as are necessary in connection with (a) her private, passive investments, (b) charitable or community activities, (c) participation in trade or professional organizations and (d) service on the board of directors (or comparable body) of not more than one third-party entity or organization that does not compete with the Company Business (as defined in the Confidentiality Agreement), so long as the foregoing do not interfere materially with Employee’s performance of her duties hereunder as determined in good faith by the Board or the President and Chief Executive Officer of the Company.

	
			
	 
	 
	 

4.    Compensation.  As the total consideration for Employee’s services rendered under this Agreement, Employer shall pay or provide Employee the following compensation and benefits:
4.1    Salary.  Employee shall initially be entitled to receive an annual base salary during the Term of three hundred thousand Dollars ($300,000) (hereinafter the “Base Salary”), payable in accordance with the usual payroll practices of Employer as established from time to time.
4.2    Discretionary Bonus.  Employee shall be eligible to receive during each calendar year, commencing in 2014, an annual target performance bonus of 30% of base salary, the determination of the amount of any annual performance bonus earned by Employee to be made by the Board upon the recommendation of the Compensation Committee of the Board and in its sole discretion.
4.3    Stock Option.  As soon as practicable on or after the Effective Date, the Company shall grant Employee under the Company’s Amended and Restated 2007 Incentive Plan (the “Plan”) a stock option (“Option”) to purchase 200,000 shares of the Company’s common stock.  The Option shall vest in sixteen (16) equal quarterly installments of 12,500 shares over four years beginning on the first quarterly anniversary of the Effective Date, provided, in each case, that Employee remains in the continuous employ of Employer through such quarterly anniversary date.  The Option shall (a) be exercisable at an exercise price per share equal to the closing market price of the Company common stock on the date of the grant, (b) have a term of ten years, and (c) be on such other terms as shall be determined by the Board (or the Compensation Committee of the Board) and set forth in a customary form of stock option agreement under the Plan evidencing the Option.
4.4    Expense Reimbursement and Relocation.  Employer shall reimburse Employee for reasonable business expenses incurred by Employee in connection with the performance of Employee’s duties in accordance with Employer’s usual practices and policies in effect from time to time.  Any reimbursements hereunder shall be paid to Employee in accordance with the Company’s expense reimbursement policies and procedures from time to time in effect.  Expenses available for reimbursement will include up to $50,000 in costs incurred by the employee related to the employee’s relocation to Portland, Oregon. The cost of the temporary housing, transportation and travel for Employee and her family for up to the 3 months from the Effective Date will be included as reimbursable relocation expense.
4.5    Vacation.  Employee shall be entitled to 20 days of paid “time off’ (vacation days plus sick time/personal time) for each full calendar year in accordance with the Company’s policies from time to time in effect, in addition to holidays observed by the Company (for partial calendar years, the Employee’s paid time off’ will be pro-rated).  Paid time off may be taken at such times and intervals as the Employee shall determine, subject to the business needs of the Company, and otherwise shall be subject to the policies of the Company, as in effect from time to time.  The number of paid “time off’ days will accrue per pay period and will stop accruing once 20 days have been reached.

	
			
	 
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4.6    Employee Benefits.  The Company shall provide Employee and her dependents, if any, with coverage under any and all medical, dental and vision plans and other benefit programs available generally to the Company’s senior executives and their dependents, to the extent Employee and her dependents satisfy the applicable eligibility requirements, and the Company shall pay, directly or indirectly, the premiums associated with any such medical plans to the same extent the Company pays such premiums for other senior executives of the Company.  Employee shall be eligible to participate in any medical insurance and other employee benefits made available generally by Employer to all senior executives under Employer’s plans and employment policies in effect during the Term. Employee acknowledges and agrees that, any such plans or policies now or hereafter in effect may be modified or terminated by Employer at any time in its discretion.
4.7    Payroll Taxes.  Employer shall have the right to deduct from the compensation and benefits due to Employee hereunder any and all sums required for social security and withholding taxes and for any other federal, state, or local tax or charge which may be in effect or hereafter enacted or required as a charge on the compensation or benefits of Employee.
5.    Termination.  This Agreement and Employee’s employment may be terminated as set forth in this Section 5.
5.1    Termination by Employer for Cause; Termination by Employee.  Employer may terminate Employee’s employment hereunder for “Cause” upon notice to Employee, and Employee may terminate his employment hereunder, for any reason or no reason, upon notice to Employer.  “Cause” for the purpose of this Agreement shall mean any of the following:
(a)    Employee’s breach of any material term of this Agreement, including its Exhibits; provided that the first occasion of any particular breach shall not constitute Cause unless Employee shall have previously received written notice from Employer stating the nature of such breach and affording Employee at least ten (10) days to correct such breach;
(b)    Employee s conviction of, or plea of guilty or nolo contendere to, any felony or other crime of moral turpitude;
(c)    Employee’s act of fraud or dishonesty injurious to Employer or its reputation;
(d)    Employee’s continual failure or refusal to perform her material duties as required under this Agreement after written notice from Employer stating the nature of such failure or refusal and affording Employee at least ten (10) days to correct the same;
(e)    Employee’s act or omission that, in the reasonable determination of Employer’s Board (or a Committee of the Board), indicates alcohol or drug abuse by Employee; or

	
			
	 
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(f)    Employee’s act or personal conduct that, in the judgment of the Board (or a Committee of the Board), gives rise to a material risk of liability of Employee or Employer under federal or applicable state law for discrimination, or sexual or other forms of harassment, or other similar liabilities to subordinate employees.
Upon termination of Employee’s employment by Employer for Cause or by Employee for any reason, all compensation and benefits to Employee hereunder shall cease except that Employee shall be entitled to payment, not later than three days after the date of termination, of (i) any accrued but unpaid salary and unused paid time off (only as accrued during the then-current year of employment), and (ii) reimbursement of business expenses accrued but unpaid as of the date of termination. In addition, Employer’s indemnification obligations shall remain in effect in accordance with the terms thereof.
5.2    Termination by Employer without Cause.  Employer may also terminate Employee’s employment without Cause; provided, however, that, if such termination occurs subsequent to six (6) months after the Effective Date, Employer shall remain obligated to continue paying in accordance with Section 4.1 Employee’s Base Salary at the time of termination for a period of six months following the termination.  Upon any termination pursuant to this Section 5.2, Employee shall, not later than three days after the date of termination, be entitled to payment of any unused vacation time (only as accrued as of the date of such termination as provided in this Agreement and in accordance with applicable law) and reimbursement of business expenses accrued but unpaid as of the date of termination.  If, in the event of a change of control of Employer during the Term, the compensation, benefits, title or duties of Employee under this Agreement are reduced, or Employee must relocate more than 50 miles from her Oregon residence, Employee shall be considered terminated by Employer without Cause, with all of the benefits and payments due Employee as set forth in this Section 5.2.
6.    Equitable Remedies; Injunctive Relief.  Employee hereby acknowledges and agrees that monetary damages are inadequate to fully compensate Employer for the damages that would result from a breach or threatened breach of any of the provisions of the Confidentiality Agreement and, accordingly, that Employer shall be entitled to equitable remedies, including, without limitation, specific performance, temporary restraining orders, and preliminary injunctions and permanent injunctions, to enforce the Confidentiality Agreement without the necessity of proving actual damages in connection therewith. The provision shall not, however, diminish Employer’s right to claim and recover damages or enforce any other of its legal or equitable rights or defenses.
7.    Indemnification.  Employer and Employee acknowledge that, as the Vice President and General Counsel, Employee shall be a corporate officer of Employer and, as such, Employee shall be entitled to indemnification to the full extent mandated by Employer to its officers under the Employer’s Amended and Restated Certificate of Incorporation and Amended and Restated By-laws as in effect as of the date of this Agreement.
8.    Severable Provisions.  The provisions of this Agreement are severable and if any one or more provisions is determined to be illegal or otherwise unenforceable, in whole or in 

	
			
	 
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part, the remaining provisions, and any partially unenforceable provisions to the extent enforceable, shall nevertheless be binding and enforceable.
9.    Successors and Assigns.  This Agreement shall inure to the benefit of and shall be binding upon and enforceable by the parties and their respective successors, assigns, heirs and representatives; provided, however, that neither party may assign this Agreement without the prior written consent of the other party; and, provided further, that this Agreement may be assigned by the Company to a successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business or assets of Employer, and Employee shall cause any such successor to assume expressly and agree to perform this Agreement in the same manner and to the same extent that Employer would have been required to perform it.
10.    Entire Agreement.  This Agreement, including the Confidentiality Agreement, contains the entire agreement of the parties relating to the subject matter hereof, and the parties hereto have made no agreements, representations or warranties relating to the subject matter of this Agreement that are not set forth otherwise therein or herein.  Except as expressly provided herein, this Agreement (including the Confidentiality Agreement) supersedes any and all prior or contemporaneous agreements, written or oral, between Employee and Employer relating to the subject matter hereof.
11.    Amendment.  No modification of this Agreement shall be valid unless made in writing, approved by the Board (or a committee of the Board) and signed by the parties hereto and unless such writing is made by an executive officer of Employer (other than Employee).  The parties hereto agree that in no event shall an oral modification of this Agreement be enforceable or valid.
12.    Governing Law: Arbitration.  This Agreement is and shall be governed and construed in accordance with the laws of the State of Delaware without giving effect to the choice-of-law rules of Delaware.  Except to the extent a remedy is sought as described in Section 7, above, any dispute arising out of, or relating to, this Agreement or the breach thereof, or regarding the interpretation thereof, shall be exclusively decided by binding arbitration conducted in Portland, Oregon in accordance with the rules of the American Arbitration Association (the “AAA”) then in effect before a single arbitrator appointed in accordance with such rules.  Judgment upon any award rendered therein may be entered and enforcement obtained thereon in any court having jurisdiction.  Each of the parties agrees that service of process in such arbitration proceedings shall be satisfactorily made upon it if sent by registered mail addressed to it at the address referred to in Section 13, below.  The costs of such arbitration shall be borne proportionate to the finding of fault as determined by the arbitrator. Judgment on the arbitration award may be entered by any court of competent jurisdiction.
13.    Notice.  All notices and other communications under this Agreement shall be in writing and mailed, electronically mailed, telecopied (in case of notice to Employer only) or delivered by hand or by a nationally recognized courier service guaranteeing overnight delivery to a party at the following address (or to such other address as such party may have specified by notice given to the other party pursuant to the provision):

	
			
	 
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If to Employer:
Galena Biopharma, Inc. 
Attention: Chief Executive Officer 
4640 Macadam Avenue, Suite 270 
Portland, Oregon 97239 
Phone: 503-961-4466
If to Employee:
Through the Company e-mail or the Company regular mail box, if utilized by the Company, or if Employee shall not longer be employed:
Margaret Kivinski 
******************** 
********************
14.    Survival.  Sections 7 through 16 shall survive the expiration or termination of this Agreement.
15.    Counterparts.  This Agreement may be executed in counterparts, each of which shall be deemed to be an original and all of which together shall be deemed to be one and the same agreement.
16.    Attorney’s Fees.  In any action or proceeding to construe or enforce any provision of this Agreement the prevailing party shall be entitled to recover its or his reasonable attorneys’ fees and other costs of suit in addition to any other recoveries.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written.
	
		
	 
	EMPLOYER

	 
	 

	 
	Galena Biopharma, Inc.

	 
	 

	 
	 

	 
	By:   /s/ Mark J. Ahn

	 
	   Mark J. Ahn, Ph.D.

	 
	   President and Chief Executive Officer

	 
	 

	 
	 

	 
	EMPLOYEE

	 
	 

	 
	 

	 
	/s/ Margaret Kivinski

	 
	Margaret Kivinski

	 
	 

	
			
	 
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Exhibit 1 
Galena Biopharma, Inc.

EMPLOYEE CONFIDENTIALITY, NON-COMPETITION, AND 
PROPRIETARY INFORMATION AGREEMENT
AGREEMENT, effective as of July 28, 2014, between Galena Biopharma, Inc., a Delaware corporation (the “Company”), and Margaret Kivinski (the “Employee”).
1.Employee will make full and prompt disclosure to the Company of all inventions, improvements, modifications, discoveries, methods, technologies, biological materials, and developments, and all other materials, items, techniques, and ideas related directly or indirectly to the business of the Company, whether patentable or not, made or conceived by Employee or under Employee’s direction during Employee’s employment with the Company, whether or not made or conceived during normal working hours, or on the premises of the Company (all of which are collectively termed “Intellectual Property” hereinafter).
2.    Employee agrees that all Intellectual Property, as defined above, shall be the sole property of the Company and its assigns, and the Company and its assigns shall be the sole owner of all patents and other rights in connection therewith. Employee hereby assigns to the Company any rights Employee may have or acquire in all Intellectual Property and all related patents, copyrights, trademarks, trade names, and other industrial and intellectual property rights and applications therefore, in the United States and elsewhere. Employee further agrees that with regard to all future developments of Intellectual Property, Employee will assist the Company in every way that may be reasonably required by the Company (and at the Company’s expense) to obtain and, from time to time, enforce patents on Intellectual Property in any and all countries that the Company may require, and to that end, Employee will execute all documents reasonably necessary for use in applying for and obtaining such patents thereon and enforcing the same, as the Company may desire, together with any assignment thereof to the Company or persons designated by the Company, and Employee hereby appoints the Company as Employee’s attorney to execute and deliver any such documents or assignments requested by the Company (but only for the purpose of executing and filing any such document). Employee’s obligation to assist the Company in obtaining and enforcing patents for Intellectual Property in any and all countries shall continue beyond the termination of Employee’s employment with the Company, but the Company shall compensate Employee at a reasonable, standard hourly rate following such termination for time directly spent by Employee at the Company’s request for such assistance.
3.    Employee hereby represents that Employee has no continuing obligation to assign to any former employer or any other person, corporation, institution, or firm any Intellectual Property as described above. Employee represents that Employee’s performance of all the terms of the Agreement and as an employee of the Company does not and will not breach any agreement to keep in confidence proprietary information acquired by Employee, in confidence or in trust, prior to Employee’s employment by the Company. Employee has not entered into, and Employee agrees not to enter into, any agreement (either written or oral), which would put Employee in conflict with the Agreement.

	
			
	 
	 
	 

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4.    Employee agrees to assign to the Company any and all copyrights and reproduction rights to any material prepared by Employee in connection with the Agreement and/or developed by Employee during Employee’s employment with the Company that are related directly or indirectly to the business of the Company.
5.    Employee understands and agrees that a condition of Employee’s employment and continued employment with the Company is that Employee has not brought and will not bring to the Company or use in the performance of Employee’s duties at the Company any materials or documents rightfully belonging to a former employer which are not generally available to the public.
6.    Employee recognizes that the services to be performed by Employee hereunder are special, unique, and extraordinary and that, by reason of Employee’s employment with the Company, Employee may acquire Confidential Information (as hereinafter defined) concerning the operation of the Company, the use or disclosure of which would cause the Company substantial loss and damage which could not be readily calculated and for which no remedy at law would be adequate. Accordingly, Employee agrees that Employee will not (directly or indirectly) at any time, whether during or for a period of seven (7) years after Employee’s employment with the Company:
(i)    knowingly use for personal benefit or for any other reason not authorized by the Company any Confidential Information that Employee may acquire or has acquired by reason of Employee’s employment with the Company. or;
(ii)    disclose any such Confidential Information to any person or entity except (A) in the performance of Employee obligations to the Company hereunder, (B) as required by a court of competent jurisdiction, (C) in connection with the enforcement of Employee rights under the Agreement, or (D) with the prior consent of the Board of Directors of the Company.
As used herein, “Confidential Information” includes proprietary and confidential information with respect to the facilities and methods of the Company, reagents, chemical compounds, cell lines or subcellular constituents, organisms, or other biological materials, trade secrets, and other Intellectual Property, systems, patent applications, procedures, manuals, confidential reports, financial information, business plans, prospects, or opportunities, personnel information, or lists of customers and suppliers which are generally known only to the Company provided, however, that Confidential Information shall not include any information that is known or becomes generally known or available publicly other than as a result of disclosure by Employee which is not permitted as described in clause (ii) above, or the Company discloses same to others without obtaining an agreement of confidentiality.
Employee confirms that all Confidential Information is the exclusive property of the Company. All business records, papers, documents and electronic materials kept or made by Employee relating to the business of the Company which comprise Confidential Information shall be and remain the property of the Company during the Employee’s employment and at all 

	
			
	 
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times thereafter. Upon the termination, for any reason, of Employee’s employment with the Company, or upon the request of the Company at any time, Employee shall deliver to the Company, and shall retain no copies of any written or electronic materials, records and documents made by Employee or coming into Employee’s possession concerning the business or affairs of the Company and which comprise Confidential Information.
7.    During the term of Employee’s employment with the Company and for one (1) year thereafter (the “Restricted Period”), the Employee shall not directly or indirectly, for Employee’s own account or for the account of others, as an officer, director, stockholder (other than as the holder of less than 1% of the outstanding stock of any publicly traded company), owner, partner, employee, promoter, consultant, manager or otherwise participate in the promotion, financing, ownership, operation, or management of, or assist in or carry on through proprietorship, a corporation, partnership, or other form of business entity which is in competition with the Company in the field of the development of pharmaceutical vaccine products or vaccine product candidates for the treatment of HER2-positive breast cancer (the “Company Business”) within the United States or any other country in which the Company is conducting or is actively seeking or planning to conduct the Company Business as of the date of such termination. Notwithstanding the foregoing, except as otherwise agreed to in writing, Employee shall have the right to perform such incidental services as are necessary in connection with (a) his private passive investments, (b) his charitable or community activities,(c) his participation in trade or professional organizations, and (d) his service on the board of directors (or comparable body) of one third-party corporate entity that does not compete with the Company Business.
During the Restricted Period, the Employee shall not, whether for Employee’s own account or for the account of any other person (excluding the Company):
(i)    solicit or contact in an effort to do business with any person who was or is a customer of the Company during the Restricted Period, or any affiliate of any such person, if such solicitation or contact is for the purpose of competition in the field of cancer vaccines for HER2 positive breast cancer with the Company; or
(ii)    solicit or induce any of the Company’s employees to leave their employment with the Company or accept employment with anyone else, or hire any such employees or persons who were employed by the Company during the Restricted Period.
Nothing herein shall prohibit or preclude the Employee from performing any other types of services that are not precluded by the Section 7 for any other person.
The Employee shall give prompt notice to the Company of the Employee’s acceptance of employment or other fees for services relationship in the field of cancer vaccines for HER2 positive breast cancer during the Restricted Period, which notice shall include the name of, the business of, and the position that Employee shall hold with such other entity.

	
			
	 
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8.    In the event that Employee’s employment is transferred by the Company to a subsidiary, affiliated company, or acquiring company (as the case may be), Employee’s employment by such company will, for the purpose of the Confidentiality, Non-Competition, and Proprietary Information Agreement, be considered as continued employment with the Company, unless Employee executes an agreement, substantially similar in substance to the Agreement, and until the effective date of said agreement in any such company for which Employee becomes employed. It is further agreed that changes in Employee’s position or title or location unless expressly agreed to in writing will operate to terminate the Confidentiality, Non-Competition, and Proprietary Information Agreement without Cause.
9.    Upon termination of Employee’s employment for any reason, unless such employment is transferred to a subsidiary, affiliated or acquiring company of the Company, Employee agrees to leave with, or return to, the Company all records, drawings, notebooks, and other documents pertaining to the Company’s Confidential Information, whether prepared by Employee or others, as well as any equipment, tools or other devices owned by the Company, that are then in Employee’s possession, however such items were obtained, and Employee agrees not to reproduce or otherwise retain any document or data relating thereto.
10.    Employee obligations under the Agreement shall survive the termination of Employee’s employment with the Company for the respective periods specifically set forth herein regardless of the manner of. and reason for, such termination, and shall be binding upon Employee’s heirs, executors, and administrators.
11.    Employee understands and agrees that no license to any of the Company’s trademarks, patents, copyrights or other proprietary rights is either granted or implied by Employee’s access to and utilization of the Confidential Information or Intellectual Property.
12.    No delay or omission by the Company in exercising any right under the Agreement will operate as a waiver of that or any other right. A waiver or consent given by the Company on any one occasion is effective only in that instance and will not be construed as a bar to or waiver of any right on any other occasion.
13.    Employee agrees that in addition to any other rights and remedies available to the Company for any breach or threatened breach by Employee of Employee’s obligations hereunder, the Company shall be entitled to enforcement of Employee’s obligations hereunder by whatever means are at the Company’s disposal, including court injunction.
14.    The Company may assign the Agreement to any other corporation or entity which acquires (whether by purchase, merger, consolidation or otherwise) all or substantially all of the business and/or assets of the Company. In the case of a change of control of the Company in which the compensation, title, duties are reduced, or requires the Employee to relocate more than 50 miles from his then current residence, the Employee is considered Terminated without Cause, with all of the benefits and payments due Employee under Section 5.2 of the Employee Agreement. Employee shall have no rights of assignment.

	
			
	 
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15.    If any provision of the Agreement shall be declared invalid, illegal, or unenforceable, then such provision shall be enforceable to the extent that a court deems it reasonable to enforce such provision. If such provision shall be unreasonable to enforce to any extent, such provision shall be severed and all remaining provisions shall continue in full force and effect.
16.    The Agreement shall be effective as of the date first written above.
17.    The Agreement shall be governed in all respects by the laws of the State of Delaware, without regard to principles of conflicts of law.
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IN WITNESS WHEREOF, Employee has executed the Agreement as of the date set forth above:
	
		
	 
	 

	 
	 

	 
	By:  /s/ Margaret Kivinski

	 
	 

	 
	Name of Employee:   Margaret Kivinski

	 
	 

	 
	 

	 
	ACCEPTED AND AGREED TO:

	 
	 

	 
	Galena Biopharma, Inc.

	 
	 

	 
	 

	 
	By:   /s/ Mark J. Ahn

	 
	   Mark J. Ahn, Ph.D.

	 
	   President and Chief Executive Officer

	 
	 

	
			
	 
	610.2 COCAgreement-Purvis

EXECUTIVE CHANGE OF CONTROL AGREEMENT
THIS EXECUTIVE CHANGE OF CONTROL AGREEMENT (this "Agreement") is dated as of October 31, 2014 (the "Effective Date"), by and between Mattson Technology, Inc., (the "Company"), and Tyler Purvis (the "Executive").
RECITALS
WHEREAS, the Company desires to create a greater incentive for the Executive to remain in the employ of the Company, particularly in the event of any possible change or threatened change of control of the Company; and
WHEREAS, the parties desire to memorialize their agreement with respect thereto in the manner set forth herein, 
NOW, THEREFORE, in consideration of the Executive's past and future services to the Company and the mutual covenants contained herein, the receipt and adequacy of which is hereby acknowledged, the parties hereto hereby agree as follows:
AGREEMENT
1.Term of Agreement.  
(a)    This Agreement will have an initial term of two (2) years commencing on the Effective Date.  On the second anniversary of the Effective Date, this Agreement will renew automatically for additional one (1) year terms, unless either party provides the other party with written notice of non-renewal at least sixty (60) days prior to the date of automatic renewal.  Notwithstanding the foregoing provisions of this paragraph, upon commencement of the Change of Control Period, the term of this Agreement will extend automatically through the date that is twelve (12) months following the effective date of the Change of Control.  If Executive becomes entitled to benefits under Section 2 during the term of this Agreement, the Agreement will not terminate until all of the obligations of the parties hereto with respect to this Agreement have been satisfied  
(b)    This Agreement shall terminate in the event that, prior to the commencement of a Change of Control Period, the Executive’s reporting relationship changes such that he or she no longer reports to the Chief Financial Officer.
2.    Termination Following a Change of Control.  If the Executive's employment with the Company is terminated (i) by the Company for any reason other than for "Good Cause" as defined in Section 8 herein, or (ii) by Executive for "Good Reason" as defined in Section 8 herein, with thirty (30) days written notice to the Company, and either such termination is within the "Change of Control Period" as defined in Section 8 herein, Executive shall be entitled to the following benefits:
(a)    Final Paycheck.  Payment, in a lump sum, of any and all base salary due and owing through the date of termination, plus an amount equal to all earned but unused PTO hours 

    

through the date of termination and reimbursement for all reasonable expenses, less any deductions required by applicable law; and
(b)    Severance Payment.  A cash payment in an amount equal to (i) the greater of (A) the Executive's base salary for the twelve (12) months preceding the Change of Control or (B) the Executive's then-current annual base salary, plus (ii) one hundred percent (100%) of the Executive's annual target bonus award; and
(c)    Accelerated Vesting.  All unvested Awards (as defined in the 2012 Equity Incentive Plan, which shall be referred to as the "Stock Plan") outstanding as of the date of termination of employment shall fully vest; and
(d)    Medical and Dental Benefits.  For a period of twelve (12) months beginning on the first day of the calendar month beginning after the date of termination of employment, provided that Executive completes and returns the appropriate enrollment forms to the respective provider in a timely manner, the Company shall reimburse Executive for the cost of Executive's and his or her dependent's (to the extent such dependents were covered under the Company's group plans) medical and dental benefit coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985 ("COBRA") to the same extent provided for by the Company's group plans at the time of termination.  In the event Executive becomes covered under another employer's group health plan that provides Executive and his or her dependents with comparable benefits and levels of coverage during this 12- month period, Executive shall notify Company and Company's obligation to reimburse Executive for continued medical and dental benefits coverage shall end.  The period of such Company-reimbursed COBRA coverage shall be considered part of Executive's COBRA coverage entitlement period, and may, for tax purposes, be considered income to Executive.  In addition, and notwithstanding anything to the contrary in this clause (d), if the Company determines in its sole and reasonable discretion that it cannot reimburse Executive the COBRA premiums without potentially violating applicable law (including, without limitation, Section 2716 of the Public Health Service Act), the Company will in lieu thereof provide to Executive a taxable monthly payment in an amount equal to the monthly COBRA premium that Executive would be required to pay to continue his or her (and to the extent applicable, his or her dependents) medical and dental benefit coverage in effect on the date of such termination, which payments will be made regardless of whether the Executive elects COBRA continuation coverage.
3.    Timing of Payments.  
(a)    The payments provided for in Section 2(a) herein, as applicable, shall be payable immediately upon Executive's termination.  
(b)    The receipt of any benefits pursuant to Section 2(b), (c), and (d) will be subject to Executive signing and not revoking a standard release of claims with the Company (in a form acceptable to the Company (the “Release”)) and the Release becoming effective and irrevocable no later than sixty (60) days following the termination date.  The benefits provided for in Section 2(b), (c), and (d) herein, as applicable, shall be made within ten (10) days of the date that the Release is effective and irrevocable, subject to the provisions of Section 7.  All such payments will 

    

be subject to applicable payroll or other taxes required to be withheld by the Company.  Benefits provided for in Section 2(c) shall be made in accordance with the Stock Plan, subject to any delay required by Section 7. 
4.    Subsequent Employment.  The compensation and benefits payable hereunder with the exception of those benefits provided for under Section 2(d), shall not be reduced or offset by any amounts that the Executive earns or could earn from any subsequent employment. 
5.    Section 280G Matters.  If the benefits described in Section 2 herein, as applicable, (the "Severance Payment") would otherwise constitute a parachute payment under Section 280G of the Internal Revenue Code of 1986, as amended (the "Code"), and but for this Section would be subject to the excise tax imposed by Section 4999 of the Code (the "Excise Tax"), Executive shall either: (i) pay the Excise Tax, or (ii) have the benefits reduced to such lesser extent as would result in no portion of such benefits being subject to the Excise Tax, whichever of the foregoing amounts, taking into account the applicable federal, state and local income taxes and the Excise Tax, results in the receipt by Executive on an after-tax basis, of the greatest amount of benefits, notwithstanding that all or some portion of such benefits may be taxable under Section 4999 of the Code.  Unless the Company and Executive otherwise agree in writing, any determination required under this Section 5 will be made in writing by a national "Big Four" accounting firm selected by the Company or such other person or entity to which the parties mutually agree (the "Accountants"), whose determination will be conclusive and binding upon Executive and the Company for all purposes.  For purposes of making the calculations required by this Section 5, the Accountants may make reasonable assumptions and approximations concerning applicable taxes and may rely on reasonable, good faith interpretations concerning the application of Sections 280G and 4999 of the Code.  The Company and the Executive shall furnish to the Accountants such information and documents as the Accountants may reasonably request in order to make a determination under this Section.  The Company shall bear all costs the Accountants may reasonably incur in connection with any calculations contemplated by this Section 5.  Any reduction in payments and/or benefits required by this Section 5 shall occur in the following order: (1) reduction of cash payments; (2) reduction of vesting acceleration of equity awards; and (3) reduction of other benefits paid to Executive.  In the event that acceleration of vesting of equity awards is to be reduced, such acceleration of vesting shall be cancelled in the reverse order of the date of grant for Executive's equity awards.
6.    Employment Status.  Nothing in this Agreement shall be deemed to constitute a contract for employment for any specific period of time.  The parties expressly acknowledge and agree that the Executive's employment with the Company shall continue to be "at will."
7.    Section 409A.  
(a)    Notwithstanding anything to the contrary in this Agreement, no Deferred Compensation Separation Benefits (as defined below) will be paid or otherwise provided until Executive has a “separation from service”.
(b)    Any severance or benefits under this Agreement that would be considered Deferred Compensation Separation Benefits will be paid on, or, in the case of installments, will not 

    

commence until, the sixtieth (60th) day following Executive’s separation from service, or if later, such time as required by Section 7(c).  Any installment payments that would have been made to Executive during the sixty (60) day period immediately following Executive’s separation from service but for the preceding sentence will be paid to Executive on the sixtieth (60th) day following Executive’s separation from service and the remaining payments will be made as provided in this Agreement.
(c)    Notwithstanding anything to the contrary in this Agreement, if Executive is a "specified employee" within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended (the "Code") and the final regulations and any guidance promulgated thereunder ("Section 409A") at the time of Executive's termination (other than due to death) or resignation, then the severance payable to Executive, if any, pursuant to this Agreement, when considered together with any other severance payments or separation benefits that are considered deferred compensation under Section 409A (together, the "Deferred Compensation Separation Benefits") that are payable within the first six (6) months following Executive's separation from service, will become payable on the first payroll date that occurs on or after the date six (6) months and one (1) day following the date of Executive's separation from service.  All subsequent Deferred Compensation Separation Benefits, if any, will be payable in accordance with the payment schedule applicable to each payment or benefit.  Notwithstanding anything herein to the contrary, if Executive dies following his separation from service but prior to the six (6) month anniversary of his separation from service, then any payments delayed in accordance with this paragraph will be payable in a lump sum as soon as administratively practicable after the date of Executive's death and all other Deferred Compensation Separation Benefits will be payable in accordance with the payment schedule applicable to each payment or benefit.  Each payment and benefit payable under this Agreement is intended to constitute separate payments for purposes of Section 1.409A-2(b)(2) of the Treasury Regulations.
(d)    Any amount paid under this Agreement that satisfies the requirements of the "short-term deferral" rule set forth in Section 1.409A-1(b)(4) of the Treasury Regulations shall not constitute Deferred Compensation Separation Benefits for purposes of clause (c) above.
(e)    Any amount paid under this Agreement that qualifies as a payment made as a result of an involuntary separation from service pursuant to Section 1.409A-1(b)(9)(iii) of the Treasury Regulations that do not exceed the Section 409A Limit shall not constitute Deferred Compensation Separation Benefits for purposes of clause (c) above.  "Section 409A Limit" will mean the lesser of two (2) times: (i) Executive's annualized compensation based upon the annual rate of pay paid to Executive during the Executive's taxable year preceding the Executive's taxable year of Executive's termination of employment as determined under, and with such adjustments as are set forth in, Treasury Regulation 1.409A-1(b)(9)(iii)(A)(1) and any Internal Revenue Service guidance issued with respect thereto; or (ii) the maximum amount that may be taken into account under a qualified plan pursuant to Section 401(a)(17) of the Code for the year in which Executive's employment is terminated.
(f)    The foregoing provisions are intended to comply with the requirements of Section 409A so that none of the severance payments and benefits to be provided hereunder will be 

    

subject to the additional tax imposed under Section 409A, and any ambiguities herein will be interpreted to so comply.  The Company and Executive agree to work together in good faith to consider amendments to this Agreement and to take such reasonable actions which are necessary, appropriate or desirable to avoid imposition of any additional tax or income recognition prior to actual payment to Executive under Section 409A.
8.    Definitions.
(a)    Good Cause.  For purposes of this Agreement, "Good Cause" means: (i) performance of any act or failure to perform any act in bad faith and to the detriment of the Company, (ii) dishonesty, material breach of any agreement with the Company, or intentional misconduct, or (iii) commission of a crime involving dishonesty, breach of trust, or physical or emotional harm to any person.
(b)    Good Reason.  For purposes of this Agreement, "Good Reason" means any of the following, without Executive's written consent:  (i) a significant reduction  by the Company in Executive's annual base salary; (ii) the failure of the Company to obtain an agreement from any successor to the Company, or purchaser of all or substantially all of the Company's assets, to assume this Agreement; (iii) the assignment of Executive to duties which reflect a material adverse change in authority, responsibility or status with the Company or any successor; or (iv) the Company requiring Executive to reside or be based at a location 50 miles or more from the location where Executive was based immediately prior to the Change of Control.
Executive will not resign for Good Reason without first providing the Company with (x) written notice within sixty (60) days of the event that Executive believes constitutes "Good Reason" specifically identifying the acts or omissions constituting the grounds for Good Reason and (y) a reasonable cure period of not less than thirty (30) days following the date of such notice.
(c)    Ownership Change Event.  For purposes of the definition of "Change of Control" below, an "Ownership Change Event" shall be deemed to have occurred if any of the following occurs with respect to the Company:
(i)    the direct or indirect sale or exchange in a single or series of related transactions by the shareholders of the Company of more than fifty percent (50%) of the voting stock of the Company;
(ii)    a merger or consolidation in which the Company is a party; or
(iii)    the sale, exchange, or transfer of all or substantially all of the assets of the Company.
(d)    Change of Control.  A "Change of Control" shall mean (i) an Ownership Change Event or a series of related Ownership Change Events (collectively, the "Transaction") wherein the shareholders of the Company immediately before the Transaction do not retain immediately after the Transaction, direct or indirect beneficial ownership of more than fifty percent 

    

(50%) of the total combined voting power of the outstanding voting stock of the Company or the surviving corporation or the surviving corporation's parent (the "Transferee Corporation(s)"), as the case may be; or (ii) a liquidation or dissolution of the Company.  For purposes of the preceding sentence, indirect beneficial ownership shall include, without limitation, an interest resulting from ownership of the voting stock of one or more corporations which, as a result of the Transaction, own the Company or the Transferee Corporation(s), as the case may be, either directly or through one or more subsidiary corporations.  The Board shall have the right to determine whether multiple sales or exchanges of the voting stock of the Company or multiple Ownership Change Events are related, and its determination shall be final, binding and conclusive.
(e)    Change of Control Period.  "Change of Control Period" means the period commencing on the Company's public announcement of a proposed Change of Control and ending on the earlier of (A) the twelve (12) month period following the consummation of the proposed Change of Control, or (B) the Company's public announcement that the proposed Change of Control will not occur.
9.    Miscellaneous Provisions.
(a)    Entire Agreement.  This Agreement, together with the Company's Stock Plan, stock option agreements, restricted stock units agreements and/or stock repurchase agreements and any Confidentiality, Proprietary Information and Assignment of Inventions Agreement, contains the entire agreement of the parties with respect to the subject matter herein and supersedes and replaces all prior or contemporaneous agreements or understandings between the parties.  This Agreement may not be amended or modified in any manner, except by an instrument in writing signed by the Executive and Chief Executive Officer of the Company.  Failure of either party to enforce any of the provisions of this Agreement or any rights with respect thereto or failure to exercise any election provided for herein shall in no way be considered to be a waiver of such provisions, rights or elections or in any way effect the validity of this Agreement.  The failure of either party to exercise any of said provisions, rights or elections shall not preclude or prejudice such party from later enforcing or exercising the same or other provisions, rights or elections which it may have under this Agreement.
(b)    Successors and Beneficiaries.  This Agreement shall be binding on and inure to the benefit of the successors, assigns, heirs, devisees and personal representatives of the parties, including any successor to the Company by merger or combination and any purchaser of all or substantially all of the assets of the Company.  In the event that the Executive dies before receipt of all benefits to which the Executive becomes entitled under this Agreement, the payment of such benefits will be made, on the due date or dates hereunder had the Executive survived, to the executors or administrators of the Executive's estate.
(c)    Governing Law.  This Agreement is made in, and shall be governed by and construed in accordance with the laws of, the State of California.

    

(d)    Severability.  If any term, provision, covenant or condition of this Agreement is held to be invalid, void, or unenforceable, the remainder of the provisions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated thereby.

    

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.
"Company"        "Executive"
MATTSON TECHNOLOGY, INC.        Tyler Purvis, Chief Accounting Officer
    
By:    /s/ Fusen Chen        /s/ Tyler Purvis
Name: Fusen Chen                
Title:   Chief Executive Officer, President
Address:

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