Document:

Prepared by R.R. Donnelley Financial -- Employment Letter Agreement between the Registrant and Earle L. Canty

 Exhibit 10.16 
  
 December 8, 2003 
  
 Earle Canty 
  
 Dear Earle: 
  
 Conor Medsystems, Inc. (the
“Company” or “Conor”) is pleased to offer you a position as Vice President, Regulatory Affairs and Quality Assurance, reporting to Frank Litvack, CEO. 
  
 You will be paid an annual salary of $180,000, payable twice monthly in accordance with Conor’s standard payroll practices. Your start
date will January 12, 2004. You will be entitled to the benefits that Conor customarily makes available to employees in positions comparable to yours, including inclusion in the Conor group health insurance program. You will also be entitled to 15
days of Paid Time Off per year, consistent with Conor’s leave policy. 
  
 Subject to the approval of the Company’s Board of Directors, you will be granted an option to purchase 225,000 shares of the Company’s Common Stock at an exercise price per share equal to the fair market value per share on the
date the option is granted. The option will be governed in all respects by the terms and conditions of the Company’s 1999 Stock Option Plan and your stock option agreement with the Company. 
  
 In the event of a Change of Control (as defined below) of the Company and you are either
terminated without Cause (as defined below) or Constructively Terminated (as defined below) without Cause, then all of the then remaining unvested option shares shall be deemed immediately vested. 
  
 “Change of Control” shall mean (i) the consummation of a merger, reorganization or
other transaction or series of related transactions following which the stockholders of the Company immediately prior to the transaction own less than 50% of the total voting power represented by the voting securities of the Company of such
surviving entity (or its parent) outstanding immediately after the transaction, and the directors serving the Company’s Board of Directors immediately prior to such transaction fail to constitute a majority of the Board of Directors of the
surviving entity (or its parent) immediately after such transaction; or (ii) the consummation of the sale or disposition by the Company of all or substantially all of the Company’s assets. 
  
 “Cause” shall mean your failure to perform your assigned duties or responsibilities
as a Service Provider (other than a failure resulting from your Disability) after notice thereof from the Company describing your failure to perform such duties or responsibilities; (ii) your engaging in any act of dishonesty, fraud or
misrepresentation; (iii) your violation of any federal or state law or regulation applicable to the Company’s business; (iv) your breach of any confidentiality agreement or invention assignment agreement between you and the Company; or (v) your
being 

  

 Earle Canty 
 December
8, 2003 
 Page 2 
  

 
convicted of, or entering a plea of nolo contendere to, any crime or committing any act of moral turpitude. 
  
 “Constructive Termination” shall mean (i) without your express written consent, a
material reduction in your duties, position or responsibilities relative to your duties, position or responsibilities in effect immediately prior to such reduction; provided, however, that a reduction in duties, position and responsibilities solely
by virtue of the Company being acquired and made part of a larger entity shall not constitute a “Constructive Termination.” 
  
 The Company asks that you complete the enclosed Employment, Confidential Information, Invention Assignment and Arbitration Agreement (“Confidentiality
Agreement”) prior to commencing employment. In part, this Confidentiality Agreement requests that a departing employee refrain from using or disclosing Conor’s Confidential Information (as defined in the Agreement) in any manner which
might be detrimental to or conflict with the business interests of Conor or its employees, assigns to Conor any rights an employee has in any inventions developed during the course of employment and refrains for one year from soliciting Conor
employees. This Agreement does not prevent a former employee from using his or her general knowledge and experience (no matter when or how gained) in any new field or position and does not require an employee to assign inventions made prior to
employment with Conor. 
  
 This offer is contingent upon completion of our hiring
process including the successful completion of all reference checks, a financial and criminal background investigation and verification of all academic degrees. Additionally, we will require information satisfactory to the Company regarding your
recent position. 
  
 During the period that you render services to the Company,
you will not engage in any employment, business or activity that is in any way competitive with the business or proposed business of the Company. You will disclose to the Company any other gainful employment, business, or activity. You also will not
assist any other person or organization in competing with the Company or in preparing to engage in competition with the business or proposed business of the Company. 
  
 Under federal immigration laws, the Company is required to verify each new employee’s identity and legal authority to work in the
United States. Accordingly, please be prepared to furnish appropriate documents satisfying those requirements; this offer of employment is conditioned on submission of satisfactory documentation. 
  
 We hope that you and Conor will find mutual satisfaction with your employment. All of us at
Conor are very excited about you joining our team and look forward to a beneficial and fruitful relationship. Employment at Conor is on an at-will basis: employees have the right to terminate their employment with or without cause and with or
without advance notice, and the Company reserves for itself an equal right. 
  
 This letter and the Confidentiality Agreement contain the entire agreement with respect to your employment. The terms of this offer may only be changed by written agreement, although the 

  

 Earle Canty 
 December
8, 2003 
 Page 3 
  

 
Company may from time to time, in its sole discretion, adjust the benefits provided to you and its other employees. Should you have any questions with regard
to any of the items indicated above, please call me. 
  
 Earle, it is a pleasure
to extend this offer to you and we look forward to having you join the Conor team. Kindly indicate your consent to this employment agreement by signing and returning a copy of this letter and the Confidentiality Agreement to me; retain the second
copy for your records. Upon your signature below, this will become our binding agreement with respect to your employment and its terms, merging and superseding in their entirety all other or prior agreements and communications by you and Conor as to
the specific subjects of this letter. 
  

	
	 Very truly yours

	
	 /s/ Michael Boennighausen

	 Michael Boennighausen
 Vice President, Finance and Administration

  

 Earle Canty 
 December
8, 2003 
 Page 4 
  

 ACCEPTANCE: 
  
 I accept the terms of my employment with Conor Medsystems, Inc. as set forth herein. I understand that this offer letter does not constitute a contract of
employment for any specified period of time, and that my employment relationship may be terminated by either party, with or without cause and with or without notice. 
  

					
			
	 /s/ Earle Canty
	 	 	 	 11.Dec.2003

	 Earle Canty
	 	 	 	 DatePrepared by R.R. Donnelley Financial -- Employment Letter Agreement between the Registrant and Stephen H. Diaz

 Exhibit 10.17 
  
 January 5, 2000 
  
 Mr. Stephen H. Diaz 
  
 Dear Steve: 
  
 On behalf of Conor
Medsystems, Inc. (the “Company”), I am pleased to offer you a position with the Company based upon the following terms: 
  
 1. Position. Upon acceptance of this offer, you will become the Director of Engineering for the Company initially reporting to Jeff Shanley,
President and Chief Executive Officer. You will assume and discharge such responsibilities as are commensurate with such position and as Jeff Shanley may direct. During the term of your employment, you shall devote your full time, skill and
attention to your duties and responsibilities and shall perform them faithfully, diligently and competently. In addition, you shall comply with and be bound by the operating policies, procedures and practices of the Company in effect from time to
time during your employment. 
  
 2. Effective Date. The
effective date of employment shall be within 14 business days, as decided by the Company, from the execution date of a confidentiality agreement (“Confidentiality Agreement”) by and between the Company and yourself, which execution and
adherence to the terms of such Confidentiality Agreement shall be a condition to your employment with the Company. 
  
 3. At-Will Employment. You should be aware that your employment with the Company is for no specified period and constitutes “at-will”
employment. As a result, you are free to terminate your employment at any time, for any reason or for no reason. Similarly, the Company is free to terminate your employment, at any time, for any reason or for no reason and that the terms of your
employment, including but not limited to promotion, demotion, transfer, compensation, benefits, duties and location of work may be changed at any time, for any reason or for no reason. In the event of termination of your employment, you will not be
entitled to any payments, benefits, damages, awards or compensation other than as may otherwise be available in accordance with the Company’s established employee plans and policies at the time of termination. 
  
 Compensation. (a) In consideration of your services, effective as of
the commencement of your employment (which will be not later than January 8, 2001), you will be paid a base salary of $6,666.67 per month, less applicable withholdings, payable twice monthly in accordance with the Company’s standard payroll
practices. Your salary will begin as of the effective date of employment. The first and last payment by the Company to you will be prorated, if necessary, to reflect a commencement or termination date other than the first or last working day of a
pay period. Your base salary will be reviewed annually by the Company. 
  

 (b) In addition to your base salary, you may be entitled to participate in such incentive
compensation plan which may be adopted by the Company in its sole discretion. You understand that the adoption of any such plan, the eligibility and measurement criteria and all other terms shall be at the sole discretion of the Company. 

 
 (c) If your employment is terminated by the Company for
any reason, with or without cause, or if you resign your employment voluntarily, no compensation or other payments will be paid or provided to you for periods following the date when such a termination of employment is effective, provided that any
rights you may have under the benefit plans of the Company shall be determined under the provisions of those plans. If your employment terminates as a result of your death or disability, no compensation or payments will be made to you other than
those to which you may otherwise be entitled under the benefit plans of the Company. 
  
 4. Vacation and Benefits. During the term of your employment, you will be entitled to standard vacation and fringe benefits in accordance with the Company’s practices covering employees, as such benefits
may be in effect from time to time. 
  
 5. Stock Option.
Subject to action by the Company’s board of directors and compliance with applicable state and federal securities laws, the Company will grant to you an option to purchase 50,000 shares of the Company’s Common Stock (the
“Option”) pursuant to the Company’s Incentive Stock Plan, as amended (the “Plan”), adopted by the board of directors and stockholders of the Company. The exercise price of the Option will be the fair market value of the
Company’s Common Stock on the date of grant as determined by the Company’s board of directors. The Option will vest over four (4) years with one forty-eighth (1/48) of the total shares vesting at the end of each full month thereafter until
all such shares are exercisable, subject to all provisions of the Plan and your continued employment with the Company. 
  
 6. Additional Stock Option. Subject to action by the Company’s board of directors and compliance with applicable state and federal securities
laws, the Company will grant to you an additional option to purchase 50,000 shares of the Company’s Common Stock (the “Additional Option”) pursuant to the Plan, adopted by the board of directors and stockholders of the Company. The
exercise price of the Additional Option will be the fair market value of the Company’s Common Stock on the date of grant as determined by the Company’s board of directors. The Additional Option will vest over one (1) year with one-twelfth
(1/12) of the shares vesting at the end of each full month thereafter until all such shares are exercisable, subject to all provisions of the Plan and your continued employment with the Company. 
  
 7. Employment, Confidential Information, Invention Assignment and
Arbitration Agreement. As a condition of accepting this offer of employment, you will be required to complete, sign and return the Company’s standard form of Confidential Information and Proprietary Information and Inventions Agreement.

  
 8. Immigration Laws. For purposes of federal
immigration laws, you will be required to provide to the Company documentary evidence of your identity and eligibility for employment in the United States. Such documentation must be provided within 3 business days 

  

 2. 

 
of the effective date of your employment, or your employment relationship with the Company may be terminated. 
  
 9. Conflicting Employment. During the period that you render services
to the Company, you will not engage in any employment, business or activity that is in any way competitive with the business or proposed business of the Company. You will disclose to the Company in writing any other gainful employment, business or
activity that you are currently associated with or participate in that competes with the Company. You will not assist any other person or organization in competing with the Company or in preparing to engage in competition with the business or
proposed business of the Company. 
  
 10. Entire Agreement.
This offer letter, the Confidential Information and Proprietary Information and Inventions Agreement and the agreements representing stock options granted to you under the Plan, when signed by you, set forth the terms of your employment with the
Company and supersede any and all prior representations and agreements, whether written or oral. 
  
 11. Amendment. This agreement can only be amended in a writing signed by you and an officer of the Company. Any waiver of a right under this
agreement must be in writing. 
  
 12. Governing Law. This
agreement will be governed under the laws of the State of California applicable to such agreements made and to be performed entirely within such State. 
  
 We look forward to you joining the Company. If the foregoing terms are agreeable, please indicate your acceptance by signing the enclosed copy of this
letter in the space provided below and returning it to me within one (1) week. 
  

			
	 Sincerely,

	
	 CONOR MEDSYSTEMS, INC.

		
	By:	 	 /s/ Jeff Shanley

	 	 	 Jeff Shanley, President and Chief
 Executive Officer

  

	
	 AGREED AND ACCEPTED:

	
	 /s/ Stephen H. Diaz

	 Stephen H. Diaz

  

 3.

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