Document:

Exhibit

    

December 11, 2015

Todd Zavodnick 
 
Re: Employee Offer Letter
Dear Todd:
ZELTIQ AESTHETICS, INC. (the “Company”) is pleased to offer you this Employee Offer Letter (“Offer Letter”).  
1.POSITION; DUTIES.  Your title will be President, International and you will report to me, Mark Foley, President and Chief Executive Officer.  In this position you will perform the duties outlined in the job description and such other duties as may be assigned.  The Company may change your position, duties, and work location from time to time as it deems necessary, subject to the terms of this Offer Letter.  Your start date (“Start Date”) is February 1, 2016.
2.    COMPENSATION. 
(a)    Base Salary.  You will be paid a salary at the annual rate of $350,000, less required deductions and withholdings, payable in semi-monthly installments or otherwise in accordance with the Company’s standard payroll practices for salaried employees.  This salary may be subject to adjustment pursuant to the Company’s employee compensation policies in effect from time to time.
(b)    Initial Equity Grant.  Subject to the approval of the Board of Directors, you will be granted Restricted Stock Units (“RSUs”) with a Value of $2,500,000.00 (two million five hundred thousand dollars) pursuant to the Company’s 2011 Equity Plan.  The vesting commencement date of these shares shall be the 24th of the month following your Start Date.   The number of shares subject to the RSUs shall be equal to the Value set forth above divided by the average Fair Market Value of the Company’s stock for thirty calendar days prior to the Date of Grant.   The RSUs shall vest over four (4) years with one-fourth (1/4) of the RSU’s vesting at the end of twelve (12) months after the vesting commencement date, and each remaining one-fourth (1/4) vesting annually at the end of twenty-four (24) months, thirty-six (36) months, and forty-eight (48) months after the vesting commencement date, respectively. The RSUs will be subject to the terms and conditions applicable to RSUs granted under the Company’s 2011 Equity Incentive Plan, and as described in that Plan and the applicable equity agreement.
(c)    Car Allowance: You are eligible to receive a $375.00 per pay period car allowance.  Employees must maintain a satisfactory driving record for continued eligibility for the car allowance.
(d)    Corporate Bonus Plan.  Your target annual bonus shall be 75% of your base salary (“Target Bonus”).  This will not be pro-rated for your length of service in 2016.  All other aspects of your eligibility are pursuant to the Company's Corporate Bonus Plan (the “Bonus Plan”).  You are also eligible to earn up to an additional 1x of your Target Bonus based upon the combination of Company overachievement and your individual performance pursuant to the terms of the 2016 Bonus Plan.  You must be employed on the date of payout for the bonus to be considered earned.
(e)    Sign On Advances: On the 1st pay period following your start date, you will be provided with a $50,000.00 (fifty thousand dollars) sign on advance.  At this time, you will also receive a second advance equal to $247,500.00 (two hundred forty seven thousand five hundred dollars) less the bonus amount that you are paid by your current employer prior to or upon your resignation.   Both advances shall be subject to applicable deductions and withholdings.  Both advances shall be considered earned after you have successfully completed twelve (12) months of employment with the Company from your Start Date.  Thus, if within twelve months of your Start Date, you either resign from the Company without Good Reason (as defined herein) or the Company terminates your employment for Cause (as defined herein), then you will be required to repay the gross amount of both advances to the Company. If the Company terminates your employment without Cause during the first twelve months of your employment, you will not be obligated to repay either advance.  
3.    BENEFITS.  You shall be entitled to the Company’s employment benefits available to all Company employees, as the same currently exist or may exist in the future, pursuant to the terms of the applicable benefit plans.  You acknowledge that participation in Company benefit programs may require payroll deductions and/or direct contributions by you. 
4.    EMPLOYMENT TERMS.  Your employment relationship with the Company will be governed by the general employment policies and practices of the Company.  You will be required as a condition to your employment with the Company, to execute and abide by the Company’s standard Confidential Information and Invention Assignment Agreement, attached hereto as EXHIBIT A (the “Confidential Information and Invention Assignment Agreement”).  Your duties under the Confidential Information and Invention Assignment Agreement shall survive termination of your employment with the Company.  By signing this Offer Letter, you again acknowledge that a remedy at law for any breach or threatened breach by you of the provisions of the Confidential Information and Invention Assignment Agreement would be inadequate, and you therefore agree that the Company shall be entitled to injunctive relief in case of any such breach or threatened breach.
5.    AT-WILL EMPLOYMENT.  Your employment with the Company will be “at-will,” meaning that either you or the Company will be entitled to terminate your employment at any time, and for any or no reason, with or without cause.  Although your job duties, title, compensation and benefits, as well as the Company’s personnel policies and procedures, may change from time to time, the “at will” nature of your employment may only be changed in an express written agreement signed by you and a duly authorized officer of the Company.
6.    SEVERANCE.  
(a)    Termination Without Cause Outside of Covered Period.  If: (i) at any time other than during the Covered Period your employment is terminated by the Company without Cause (and other than a result of your death or disability); and (ii) not later than 60 days following your termination of employment you execute a general release of claims (the “Release”) in favor of the Company in such form provided by the Company, return such Release to the Company within the applicable time period set forth therein, and permit such Release to become effective in accordance with its terms; then, on the sixtieth (60th) day following such termination of employment, you shall receive or commence to receive, as the case may be:
(i)    Continuation of your then-current base salary, less required deductions and withholdings, for a period of twelve (12) months after your employment termination date, payable on the Company’s regular payroll dates;
(ii)     Your Target Bonus, less required deductions and withholdings, for the year in which your employment terminates; to be paid within 10 days of your execution of the Release; 
(iii)    The Company will pay your COBRA health insurance premiums sufficient to maintain your then-current coverage for a period of twelve (12) months following termination of employment, provided that you timely elect COBRA, continue to be eligible for COBRA during such time period, and do not become eligible for health insurance benefits through another employer.  You agree to promptly notify the Company in writing if you become eligible for health insurance benefits through another employer during the time you are receiving Severance Benefits.  Notwithstanding the foregoing, if the Company determines, in its sole discretion, that it cannot provide the foregoing COBRA subsidy without potentially violating applicable law (including, without limitation, Section 2716 of the Public Health Service Act), the Company shall instead provide you with a taxable monthly payment equal to the monthly COBRA subsidy, which shall be paid regardless of whether you elect COBRA coverage, shall commence in the month following the month in which you incur a Separation from Service (as defined in Section 8(c) below) and shall end on the earlier of the date you obtain other employment and the date that is twelve (12) months following your Separation from Service.
(b)    Termination Without Cause or Good Reason Resignation During Covered Period.  If: (i) at any time during the Covered Period your employment is terminated by the Company without Cause or by you for Good Reason (and other than a result of your death or disability); and (ii) not later than 60 days following your termination of employment you execute a Release in favor of the Company in such form provided by the Company, return such Release to the Company within the applicable time period set forth therein, and permit such Release to become effective in accordance with its terms; then, on the sixtieth (60th) day following such termination of employment, you shall receive or commence to receive, as the case may be:
(i)    Continuation of your then-current base salary (as determined without giving effect to any reduction in base salary that would give rise to your right to resign for Good Reason), less required deductions and withholdings, for a period of twelve (12) months after your employment termination date, payable on the Company’s regular payroll dates;
(ii)    Your Target Bonus, less required deductions and withholdings, for the year in which your employment terminates;
(iii)    Full acceleration of the vesting, if applicable, of all of your then outstanding equity awards, which includes any equity awards granted to you prior to or following the consummation of a Change in Control, in each case effective as of your last date of employment.  To the extent necessary to give effect to the intent of the foregoing provision, notwithstanding anything to the contrary set forth in your equity award agreements or the applicable equity incentive plan under which such equity award was granted that provides that any then unvested portion of your equity award will immediately expire upon your termination of employment, no unvested portion of your equity award shall generally terminate any earlier than three (3) months following any termination of your employment that is a termination without Cause or Good Reason resignation that occurs prior to a Change in Control.
(iv)     The Company will pay your COBRA health insurance premiums sufficient to maintain your then-current coverage for a period of one year following termination of employment, provided that you timely elect COBRA, continue to be eligible for COBRA during such time period, and do not become eligible for health insurance benefits through another employer. You agree to promptly notify the Company in writing if you become eligible for health insurance benefits through another employer during the time you are receiving the COBRA premium benefits. Notwithstanding the foregoing, if the Company determines, in its sole discretion, that it cannot provide the foregoing COBRA subsidy without potentially violating applicable law (including, without limitation, Section 2716 of the Public Health Service Act), the Company shall instead provide you with a taxable monthly payment equal to the monthly COBRA subsidy, which shall be paid regardless of whether you elect COBRA coverage, shall commence in the month following the month in which you incur a Separation from Service (as defined in Section 8(c) below) and shall end on the earlier of the date you obtain other employment and the one year anniversary of your Separation from Service.
(c)    Definitions.  Definitions of Cause, Change in Control, Covered Period and Good Reason are as follows:
(i)    “Cause” shall mean: (A) a willful failure by you to substantially perform your duties hereunder, other than a failure resulting from your complete or partial incapacity due to physical or mental illness or impairment; (B) a willful act by you which constitutes gross misconduct and which is injurious to the Company; (C) a willful breach by you of a material provision of this Amended Offer Letter or your Confidential Information and Invention Assignment Agreement; (D) a material and willful violation by you of a federal or state law or regulation applicable to the business of the Company; or (E) termination of your employment in connection with the bankruptcy, insolvency, liquidation, or similar winding-up of the business of the Company.
(ii)    “Change in Control” shall mean: (A) a sale of all or substantially all of the Company's assets; or (B) any merger, consolidation or other business combination transaction of the Company with or into another corporation, entity or person, other than a transaction in which the holders of at least a majority of the shares of voting capital stock of the Company outstanding immediately prior to such transaction continue to hold (either by such shares remaining outstanding or by their being converted into shares of voting capital stock of the surviving entity) a majority of the total voting power represented by the shares of voting capital stock of the Company (or the surviving entity) outstanding immediately after such transaction other than any transaction involving the issuance of any newly issued equity securities solely for cash.
(iii)    “Covered Period” shall mean the period commencing three (3) months prior to the consummation of a Change in Control and ending eighteen (18) months following the consummation of a Change in Control.  For such purposes, if the condition triggering your right to resign for Good Reason occurs within the Covered Period, and your employment terminates within thirty (30) following expiration of the Cure Period (as defined below), the resignation for Good Reason will be deemed to have occurred during the Covered Period.
(iv)     “Good Reason” shall mean: (A) any material reduction in your base compensation (which includes base salary, Target Bonus and any other base compensation); (B) a material diminution of your job duties or responsibilities; or (C) a change in the location of your employment of more than 20 miles (which is material) from its current location unless such relocation is within 50 miles of your principal residence; provided, however, that in order to terminate your employment for Good Reason you shall first give the Company written notice stating with reasonable specificity the basis for the termination with Good Reason within ninety (90) days of the first occurrence of the event giving rise to Good Reason; give the Company a period of thirty (30) days to cure or remedy the problem, unless such problem cannot be cured or remedied within thirty (30) days, in which case the period for remedy or cure shall be extended for a reasonable time (not to exceed an additional thirty (30) days) (the “Cure Period”); and terminate your employment within thirty (30) days following the expiration of such Cure Period.
7.    OUTSIDE ACTIVITIES.  While you render services to the Company, you will not engage in any other gainful employment, business or activity without the written consent of the Company.  While you render services to the Company, you also will not assist any person or organization in competing with the Company, in preparing to compete with the Company or in hiring any employees of the Company.  During the term of your employment by the Company, except on behalf of the Company, you shall not directly or indirectly, whether as an officer, director, stockholder, partner, proprietor, associate, representative, consultant, or in any capacity whatsoever engage in, become financially interested in, be employed by or have any business connection with any other person, corporation, firm, partnership or other entity whatsoever which were known by you to compete directly with the Company, throughout the world, in any line of business engaged in (or planned to be engaged in) by the Company; provided, however, that anything above to the contrary notwithstanding, you may own, as a passive investor, securities of any competitor corporation, so long as your direct holdings in any one such corporation shall not in the aggregate constitute more than 1% of the voting stock of such corporation.
8.    COMPLIANCE WITH IRC SECTION 409A.
(a)    Exemptions.  The severance and other benefits under this Amended Offer Letter are intended to qualify for exemptions from application of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and the regulations and other guidance thereunder and any state law of similar effect (collectively, “Section 409A”), provided under Treasury Regulations 1.409A-1(b)(4), 1.409A1-(b)(5) and 1.409A-1(b)(9), and this Amended Offer Letter will be construed to the greatest extent possible as consistent with those provisions, and to the extent not so exempt, this letter (and any definitions hereunder) will be construed in a manner that complies with Section 409A to the extent necessary to avoid adverse personal tax under Section 409A.
(b)    Deferral.  Notwithstanding anything herein to the contrary, if at the time of your termination of employment with the Company you are a “specified employee” as defined in Section 409A and the deferral of the commencement of any payments or benefits otherwise payable hereunder as a result of such termination of employment is necessary in order to prevent any adverse tax consequences under Section 409A, then the Company will defer the commencement of the payment of any such payments or benefits hereunder (without any reduction in such payments or benefits ultimately paid or provided to you) until the date that is six months and one day following your termination of employment with the Company (or such earlier date as is permitted without incurring adverse consequences under Section 409A).
(c)    Separation from Service.  Notwithstanding anything to the contrary herein, a termination of employment shall not be deemed to have occurred for purposes of any provision of this Offer Letter providing for the payment of amounts or benefits upon or following a termination of employment unless such termination is also a “Separation from Service” within the meaning of Section 409A and, for purposes of this Offer Letter, references to a “resignation,” “termination,” “termination of employment” or like terms shall mean Separation from Service.
(d)    Timing of Payments.  For the avoidance of doubt, any severance benefit payments otherwise scheduled to be made prior to the sixtieth (60th) day following your termination of employment shall instead accrue and will be paid on such sixtieth (60th) day following your termination of employment.

9.    PARACHUTE PAYMENTS.
(a)    Reduced Payment.  If any payment or benefit you would receive from the Company or otherwise in connection with a Change of Control or other similar transaction (“Payment”) would: (i) constitute a “parachute payment” within the meaning of Section 280G of the Code; and (ii) but for this sentence, be subject to the excise tax imposed by section 4999 of the Code (the “Excise Tax”), then such Payment will be equal to the Reduced Amount.  The “Reduced Amount” will be either: (x) the largest portion of the Payment that would result in no portion of the Payment being subject to the Excise Tax; or (y) the largest portion, up to and including the total, of the Payment, whichever amount ((x) or (y)), after taking into account all applicable federal, state and local employment taxes, income taxes, and the Excise Tax (all computed at the highest applicable marginal rate), results in your receipt, on an after-tax basis, of the greater amount of the Payment notwithstanding that all or some portion of the Payment may be subject to the Excise Tax.  If a reduction in payments or benefits constituting “parachute payments” is necessary so that the Payment equals the Reduced Amount, reduction will occur in the manner that results in the greatest economic benefit for you.
10.    Calculations.  The independent registered public accounting firm engaged by the Company for general audit purposes as of the day prior to the effective date of the event described in Section 280G(b)(2)(A)(i) of the Code will perform the foregoing calculations.  If the independent registered public accounting firm so engaged by the Company is serving as accountant or auditor for the individual, entity or group effecting such Change of Control or similar transaction, the Company will appoint a nationally recognized independent registered public accounting firm to make the determinations required hereunder.  The independent registered public accounting firm engaged to make the determinations hereunder will provide its calculations, together with detailed supporting documentation, to the Company and you within 30 calendar days after the date on which your right to a Payment is triggered (if requested at that time by the Company or you) or such other time as reasonably requested by the Company or you.  Any good faith determinations of the independent registered public accounting firm made hereunder will be final, binding and conclusive upon the Company and you.
11.    ENTIRE AGREEMENT.  This Offer Letter, including the Confidential Information and Invention Assignment Agreement attached hereto, sets forth the full and complete agreement between you and the Company regarding your employment with the Company as of the Effective Date.  Any previous, additional or contrary terms, representations, offers or agreements, whether written or oral, that may have been made to you are hereby revoked and superseded in their entirety by this offer.
We hope that you find the foregoing terms acceptable.  You may indicate your agreement with these terms and accept this Offer Letter by signing and dating this Offer Letter below and returning it to me no later than December 18, 2015.
If you have any questions, please call me at (650) 353-6885.

Very truly yours, 
 
 
/s/ Mark Foley     
Mark Foley, President & CEO
AGREED AND ACCEPTED
I have read and accept this Offer Letter: 

 
/s/ Todd Zavodnick     
Todd Zavodnick 
Dated: 12/16/2015

EXHIBIT A 
 
ZELTIQ AESTHETICS, INC. 
EMPLOYEE CONFIDENTIAL INFORMATION AND 
INVENTION ASSIGNMENT AGREEMENT

1.Exhibit

EXHIBIT 10.42  

PROJECT AGREEMENT
(SALES OPERATIONS SERVICES for CLIENT SALES TEAMS)

This Project Agreement (this “Project Agreement”) is made as of January 1, 2016 (the “Effective Date”) by and between inVentiv Commercial Services, LLC with an office located at 500 Atrium Drive, Somerset, NJ 08873 (“inVentiv”) and Omeros Corporation, with an office located at 201 Elliott Avenue West, Seattle, WA 98119 (“Client”).   Client and inVentiv may each be referred to herein as a “Party” and collectively, the “Parties”.

RECITALS

A.    Client and inVentiv have entered into a Master Service Agreement dated as of May 12, 2014 (the “MSA”) as well as a Project Agreement thereunder for detailing and sales operations dated May 12, 2014 as amended by a first amendment dated June 13, 2014 and second amendment dated August 19, 2014 (the “Sales Detailing Project Agreement”), a Project Agreement thereunder for sales operations services dated July 24, 2014 (the “Sales Operations Project Agreement”), and a Project Agreement thereunder for medical sciences liaisons operations services dated July 18, 2014 (the “MSL Project Agreement”).

B.    Client and inVentiv desire to terminate the Sales Detailing Project Agreement, the Sales Operations Project Agreement, and the MSL Project Agreement effective as of December 31, 2015 on the basis of terms set forth herein, and to enter into this Project Agreement pursuant to which inVentiv shall provide operations services commencing on the Effective Date as set forth more fully in Exhibit A attached hereto. 

C.    As part of the termination of the Sales Detailing Project Agreement, Omeros and inVentiv acknowledge that a substantial portion of the specialty sales representatives (“SSRs”) employed by inVentiv and assigned to Omeros under the Sales Detailing Project Agreement will be “converted” to be employed by Omeros, rather than inVentiv, as of the Effective Date, and that other SSRs will not be employed by Omeros.

1.        Interpretation and Construction

The Parties confirm that the MSA shall govern the relationship between the Parties, and this Project Agreement shall be subject to the terms of the MSA.  Unless otherwise expressly set forth herein, in the event of a conflict or inconsistency between the terms and conditions set forth in the MSA and the terms and conditions set forth in this PA, the terms and conditions set forth in the MSA shall take precedence, govern and control.  Unless otherwise expressly provided herein (including in any exhibits), capitalized terms used in this Project Agreement have the meanings set forth in the Master Service Agreement.

2.        The Services

A detailed description of the operations services to be provided under this Project Agreement (the “Operations Services”) are set forth on Exhibit A attached hereto and made a part hereof.

EXHIBIT 10.42  

3.         The Term

This Project Agreement shall be in effect as of the Effective Date and shall remain in effect until the first (1st) anniversary of the Deployment Date (as defined in Exhibit A), unless extended as provided herein (the “Term”).  The period from the Deployment Date until the day prior to the one (1) year anniversary of the Deployment Date shall be referred to herein as “Year One”. The Term may be extended for additional periods of one (1) year (each an “Additional Term”) upon the mutual written agreement of the Parties not less than ninety (90) days before the end of the Term or any Additional Term.

4.     Termination of this Project Agreement

(a)    Subject to Section 4(b) below, either Party may terminate this Project Agreement in accordance with Section 12 of the MSA.

(b)    Notwithstanding Section 12(a)(v) of the MSA, Client may additionally and without penalty terminate this Project Agreement in its sole discretion by providing inVentiv with at least sixty (60) days' prior written notice.

5.     Fees for this Project Agreement

Set forth on Exhibit B are the costs and fees to be paid by Client to inVentiv for the performance of the Operations Services under this Project Agreement.

6.     Termination of Other Project Agreements

A.Early Termination:  The parties agree that the Sales Detailing Project Agreement, the Sales Operations Project Agreement, and the MSL Project Agreement shall each terminate effective as of December 31, 2015.

B.Early Termination Fees:  In consideration for early termination of the Sales Detailing Project Agreement, the Sales Operations Project Agreement, the MSL Project Agreement, and in lieu of all other conversion fees, penalties and payments set forth in the Project Agreements associated with the early termination of the Sales Detailing Project Agreement, hiring by Omeros of SSRs, removal of other SSRs from providing services to Omeros without replacement, and amendment of the Sales Operations Project Agreement and MSL Project Agreement, Omeros agrees to pay and inVentiv agrees to accept the following fees:

i)An “Early Conversion Penalty Fee” of $174,696, which shall be invoiced following conversion on or after the Effective Date and payable within thirty (30) days of Omeros’ receipt of the invoice.

ii)A “SSR Conversion Fee” of $2,000 per inVentiv SSR that is employed by Omeros on the Effective Date, which shall be invoiced following conversion on or after the Effective Date.  The parties assume that 

EXHIBIT 10.42  

Omeros will convert 26 inVentiv SSRs for an estimated total SSR Conversion Fees of $52,000, such estimate to be adjusted based on actual hires.

iii)Any outstanding charges or credits associated with services provided and costs incurred under the Sales Detailing Project Agreement, the Sales Operations Project Agreement, and the MSL Project Agreement through December 31, 2015 will remain owed and payable and settled in accordance with such Project Agreements, provided that Omeros will process and provide incentive compensation payments directly to the converted SSRs hired by Omeros for their performance during the fourth quarter of 2015 based on sales results for the fourth quarter of 2015.  Omeros will also reimburse inVentiv on a pro-rata basis for fourth quarter 2015 performance-based incentive compensation owed and paid by inVentiv to SSRs that had been assigned to Omeros, not hired by Omeros, and whose employment was terminated by inVentiv November 6, 2015.

C.Separation for Non-Converted SSRs:  For each inVentiv SSR not employed by Omeros and whose employment was terminated by inVentiv November 6, 2015, Omeros will also reimburse inVentiv for the cost of severance and health insurance for such SSRs through November 30, 2015, estimated to total in aggregate $55,000 for eight terminated SSRs, such estimate to be adjusted based on the actual number of such SSRs and days of severance paid.  Qualification for severance reimbursement for terminated SSRs shall be dependent on the terminated SSRs not being offered another position with inVentiv prior to the Effective Date.  inVentiv shall provide Omeros a report by December 15, 2015 detailing the terminated SSRs and the cost of severance paid and shall invoice Omeros for such severance amounts paid, which invoice shall be paid by Omeros within thirty (30) days of receipt.  

D.Purchase of Technology Hardware:  Omeros agrees to purchase and inVentiv agrees to sell the following technology hardware used as of December 31, 2015 by inVentiv’s SSRs currently or previously assigned to Omeros, for the total sum of $17,638, which amount shall be paid by Omeros within thirty (30) days of receipt of the equipment and a corresponding invoice: 45 iPad Air 32GB; 44 Lenovo T440p laptops, associated printers, and all peripherals; and 45 VZW devices. inVentiv shall transfer to Omeros all warranties applicable to the purchased technology hardware and Omeros shall upon request certify removal of inVentiv licensed software. 

7.    Integration

This Project Agreement and the MSA set forth the parties entire understanding of the subject matter set forth herein and supersedes all prior related written agreements between the parties, including the letter of intent between the parties executed November 5, 2015.

WHEREFORE, the parties hereto have caused this Project Agreement to be executed by their duly authorized representatives on the day and year first above written.

EXHIBIT 10.42  

	
		
	OMEROS CORPORATION
	INVENTIV COMMERCIAL SERVICES, LLC

	By:  /s/ Gregory A. Demopulos        
	By:     /s/ Theodore Wong        

	Name: Gregory A. Demopulos, M.D.
	Name:     Theodore Wong

	Title:  Chairman & CEO
	Title:     VP & CFO

	Date:  December 10, 2015
	Date:     Dec 23, 2015

EXHIBIT 10.42  

EXHIBIT A
THE SALES OPERATIONS SERVICES FOR CLIENT SALES TEAMS

1.0     Executive Summary

This Exhibit A describes the work required for the initial implementation  and ongoing operation of the Sales Operations Services  to support the Client's Sales Management Team and Home Office employees (collectively, “Client Employees”) for product OMIDRIA® (phenylephrine and ketorolac injection) 1% / 0.3%.   For purposes of this Project Agreement, the Deployment Date shall mean on or about January 1, 2016.

Any changes to the assumptions, deliverables, or scope of work described in this document or any new work requests will follow Section 4.0, the Change Control Process of this document.

2.0     Scope of Services

This Exhibit A defines the work related to the following service areas for the initial implementation and the operation of the Sales Operations Services within the following areas:

•    Project Management
•    Customer Relationship Management (CRM)
•    Veeva Network
•    Field Support Services
•    Sales & Technology Training Services

3.0     Scope of Work Definition

3.1 Project Management

inVentiv has developed  a project implementation  methodology based upon industry best practices into the most efficient process and method for conducting and managing projects.

The inVentiv project team will include this engagement in their ongoing support of the Omeros Sales implementation:

•    Provide a practical approach to project planning, execution and service delivery
•    Maintain discipline and structure without constraining the project efforts
•    Frame the project within the strategies of the clients business requirements

inVentiv will hereby extend its fully integrated project management approach for the implementation of the Sales Support Services referred to as the “Project”.   This Project will be managed by the assigned project manager (“Project Manager”) and include ongoing tracking and monitoring of project activities, timelines, and deliverables associated with the Omeros sales implementation. After the implementation period is over and field users are deployed, the 

EXHIBIT 10.42  

operational support of the client will be provided by the dedicated share of an Operations Manager with support provided as needed by the Project Manager. Initially the share of the Operations Manager shall be 25%, and the parties agree to re-evaluate and adjust this after sixty (60) days from the Effective Date.

3.2 Customer Relationship Management (“CRM”)

inVentiv will provide licenses for Omeros’ field sales, medical affairs, national account, and sales management personnel (collectively “Field Users”) and for Omeros’ home office personnel (“Home Office Users”) to utilize the Omeros CRM solution developed  as part of the existing inVentiv CRM service offering provided to support the Omeros inVentiv Implementation.  inVentiv will utilize Veeva CRM software, an industry leader in providing cloud-based CRM applications to the Life Sciences industry. The CRM Services include those supported within the inVentiv

Health General Development Org or GDO, including:

•    Customer Management across Account Profiles (Individuals & Organizations)
•    Call Recording, Reporting, and loading of Call Plans
•    Closed-Loop Marketing (“CLM”); loading and presentation of digital media as part of integrated call record
•    Medical Inquiry Request Form (“MIRF'') including physician signature capture
•    Field Coaching configuration
•    Reports & Dashboards based on industry best practices to enhance field and field management performance (online only)
•    iPad/Online Platform options including on-line/home office PC, Field Tablet PC, and iPad to support mobility needs and improved customer interaction

3.3  Veeva Network & Open Data Access/Ongoing Validation

inVentiv, in partnership with Veeva, will provide Client a unique end-to-end commercial operations platform coupled with timely and accurate customer data.  The access to Veeva open network will fix existing data issues (de-duplication and then remove dead, moved, retired targets) and will augment the current data set with missing identifiers or other information.  The platform provides the following uses:
•Licensed Client Field and Home Office users have access to entire customer universe (HCPs, HCOs, Affiliations)
•Data Change Requests can be submitted by field users – will reduce routine action request processing activity
•Timely and accurate data available to all users
•iTargeting & alignment team will have access to a rich data source to identify an initial target universe

inVentiv services will include a user license for the Veeva Network application and Open Data Services based on a per user per month fee, assuming the same user count as the CRM field user purchase.   

EXHIBIT 10.42  

3.4 Field Support Services

Help Desk:

The inVentiv Field Service Desk supports inVentiv Systems and Operational processes, to ensure field user readiness and performance.

•    Field Support Service Desk hours are Monday through Friday, 8am-10pm, Eastern Time
•    Standard inVentiv metrics and KPIs for call and ticket resolution
•    Field Support can be reached via telephone or via email
•    Knowledge Base will be supplied for Service desk based on client business rules and system configuration
•    Standard Monthly reporting will be provided along with Post-Rollout daily monitoring reporting for 2 weeks following each field deployment

4.0 Change Control Process

Throughout the development of a business solution, additional knowledge is gained and situations and underlying assumptions change.  A key component of the project management process is to identify the changes and make informed decisions, especially with regard to functionality, schedule and cost.

The change control process enables inVentiv and its customer to maintain a shared vision for the project.  The objectives of change control are to:

•    Assess the impact of scope changes on project schedules, resources and pricing
•    Provide a formal vehicle for approval to proceed with any changes to this Statement of
Work
•    Provide a project audit record of all material changes to the original Statement of Work

If requirements arise that are outside the scope of this proposal, a Change of Scope document will be submitted for client approval following the below process:

1.  Client requests additional requirements for new functionality or deliverables outside the scope of work identified.
2.   inVentiv reviews change, meets with client and internal team members to understand and scope client expectations regarding business need, timelines, and other deliverable expectations.
3.   inVentiv provides Change of Scope document which outlines work effort, timeline and pricing impacts of the change.  Pricing will be determined based on standard rates provided below.
4.   Client accepts proposal and signs Change of Scope document which authorizes work to begin on the change request.

EXHIBIT 10.42  

Standard Pricing Table for changes of scope approved by Omeros:

	
		
	Role
	Price/HR

	Software Development
	$250

	Data Management
	$250

	Alignment/Call Planning
	$250

	Testing
	$150

	Project Management
	$150

	Training (Content/Delivery)
	$150

	Hardware/Help Desk
	$150

EXHIBIT 10.42  

EXHIBIT B
COMPENSATION- FIXED FEES, VARIABLE FEES AND PASS-THROUGH COSTS
I.    FIXED FEES
Fixed Monthly Fee

Commencing thirty (30) days prior to the Effective Date, inVentiv shall invoice Omeros (“Client”) for the following Fixed Monthly Fees.

	
		
	Position

	Year 1
Fixed Monthly Fee

	Ongoing Field Operations Support - Monthly Fee for Veeva sales management database
	$15,449

	Ongoing Field Operations Support – Monthly fee for 25% share of an Operations Manager*
	$4,187

	Per Field User
(Assume 55**)
	$277

	Per Home Office User
(Assume 5**)
	$237

* Initially the share of the Operations Manager shall be 25%, and the parties agree to re-evaluate and adjust this share and the corresponding fee after sixty (60) days from the Effective Date.
** To be adjusted based on actual users and corresponding licenses.

II.     PASS-THROUGH COSTS

In addition to the Fixed Fees, certain expenses will be charged to Client on a pass­
through basis.  These expenses will be billed to Client at actual cost. ·Pass-through costs include:

•    All travel related expenses (transportation, lodging, meals, etc.) if approved in advance
 
               by Client
•    Printing, postage and office supplies
•    Data purchases
•    Other expenses which have been approved by Client

III.     INVOICES; BILLING TERMS

Commencing thirty (30) days prior to the Deployment Date, Client will be billed monthly the amounts stated above as the Fixed Monthly Fees (per user type times the number of each user type plus the Ongoing Field Operations Support Monthly Fee). Pass-through Costs will be billed to Client at actual cost as incurred by inVentiv. 

Each monthly invoice shall be submitted thirty (30) days prior to the start of a month in which Operations Services are to be provided and payment on invoices shall be due the later of the first day of that month in which the Operations Services are provided or thirty (30) days following Client’s receipt of each 

EXHIBIT 10.42  

applicable invoice from inVentiv.  If an invoice is not paid when due, inVentiv reserves the right to impose a finance charge of 1% monthly, applied to the outstanding balance due.

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