Document:

EX-10.16

 Exhibit 10.16 
 Description of Annual Cash Incentive Program 
 Targacept, Inc. (the
“Company”) maintains an incentive award program (the “Program”) under which all of its employees, including its named executive officers, are eligible to receive an annual cash incentive bonus. Under the terms of the Program,
each employee is assigned a target bonus percentage of his or her base salary. The target bonus percentages for the Company’s executive officers are determined by the Compensation Committee of the Board of Directors. At or about the beginning
of each fiscal year, the Compensation Committee establishes performance objectives for the Company for that year and ascribes, for each performance objective, a percentage weighting, target criteria for achievement and, beginning with fiscal 2013,
in some cases threshold and/or maximum criteria for achievement. For each annual performance objective that has threshold criteria, the weighting for the objective is not credited if the threshold criteria are not met and 50% of the weighting for
the objective is credited if the threshold (but not the target or, if applicable, maximum) criteria are met; if the target (but not the maximum, if applicable) criteria are met for a performance objective, 100% of its weighting is credited; and for
each annual performance objective that has maximum criteria, 150% of the weighting for the objective is credited if the maximum criteria are met; in each case subject to any discretionary adjustments that may be made by the Compensation Committee.
As a result, the maximum weighting for all of the performance objectives in the aggregate can be up to 150%. The performance objectives typically relate to some of the following areas — the progression or advancement of the Company’s
product candidates, development program execution or outcomes, the enhancement of the Company’s product portfolio, business development, alliance management, regulatory operations, capital or operational efficiency, human resources matters and
communications matters. 
 Following the end of the fiscal year, the Compensation Committee determines the achievement level for
the Program for that year. In making its determination, the Compensation Committee evaluates which achievement criteria have been met, if any, for each performance objective, the circumstances surrounding any performance objective or associated
criteria that has not been met and whether to award all or any portion of the weighting ascribed to that performance objective(s), and whether to make any adjustment based on other Company accomplishments that occurred during the year. 

For a group of employees that includes the Company’s principal executive officer, principal financial officer and other named
executive officers, 100% of the annual cash incentive bonus is determined based on the achievement level for the Program determined by the Compensation Committee as described above. Accordingly, the annual cash incentive bonus for a particular year
for each employee in this group is determined by multiplying the amount of his or her base salary received for that year times his or her assigned target bonus percentage times the achievement level for the Program determined by the Compensation
Committee. For the Company’s remaining employees, 50% of the annual cash incentive bonus is based on the achievement level for the Program determined by the Compensation Committee and the other 50% is based on individual performance.EX-10.17

 Exhibit 10.17 
 Description of Non-Employee Director Compensation Program 
 Targacept, Inc.
(the “Company”) maintains a non-employee director compensation program pursuant to which: 
  

	 	•	 	 each non-employee director who is first elected or appointed to the Board of Directors after the Company’s initial public offering receives a
nonqualified option to purchase 25,000 shares of the Company’s common stock on the fifth business day after his or her election or appointment (an “Initial Option”); 

 

	 	•	 	 each non-employee director who is first elected or appointed as chairman of the Board of Directors after the Company’s initial public offering
receives an additional Initial Option to purchase 10,000 shares of the Company’s common stock on the fifth business day after his or her election or appointment; 

 

	 	•	 	 each non-employee director receives on an annual basis a nonqualified option to purchase 12,500 shares of the Company’s common stock or, in the
case of the chairman of the Board of Directors, an option to purchase 17,500 shares of the Company’s common stock (an “Annual Option”); 

  

	 	•	 	 each non-employee director receives an annual cash retainer of $35,000 payable in quarterly installments ($55,000 in the case of the chairman of the
Board of Directors); and 

  

	 	•	 	 each member of the Audit Committee receives an additional annual cash retainer of $10,000 ($20,000 in the case of the chairman of the committee); each
member of the Compensation Committee receives an additional annual cash retainer of $7,500 ($15,000 in the case of the chairman of the committee); and each member of the Governance and Nominating Committee and each member of the Technology and
Innovation Committee receives an additional annual cash retainer of $5,000 ($10,000 in the case of the chairman of the committee). 

 Each Initial Option vests and becomes exercisable (i) with respect to one-third of the shares subject to the Initial Option, on the earlier of the first anniversary of the grant date or the last
business day before the annual meeting of stockholders that occurs in the next calendar year, provided that the recipient director remains in service on the vesting date, and (ii) with respect to the remaining two-thirds of the shares subject
to the Initial Option on a pro rata quarterly basis over the next two years, if the recipient director remains in service as a director during such periods. 
 Each Annual Option is granted on the fifth business day after the date of the stockholders meeting at which directors are elected, if the recipient director remains in service as a director as of the
grant date, and vests and becomes exercisable in full on the earlier of the first anniversary of the grant date or the last business day before the annual meeting of stockholders that occurs in the next calendar year, provided that the recipient
director remains in service as a director on the vesting date. 
 The option price per share for both Initial Options and Annual
Options is equal to the fair market value of the common stock as of the date the option is granted, as determined in accordance with the Company’s 2006 Stock Incentive Plan (or any successor plan). The option period for both Initial Options and
Annual Options is 10 years. Initial Options and Annual Options granted to any director are subject to certain restrictions on exercise if his or her service on the Board of Directors terminates.EX-10.16

 Exhibit 10.16 
 BARRETT BUSINESS SERVICES, INC. 
 SUMMARY OF COMPENSATION ARRANGEMENTS

 FOR NON-EMPLOYEE DIRECTORS 
 As of March 15, 2013, compensation arrangements for non-employee directors of Barrett Business Services, Inc. (the “Company”) consist of (a) an annual retainer of $50,000 ($68,000 for
the Chairman of the Board) payable in cash in monthly installments and (b) annual cash compensation of $15,000, $10,000, $5,000 and $5,000 payable in cash annually to the Audit, Compensation, Investment, and Corporate Governance and Nominating
Committee chairs, respectively. Each non-employee director also received a grant under the Company’s 2009 Stock Incentive Plan of restricted stock units for 2,500 shares vesting in four equal annual installments effective July 2, 2012.EX-10.12.1

 Exhibit 10.12.1 

FIRST AMENDMENT TO 
 CREDIT AND SECURITY AGREEMENTS 
 THIS FIRST AMENDMENT TO CREDIT AND
SECURITY AGREEMENTS (the “Amendment”), dated as of March 13, 2013, is entered into by and among ZHONE TECHNOLOGIES, INC., a Delaware corporation (“Zhone Technologies”), ZTI MERGER SUBSIDIARY III, INC., a Delaware
corporation (“ZTI”; Zhone Technologies and ZTI are sometimes referred to herein individually as a “Borrower” and collectively as the “Borrowers”), PREMISYS COMMUNICATIONS, INC., a Delaware
corporation (“Premisys”), ZHONE TECHNOLOGIES INTERNATIONAL, INC., a Delaware corporation, (“Zhone International”), PARADYNE NETWORKS, INC., a Delaware corporation (“Paradyne Networks”), PARADYNE
CORPORATION, a Delaware corporation (“Paradyne Corporation”; Premisys, Zhone International, Paradyne Networks, and Paradyne Corporation are sometimes referred to herein individually as a “Guarantor” and collectively
as the “Guarantors”), and WELLS FARGO BANK, NATIONAL ASSOCIATION (“Lender”). 
 RECITALS

 A. Borrowers, Guarantors, and Lender are parties to (i) a Credit and Security Agreement, dated March 13, 2012 (as
amended from time to time, the “Domestic Credit Agreement”), and (ii) a Credit and Security Agreement (Ex-Im Subfacility), dated March 13, 2012 (as amended from time to time, the “Ex-Im Credit Agreement”;
and together with the Domestic Credit Agreement, collectively, the “Credit Agreements”). Capitalized terms used in this Amendment have the meanings given to them in the Credit Agreements unless otherwise specified in this Amendment.

 B. Borrowers and Guarantors have requested that certain amendments be made to the Credit Agreements, and Lender is willing to
agree to such amendments pursuant to the terms and conditions set forth herein. 
 NOW, THEREFORE, in consideration of the
premises and of the mutual covenants and agreements herein contained, it is agreed as follows: 
 1. Amendments to Credit Agreements. The
Credit Agreements are amended as follows: 
 1.1 Section 8 of the Credit Agreements. Section 8 of the
Credit Agreements is amended to read in its entirety as follows: 
 “8 FINANCIAL COVENANTS.  

Each Borrower covenants and agrees that, until termination of all obligations of Lender to provide extensions of credit
hereunder and payment in full of the Obligations, Borrowers will comply with each of the following financial covenants: 
 (a)
Minimum Liquidity. Have Liquidity of at least the following: 
  

			
	 Minimum Liquidity
	  	Applicable Period/Test Date
	     $3,000,000
	  	At all times

 (b) Minimum EBITDA. If a Liquidity Trigger Event shall occur,
Borrowers shall achieve EBITDA, for the periods described below, of at least the required amount set forth in the following table for the applicable period set forth opposite thereto (it being understand that such requirement shall be effective
immediately and retroactively) (numbers appearing between “< >” are negative): 
  

			
	 Applicable Amount
	  	Applicable Period
	 $<1,750,000>
	  	Three-month period ending March 31, 2013
	 $<2,000,000>
	  	Six-month period ending June 30, 2013
	 $<2,500,000>
	  	Nine-month period ending September 30, 2013
	 $<2,000,000>
	  	Twelve-month period ending December 31, 2013

 (c) Maximum Capital Expenditures. Shall not incur or contract to incur
Non-Financed Capital Expenditures in excess of $500,000 in payments in the aggregate during the fiscal year ending December 31, 2013. Borrowers shall provide a report to Lender on the status of their Non-Financial Capital Expenditures each
month. 
 Borrowers shall deliver their Projections for subsequent fiscal years to Lender as required in
Section 6.1 and shall work with Lender to set financial covenants for periods beyond those set forth above. Failure to set financial covenants prior to December 31 for each subsequent fiscal year shall constitute an Event of
Default.” 
 2. No Other Changes. Except as explicitly amended by this Amendment or the other Loan Documents delivered in connection
with this Amendment, all of the terms and conditions of the Credit Agreements and the other Loan Documents shall remain in full force and effect and shall apply to any advance or letter of credit thereunder. This Amendment shall be deemed to be a
“Loan Document” (as defined in the Credit Agreements). 
 3. Accommodation Fee. [Intentionally Omitted]. 

4. Conditions Precedent. This Amendment shall be effective when Lender shall have receiveda duly executed original hereof, together with each of
the following, each in substance and form acceptable to Lender in its sole discretion and duly executed by all relevant parties: 
 4.1 Certificates of Authority from the corporate secretaries of the Borrowers and Guarantors; and 

  
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 4.2 Such other matters as Lender may require. 

5. Representations and Warranties. Borrowers and Guarantors hereby represent and warrant to Lender as follows: 

5.1 Borrowers and Guarantors have all requisite power and authority to execute this Amendment and any other agreements or instruments
required hereunder and to perform all of their obligations hereunder, and this Amendment and all such other agreements and instruments have been duly executed and delivered by Borrowers and Guarantors and constitute the legal, valid and binding
obligation of Borrowers and Guarantors, enforceable in accordance with its terms. 
 5.2 The execution, delivery and performance
by Borrowers and Guarantors of this Amendment and any other agreements or instruments required hereunder have been duly authorized by all necessary corporate action and do not (i) require any authorization, consent or approval by any governmental
department, commission, board, bureau, agency or instrumentality, domestic or foreign, (ii) violate any provision of any law, rule or regulation or of any order, writ, injunction or decree presently in effect, having applicability to Borrowers or
Guarantors, or the certificates of incorporation or by-laws of Borrowers or Guarantors, or (iii) result in a breach of or constitute a default under any indenture or loan or credit agreement or any other agreement, lease or instrument to which
Borrowers or Guarantors are a party or by which Borrowers and Guarantors or their respective properties may be bound or affected. 
 5.3 All of the representations and warranties contained in Section 5 and Exhibit D of the Credit Agreements are true and correct on and as of the date hereof as though made on and as of
such date, except to the extent that such representations and warranties relate solely to an earlier date (in which case such representations and warranties continue to be true and correct as of such earlier date). 

6. References. All references in the Credit Agreements to “this Agreement” shall be deemed to refer to the Credit Agreements as amended
hereby; and any and all references in the other Loan Documents to the Credit Agreements shall be deemed to refer to the Credit Agreements as amended hereby. 
 7. No Waiver. The execution of this Amendment and the acceptance of all other agreements and instruments related hereto shall not be deemed to be a waiver of any Default or Event of Default under
the Credit Agreements or a waiver of any breach, default or event of default under any Loan Document or other document held by Lender, whether or not known to Lender and whether or not existing on the date of this Amendment. 

8. Release. Borrowers and Guarantors hereby absolutely and unconditionally release and forever discharge Lender, and any and all participants,
parent corporations, subsidiary corporations, affiliated corporations, insurers, indemnitors, successors and assigns thereof, together with all of the present and former directors, officers, agents, attorneys, and employees of any of the foregoing,
from any and all claims, demands or causes of action of any kind, nature or description, whether arising in law or equity or upon contract or tort or under any state or federal 

  
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law or otherwise, which Borrowers or Guarantors have had, now have or have made claim to have against any such person for or by reason of any act, omission, matter, cause or thing whatsoever
arising from the beginning of time to and including the date of this Amendment, whether such claims, demands and causes of action are matured or unmatured or known or unknown. It is the intention of the Borrowers and Guarantors in executing this
release that the same shall be effective as a bar to each and every claim, demand and cause of action specified and in furtherance of this intention each of the Borrowers and Guarantors waives and relinquishes all rights and benefits under
Section 1542 of the Civil Code of the State of California, which provides: 
 “A GENERAL RELEASE DOES NOT EXTEND TO
CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MIGHT HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.” 

The parties acknowledge that each may hereafter discover facts different from or in addition to those now known or believed to be true with respect to
such claims, demands, or causes of action and agree that this instrument shall be and remain effective in all respects notwithstanding any such differences or additional facts. 
 9. Costs and Expenses. Borrowers agree to pay all fees and disbursements of counsel to Lender for the services performed by such counsel in connection with the preparation of this Amendment and the
documents and instruments incidental hereto. Borrowers hereby agree that Lender may, at any time or from time to time in its sole discretion and without further authorization by Borrowers, make a loan to Borrowers under the Credit Agreements, or
apply the proceeds of any loan, for the purpose of paying any such fees, disbursements, costs and expenses. 
 10. Miscellaneous. This
Amendment may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed an original and all of which counterparts, taken together, shall constitute one and the same instrument. Transmission by facsimile
or “pdf” file of an executed counterpart of this Amendment shall be deemed to constitute due and sufficient delivery of such counterpart. Any party hereto may request an original counterpart of any party delivering such electronic
counterpart. This Amendmentand the rights and obligations of the parties hereto shall be construed in accordance with, and governed by, the laws of the State of California. In the event of any conflict between this Amendment and the Credit
Agreements, the terms of this Amendment shall govern. 
 [Signature Page Follows] 

  
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 IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of
the date first above written. 
  

					
	BORROWERS:
		
		 	ZHONE TECHNOLOGIES, INC.
			
		 	 By:
	 	 /s/ KIRK MISAKA

		 	Name:	 	Kirk Misaka
		 	Title:	 	Chief Financial Officer
		
		 	ZTI MERGER SUBSIDIARY III, INC.
			
		 	By:	 	 /s/ KIRK MISAKA

		 	Name:	 	Kirk Misaka
		 	Title:	 	Chief Financial Officer

  

					
	GUARANTORS:
		
		 	PREMISYS COMMUNICATIONS, INC.
			
		 	By:	 	 /s/ KIRK MISAKA

		 	Name:	 	Kirk Misaka
		 	Title:	 	Chief Financial Officer
		
		 	ZHONE TECHNOLOGIES
		 	INTERNATIONAL, INC.
			
		 	By:	 	 /s/ KIRK MISAKA

		 	Name:	 	Kirk Misaka
		 	Title:	 	Chief Financial Officer
		
		 	PARADYNE NETWORKS, INC.
			
		 	By:	 	 /s/ KIRK MISAKA

		 	Name:	 	Kirk Misaka
		 	Title:	 	Chief Financial Officer
		
		 	PARADYNE CORPORATION
			
		 	By:	 	 /s/ KIRK MISAKA

		 	Name:	 	Kirk Misaka
		 	Title:	 	Chief Financial Officer
	
	LENDER:
		
		 	WELLS FARGO BANK, NATIONAL ASSOCIATION
			
		 	By:	 	 /s/ HARRY L. JOE

		 	Name:	 	Harry L. Joe
		 	Title:	 	Authorized Signatory

  
 S-1

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