false 0001217234 0001217234 2024-09-06 2024-09-06

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): September 6, 2024

 

 

CAREDX, INC.

(Exact Name of Registrant as Specified in its Charter)

 

 

 

Delaware   001-36536   94-3316839

(State or Other Jurisdiction

of Incorporation)

 

(Commission

File Number)

 

(IRS Employer

Identification No.)

8000 Marina Boulevard, 4th Floor

Brisbane, California 94005

(Address of Principal Executive Offices) (Zip Code)

(415) 287-2300

Registrant’s telephone number, including area code

N/A

(Former Name, or Former Address, if Changed Since Last Report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Exchange Act:

 

(Title of each class)

 

(Trading
Symbol)

 

(Name of exchange
on which registered)

Common Stock, $0.001 Par Value   CDNA   The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 


Item 5.02.

Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

The Board of Directors of CareDx, Inc. (the “Company”) has appointed Keith Kennedy, as the Company’s Chief Operating Officer, effective September 12, 2024 (the “Effective Date”).

Mr. Kennedy, age 54, has served as the Chief Financial Officer at PharmaLogic Holdings, Inc., since April 2022. Mr. Kennedy previously served with Veracyte, Inc. from December 2016 to May 2021, where he served as Chief Operations Officer, Chief Financial Officer, and Secretary. Prior to Veracyte, Mr. Kennedy held key executive positions at MCG Capital as President and Chief Executive Officer, at Arlington Capital Partners as Healthcare Executive-in-Residence, and at GE Capital as Managing Director. Mr. Kennedy received a B.S. in Accounting from Indiana University Bloomington in 1992 and an M.B.A. from William & Mary – Raymond A. Mason School of Business in 1995.

There are no reportable family relationships or related party transactions (as defined in Item 404(a) of Regulation S-K) involving the Company and Mr. Kennedy. Mr. Kennedy was not selected to serve as the Company’s Chief Operating Officer pursuant to any arrangement or understanding with any person.

In connection with his appointment, on July 27, 2024, Mr. Kennedy and the Company entered into an offer letter (the “Offer Letter”). Pursuant to the Offer Letter, Mr. Kennedy’s initial annualized salary will be $575,000, and he will be eligible to receive an annual performance bonus of up to 60% of his base salary (which will be pro-rated for 2024). Mr. Kennedy will also be eligible for reimbursement of relocation expenses during the first twelve months of his employment not to exceed $100,000. Mr. Kennedy’s employment will be on an “at will” basis.

In connection with his appointment and as provided in the Offer Letter, Mr. Kennedy was granted on the Effective Date (i) an option to purchase shares of the Company’s common stock (the “Inducement Option”), having a grant date fair value of $2,000,000, which option will vest over four years, with 25% of the total number of shares subject to the Inducement Option vesting on the one-year anniversary of the Effective Date and 1/48th of the total number of shares subject to the Inducement Option vesting at the end of each calendar month thereafter, and (ii) an award of restricted stock units (the “Inducement RSUs”), having a grant date value of $2,000,000, which will vest in four equal, annual installments beginning with the one-year anniversary of the Effective Date, in each case subject to Mr. Kennedy’s continued services to the Company on each vesting date, except as otherwise provided in the Change of Control and Severance Agreement (as defined below). The Inducement Option and the Inducement RSUs were inducements material to Mr. Kennedy agreeing to enter into employment with the Company and Mr. Kennedy has not previously been an employee or director of the Company.

In connection with Mr. Kennedy’s appointment, the Company also entered into a Change of Control and Severance Agreement (the “Change of Control and Severance Agreement”) with Mr. Kennedy that will remain in effect for so long as Mr. Kennedy remains employed by the Company. Pursuant to the Change of Control and Severance Agreement, if within three months prior to, or twelve months following, a “change of control” (as defined in the Change of Control and Severance Agreement) (such period, the “Change of Control Period”), the Company or its successor terminates Mr. Kennedy’s employment without Cause or Mr. Kennedy resigns for Good Reason, Mr. Kennedy will be entitled to (a) a lump sum payment equal to twelve months of Mr. Kennedy’s annual base salary (at the greater of the rate in effect immediately prior to the change of control or the rate in effect immediately prior to the date of such termination), (b) acceleration of vesting with respect to 100% of any unvested equity awards (with any performance criteria being deemed achieved at target levels for the relevant performance period(s)), (c) a lump sum payment equal to 100% of Mr. Kennedy’s annual bonus (equal to the greater of target bonus in effect for the fiscal year in which the change of control occurs or the target bonus in effect for the fiscal year in which the termination occurs) and (d) reimbursement of COBRA premiums for Mr. Kennedy and his eligible dependents for twelve months, provided, that such reimbursement will cease on the date that Mr. Kennedy becomes covered under a similar plan. Pursuant to the Change of Control and Severance Agreement, if the Company or its successor terminates Mr. Kennedy’s employment without Cause or Mr. Kennedy resigns for Good Reason outside of the Change of Control Period, Mr. Kennedy will be entitled to (i) twelve months’ severance based on Mr. Kennedy’s annual base salary payable in accordance with the Company’s normal payroll, (ii) reimbursement of COBRA premiums for Mr. Kennedy and his eligible dependents for twelve months, provided, that such reimbursement will cease on the date that Mr. Kennedy becomes covered under a similar plan and (iii) if such termination occurs prior to the one year anniversary of Mr. Kennedy’s start date, acceleration of vesting with respect to a pro-rated portion of the equity awards granted to Mr. Kennedy in connection with his initial appointment, based on the number of days that elapsed since his start date (but for the avoidance of doubt, only with respect to the initial 25% cliff vesting tranches otherwise scheduled to vest on the one year anniversary of Mr. Kennedy’s start date). Payment of the foregoing under the Change of Control and Severance Agreement is conditioned upon execution of a separation agreement and release of claims in favor of the Company. All terms used in this paragraph and not defined in this Current Report on Form 8-K shall have the meanings set forth in the Change of Control and Severance Agreement.

 

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In connection with his employment, Mr. Kennedy also entered into a Confidential Information, Invention Assignment, Non-Competition, and Arbitration Agreement (the “CIIA Agreement”) with the Company, which includes indefinite confidentiality provision, invention assignment, non-compete covenants during his employment (and for twelve months thereafter, unless he is based in California), non-solicit covenants during his employment and for twelve months thereafter, and an agreement to arbitrate all employment-related disputes.

The foregoing descriptions of the Offer Letter, the Change of Control and Severance Agreement and the CIIA Agreement do not purport to be complete and are qualified in their entirety by reference to the full text of the Offer Letter, the Change of Control and Severance Agreement and the CIIA Agreement, which are filed as Exhibit 10.1, 10.2 and 10.3, respectively, to this Current Report on Form 8-K and incorporated herein by reference.

In connection with the appointment of Mr. Kennedy as the Company’s Chief Operating Officer and the appointment of Jessica Meng as the Company’s Chief Commercial Officer, the Company reached an agreement with Alexander Johnson, the Company’s President of Patient and Testing Services, pursuant to which Mr. Johnson’s employment concludes effective as of September 13, 2024 and that such separation will be treated as a termination by the Company without “cause” for purposes of the various agreements in place between the Company and Mr. Johnson. The Company and Mr. Johnson are currently negotiating the terms of his separation and consulting arrangement that will be finalized at a later date.

 

Item 8.01

Other Events.

On September 12, 2024, the Company issued a press release announcing the appointment of Mr. Kennedy as the Company’s Chief Operating Officer. A copy of the press release is filed herewith as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.

 

Item 9.01.

Financial Statements and Exhibits.

(d) Exhibits.

 

Exhibit
No.
   Description
10.1    Offer Letter, dated July 27, 2024, between CareDx, Inc. and Keith Kennedy.
10.2    Change of Control and Severance Agreement, dated July 27, 2024, between CareDx, Inc. and Keith Kennedy.
10.3    Confidential Information, Invention Assignment, Non-Competition, and Arbitration Agreement, dated July 27, 2024, between CareDx, Inc. and Keith Kennedy.
99.1    Press release dated September 12, 2024.
104    Cover Page Interactive Data File, formatted in Inline Extensible Business Reporting Language (iXBRL).

 

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Date: September 12, 2024   CAREDX, INC.
    By:  

/s/ John Hanna

      John Hanna
      Chief Executive Officer

 

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Exhibit 10.1

 

LOGO

July 27, 2023

Dear Keith,

I am pleased to offer you a position with CareDx, Inc. (the “Company”) as a Chief Operating

Officer reporting to John Hanna, President and CEO. Start date will be September 12, 2024 or another mutually agreed upon date. This position is a full-time, exempt position, based at 8000 Marina Boulevard, Brisbane, California.

Salary

Effective upon commencement of your full-time employment at the Company you will receive an annualized salary of $575,000 paid on a biweekly basis on our regular paydays. Deductions required by law or authorized by you will be taken from each paycheck.

Annual Bonus

Additionally, you will be eligible to participate in our Corporate Annual performance bonus plan with an annual target of 60% of your base salary and your bonus for 2024 will be prorated based on the number of days you worked for the Company in 2024. You must be employed at the time of payout, except as otherwise provided in the Change of Control Agreement between you and the company dated July 27, 2024 (the Change of Control and Severance Agreement), and the amount is subject to all state and federal taxes.

Employee Benefits

As a Company employee, you are also eligible to receive certain employee benefits pursuant to the terms of Company benefit plans as described in the CareDx Benefits Brochure. You will also be eligible for reimbursement of relocation expenses during your first 12-months of employment not to exceed $100,000.

You should note that the Company may modify, in its sole discretion, job titles, salaries, holidays, vacation and any other benefits from time to time as it deems necessary.

Equity Award

As a material inducement to your executing this letter and your commencement of employment with the Company, you will be granted the following equity awards effective upon your start date:

$2 million in stock options, whereby the number of stock options subject to the award will be calculated using the Black-Sholes option pricing model on the date preceding the public announcement of your hire, and the exercise price of the stock options shall be the closing price of the Company’s common stock, as reported on The Nasdaq Stock Market LLC (“Nasdaq”), on the date of grant. This option shall vest subject to your continued employment with the company, except as otherwise provided in the Change of Control and Severance Agreement, as to one-fourth (1/4) of the shares on the one-year


LOGO

 

anniversary of your start date, and as to an additional one forty-eight (1/48th) of the total number of shares subject other option at the end of each calendar month thereafter. Details of the price of these options will be provided in you stock option grant and determined by the compensation & Human Capital Committee of the Board; and

$2 million in restricted stock units based on the closing price of the Company’s common stock, as reported on the Nasdaq, on the date preceding the public announcement of your hire. 25% of the Restricted Stock Units will vest on the one-year anniversary of your start date and 25% of the Restricted Stock Units will vest each year thereafter on the same date as your start date, subject to your continued employment with the company on each such vesting date, except as otherwise provided in the Change of Control and Severance Agreement.

The equity awards described above shall be awarded outside of the Company’s equity incentive plans as “inducement grants” within the meaning of Nasdaq Listing Rule 5635(c)(4) and shall be subject to you entering into customary equity award agreements associated documentation with respect to such awards.

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 resign at any time, for any reason or for no reason. Similarly, the Company is free to conclude its employment relationship with you at any time, with or without cause. In the event of certain terminations, you will be eligible to receive benefits pursuant to the Change of Control and Severance Agreement.

For purposes of federal immigration law, 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 to us within three (3) business days of your date of hire, or our employment relationship with you may be terminated. Your employment also is subject to successful verification of your professional references, and to our standard pre-employment process, which includes completion of an employment application and successful completion of a standard background check, including not being on the Medicare disbarment list.

Employment Agreements

As a condition to your employment with the Company, you will be required to sign the Company’s standard At-Will Employment, Confidential Information, Invention Assignment, Non-Competition and Arbitration Agreement, a copy of which will be provided to you.

We also ask that, if you have not already done so, you disclose to the Company any and all agreements relating to your prior employment that may affect your eligibility to be employed by the Company or limit the manner in which you may be employed. It is the Company’s understanding that any such agreements will not prevent you from performing the duties of your position and you represent that such is the case. Moreover, you agree that, during the term of your employment with the Company, you will not engage in any other employment, occupation, consulting or other business activity directly related to the business in which the Company is now involved or becomes involved during the term of your employment, nor will you engage in any other activities that conflict with your obligations to the Company. Similarly, you agree not to bring any third-party confidential information to the Company, including that of your former employer, and that in performing your duties for the Company you will not in any way utilize any such information.


LOGO

 

In the event of any dispute or claim relating to or arising out of our employment relationship, you and the Company agree that all such disputes shall be fully and finally resolved by binding arbitration conducted by the American Arbitration Association in San Mateo County, California.

Entire Agreement

This letter, along with the CareDx At-Will Employment, Confidential Information, Invention Assignment, Non-Competition and Arbitration Agreement and the Change of Control and Severance Agreement sets forth the terms of your employment with the Company and supersede any prior representations or agreements, whether written or oral. This letter may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument. This letter may not be modified or amended except by a written agreement, signed by the Company and by you. To accept this offer sign and date within ADP. Please direct any questions regarding the offer letter to me, Stacey Follon, SVP Head of Human Resources at sfollon@caredx.com. This offer will expire on {OFFER EXPIRATION DATE}.

I am look forward to working with you at CareDx, Inc.

 

Sincerely,

/s/ John W. Hanna

John W. Hanna

President and Chief Executive Officer

ACCEPTED AND AGREED TO BY:

/s/ Keith S. Kennedy

Keith S. Kennedy

On this day 7/27/2024

Exhibit 10.2

CAREDX, INC.

CHANGE OF CONTROL AND SEVERANCE AGREEMENT

This Change of Control and Severance Agreement (the “Agreement”) is made and entered into by and between Keith S. Kennedy (“Executive”) and CareDx, Inc., a Delaware corporation (the “Company”), effective as of July 27, 2024 (the “Effective Date”).

RECITALS

1. The Board of Directors of the Company (the “Board”) believes that it is in the best interests of the Company and its stockholders (i) to assure that the Company will have the continued dedication and objectivity of Executive, notwithstanding the possibility, threat or occurrence of a Change of Control and (ii) to provide Executive with an incentive to continue Executive’s employment prior to a Change of Control and to motivate Executive to maximize the value of the Company upon a Change of Control for the benefit of its stockholders.

2. The Board believes that it is imperative to provide Executive with certain severance benefits upon Executive’s termination of employment under certain circumstances. These benefits will provide Executive with enhanced financial security, incentive and encouragement to remain with the Company notwithstanding the possibility of a Change of Control.

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

AGREEMENT

NOW, THEREFORE, in consideration of the mutual covenants contained herein, the parties hereto agree as follows:

1. Term of Agreement. This Agreement will remain in effect for so long as Executive remains employed by the Company. Notwithstanding the foregoing provisions of this paragraph, if Executive becomes entitled to benefits under Section 3 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 including with respect to benefits arising out of a Change in Control which occurs after the termination of Executive’s employment.

2. At-Will Employment. The Company and Executive acknowledge that Executive’s employment is and will continue to be at-will, as defined under applicable law. As an at-will employee, either the Company or the Executive may terminate the employment relationship at any time, with or without Cause and with or without Good Reason.


3. Severance Benefits.

(a) Termination without Cause or Resignation for Good Reason Unrelated to a Change of Control. If the Company terminates Executive’s employment with the Company without Cause (excluding death or Disability) or Executive Resigns for Good Reason, and such termination occurs outside of the Change of Control Period, then subject to Section 4, Executive will receive the following:

(i) Accrued Compensation. The Company will pay Executive all accrued but unpaid vacation, expense reimbursements, wages, any unpaid bonus from a prior year (to the extent actually earned but ignoring any continued employment requirement), and all other benefits due to Executive under any Company-provided plans, policies and arrangements. For the avoidance of doubt, the unpaid prior year bonus, if any, shall be paid on the same date such bonuses are paid to other officers of the Company.

(ii) Continuing Severance Payments. Executive will be paid continuing payments of severance pay at a rate equal to Executive’s base salary rate, as then in effect (or, if such termination is due to Executive’s resignation for Good Reason due to a decrease in Executive’s base salary, the base in effect prior to such reduction), for twelve (12) months from the date of such termination of employment, to be paid periodically in accordance with the Company’s normal payroll policies.

(iii) Continuation Coverage. If Executive elects continuation coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”) within the time period prescribed pursuant to COBRA for Executive and Executive’s eligible dependents, then the Company will reimburse Executive for the COBRA premiums for such coverage (at the coverage levels in effect immediately prior to Executive’s termination) until the earlier of (A) a period of twelve (12) months from the date of termination or (B) the date upon which Executive and/or Executive’s eligible dependents become covered under similar plans. The reimbursements will be made by the Company to Executive consistent with the Company’s normal expense reimbursement policy. Notwithstanding the first sentence of this Section 3(a)(iii), if the Company determines in its sole discretion that it cannot provide the foregoing benefit without potentially violating, or being subject to, an excise tax under 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, payable on the last day of a given month, in an amount equal to the monthly COBRA premium that Executive would be required to pay to continue Executive’s group health coverage in effect on the termination of employment date (which amount will be based on the premium for the first month of COBRA coverage), which payments will be made regardless of whether Executive elects COBRA continuation coverage and will commence on the month following Executive’s termination of employment and will end on the earlier of (x) the date upon which Executive obtains other employment or (y) the date the Company has paid an amount equal twelve (12) payments. For the avoidance of doubt, the taxable payments in lieu of COBRA reimbursements may be used for any purpose, including, but not limited to, continuation coverage under COBRA, and will be subject to all applicable tax withholdings.

(iv) If such termination occurs prior to the one year anniversary of Executive’s start date, notwithstanding anything to the contrary in the award agreements and plans governing Executive’s equity awards awarded in connection with Executive starting at the Company, such awards will vest pro rata based on the number of days that have elapsed since Executive’s start date (but for the avoidance of doubt, only with respect to the initial 25% cliff vesting tranches otherwise scheduled to vest on the one year anniversary of Executive’s start date).

 

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(b) Termination without Cause or Resignation for Good Reason in Connection with a Change of Control. If the Company terminates Executive’s employment with the Company without Cause (excluding death or Disability) or if Executive resigns from such employment for Good Reason, and, in each case, such termination occurs during the Change of Control Period, then subject to Section 4, Executive will receive the following:

(i) Accrued Compensation. The Company will pay Executive all accrued but unpaid vacation, expense reimbursements, wages, any unpaid bonus from a prior year (to the extent actually earned but ignoring any continued employment requirement), and all other benefits due to Executive under any Company-provided plans, policies and arrangements. For the avoidance of doubt, the unpaid prior year bonus, if any, shall be paid on the same date such bonuses are paid to other officers of the Company.

(ii) Severance Payment. Executive will receive a lump-sum payment (less applicable withholding taxes) equal to twelve (12) months of Executive’s annual base salary as in effect immediately prior to Executive’s termination date or, if greater, at the level in effect immediately prior to the Change of Control (or, if such termination is due to Executive’s resignation for Good Reason due to a decrease in Executive’s base salary, the base in effect prior to such reduction). For the avoidance of doubt, if (x) Executive incurred a termination prior to a Change of Control that qualifies Executive for severance payments under Section 3(a)(ii); and (y) a Change of Control occurs within the three (3) month period following Executive’s termination of employment that qualifies Executive for the superior benefits under this Section 3(b)(ii), then Executive shall be entitled to a lump-sum payment of the amount calculated under this Section 3(b)(ii), less amounts already paid under Section 3(a)(ii) and such amount lump-sum amount shall be payable upon the later of: (A) the Change of Control, (B) the date the Release (as defined below) is effective and irrevocable or (C) such later date required by Section 4(c).

(iii) Bonus Payment. Executive will receive a lump-sum payment equal to one hundred percent (100%) of the greater of (A) Executive’s target bonus as in effect for the fiscal year in which the Change of Control occurs or (B) Executive’s target bonus as in effect for the fiscal year in which Executive’s termination of employment occurs. For avoidance of doubt, the amount paid to Executive pursuant to this Section 3(b)(iii) will not be prorated based on the actual amount of time Executive is employed by the Company during the fiscal year (or the relevant performance period if something different than a fiscal year) during which the termination occurs.

(iv) Continuation Coverage. If Executive elects continuation coverage pursuant to COBRA within the time period prescribed pursuant to COBRA for Executive and Executive’s eligible dependents, then the Company will reimburse Executive for the COBRA premiums for such coverage (at the coverage levels in effect immediately prior to Executive’s termination) until the earlier of (A) a period of twelve (12) months from the date of termination or (B) the date upon which Executive and/or Executive’s eligible dependents become covered under similar plans. The reimbursements will be made by the Company to Executive consistent with the Company’s normal expense reimbursement policy. Notwithstanding the first sentence of this Section 3(b)(iv), if the Company determines in its sole discretion that it cannot provide the foregoing benefit without potentially violating, or being subject to, an excise tax under 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, payable on the last day of a given month, in an amount equal to the monthly COBRA premium that Executive would be

 

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required to pay to continue Executive’s group health coverage in effect on the termination of employment date (which amount will be based on the premium for the first month of COBRA coverage), which payments will be made regardless of whether Executive elects COBRA continuation coverage and will commence on the month following Executive’s termination of employment and will end on the earlier of (x) the date upon which Executive obtains other employment or (y) the date the Company has paid an amount equal to twelve (12) months of payments. For the avoidance of doubt, the taxable payments in lieu of COBRA reimbursements may be used for any purpose, including, but not limited to, continuation coverage under COBRA, and will be subject to all applicable tax withholdings.

(v) Accelerated Vesting of Equity Awards. One hundred percent (100%) of Executive’s then-outstanding and unvested Equity Awards will become vested in full. If, however, an outstanding Equity Award is to vest and/or the amount of the award to vest is to be determined based on the achievement of performance criteria, then the Equity Award will vest as to one hundred percent (100%) of the amount of the Equity Award assuming the performance criteria had been achieved at target levels for the relevant performance period(s).

(c) Voluntary Resignation; Termination for Cause. If Executive’s employment with the Company terminates (i) voluntarily by Executive (other than for Good Reason) or (ii) for Cause by the Company, then Executive will not be entitled to receive severance or other benefits except for those (if any) as may then be established under the Company’s then existing severance and benefits plans and practices or pursuant to other written agreements with the Company.

(d) Disability; Death. If the Company terminates Executive’s employment as a result of Executive’s Disability, or Executive’s employment terminates due to Executive’s death, then Executive will not be entitled to receive any other severance or other benefits, except for any unpaid bonus from a prior year (to the extent actually earned but ignoring any continued employment requirement), and those (if any) as may then be established under the Company’s then existing written severance and benefits plans and practices or pursuant to other written agreements with the Company. For the avoidance of doubt, the unpaid prior year bonus, if any, shall be paid on the same date such bonuses are paid to other officers of the Company.

(e) Exclusive Remedy. In the event of a termination of Executive’s employment as set forth in Section 3(a) or (b) of this Agreement, the provisions of Section 3 are intended to be and are exclusive and in lieu of any other rights or remedies to which Executive or the Company otherwise may be entitled, whether at law, tort or contract, in equity or under this Agreement (other than the payment of accrued but unpaid wages, as required by law, and any unreimbursed reimbursable expenses). Executive will be entitled to no benefits, compensation or other payments or rights upon a termination of employment other than those benefits expressly set forth in Section 3 of this Agreement.

4. Conditions to Receipt of Severance

(a) Release of Claims Agreement. The receipt of any severance payments or benefits (other than the accrued benefits set forth in either Sections 3(a)(i) or 3(b)(i)) pursuant to this Agreement is subject to Executive signing and not revoking a separation agreement and release of claims, which shall not contain any mitigation, offset, or restrictive covenants which are longer

 

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or more onerous on Executive than those to which Executive is already subject, in substantially the form attached hereto as Exhibit A (the “Release”), which must become effective and irrevocable no later than the sixtieth (60th) day following Executive’s termination of employment (the “Release Deadline”). If the Release does not become effective and irrevocable by the Release Deadline, Executive will forfeit any right to severance payments or benefits under this Agreement. In no event will severance payments or benefits be paid or provided until the Release actually becomes effective and irrevocable.

(b) Confidential Information and Invention Assignment Agreements. Executive’s receipt of any payments or benefits under Section 3 (other than the accrued benefits set forth in either Sections 3(a)(i) or 3(b)(i)) will be subject to Executive continuing to comply with the terms of the At-Will Employment, Confidential Information, Invention Assignment and Arbitration Agreement dated July 27, 2024, between the Company and Executive, as such agreement may be amended from time to time.

(c) Section 409A.

(i) Notwithstanding anything to the contrary in this Agreement, no severance pay or benefits to be paid or provided to Executive, if any, pursuant to this Agreement that, when considered together with any other severance payments or separation benefits, are considered deferred compensation under Section 409A of the Code, and the final regulations and any guidance promulgated thereunder (“Section 409A”) (together, the “Deferred Payments”) will be paid or otherwise provided until Executive has a “separation from service” within the meaning of Section 409A. Similarly, no severance payable to Executive, if any, pursuant to this Agreement that otherwise would be exempt from Section 409A pursuant to Treasury Regulation Section 1.409A-1(b)(9) will be payable until Executive has a “separation from service” within the meaning of Section 409A.

(ii) It is intended that none of the severance payments under this Agreement will constitute Deferred Payments but rather will be exempt from Section 409A as a payment that would fall within the “short-term deferral period” as described in Section 4(c)(iv) below or resulting from an involuntary separation from service as described in Section 4(c)(v) below. However, any severance payments or benefits under this Agreement that would be considered Deferred Payments 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 4(c)(iii). Except as required by Section 4(c)(iii), 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.

(iii) Notwithstanding anything to the contrary in this Agreement, if Executive is a “specified employee” within the meaning of Section 409A at the time of Executive’s termination (other than due to death), then the Deferred Payments, if any, 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 Payments, if any, will be payable

 

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in accordance with the payment schedule applicable to each payment or benefit. Notwithstanding anything herein to the contrary, if Executive dies following Executive’s separation from service, but before the six (6) month anniversary of the 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 Payments 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 a separate payment under Section 1.409A-2(b)(2) of the Treasury Regulations.

(iv) 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 will not constitute Deferred Payments for purposes of clause (i) above.

(v) 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 does not exceed the Section 409A Limit (as defined below) will not constitute Deferred Payments for purposes of clause (i) above.

(vi) Payments with respect to reimbursements of expenses or benefits or provision of fringe or other in-kind benefits shall be made on or before the last day of the calendar year following the calendar year in which the relevant expense or benefit is incurred. The amount of expenses or benefits eligible for reimbursement, payment or provision during a calendar year shall not affect the expenses or benefits eligible for reimbursement, payment or provision in any other calendar year.

(vii) 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 that are necessary, appropriate or desirable to avoid imposition of any additional tax or income recognition before actual payment to Executive under Section 409A.

5. Limitation on Payments. In the event that the severance and other benefits provided for in this Agreement or otherwise payable to Executive (i) constitute “parachute payments” within the meaning of Section 280G of the Code, and (ii) but for this Section 5, would be subject to the excise tax imposed by Section 4999 of the Code, then Executive’s benefits under Section 3 will be either:

(a) delivered in full, or

(b) delivered as to such lesser extent which would result in no portion of such benefits being subject to excise tax under Section 4999 of the Code,

 

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whichever of the foregoing amounts, taking into account the applicable federal, state and local income taxes and the excise tax imposed by Section 4999, 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. If a reduction in severance and other benefits constituting “parachute payments” is necessary so that benefits are delivered to a lesser extent, reduction will occur in the following order: (i) reduction of cash payments; (ii) cancellation of awards granted “contingent on a change in ownership or control” (within the meaning of Code Section 280G); (iii) cancellation of accelerated vesting of equity awards; and (iv) reduction of employee benefits. In the event that acceleration of vesting of equity award compensation is to be reduced, such acceleration of vesting will be cancelled in the reverse order of the date of grant of Executive’s equity awards.

Unless the Company and Executive otherwise agree in writing, any determination required under this Section 5 will be made in writing by the Company’s independent public accountants immediately prior to a Change of Control or such other person or entity to which the parties mutually agree (the “Firm”), whose determination will be conclusive and binding upon Executive and the Company. For purposes of making the calculations required by this Section 5, the Firm 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 Executive will furnish to the Firm such information and documents as the Firm may reasonably request in order to make a determination under this Section. The Company will bear all costs the Firm may incur in connection with any calculations contemplated by this Section 5.

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

(a) Cause. “Cause” will mean:

(i) Executive’s material failure to perform Executive’s stated duties, and Executive’s continued failure to cure such failure to the reasonable satisfaction of the Company within ten (10) days following written notice of such failure to Executive from the Board;

(ii) Executive’s material violation of a written Company policy (including any insider trading policy) or any written agreement or covenant with the Company;

(iii) Executive’s conviction of, or entry of a plea of guilty or nolo contendere to, a felony (other than motor vehicle offenses the effect of which do not materially impair Executive’s performance of his employment duties);

(iv) a willful act by Executive that constitutes gross misconduct and which is injurious to the Company;

(v) Executive’s commission of any act of fraud, embezzlement, dishonesty or any other willful misconduct that has caused or is reasonably expected to result in material injury to the Company;

(vi) the unauthorized use or disclosure by Executive of any proprietary information or trade secrets of the Company or any other party to whom Executive owes an obligation of nondisclosure as a result of Executive’s relationship with the Company; or

 

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(vii) Executive’s willful failure to cooperate with an investigation by a governmental authority.

Notwithstanding the foregoing, (A) with respect to any termination for Cause relying on cause (i) or (ii) of the definition above, no Cause shall exist unless the Company has provided written notice to Executive describing in detail such Cause conduct and, to the extent an act or omission giving rise to Cause is reasonably susceptible to cure (as determined by the Company’s board of directors in its reasonable, discretion), Executive shall have been given a reasonable opportunity, not to exceed thirty (30) days or other specified period above, after written notice by the Company, to cure such act or omission.. The foregoing definition does not in any way limit the Company’s ability to terminate Executive’s employment relationship at any time as provided in Section 2 above, and the term “Company” will be interpreted to include any subsidiary, parent, affiliate or successor thereto, if applicable.

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

(i) A change in the ownership of the Company which occurs on the date that any one person, or more than one person acting as a group (“Person”), acquires ownership of the stock of the Company that, together with the stock held by such Person, constitutes more than fifty percent (50%) of the total voting power of the stock of the Company; provided, however, that for purposes of this subsection, the acquisition of additional stock by any one Person, who is considered to own more than fifty percent (50%) of the total voting power of the stock of the Company, will not be considered a Change of Control; or

(ii) A change in the effective control of the Company that occurs on the date that a majority of members of the Board are replaced during any twelve (12) month period by Directors whose appointment or election is not endorsed by a majority of the members of the Board prior to the date of the appointment or election. For purposes of this clause (ii), if any Person is considered to be in effective control of the Company, the acquisition of additional control of the Company by the same Person will not be considered a Change of Control; or

(iii) A change in the ownership of a substantial portion of the Company’s assets which occurs on the date that any Person acquires (or has acquired during the twelve (12) month period ending on the date of the most recent acquisition by such person or persons) assets from the Company that have a total gross fair market value equal to or more than fifty percent (50%) of the total gross fair market value of all of the assets of the Company immediately prior to such acquisition or acquisitions; provided, however, that for purposes of this subsection (iii), the following will not constitute a change in the ownership of a substantial portion of the Company’s assets: (A) a transfer to an entity that is controlled by the Company’s stockholders immediately after the transfer, or (B) a transfer of assets by the Company to: (1) a stockholder of the Company (immediately before the asset transfer) in exchange for or with respect to the Company’s stock, (2) an entity, fifty percent (50%) or more of the total value or voting power of which is owned, directly or indirectly, by the Company, (3) a Person, that owns, directly or indirectly, fifty percent (50%) or more of the total value or voting power of all the outstanding stock of the Company, or (4) an entity, at least fifty percent (50%) of the total value or voting power of which is owned, directly or indirectly, by a Person described in this subsection (iii)(B)(3). For purposes of this subsection (iii), gross fair market value means the value of the assets of the Company, or the value of the assets being disposed of, determined without regard to any liabilities associated with such assets.

 

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For purposes of this definition, persons will be considered to be acting as a group if they are owners of a corporation that enters into a merger, consolidation, purchase or acquisition of stock, or similar business transaction with the Company.

Notwithstanding the foregoing, a transaction will not be deemed a Change of Control unless the transaction qualifies as a change in the ownership or effective control of the Company, or in the ownership of a substantial portion of the assets of the Company, within the meaning of Section 409A (and specifically Treasury Regulation 1.409A-3(a)(5)), as it has been and may be amended from time to time, and any proposed or final Treasury Regulations and Internal Revenue Service guidance that has been promulgated or may be promulgated thereunder from time to time.

Further and for the avoidance of doubt, a transaction will not constitute a Change of Control if: (i) its sole purpose is to change the state of the Company’s incorporation, or (ii) its sole purpose is to create a holding company that will be owned in substantially the same proportions by the persons who held the Company’s securities immediately before such transaction.

(c) Change of Control Period. “Change of Control Period” will mean the period beginning three (3) months prior to, and ending twelve (12) months following, a Change of Control.

(d) Code. “Code” will mean the Internal Revenue Code of 1986, as amended.

(e) Disability. “Disability” will mean that Executive has been unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months. Alternatively, Executive will be deemed disabled if determined to be totally disabled by the Social Security Administration. Termination resulting from Disability may only be effected after at least thirty (30) days’ written notice by the Company of its intention to terminate Executive’s employment. In the event that Executive resumes the performance of substantially all of Executive’s duties hereunder before the termination of Executive’s employment becomes effective, the notice of intent to terminate based on Disability will automatically be deemed to have been revoked.

(f) Equity Awards. “Equity Awards” will mean Executive’s outstanding stock options, stock appreciation rights, restricted stock units, performance shares, performance stock units and any other Company equity compensation awards.

 

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(g) Good Reason. “Good Reason” will mean Executive’s voluntary termination, within thirty (30) days following the expiration of any Company cure period (discussed below) following the occurrence of one or more of the following, without Executive’s consent:

(i) a material reduction of Executive’s title, duties, authority or responsibilities, relative to Employee’s title, duties, authority or responsibilities as in effect immediately prior to such reduction; provided, however, that continued employment following the Change of Control with substantially the same responsibility with respect to the Company’s business and operations will not constitute “Good Reason” (for example, Executive will not have been removed from Executive’s position if Executive is employed by the Company and Executive has substantially the same responsibilities with respect to the business of the Company as Executive had immediately prior to the Change of Control, whether Executive’s title is revised to reflect Executive’s placement within the overall corporate hierarchy and whether Executive provides services to a subsidiary, affiliate, business unit or otherwise);

(ii) a material reduction by the Company of Executive’s annual base salary as in effect on the Effective Date (or, if lower, as in effect immediately prior to the reduction), except to the extent the base salaries of all other senior executives of the Company are similarly reduced;

(iii) the failure of the Company to obtain assumption of this Agreement by any successor;

(iv) a material change in the geographic location of Executive’s principal workplace; provided, that a relocation of less than thirty (0) miles from Brisbane, California will not be considered a material change in geographic location; or

(v) any other action or inaction by the Company which constitutes a material breach of this Agreement or any other written agreement between the Company and Executive.

Executive may not resign for Good Reason without first providing the Company with written notice within ninety (90) days of the existence of the condition that Executive believes constitutes Good Reason specifically identifying the acts or omissions constituting the grounds for Good Reason and a reasonable cure period of not less than thirty (30) days following the date of such notice.

For purposes of the “Good Reason” definition, the term “Company” will be interpreted to include any subsidiary, parent, affiliate or successor thereto, if applicable.

(h) Section 409A Limit. “Section 409A Limit” will mean two (2) times the lesser of: (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.

 

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7. Successors.

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

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

8. Notice.

(a) General. Notices and all other communications contemplated by this Agreement will be in writing and will be deemed to have been duly given when sent electronically or personally delivered when mailed by U.S. registered or certified mail, return receipt requested and postage prepaid or when delivered by a private courier service such as UPS, DHL or Federal Express that has tracking capability. In the case of Executive, notices will be sent to the e-mail address or addressed to Executive at the home address, in either case which Executive most recently communicated to the Company in writing. In the case of the Company, electronic notices will be sent to the e-mail address of the General Counsel and mailed notices will be addressed to its corporate headquarters, and all notices will be directed to the attention of its General Counsel.

(b) Notice of Termination. Any termination by the Company for Cause or by Executive for Good Reason will be communicated by a notice of termination to the other party hereto given in accordance with Section 8(a) of this Agreement. Such notice will indicate the specific termination provision in this Agreement relied upon, will set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination under the provision so indicated, and will specify the termination date (which will be not more than ninety (90) days after the giving of such notice).

9. Resignation. Upon the termination of Executive’s employment for any reason, Executive will be deemed to have resigned from all officer and/or director positions held at the Company and its affiliates voluntarily, without any further required action by Executive, as of the end of Executive’s employment and Executive, at the Board’s request, will execute any documents reasonably necessary to reflect Executive’s resignation.

 

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10. Arbitration.

(a) Arbitration. In consideration of Executive’s employment with the Company, its promise to arbitrate all employment-related disputes, and Executive’s receipt of the compensation, pay raises and other benefits paid to Executive by the Company, at present and in the future, Executive agrees that any and all controversies, claims or disputes with anyone (including the Company and any employee, officer, director, stockholder or benefit plan of the Company in their capacity as such or otherwise) arising out of, relating to or resulting from Executive’s employment with the Company or termination thereof, including any breach of this Agreement, will be subject to binding arbitration under the Arbitration Rules set forth in California Code of Civil Procedure Section 1280 through 1294.2, including Section 1281.8 (the “Act”), and pursuant to California law. The Federal Arbitration Act will also apply with full force and effect, notwithstanding the application of procedural rules set forth under the Act.

(b) Dispute Resolution. Disputes that Executive agrees to arbitrate, and thereby agrees to waive any right to a trial by jury, include any statutory claims under local, state or federal law, including, but not limited to, claims under Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act of 1990, the Age Discrimination in Employment Act of 1967, the Older Workers Benefit Protection Act, the Sarbanes Oxley Act, the Worker Adjustment and Retraining Notification Act, the California Fair Employment and Housing Act, the Family and Medical Leave Act, the California Family Rights Act, the California Labor Code, claims of harassment, discrimination, and wrongful termination and any statutory or common law claims. Executive further understands that this Agreement to arbitrate also applies to any disputes that the Company may have with Executive.

(c) Procedure. Executive agrees that any arbitration will be administered by the Judicial Arbitration & Mediation Services, Inc. (“JAMS”), pursuant to its Employment Arbitration Rules & Procedures (the “JAMS Rules”). The arbitrator will have the power to decide any motions brought by any party to the arbitration, including motions for summary judgment and/or adjudication, motions to dismiss and demurrers and motions for class certification, prior to any arbitration hearing. The arbitrator will have the power to award any remedies available under applicable law, and the arbitrator will award attorneys’ fees and costs to the prevailing party, except as prohibited by law. The Company will pay for any administrative or hearing fees charged by the administrator or JAMS, and all arbitrator’s fees, except that Executive will pay any filing fees associated with any arbitration that Executive initiates, but only so much of the filing fee as Executive would have instead paid had Executive filed a complaint in a court of law. Executive agrees that the arbitrator will administer and conduct any arbitration in accordance with California law, including the California Code of Civil Procedure and the California Evidence Code, and that the arbitrator will apply substantive and procedural California law to any dispute or claim, without reference to the rules of conflict of law. To the extent that the JAMS Rules conflict with California law, California law will take precedence. The decision of the arbitrator will be in writing. Any arbitration under this Agreement will be conducted in Santa Clara County, California.

(d) Remedy. Except as provided by the Act, arbitration will be the sole, exclusive and final remedy for any dispute between Executive and the Company. Accordingly, except as provided by the Act and this Agreement, neither Executive nor the Company will be permitted to pursue court action regarding claims that are subject to arbitration. Notwithstanding, the arbitrator will not have the authority to disregard or refuse to enforce any lawful Company policy, and the arbitrator will not order or require the Company to adopt a policy not otherwise required by law which the Company has not adopted.

 

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(e) Administrative Relief. Executive is not prohibited from pursuing an administrative claim with a local, state or federal administrative body or government agency that is authorized to enforce or administer laws related to employment, including, but not limited to, the Department of Fair Employment and Housing, the Equal Employment Opportunity Commission, the National Labor Relations Board or the Workers’ Compensation Board. However, Executive may not pursue court action regarding any such claim, except as permitted by law.

(f) Voluntary Nature of Agreement. Executive acknowledges and agrees that Executive is executing this Agreement voluntarily and without any duress or undue influence by the Company or anyone else. Executive further acknowledges and agrees that Executive has carefully read this Agreement and that Executive has asked any questions needed for Executive to understand the terms, consequences and binding effect of this Agreement and fully understands it, including that EXECUTIVE IS WAIVING EXECUTIVE’S RIGHT TO A JURY TRIAL. Finally, Executive agrees that Executive has been provided an opportunity to seek the advice of an attorney of Executive’s choice before signing this Agreement.

11. Miscellaneous Provisions.

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

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

(c) Headings. All captions and section headings used in this Agreement are for convenient reference only and do not form a part of this Agreement.

(d) Entire Agreement. This Agreement constitutes the entire agreement of the parties hereto and supersedes in their entirety all prior representations, understandings, undertakings or agreements (whether oral or written and whether expressed or implied) of the parties with respect to the subject matter hereof, including, but not limited to, any rights to extended post-termination exercise period, severance and/or change of control benefits set forth in Executive’s offer letter or agreements evidencing Executive’s Equity Awards, if applicable. No waiver, alteration or modification of any of the provisions of this Agreement will be binding unless in writing and signed by duly authorized representatives of the parties hereto and which specifically mention this Agreement.

(e) Choice of Law. The validity, interpretation, construction and performance of this Agreement will be governed by the laws of the State of California (with the exception of its conflict of laws provisions). Any claims or legal actions by one party against the other arising out of the relationship between the parties contemplated herein (whether or not arising under this Agreement) will be commenced or maintained in any state or federal court located in the jurisdiction where Executive resides, and Executive and the Company hereby submit to the jurisdiction and venue of any such court.

 

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

(g) Withholding. All payments made pursuant to this Agreement will be subject to withholding of applicable income, employment and other taxes.

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

[Signature Page to Follow]

 

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

 

COMPANY     CAREDX, INC.
    By:   /s/ John Hanna
    Name:   John Hanna
    Title:   President and Chief Executive Officer
    Date:   7/27/2024

 

EXECUTIVE     By:   /s/ keith kennedy
    Name:   keith kennedy
    Date:   7/27/2024

[Signature Page to Change of Control and Severance Agreement]


EXHIBIT A

FORM OF RELEASE OF CLAIMS

This release of claims (this “Agreement”) is made by and between CareDx, Inc. (the “Company”) and ____________ (“Executive”). The Company and Executive are sometimes collectively referred to herein as the “Parties” and individually referred to as a “Party.”

RECITALS

WHEREAS, Executive signed an At-Will Employment, Confidential Information, Invention Assignment and Arbitration Agreement with the Company on __________, 2024 (as may be amended or restated, the “Confidentiality Agreement”);

WHEREAS, Executive signed a Change of Control and Severance Agreement with the company on _______, 2024 (as may be amended or restated, the “Change of Control Agreement”), which, among other things, provides for certain severance benefits to be paid to Executive by the Company upon the termination of Executive’s employment following a Change of Control (as defined in the Change of Control Agreement) of the Company;

WHEREAS, Executive was employed by the Company until ________________, when Executive’s employment was terminated following a Change of Control (“Termination Date”);

WHEREAS, in accordance with Section 4 of the Change of Control and Severance Agreement between the Company and Executive, Executive has agreed to enter into and not revoke a standard release of claims in favor of the Company as a condition to receiving the severance benefits described in the Change of Control Agreement; and

WHEREAS, the Parties wish to resolve any and all disputes, claims, complaints, grievances, charges, actions, petitions and demands that Executive may have against the Company and any of the Releasees (as defined below), including, but not limited to, any and all claims arising out of or in any way related to Executive’s employment relationship with the Company and the termination of that relationship.

NOW, THEREFORE, for good and valuable consideration, including the mutual promises and covenants made herein, the Company and Executive hereby agree as follows:

COVENANTS

12. Termination. Executive’s employment with the Company terminated on the Termination Date.

13. Payment of Salary and Receipt of All Benefits. Executive acknowledges and represents that, other than the consideration to be paid in accordance with the terms and conditions of the Change of Control Agreement, the Company has paid or provided all salary, wages, bonuses, accrued vacation/paid time off, premiums, leaves, housing allowances, relocation costs, interest, severance, outplacement costs, fees, reimbursable expenses, commissions, draws, stock, stock options or other equity awards (including restricted stock unit awards), vesting and any and all other benefits and compensation due to Executive and that no other reimbursements or compensation are owed to Executive.


14. Release of Claims. Executive agrees that the consideration to be paid in accordance with the terms and conditions of the Severance Agreement represents settlement in full of all outstanding obligations owed to Executive by the Company and its current and former officers, directors, employees, agents, investors, attorneys, stockholders, administrators, affiliates, benefit plans, plan administrators, insurers, trustees, divisions and subsidiaries, and predecessor and successor corporations and assigns (collectively, the “Releasees”). Executive, on Executive’s own behalf and on behalf of Executive’s respective heirs, family members, executors, agents and assigns hereby and forever releases the Releasees from, and agrees not to sue concerning, or in any manner to institute, prosecute or pursue any claim, complaint, charge, duty, obligation, demand or cause of action relating to any matters of any kind, whether presently known or unknown, suspected or unsuspected, that Executive may possess against any of the Releasees arising from any omissions, acts, facts or damages that have occurred up until and including the Effective Date of this Agreement, including, without limitation, the following:

(a) any and all claims relating to or arising from Executive’s employment relationship with the Company and the termination of that relationship;

(b) any and all claims relating to, or arising from, Executive’s right to purchase, or actual purchase of shares of stock of the Company, including, without limitation, any claims for fraud, misrepresentation, breach of fiduciary duty, breach of duty under applicable state corporate law and securities fraud under any state or federal law;

(c) any and all claims for wrongful discharge of employment; termination in violation of public policy; discrimination; harassment; retaliation; breach of contract, both express and implied; breach of covenant of good faith and fair dealing, both express and implied; promissory estoppel; negligent or intentional infliction of emotional distress; fraud; negligent or intentional misrepresentation; negligent or intentional interference with contract or prospective economic advantage; unfair business practices; defamation; libel; slander; negligence; personal injury; assault; battery; invasion of privacy; false imprisonment; conversion and disability benefits;

(d) any and all claims for violation of any federal, state or municipal statute, including, but not limited to, Title VII of the Civil Rights Act of 1964; the Civil Rights Act of 1991; the Rehabilitation Act of 1973; the Americans with Disabilities Act of 1990; the Equal Pay Act; the Fair Labor Standards Act; the Fair Credit Reporting Act; the Age Discrimination in Employment Act of 1967; the Older Workers Benefit Protection Act; the Employee Retirement Income Security Act of 1974; the Worker Adjustment and Retraining Notification Act; the Family and Medical Leave Act; the Sarbanes-Oxley Act of 2002; the California Family Rights Act; the California Labor Code; the California Workers’ Compensation Act and the California Fair Employment and Housing Act;

(e) any and all claims for violation of the federal, or any state, constitution;

(f) any and all claims arising out of any other laws and regulations relating to employment or employment discrimination;

 

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(g) any claim for any loss, cost, damage or expense arising out of any dispute over the non-withholding or other tax treatment of any of the proceeds received by Executive as a result of this Agreement; and

(h) any and all claims for attorneys’ fees and costs. Executive agrees that the release set forth in this Section 3 (the “Release”) will be and remain in effect in all respects as a complete general release as to the matters released. The Release does not extend to any severance obligations due Executive under the Severance Agreement. The Release does not release claims that cannot be released as a matter of law, including, but not limited to,

Executive’s right to file a charge with or participate in a charge by the Equal Employment Opportunity Commission, or any other local, state or federal administrative body or government agency that is authorized to enforce or administer laws related to employment, against the Company (with the understanding that any such filing or participation does not give Executive the right to recover any monetary damages against the Company; Executive’s release of claims herein bars Executive from recovering such monetary relief from the Company). Executive represents that Executive has made no assignment or transfer of any right, claim, complaint, charge, duty, obligation, demand, cause of action or other matter waived or released by this Section 3. Nothing in this Agreement waives Executive’s rights to indemnification or any payments under any fiduciary insurance policy, if any, provided by any act or agreement of the Company, state or federal law or policy of insurance.

15. Acknowledgment of Waiver of Claims under ADEA. Executive acknowledges that Executive is waiving and releasing any rights Executive may have under the Age Discrimination in Employment Act of 1967 (“ADEA”) and that this waiver and release is knowing and voluntary. Executive agrees that this waiver and release does not apply to any rights or claims that may arise under the ADEA after the Effective Date of this Agreement. Executive acknowledges that the consideration given for this waiver and release Agreement is in addition to anything of value to which Executive was already entitled. Executive further acknowledges that Executive has been advised by this writing that (a) Executive should consult with an attorney prior to executing this Agreement; (b) Executive has at least 21 days within which to consider this Agreement; (c) Executive has 7 days following the execution of this Agreement by the parties to revoke the Agreement; (d) this Agreement will not be effective until the revocation period has expired and (e) nothing in this Agreement prevents or precludes Executive from challenging or seeking a determination in good faith of the validity of this waiver under the ADEA, nor does it impose any condition precedent, penalties or costs for doing so, unless specifically authorized by federal law. In the event Executive signs this Agreement and delivers it to the Company in less than the 21-day period identified above, Executive hereby acknowledges that Executive has freely and voluntarily chosen to waive the time period allotted for considering this Agreement. Executive acknowledges and understands that revocation must be accomplished by a written notification to the General Counsel of the Company that is received prior to the Effective Date.

 

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16. California Civil Code Section 1542. Executive acknowledges that Executive has been advised to consult with legal counsel and is familiar with the provisions of California Civil Code Section 1542, a statute that otherwise prohibits the release of unknown claims, which provides as follows:

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.

Executive, being aware of California Civil Code Section 1542, agrees to expressly waive any rights Executive may have thereunder, as well as under any other statute or common law principles of similar effect.

17. No Pending or Future Lawsuits. Executive represents that Executive has no lawsuits, claims or actions pending in Executive’s name, or on behalf of any other person or entity, against the Company or any of the other Releasees. Executive also represents that Executive does not intend to bring any claims on Executive’s own behalf or on behalf of any other person or entity against the Company or any of the other Releasees.

18. Sufficiency of Consideration. Executive hereby acknowledges and agrees that Executive has received good and sufficient consideration for every promise, duty, release, obligation, agreement and right contained in this Release.

19. Confidential Information. Executive reaffirms and agrees to observe and abide by the terms of the Confidentiality Agreement, specifically including the provisions therein regarding nondisclosure of the Company’s trade secrets and confidential and proprietary information, which agreement will continue in force; provided, however, that: (a) as to any provisions regarding competition contained in the Confidentiality Agreement that conflict with the provisions regarding competition contained in the Severance Agreement, the provisions of the Severance Agreement will control; (b) as to any provisions regarding solicitation of employees contained in the Confidentiality Agreement that conflict with the provisions regarding solicitation of employees contained in this Agreement, the provisions of this Agreement will control.

20. Return of Company Property; Passwords and Password-protected Documents. Executive confirms that Executive has returned to the Company in good working order all keys, files, records (and copies thereof), equipment (including, but not limited to, computer hardware, software and printers, wireless handheld devices, cellular phones and pagers), access or credit cards, Company identification and any other Company-owned property in Executive’s possession or control. Executive further confirms that Executive has cancelled all accounts for Executive’s benefit, if any, in the Company’s name, including, but not limited to, credit cards, telephone charge cards, cellular phone and/or pager accounts and computer accounts. Executive also confirms that Executive has delivered all passwords in use by Executive at the time of Executive’s termination, a list of any documents that Executive created or of which Executive is otherwise aware that are password-protected, along with the password(s) necessary to access such password-protected documents.

 

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21. No Cooperation. Executive agrees that Executive will not knowingly encourage, counsel or assist any attorneys or their clients in the presentation or prosecution of any disputes, differences, grievances, claims, charges or complaints by any third party against any of the Releasees, unless under a subpoena or other court order to do so or as related directly to the ADEA waiver in this Agreement. Executive agrees both to immediately notify the Company upon receipt of any such subpoena or court order, and to furnish, within three (3) business days of its receipt, a copy of such subpoena or other court order. If approached by anyone for counsel or assistance in the presentation or prosecution of any disputes, differences, grievances, claims, charges or complaints against any of the Releasees, Executive will state no more than that Executive cannot provide any such counsel or assistance.

22. Nondisparagement. Executive agrees that Executive will not in any way, directly or indirectly, do or say anything at any time which disparages the Company, its business interests or reputation or that of any of the other Releasees. Likewise, the Company, through its directors and senior management, will not in any way, directly or indirectly, do or say anything at any time which disparages Executive or his business interests or reputation.

23. No Admission of Liability. Executive understands and acknowledges that this Agreement constitutes a compromise and settlement of any and all actual or potential disputed claims by Executive. No action taken by the Company hereto, either previously or in connection with this Agreement, will be deemed or construed to be (a) an admission of the truth or falsity of any actual or potential claims or (b) an acknowledgment or admission by the Company of any fault or liability whatsoever to Executive or to any third party.

24. Solicitation of Employees. Executive agrees that for a period of 12 months immediately following the Effective Date of this Agreement, Executive will not directly or indirectly (a) solicit, induce, recruit or encourage any of the Company’s employees to leave their employment at the Company or (b) attempt to solicit, induce, recruit or encourage, either for Executive or for any other person or entity, any of the Company’s employees to leave their employment.

25. Costs. The Parties will each bear their own costs, attorneys’ fees and other fees incurred in connection with the preparation of this Agreement.

26. Arbitration. THE PARTIES AGREE THAT ANY AND ALL DISPUTES ARISING OUT OF THE TERMS OF THIS AGREEMENT, THEIR INTERPRETATION AND ANY OF THE MATTERS HEREIN RELEASED, WILL BE SUBJECT TO ARBITRATION IN SAN MATEO COUNTY, CALIFORNIA, BEFORE JUDICIAL ARBITRATION & MEDIATION SERVICES (“JAMS”), PURSUANT TO ITS EMPLOYMENT ARBITRATION RULES & PROCEDURES (“JAMS RULES”). THE ARBITRATOR MAY GRANT INJUNCTIONS AND OTHER RELIEF IN SUCH DISPUTES. THE ARBITRATOR WILL ADMINISTER AND CONDUCT ANY ARBITRATION IN ACCORDANCE WITH CALIFORNIA LAW, INCLUDING THE CALIFORNIA CODE OF CIVIL PROCEDURE, AND THE ARBITRATOR WILL APPLY SUBSTANTIVE AND PROCEDURAL CALIFORNIA LAW TO ANY DISPUTE OR CLAIM, WITHOUT REFERENCE TO ANY CONFLICT-OF-LAW PROVISIONS OF ANY JURISDICTION. TO THE EXTENT THAT THE JAMS RULES CONFLICT WITH CALIFORNIA LAW, CALIFORNIA LAW WILL TAKE PRECEDENCE. THE DECISION OF THE ARBITRATOR WILL BE FINAL, CONCLUSIVE AND BINDING ON THE PARTIES TO THE ARBITRATION. THE PARTIES AGREE THAT THE

 

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PREVAILING PARTY IN ANY ARBITRATION WILL BE ENTITLED TO INJUNCTIVE RELIEF IN ANY COURT OF COMPETENT JURISDICTION TO ENFORCE THE ARBITRATION AWARD. THE PARTIES TO THE ARBITRATION WILL EACH PAY AN EQUAL SHARE OF THE COSTS AND EXPENSES OF SUCH ARBITRATION, AND EACH PARTY WILL SEPARATELY PAY FOR ITS RESPECTIVE COUNSEL FEES AND EXPENSES; PROVIDED, HOWEVER, THAT THE ARBITRATOR WILL AWARD ATTORNEYS’ FEES AND COSTS TO THE PREVAILING PARTY, EXCEPT AS PROHIBITED BY LAW. THE PARTIES HEREBY AGREE TO WAIVE THEIR RIGHT TO HAVE ANY DISPUTE BETWEEN THEM RESOLVED IN A COURT OF LAW BY A JUDGE OR JURY. NOTWITHSTANDING THE FOREGOING, THIS SECTION WILL NOT PREVENT EITHER PARTY FROM SEEKING INJUNCTIVE RELIEF (OR ANY OTHER PROVISIONAL REMEDY) FROM ANY COURT HAVING JURISDICTION OVER THE PARTIES AND THE SUBJECT MATTER OF THEIR DISPUTE RELATING TO THIS AGREEMENT AND THE AGREEMENTS INCORPORATED HEREIN BY REFERENCE. SHOULD ANY PART OF THE ARBITRATION AGREEMENT CONTAINED IN THIS PARAGRAPH CONFLICT WITH ANY OTHER ARBITRATION AGREEMENT BETWEEN THE PARTIES, THE PARTIES AGREE THAT THIS ARBITRATION AGREEMENT WILL GOVERN.

27. Authority. The Company represents and warrants that the undersigned has the authority to act on behalf of the Company and to bind the Company and all who may claim through it to the terms and conditions of this Agreement. Executive represents and warrants that Executive has the capacity to act on Executive’s own behalf and on behalf of all who might claim through Executive to bind them to the terms and conditions of this Agreement. Each Party warrants and represents that there are no liens or claims of lien or assignments in law or equity or otherwise of or against any of the claims or causes of action released herein.

28. No Representations. Executive represents that Executive has had the opportunity to consult with an attorney, and has carefully read and understands the scope and effect of the provisions of this Agreement. Executive has relied upon any representations or statements made by the Company that are not specifically set forth in this Agreement.

29. Severability. In the event that any provision or any portion of any provision hereof or any surviving agreement made a part hereof becomes or is declared by a court of competent jurisdiction or arbitrator to be illegal, unenforceable or void, this Agreement will continue in full force and effect without said provision or portion of provision.

30. Entire Agreement. This Agreement represents the entire agreement and understanding between the Company and Executive concerning the subject matter of this Agreement and Executive’s employment with and separation from the Company and the events leading thereto and associated therewith, and supersedes and replaces any and all prior agreements and understandings concerning the subject matter of this Agreement and Executive’s relationship with the Company, with the exception of the Severance Agreement, the Confidentiality Agreement and Executive’s written equity compensation agreements with the Company.

31. No Oral Modification. This Agreement may only be amended in writing signed by Executive and the Chairman of the Board of Directors of the Company.

 

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32. Governing Law. This Agreement will be governed by the laws of the State of California, without regard for choice-of-law provisions. Executive consents to personal and exclusive jurisdiction and venue in the State of California.

33. Effective Date. Executive understands that this Agreement will be null and void if not executed by Executive within 21 days. Each Party has seven days after that Party signs this Agreement to revoke it. This Agreement will become effective on the eighth (8th) day after Executive signed this Agreement, so long as it has been signed by the Parties and has not been revoked by either Party before that date (the “Effective Date”).

34. Counterparts. This Agreement may be executed in counterparts and by facsimile, and each counterpart and facsimile will have the same force and effect as an original and will constitute an effective, binding agreement on the part of each of the undersigned.

35. Voluntary Execution of Agreement. Executive understands and agrees that Executive executed this Agreement voluntarily, without any duress or undue influence on the part or behalf of the Company or any third party, with the full intent of releasing all of Executive’s claims against the Company and any of the other Releasees. Executive expressly acknowledges that:

(a) Executive has read this Agreement;

(b) Executive has been represented in the preparation, negotiation and execution of this Agreement by legal counsel of Executive’s own choice or has elected not to retain legal counsel;

(c) Executive understands the terms and consequences of this Agreement and of the releases it contains; and

(d) Executive is fully aware of the legal and binding effect of this Agreement.

* * * * *

 

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IN WITNESS WHEREOF, the Parties have executed this Agreement on the respective dates set forth below.

 

COMPANY

   

CAREDX, INC.

    By:    
    Name:    
    Title:    
    Dated:    
EXECUTIVE      
      (Signature)
    Dated:    

[Signature Page to Release of Claims]

Exhibit 10.3

CareDx, Inc.

CONFIDENTIAL INFORMATION,

INVENTION ASSIGNMENT, NON-COMPETITION,

AND ARBITRATION AGREEMENT

As a condition of my employment with CareDx, its subsidiaries, affiliates, successors, or assigns (together the “Company”), my receipt of confidential information, and the compensation now and hereafter paid to me and benefits provided to me by the Company, I agree to the following provisions of this CareDx Confidential Information, Invention Assignment, Non-Competition and Arbitration Agreement (the “Agreement”):

1. At-Will Employment.

I UNDERSTAND AND ACKNOWLEDGE THAT MY EMPLOYMENT WITH THE COMPANY IS FOR NO SPECIFIED TERM AND CONSTITUTES “AT-WILL” EMPLOYMENT. I ALSO UNDERSTAND THAT ANY REPRESENTATION TO THE CONTRARY IS UNAUTHORIZED AND NOT VALID UNLESS IN WRITING AND SIGNED BY THE PRESIDENT OF THE COMPANY. ACCORDINGLY, I ACKNOWLEDGE THAT MY EMPLOYMENT RELATIONSHIP MAY BE TERMINATED AT ANY TIME, WITH OR WITHOUT GOOD CAUSE OR FOR ANY OR NO CAUSE, AT MY OPTION OR AT THE OPTION OF THE COMPANY, WITH OR WITHOUT NOTICE. I FURTHER ACKNOWLEDGE THAT THE COMPANY MAY MODIFY JOB TITLES, SALARIES, AND BENEFITS FROM TIME TO TIME AS IT DEEMS NECESSARY.

2. Purpose of Agreement. I understand that the purpose of this Agreement is to protect the intellectual property, business relationships, goodwill and other assets of the Company, including human capital, and to align the interests of the Company and its employees.

3. Confidential Information.

A. Company Information. I understand that my employment by the Company creates a relationship of confidence and trust with respect to any information of a confidential or secret nature that (a) relates to the business of the Company or to the business of any parent, subsidiary, affiliate, customer, supplier or vendor of the Company, or any other party with whom the Company agrees to hold information of such party in confidence; (b) that is not generally known to the public or to other persons in the industry; and (c) that the Company has taken reasonable measures under the circumstances to protect from unauthorized use or disclosure (“Company Confidential Information”). Company Confidential Information covered by this Agreement means (i) trade secrets; (ii) proprietary information that does not rise to the level of a statutorily protectable trade secret that is made the property of the Company through positive operation of law in the form of this mutual agreement of the parties; or (iii) information that is otherwise legally protectable because it is confidential and is treated as such. Such Company Confidential Information includes, but is not limited to, Inventions (as defined below), knowledge, data, information, know-how, non-public intellectual property rights including unpublished or pending patent applications and all related patent rights, techniques, formulae, processes, discoveries, improvements, ideas, conceptions, compilations of data, and developments, whether or not patentable and whether or not copyrightable. By way of example, Company Confidential Information includes: non-public


information relating to the Company’s products, services and methods of operation, customers and suppliers, vendors, chemical formulae, computer software, financial information, operating and cost data, research databases, selling and pricing information, business and marketing plans and strategies, and information concerning potential acquisitions, dispositions or joint ventures. The foregoing are only examples of Company Confidential Information.

If I am uncertain as to whether any particular information or material constitutes Company Confidential Information, I will seek written clarification from either my direct supervisor or the Company’s Head of Human Resources, or if I am no longer employed by the Company, from the Company’s Head of Human Resources.

B. Confidentiality Obligations. I agree that, at all times, both during and after my employment with the Company, I will hold all Company Confidential Information in the strictest confidence. I will not use, disclose, copy, reverse-engineer, distribute, or gain unauthorized access to any Company Confidential Information without the prior written consent of the Company, except as may be necessary to perform my duties as an employee of the Company for the benefit of the Company. I understand that my unauthorized access, use or disclosure of Company Confidential Information during my employment may lead to disciplinary action, up to and including immediate termination and legal action by the Company. Notwithstanding my confidentiality obligations, I understand that I am permitted to disclose Company Confidential Information that is required to be disclosed by me pursuant to judicial order or other legal mandate, provided that I have given the Company prompt notice of the disclosure requirement, and that I fully cooperate with any efforts by the Company to obtain and comply with any protective order imposed on such disclosure.

C. Exceptions to Company Confidential Information. Notwithstanding the definition set forth in Section 3, Company Confidential Information does not include information that I can show by competent proof: (a) was generally known to the relevant public at the time of disclosure, or became generally known after disclosure to me through no fault of mine; (b) was lawfully received by me from a third party without breach of any confidentiality obligation; (c) was known to me prior to receipt from the Company as shown by documentary evidence; or (d) was independently developed by me or independent third parties without breach by me or any third party of any obligation of confidentiality or non-use as shown by documentary evidence. I understand that nothing in this Agreement is intended to limit employees’ rights to discuss the terms, wages, and working conditions of their employment, as protected by applicable law.

D. Former Employer Information. I agree that during my employment with the Company, I will not improperly use, disclose, or induce the Company to use any confidential information of any former employer or other person or entity. I further agree that I will not bring onto the premises of the Company or transfer onto the Company’s technology systems any confidential information belonging to any such employer, person, or entity unless consented to in writing by both the Company and such employer, person, or entity. I represent and warrant that after undertaking a careful search (including searches of my computers, cell phones, electronic devices, and documents), I have returned all property and confidential information belonging to all prior employers.

 

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E. Third Party Information. I recognize that the Company may have received and in the future may receive from third parties associated with the Company, e.g., the Company’s customers, suppliers, licensors, licensees, partners, or collaborators (“Associated Third Parties”), their confidential information (“Associated Third Party Confidential Information”). By way of example, Associated Third Party Confidential Information may include the technology of Associated Third Parties, requirements of Associated Third Parties, and information related to the business conducted between the Company and such Associated Third Parties. I agree at all times during my employment with the Company and thereafter to hold in the strictest confidence, and not to use or to disclose to any person, firm, or corporation, any Associated Third Party Confidential Information, except as necessary in carrying out my work for the Company consistent with the Company’s agreement with such Associated Third Parties. I further agree to comply with any and all Company policies and guidelines that may be adopted regarding Associated Third Parties and Associated Third Party Confidential Information. I understand that my unauthorized use or disclosure of Associated Third Party Confidential Information or violation of any Company policies during my employment will lead to disciplinary action, up to and including immediate termination and legal action by the Company.

4. Inventions.

A. Inventions Retained and Licensed. I have attached hereto as Exhibit A, a list describing all inventions, discoveries, original works of authorship, developments, improvements, and trade secrets that were conceived in whole or in part by me prior to my employment with the Company and to which I have any right, title, or interest (“Prior Inventions”); or, if no such list is attached, I represent and warrant that there are no such Prior Inventions. Furthermore, I represent and warrant that if any Prior Inventions are included on Exhibit A, they will not materially affect my ability to perform all obligations under this Agreement. If, in the course of my employment with the Company, I incorporate into or use in connection with any product, process, service, technology, or other work by or on behalf of the Company any Prior Invention, I hereby grant to the Company a non-exclusive, royalty-free, fully paid-up, irrevocable, perpetual, worldwide license, with the right to grant and authorize sublicenses, to make, have made, modify, use, import, offer for sale, and sell such Prior Invention as part of or in connection with such product, process, service, technology, or other work, and to practice any method related thereto.

B. Works for Hire; Assignment of Inventions. I acknowledge and agree that any copyrightable works prepared by me within the scope of my employment, individually or with others, are to the full extent permitted by law “works for hire” under the Copyright Act and that pursuant to this Agreement, the Company is and without any further action required by either party will be considered the author and owner of such copyrightable works. To the extent that any such works do not fully qualify as works for hire, I agree that they are fully subject to the assignment provisions contained herein and hereby assign all such works to the Company as provided herein. I agree that all inventions, improvements, ideas, designs, original works of authorship, formulas, processes, compositions of matter, computer software programs, databases, mask works, and trade secrets that I make or conceive or first reduce to practice or create, either alone or jointly with others, during the period of my employment, whether or not in the course of my employment, and whether or not patentable, copyrightable, or protectable as trade secrets, that (i) are developed using equipment, supplies, facilities, or trade secrets of the Company, (ii) result from work performed by me for the Company, or (iii) relate to the Company’s business or actual or

 

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demonstrably anticipated research and development (the “Inventions”), are and will continue to be the sole and exclusive property of the Company pursuant to this Agreement without any further action required by either party. Without any further action required, and subject to the provisions of Exhibit B, I hereby irrevocably assign the Inventions to the Company. I understand that this assignment by me pursuant to this Agreement is intended to, and does, extend to subject matters currently in existence, those in development, as well as those that have not yet been created. If, at any time, a court or other tribunal rules that my assignment under this Section is ineffective or unenforceable for any reason, I agree to perform all actions necessary to assign the Inventions and/or Prior Inventions to the Company. I understand and agree that the decision whether or not to commercialize or market any Invention is within the Company’s sole discretion and for the Company’s sole benefit, and that no royalty or other consideration will be due to me as a result of the Company’s efforts to commercialize or market any such Inventions.

C. Maintenance of Records. I agree to keep and maintain adequate, current, accurate, and authentic written records of all Inventions made by me (solely or jointly with others) during the term of my employment with the Company. The records will be in the form of notes, sketches, drawings, electronic files, reports, or any other format that may be specified by the Company. The records are and will be available to and remain the sole property of the Company at all times.

D. Patent and Copyright Registrations. I agree to assist the Company, or its designee, at the Company’s expense, in every proper way to secure the Company’s rights in the Inventions and any rights relating thereto in any and all countries, including the disclosure to the Company of all pertinent information and data with respect thereto, the execution of all applications, specifications, oaths, assignments, and all other instruments that the Company deems proper or necessary in order to apply for, register, obtain, maintain, defend, and enforce such rights, and in order to assign and convey to the Company, its successors, assigns, and nominees the sole and exclusive rights, title, and interest in and to such Inventions and any rights relating thereto, and testifying in a suit or other proceeding relating to such Inventions and any rights relating thereto. I further agree that my obligation to execute or cause to be executed, when it is in my power to do so, any such instrument or papers will continue after the termination of this Agreement. If the Company is unable because of my mental or physical incapacity or for any other reason to secure my signature with respect to any Inventions, including, without limitation, to apply for or to pursue any application for any United States or foreign patents or copyright registrations covering such Inventions, then I hereby irrevocably designate and appoint the Company and its duly authorized officers and agents as my agent and attorney in fact, to act for and in my behalf and stead, to execute and file any papers and oaths, and to do all other lawfully permitted acts with respect to such Inventions with the same legal force and effect as if executed by me.

E. Exception to Assignments. I understand that the provisions of this Agreement requiring assignment of Inventions to the Company do not apply to any invention that qualifies fully under the provisions of California Labor Code Section 2870 or other applicable statute (attached hereto as Exhibit B). I will advise the Company promptly in writing of any inventions that I believe meet the criteria in California Labor Code Section 2870 or other applicable statute and are not otherwise disclosed on Exhibit A.

 

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5. Conflicting Employment.

A. Current Obligations. I agree that during the term of my employment with the Company, I will not engage in or undertake any other employment, occupation, or consulting relationship that is directly related to the business in which the Company is now involved or becomes involved or in which the Company has plans to become involved, nor will I engage in any other activities that conflict with my obligations to the Company.

B. No Conflicting Obligations From Prior Relationships. Without limiting Section 5.A, I represent that I have no other agreements, relationships, or commitments to any other person or entity that conflict with my obligations to the Company under this Agreement or my ability to become employed and perform the services for which I am being hired by the Company. I further agree that if I have signed a confidentiality agreement or similar type of agreement with any former employer or other entity, I will comply with the terms of any such agreement to the extent that its terms are lawful under applicable law. Moreover, I agree to fully indemnify the Company, its directors, officers, agents, employees, investors, shareholders, administrators, affiliates, divisions, subsidiaries, predecessor and successor corporations, and assigns for all verdicts, judgments, settlements, and other losses incurred by any of them resulting from my breach of my obligations under any agreement to which I am a party or obligation to which I am bound, as well as any reasonable attorneys’ fees and costs if the plaintiff is the prevailing party in such an action, except as prohibited by law.

6. Returning Company Documents. On or before my last day of employment or at any time on demand by the Company, I will deliver to the Company, and will not keep in my possession, recreate, or deliver to anyone else, any and all Company property, including, but not limited to, Company Confidential Information, Associated Third Party Confidential Information, as well as all devices and equipment belonging to the Company (including computers, handheld electronic devices, telephone equipment, and other electronic devices), Company credit cards, records, data, notes, notebooks, reports, files, proposals, lists, correspondence, specifications, drawings, blueprints, sketches, materials, photographs, charts, any other documents and property, and reproductions of any and all of the aforementioned items that were developed by me pursuant to my employment with the Company, obtained by me in connection with my employment with the Company, or otherwise belonging to the Company, its successors, or assigns, including, without limitation, those records maintained pursuant to Section 4.C. If, at the time of termination, I have Company Confidential Information stored in my personal computer or any mobile, cloud, or other digital storage medium, I will so advise the Company. I will then work with the Company to ensure that the location of all such information is fully disclosed to the Company, retrieved by the Company in a forensically sound manner, and permanently deleted by the Company or its designee or otherwise treated in accordance with the Company’s directions. I also consent to an exit interview to confirm my compliance with this Agreement.

7. Termination Certification. Upon separation from employment with the Company, I agree to immediately sign and deliver to the Company the “Termination Certification” attached hereto as Exhibit C. I also agree to keep the Company advised of my home and business address for a period of two (2) years after termination of my employment with the Company, so that the Company can contact me regarding my continuing obligations provided by this Agreement.

 

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8. Notification of New Employer. In the event that I leave the employ of the Company, I hereby consent to notification by the Company to my new employer about my obligations under this Agreement.

9. Non-Competition. While I am employed by the Company and, subject to the state specific conditions set forth in Exhibit E, for twelve (12) months after the termination of my employment for any reason, I will not directly or indirectly, for myself or on behalf of any other person or entity, engage or attempt to engage in business that competes with the business of the Company in the United States. I acknowledge and agree that the Company provides products and services and conducts its business throughout the entire United States.

A. I understand that some entities engaging in the same or similar business as the Company may also have lines of business, parts of their business, or specific jobs that are wholly unrelated to the Company’s business and do not compete with the Company, and I understand that the Company does not intend for the restrictions contained in this Section 9 to include such unrelated lines of business, parts of businesses or jobs.

B. I understand and agree, however, that if I intend to be employed by, perform services for, or otherwise become associated with (as a principal, partner, officer, director, employee, agent, representative, contractor or consultant, whether for compensation or otherwise, or any other individual or representative role) an entity that engages in the same or similar business as the Company, it is presumed that the restrictions contained in Section 9 apply. I agree that if I do not believe the restrictions should apply because I will be performing services that I believe are wholly unrelated to the Company’s business and do not compete with the Company, I will alert the Company’s Head of Human Resources prior to accepting employment or engagement with such an entity so that the Company may make an assessment as to whether Section 9 would be violated before any potential damage is incurred.

C. I acknowledge that my experience, skills, education and training are readily transferrable and of such breadth that I can use them to my advantage in many other fields. As such, I agree that the terms of this Section 9 will not unreasonably impair my ability to engage in business or employment activities after I leave the Company.

10. Non-Solicitation of Employees. During my employment with the Company I will not directly or indirectly solicit or induce (or attempt to or assist others to solicit or induce) employees or consultants of the Company to terminate their relationship with the Company for my own benefit or for the benefit of any other person or entity. I further agree that, for twelve (12) months following the termination of my employment for any reason, I will not, directly or indirectly, solicit or induce or encourage another entity or person to solicit or induce any person employed by the Company, or any person retained by the Company as an independent contractor during my employment with the Company during the two (2) years prior to the termination of my employment, to terminate an employment relationship or contract with the Company or to obtain employment with another entity or person besides the Company.

 

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11. Non-Solicitation of Customers. During my employment with the Company I will not directly or indirectly solicit or induce (or attempt to or assist others to solicit or induce) Customers of the Company (defined below) to terminate their relationship with the Company for my own benefit or for the benefit of any other person or entity. Subject to the state specific conditions set forth in Exhibit E, I further agree that for twelve (12) months following the termination of my employment for any reason, I will not whether directly or indirectly, solicit, communicate with or otherwise contact any of the Company’s Customers for the purpose of conducting any business with them that is substantially similar to the business conducted or anticipated to be conducted by the Company during my employment. “Customer” includes any person or entity (or employee or agent of any entity), within the two (2) years before the termination of my employment (i) with whom I dealt or had direct contact; (ii) from whom I or an employee under my supervision solicited business or deals, directly or indirectly; or (iii) about whom, even without direct contact, I received Confidential Information, including but not limited to pricing or sales information. I understand that the fact that any other entity I become associated with has an existing business relationship with any such Customer is not a defense to a claim of violation of this provision.

I acknowledge and agree that the names and addresses of the Company’s Customers, its vendors and suppliers, and all other Confidential Information related to them, including their buying and/or selling habits, contracts, and special needs, whether created or obtained by, or disclosed to me during my employment, constitute Company Confidential Information.

12. Conflict of Interest Guidelines. I agree to diligently adhere to all policies of the Company, including the Conflict of Interest Guidelines attached as Exhibit D hereto, which may be revised from time to time during my employment.

13. Audit. I acknowledge that I have no reasonable expectation of privacy in any computer, technology system, email, handheld device, telephone, or documents that are used to conduct the business of the Company. As such, the Company has the right to audit and search all such items and systems, without further notice to me, to ensure that the Company is licensed to use the software on the Company’s devices in compliance with the Company’s software licensing policies, to ensure compliance with the Company’s policies, and for any other business-related purposes in the Company’s sole discretion. I understand that I am not permitted to add any unlicensed, unauthorized, or non-compliant applications to the Company’s technology systems and that I will refrain from copying unlicensed software onto the Company’s technology systems or using non-licensed software or websites. I understand that it is my responsibility to comply with the Company’s policies governing use of the Company’s documents and the internet, email, telephone, and technology systems to which I will have access in connection with my employment.

14. Arbitration and Equitable Relief in Aid of Arbitration.

A. Arbitration. IN CONSIDERATION OF MY EMPLOYMENT WITH THE COMPANY, ITS PROMISE TO ARBITRATE ALL EMPLOYMENT-RELATED DISPUTES, AND MY RECEIPT OF THE COMPENSATION, PAY RAISES, AND OTHER BENEFITS PAID TO ME BY THE COMPANY, AT PRESENT AND IN THE FUTURE AS WELL AS OTHER CONSIDERATION DESCRIBED IN THIS AGREEMENT, I AGREE THAT ANY AND ALL CONTROVERSIES, CLAIMS, OR DISPUTES WITH ANYONE (INCLUDING THE COMPANY AND ANY EMPLOYEE, OFFICER, DIRECTOR, AGENT, SHAREHOLDER, OR BENEFIT PLAN OF THE COMPANY, IN THEIR CAPACITY AS SUCH OR OTHERWISE), INCLUDING BUT NOT LIMITED TO THOSE ARISING OUT OF, RELATING TO, OR

 

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RESULTING FROM MY EMPLOYMENT WITH THE COMPANY OR THE TERMINATION OF MY EMPLOYMENT WITH THE COMPANY, INCLUDING ANY BREACH OF THIS AGREEMENT, WILL BE SUBJECT TO BINDING ARBITRATION. THE FEDERAL ARBITRATION ACT, 9 U.S.C. SECTION 1 ET SEQ., WILL GOVERN THIS ARBITRATION AGREEMENT, EXCEPT THAT IF THE FAA FOR ANY REASON IS HELD NOT TO APPLY, THEN THE ARBITRATION LAW OF THE STATE IN WHICH I LAST RENDERED SERVICES TO THE COMPANY WILL APPLY. DISPUTES THAT I AGREE TO ARBITRATE, AND THEREBY AGREE TO WAIVE ANY RIGHT TO A TRIAL BY JURY, INCLUDE ANY CLAIMS UNDER LOCAL, STATE, OR FEDERAL LAW, INCLUDING, BUT NOT LIMITED TO CLAIMS UNDER TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, THE AMERICANS WITH DISABILITIES ACT OF 1990, THE AGE DISCRIMINATION IN EMPLOYMENT ACT OF 1967, THE OLDER WORKERS BENEFIT PROTECTION ACT, THE SARBANES-OXLEY ACT, THE WORKER ADJUSTMENT AND RETRAINING NOTIFICATION ACT, THE FAMILY AND MEDICAL LEAVE ACT, CLAIMS OF HARASSMENT, DISCRIMINATION, AND WRONGFUL TERMINATION, AND ANY OTHER FEDERAL AND STATE STATUTORY OR COMMON LAW CLAIMS. I FURTHER UNDERSTAND THAT THIS AGREEMENT TO ARBITRATE ALSO APPLIES TO ANY DISPUTES THAT THE COMPANY MAY HAVE WITH ME, AND THAT THIS ARBITRATION AGREEMENT IS BINDING ON THE COMPANY WITHOUT NEED FOR ITS SIGNATURE.

B. Procedure. I AGREE THAT ANY ARBITRATION WILL BE ADMINISTERED BY JUDICIAL ARBITRATION & MEDIATION SERVICES, INC. (“JAMS”), PURSUANT TO ITS EMPLOYMENT ARBITRATION RULES & PROCEDURES (THE “JAMS RULES”), EXCEPT THAT (NOTWITHSTANDING ANY PROVISION OF THE JAMS RULES), I AGREE THAT A COURT OF COMPETENT JURISDICTION, AND NOT AN ARBITRATOR, WILL HAVE THE AUTHORITY TO RESOLVE ANY DISPUTE OVER WHETHER THIS AGREEMENT OR ANY PORTION THEREOF IS VOID OR OTHERWISE UNENFORCEABLE. EACH PARTY SHALL HAVE THE RIGHT TO TAKE DEPOSITIONS OF THREE FACT WITNESSES AND ANY EXPERT WITNESS DESIGNATED BY ANOTHER PARTY. EACH PARTY ALSO SHALL HAVE THE RIGHT TO SERVE REQUESTS FOR PRODUCTION OF DOCUMENTS AND REQUESTS FOR INSPECTION TO ANY PARTY, AND TO SUBPOENA DOCUMENTS FROM THIRD PARTIES TO THE EXTENT ALLOWED BY LAW. REQUESTS FOR ADDITIONAL DEPOSITIONS OR DISCOVERY MAY BE MADE TO THE ARBITRATOR SELECTED PURSUANT TO THIS AGREEMENT. THE ARBITRATOR MAY GRANT SUCH ADDITIONAL DISCOVERY IF THE ARBITRATOR FINDS THAT THE PARTY HAS DEMONSTRATED THAT IT NEEDS THAT DISCOVERY TO ADEQUATELY ARBITRATE THE CLAIM, TAKING INTO

ACCOUNT THE PARTIES’ MUTUAL DESIRE TO HAVE A SPEEDY, LESS-FORMAL, COST-EFFECTIVE DISPUTE-RESOLUTION MECHANISM. I AGREE THAT THE ARBITRATOR WILL HAVE THE POWER TO DECIDE ANY MOTIONS BROUGHT BY ANY PARTY TO THE ARBITRATION, INCLUDING MOTIONS FOR SUMMARY JUDGMENT AND/OR ADJUDICATION, AND MOTIONS TO DISMISS AND DEMURRERS, PRIOR TO ANY ARBITRATION HEARING. I ALSO AGREE THAT THE ARBITRATOR WILL HAVE THE POWER TO AWARD ANY REMEDIES AVAILABLE UNDER APPLICABLE LAW, INCLUDING EQUITABLE RELIEF AND DAMAGES, AND THAT THE ARBITRATOR WILL AWARD ATTORNEYS’ FEES AND COSTS TO THE PREVAILING

 

8


PARTY, EXCEPT AS PROHIBITED BY LAW. I UNDERSTAND THAT THE COMPANY WILL PAY FOR ANY ADMINISTRATIVE OR HEARING FEES CHARGED BY THE ARBITRATOR OR JAMS EXCEPT THAT I WILL PAY ANY FILING FEES ASSOCIATED WITH ANY ARBITRATION THAT I INITIATE, BUT ONLY SO MUCH OF THE FILING FEES AS I WOULD HAVE INSTEAD PAID HAD I FILED A COMPLAINT IN A COURT OF LAW. I AGREE THAT THE DECISION OF THE ARBITRATOR WILL BE IN WRITING. I UNDERSTAND THAT, IN THE EVENT OF A BREACH OF THIS AGREEMENT, THE AGGRIEVED PARTY MAY PURSUE ANY AND ALL AVAILABLE LEGAL REMEDIES, INCLUDING EQUITABLE AND MONETARY DAMAGES, IN ARBITRATION.

C. Forum and Equitable Relief in Aid of Arbitration. I AGREE THAT ANY ARBITRATION UNDER THIS AGREEMENT WILL BE CONDUCTED IN SAN MATEO COUNTY (UNLESS OTHERWISE REQUIRED BY LAW, IN WHICH CASE IT WILL OCCUR IN THE COUNTY OR COMPARABLE GOVERNMENTAL UNIT WHERE I LAST RENDERED SERVICES TO THE COMPANY). EXCEPT AS PROVIDED BY LAW AND THIS AGREEMENT, ARBITRATION WILL BE THE SOLE, EXCLUSIVE, AND FINAL FORUM FOR ANY DISPUTE BETWEEN ME AND THE COMPANY. ACCORDINGLY, EXCEPT AS PROVIDED FOR BY LAW, OTHER THAN COURT ACTION FOR EQUITABLE RELIEF IN AID OF ARBITRATION, NEITHER I NOR THE COMPANY WILL BE PERMITTED TO PURSUE COURT ACTION REGARDING CLAIMS THAT ARE SUBJECT TO ARBITRATION. I UNDERSTAND THAT IN THE EVENT OF A BREACH OR THREATENED BREACH OF THIS AGREEMENT, THE AGGRIEVED PARTY MAY SUFFER IRREPARABLE HARM. ANY PARTY OR THIRD-PARTY BENEFICIARY OF THIS AGREEMENT MAY SEEK TEMPORARY EQUITABLE RELIEF (INCLUDING WITHOUT LIMITATION, A TEMPORARY RESTRAINING ORDER OR PRELIMINARY INJUNCTION) IN AID OF ARBITRATION, WHERE SUCH RELIEF IS OTHERWISE AVAILABLE BY LAW, FROM THE FEDERAL OR STATE COURTS IN CALIFORNIA, TO WHICH I CONSENT TO PERSONAL JURISDICTION, (UNLESS OTHERWISE REQUIRED BY LAW, IN WHICH CASE IT WILL OCCUR IN THE COUNTY OR COMPARABLE GOVERNMENTAL UNIT WHERE I LAST RENDERED SERVICES TO THE COMPANY) OR FROM AN ARBITRATOR PURSUANT TO THE EMERGENCY RELIEF PROCEDURES AS SET FORTH IN JAMS COMPREHENSIVE ARBITRATION RULES & PROCEDURES. I HEREBY CONSENT TO THE JURISDICTION OF

D. Class and Collective Actions. NOTWITHSTANDING ANY PROVISION OF THE JAMS RULES, AND TO THE MAXIMUM EXTENT PERMITTED BY LAW, I WAIVE THE RIGHT TO BRING, PARTICIPATE IN, OR RECOVER UNDER, A CLASS OR COLLECTIVE ACTION.

E. Administrative Relief. I UNDERSTAND THAT THIS AGREEMENT DOES NOT PROHIBIT ME FROM PURSUING OR RECOVERING UNDER AN ADMINISTRATIVE CLAIM WITH A LOCAL, STATE, OR FEDERAL ADMINISTRATIVE BODY OR GOVERNMENT AGENCY THAT IS AUTHORIZED TO ENFORCE OR ADMINISTER LAWS RELATED TO EMPLOYMENT, INCLUDING, BUT NOT LIMITED TO, THE DEPARTMENT OF FAIR EMPLOYMENT AND HOUSING, THE EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, THE NATIONAL LABOR RELATIONS BOARD, OR THE WORKERS’ COMPENSATION BOARD. THIS AGREEMENT DOES, HOWEVER, PRECLUDE ME FROM PURSUING COURT ACTION REGARDING ANY SUCH CLAIM, EXCEPT AS PERMITTED BY LAW.

 

9


F. Voluntary Nature of Agreement. I ACKNOWLEDGE AND AGREE THAT I AM EXECUTING THIS AGREEMENT VOLUNTARILY AND WITHOUT ANY DURESS OR UNDUE INFLUENCE BY THE COMPANY OR ANYONE ELSE. I FURTHER ACKNOWLEDGE AND AGREE THAT I HAVE CAREFULLY READ THIS AGREEMENT AND THAT I HAVE ASKED ANY QUESTIONS NEEDED FOR ME TO UNDERSTAND THE TERMS, CONSEQUENCES, AND BINDING EFFECT OF THIS AGREEMENT AND FULLY UNDERSTAND IT, INCLUDING THAT I AM WAIVING MY RIGHT TO A JURY TRIAL. FINALLY, I AGREE THAT I HAVE BEEN PROVIDED AN OPPORTUNITY TO SEEK THE ADVICE OF AN ATTORNEY OF MY CHOICE BEFORE SIGNING THIS AGREEMENT.

15. DTSA Notification. Notwithstanding my confidentiality obligations set forth in this Agreement, I understand that, pursuant to the Defend Trade Secrets Act of 2016, I will not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret that: (a) is made (i) in confidence to a Federal, State or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or (b) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. In addition, if I file a lawsuit for retaliation by the Company for reporting a suspected violation of law, I may disclose the trade secret to my attorney and may use the trade secret information in the court proceeding, if I (a) file any document containing the trade secret under seal and (b) do not disclose the trade secret, except pursuant to court order. I understand that in the event it is determined that disclosure of trade secrets was not done in good faith for the reasons described above, I will be subject to damages, including punitive damages and attorneys’ fees.

16. General Provisions.

A. Governing Law. Except as provided in Section 14 above, and subject to the provisions of Exhibit E, this Agreement will be governed by the laws of the State in which I last rendered services to the Company.

B. Entire Agreement. This Agreement, together with the Exhibits herein and any executed written offer letter between me and the Company sets forth the entire agreement and understanding between the Company and me relating to the subject matter herein, and supersedes all prior discussions or representations between us, including, but not limited to, any representations made during my interview(s) or relocation negotiations, whether written or oral. Should my offer letter contradict this Agreement, this Agreement will govern. No modification of or amendment to this Agreement, nor any waiver of any rights under this Agreement, will be effective unless in writing signed by the President of the Company and the party to be bound. Any subsequent change or changes in my duties, salary, or compensation will not affect the validity or scope of this Agreement.

 

10


C. Severability. The provisions of this Agreement are severable. In addition, in the event that any provision of this Agreement conflicts with the law under which this Agreement is to be construed or if any provision is held overbroad or invalid by a court acting in aid of arbitration or arbitrator with jurisdiction over the parties to this Agreement, that provision will be deemed to be amended and reformed (and the parties agree to grant the court or arbitrator the authority to perform such amendment and reform) to reflect as nearly as possible the original intentions of the parties in accordance with the applicable law. The remaining provisions of the Agreement will continue in full force and effect.

D. Successors and Assigns. This Agreement will be binding upon my heirs, executors, assigns, administrators, and other legal representatives, and will be for the benefit of the Company, its successors, and its assigns. There are no intended third-party beneficiaries to this Agreement, except as expressly stated.

E. Waiver. Waiver by the Company of a breach of any provision of this Agreement must be in writing and will not operate as a waiver of any other or subsequent breach.

F. Survivorship. The rights and obligations of the parties to this Agreement will survive termination of my employment with the Company.

7/27/2024

Date: {CANDIDATE SIGNED DATE}

 

{CANDIDATE SIGNATURE}

/s/ keith kennedy

Signature

keith kennedy

{CANDIDATE FULL NAME}

 

 

Name of Employee (typed or printed)

 

11


Exhibit A

LIST OF PRIOR INVENTIONS

AND ORIGINAL WORKS OF AUTHORSHIP

 

Title

  

Date

  

Identifying Number of Brief

Description

__X__ No inventions or improvements

____ Additional Sheets Attached

Signature of Employee: {CANDIDATE SIGNATURE}

Print Name of Employee: {CANDIDATE FULL NAME}

Date: {CANDIDATE SIGNED DATE}


Exhibit B

STATE INVENTION STATUTES

(a) For employees who primarily live and work in California: Under California Labor Code Section 2870, (i) Any provision in an employment agreement which provides that an employee will assign, or offer to assign, any of his or her rights in an invention to his or her employer will not apply to an invention that the employee developed entirely on his or her own time without using the employer’s equipment, supplies, facilities, or trade secret information except for those inventions that either:

(1) Relate at the time of conception or reduction to practice of the invention to the employer’s business, or actual or demonstrably anticipated research or development of the employer; or

(2) Result from any work performed by the employee for the employer.

(ii) To the extent a provision in an employment agreement purports to require an employee to assign an invention otherwise excluded from being required to be assigned under subdivision (a), the provision is against the public policy of this state and is unenforceable.

(b) For employees in Illinois: Your agreement to assign to the Company any of your rights as set forth in Section 4 does not apply to any invention that qualifies fully under the provisions of 765 Ill. Comp. Stat. 1060/2, to an invention for which no equipment, supplies, facilities, or trade secret information of Company was used and which was developed entirely on your own time, unless (a) the invention relates (i) to the business of the Company, or (ii) to the Company’s actual or demonstrably anticipated research or development, or (b) the invention results from any work performed by you for the Company.


Exhibit C

CareDx, Inc.

TERMINATION CERTIFICATION

CareDx, Inc. (the “Company”) requests that you carefully review, complete, and execute this acknowledgment and certification. (If your response requires additional space, please attach and initial any supplemental pages).

1. Following the termination of my employment with the Company, I have accepted or intend to accept, or plan to apply for or otherwise seek, employment with (list all responsive entities and location of entities):

 

 

  

 

  

 

2. The position I have accepted or intend to accept is (title and general description of duties):

 

 

  

 

  

 

3. I certify that the following is a complete and exhaustive list of all electronic storage devices (ESDs), including all personal computer(s), personal email accounts, personal “smart” phones, USB flash drives (thumb drives), external storage drives, compact discs, zip discs, DVDs, SD cards, digital cameras, memory sticks, and any other electronic storage devices, and/or accounts capable of caching confidential information, identified by make and model or account address, that I have, at any time, connected to any Company computer, or used to access, download, disclose, transfer, send, receive, or store any Company data or information:

 

 

  

 

  

 

4. I certify that the following is a complete and exhaustive list of all email accounts, cloud storage accounts, FTP/secure FTP, network shared folders or drives, social media accounts, instant messaging accounts, mobile storage, or communication apps that I have, at any time, used to access, download, disclose, transfer, send, or receive any communication containing Company data or information:

 

 

  

 

  

 

5. I have been provided with a copy of my Confidential Information, Invention Assignment, Non-Competition and Arbitration Agreement (“Agreement”). I have reviewed and understand my continuing obligations as set forth in the Agreement, and I reaffirm my certification of these obligations.


6. I further acknowledge and understand that, pursuant to my Agreement, I have post-employment non-competition and non-solicitation obligations that I owe to the Company, and I will continue to abide by these obligations.

7. I [have/have not (circle one)] copied, saved, retained, disclosed, or transmitted, in any form whatsoever, any “Company Confidential Information” (as defined in my Agreement) outside the course of performing my duties for the Company’s benefit. If “have” is circled, identify the protected Company Confidential Information copied, saved, retained, disclosed, or transmitted in connection with a non-Company business-related purpose, the date of the incident, the parties involved, and the person and/or location to whom/where the Company Confidential Information was copied, saved, retained, disclosed, or transmitted:

 

 

  

 

  

 

8. During my employment with the Company, I [have/have not (circle one)] downloaded and/or stored Company files or data on my home or personal computer. If “have” is circled, identify the Company files or data downloaded or stored on the home or personal computer:

 

 

  

 

  

 

9. During my employment with the Company, I [had/did not have (circle one)] the ability to access files or data from the Company’s servers remotely. If “had” is circled, identify the Company’s files or data accessed remotely, and the computer media used for remote access:

 

 

  

 

  

 

10. During my employment with the Company, I [used/did not use (circle one)] a personal mobile phone or electronic storage device and/or backed up the contents of my Company-provided mobile phone or electronic storage device.

11. I certify that I have not misused, and will not misuse, the right of access to any Company Confidential Information. I have only accessed Company Confidential Information as required by my duties to the Company, and only at times when there was a legitimate business reason to access the information.

12. Except as disclosed in response herein, I certify that I have returned all Company property in my possession and have not retained any copies of such property, including but not limited to any Company Confidential Information. I have also returned all keys, access cards, credit cards, identification cards, phones, computers, electronic storage media, or devices that have been connected to any Company computer or on which I have stored any Company Confidential Information, electronic mail devices, electronic organizers, any other Company-issued electronic device, and other property and equipment belonging to the Company.


13. I agree that following my termination, I will not either directly or indirectly solicit or induce (or attempt to or assist others to solicit or induce) any of the Company’s employees to leave their employment, or to enter into an employment, consulting, contractor, or other relationship with any other person, firm, business entity, or organization (including with myself), as set forth in Section 10 of the Confidential Information, Invention Assignment, Non-Competition and Arbitration Agreement.

14. I agree that following my termination, I will not either directly or indirectly solicit or induce (or attempt to or assist others to solicit or induce) for the benefit of myself or any other person or entity any of the Company’s Customers, as set forth in Section 11 of the Confidential Information, Invention Assignment, Non-Competition and Arbitration Agreement.

15. I understand that the above is a summary only and does not purport to include all my continuing obligations to the Company under my Agreement. In the case of any conflict between this Termination Certification and my Agreement, the terms of my Agreement control.

 

   
 

Signature of employee

   
 

Print name

   
 

Date

Address for Notifications:    


Exhibit D

CareDx, Inc.

CONFLICT OF INTEREST GUIDELINES

It is the policy of CareDx, Inc. (the “Company”) to conduct its affairs in strict compliance with the letter and spirit of the law and to adhere to the highest principles of business ethics. Accordingly, while working for the Company, all officers, employees, and independent contractors must avoid activities that are in conflict, or give the appearance of being in conflict, with these principles and with the interests of the Company. The following are potentially compromising situations that must be avoided:

1. Revealing Company Confidential Information (as defined in the Confidential Information, Invention Assignment, Non-Competition and Arbitration Agreement) to outsiders or misusing confidential information. Unauthorized divulging of information is a violation of this policy whether or not for personal gain and whether or not harm to the Company is intended. The Confidential Information, Invention Assignment, Non-Competition and Arbitration Agreement elaborates on this principle and is a binding agreement.

2. Accepting or offering substantial gifts, excessive entertainment, favors, or payments that may be deemed to constitute undue influence or otherwise be improper or embarrassing to the Company.

3. Participating in civic or professional organizations that might involve divulging confidential information of the Company.

4. Initiating or approving personnel actions affecting reward or punishment of employees or applicants where there is a family relationship or is or appears to be a personal or social involvement.

5. Initiating or approving any form of personal or social harassment of employees.

6. Investing or holding outside directorship in suppliers, customers, or competing companies, including financial speculations, where such investment or directorship might influence in any manner a decision or course of action of the Company.

7. Borrowing from or lending to employees, customers, or suppliers.

8. Acquiring real estate I know or should know is of interest to the Company.

9. Improperly using or disclosing to the Company any confidential information or trade secrets of any former or concurrent employer or other person or entity with whom obligations of confidentiality exist.

10. Unlawfully discussing prices, costs, customers, sales, or markets with competing companies or their employees.


11. Making any unlawful agreement with distributors, including but not limited to with respect to prices.

12. Improperly using or authorizing the use of any inventions that are the subject of patent claims of any other person or entity.

13. Engaging in any conduct that is not in the best interest of the Company.

Each officer, employee, and independent contractor must take every necessary action to ensure compliance with these guidelines and to bring problem areas to the attention of higher management for review. Violations of this conflict of interest policy may result in discharge without warning.


Exhibit E

JURISDICTION SPECIFIC MODIFICATIONS

A. California. For so long as I reside or work in California and am subject to the laws of California: (i) no provision or requirement of this Agreement will be construed or interpreted in a manner contrary to the express public policy of the State of California, (ii) the Obligations of Section 9 will not apply; and (iii) Section 11 will prohibit the listed actions only to the extent I am aided in my conduct by use or disclosure of trade secrets (as defined by applicable law).

B. Massachusetts. For so long as Massachusetts General Laws Part I Title XXI Chapter 149 Section 24 L applies to my obligations under this Agreement: (i) the Obligations in Section 9 will only apply within any geographical area (a) where I had responsibilities on behalf of the Company or about which I received Confidential Information during the two (2) years prior to the cessation of my employment (b) in which the Company is engaged in business; (ii) Section 9 is further limited to situations where I am performing services that are the same as or similar in function or purpose to the services I performed for Company during the two (2) years prior to the cessation of my employment and are not enforceable if I have been terminated without cause or laid off; (iii) if at the date of the termination of my employment I am and at least the 30 days prior to that date I have been, a resident of or employed in Massachusetts, all civil actions relating to Sections 9 and 11 of this Agreement will be brought in the county where I reside or, if mutually agreed upon by the Company and me, in Suffolk County, Massachusetts; provided that, in any such action brought in Suffolk County, the superior court or the business litigation session of the superior court will have exclusive jurisdiction; (iv) this Agreement is amended to add the following new Section:

I agree that I have received fair and reasonable consideration for my obligations under this Agreement. I have had the right to consult with an attorney and have been given at least ten business days to consider this Agreement.

C. Louisiana. For so long as I am subject to the laws of Louisiana, the obligations in Section 9 will apply to me in the specific parishes in which I live or work during the two (2) years prior to the termination of my employment with the Company.

D. Oklahoma. For so long as I am subject to the laws of Oklahoma, the obligations in Section 9 will not apply and Section 11 will be modified to provide that:

During my employment with the Company I will not directly or indirectly solicit or induce (or attempt to solicit or induce) established Customers of the Company to terminate their relationship with the Company for my own benefit or for the benefit of any other person or entity. I further agree that following the termination of employment for any reason, I will not directly solicit or induce established Customers of the Company with which the Company has transacted business within the two (2) year period prior to the termination of my employment and with which I or persons supervised by me had material business-related contact or about which I have had access to Confidential Information during the two (2) years prior to the termination of my employment to terminate their relationship with the Company for my own benefit or for the benefit of any other person or entity.


I acknowledge and agree that the names and addresses of the Company’s Customers, its vendors and suppliers, and all other Confidential Information related to them, including their buying and/or selling habits, contracts, and special needs, whether created or obtained by, or disclosed to me during my employment, constitute Company Confidential Information.

Exhibit 99.1

Final Press Release For Newswire

Issue, Thursday, 9/12/24. 7:01 am ET.

CareDx Appoints Keith Kennedy Chief Operating Officer and Jessica Meng Chief Commercial Officer

CareDx Announces Addition of Operational and Commercial Expertise to Lead Key Strategic Initiatives

Marica Grskovic Appointed Chief Strategy Officer to Lead Corporate Development

BRISBANE, Calif.—(BUSINESS WIRE)— September 12, 2024 – CareDx, Inc. (Nasdaq: CDNA) – The Transplant Company focused on the discovery, development, and commercialization of clinically differentiated, high-value healthcare solutions for transplant patients and caregivers – today announced the appointment of two senior executives who will lead key initiatives as the Company advances its long-term strategic growth plan. CareDx will be sharing its long-term growth strategy during an Investor Day in October 2024.

Keith Kennedy brings more than 20 years of experience and executive leadership in healthcare including global diagnostics, biopharma services, and contract development and manufacturing organization (CDMO). “CareDx addresses a large transplant market with the potential to profitably scale,” said Kennedy. “I’m thrilled to be a part of this organization and lead the Company’s transformation towards operational excellence.”

As Chief Operating Officer, Kennedy will spearhead CareDx’s operational excellence transformation and lead its operational functions. Kennedy most recently served as Chief Financial Officer at PharmaLogic Holdings Corp. At Veracyte, Kennedy served as Chief Operations Officer, Chief Financial Officer, and Secretary. Kennedy also held key executive positions at MCG Capital Corporation and GE Capital, as well as an Executive Residence at Arlington Capital Partners. He served as an Officer in the U.S. Air Force. Kennedy holds a Bachelor of Science in Accounting with high distinction from Indiana University and a Master’s in Business Administration from the College of William & Mary. Kennedy is a Chartered Financial Analyst and Certified Public Accountant.

Jessica Meng brings to CareDx deep expertise in building successful commercial strategies for both established companies and entrepreneurial ventures in the pharmaceutical and molecular diagnostics industries. “CareDx is a critical part of the transplant ecosystem and the care of hundreds of thousands of patients. Transplant centers rely on the Company’s testing services, SaaS software solutions, and laboratory products to improve health outcomes,” said Meng. “I’m excited to be a part of the transplant community and work with its incredible clinician leaders on the next generation of CareDx solutions.”

As Chief Commercial Officer Jessica Meng will be responsible for driving CareDx’s commercial growth globally across its portfolio. Meng previously served as Chief Commercial Officer at DELFI Diagnostics, and General Manager of Women’s Health at Myovant Sciences. She previously held sales and marketing leadership roles at Veracyte and Genentech. Meng received a Bachelor of Science in Finance and Bachelor of Arts in International Relations with a minor in Mathematics from the University of Pennsylvania, and a Master’s in Business Administration, Marketing, Strategic Management from The Wharton School.


Marica Grskovic, Ph.D., has been with CareDx since 2012 where she led the development of the AlloSure® product. As Chief Strategy Officer, Grskovic will lead strategic planning and corporate development at CareDx. She previously held senior leadership roles across Operations, R&D, and Pharma Partnering. Prior to CareDx, Grskovic held scientific roles at the stem cell-based drug discovery platform technology companies iPierian and True North Therapeutics. Grskovic completed her Doctorate in Molecular Biology and Biochemistry.

About CareDx – The Transplant Company

CareDx, Inc., headquartered in Brisbane, California, is a leading precision medicine solutions company focused on the discovery, development, and commercialization of clinically differentiated, high-value healthcare solutions for transplant patients and caregivers. CareDx offers testing services, products, and digital healthcare solutions along the pre- and post-transplant patient journey and is the leading provider of genomics-based information for transplant patients. For more information, please visit: www.CareDx.com .

Forward Looking Statements

This press release includes forward-looking statements related to CareDx, Inc. These forward-looking statements are based upon information that is currently available to CareDx and its current expectations, speak only as of the date hereof, and are subject to risks and uncertainties that could cause actual results to differ materially from those projected, including general economic and market factors; and other risks discussed in CareDx’s filings with the SEC, including the Annual Report on Form 10-K for the fiscal year ended December 31, 2023 filed by CareDx with the SEC on February 28, 2024, the Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2024 filed by CareDx with the SEC on May 9, 2024 and the Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2024 filed by CareDx with the SEC on July 31, 2024, and other reports that CareDx has filed with the SEC. Any of these may cause CareDx’s actual results, performance, or achievements to differ materially and adversely from those anticipated or implied by CareDx’s forward-looking statements. CareDx expressly disclaims any obligation, except as required by law, or undertaking to update or revise any such forward-looking statements.

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Sep. 06, 2024
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Entity Central Index Key 0001217234
Document Type 8-K
Document Period End Date Sep. 06, 2024
Entity Registrant Name CAREDX, INC.
Entity Incorporation State Country Code DE
Entity File Number 001-36536
Entity Tax Identification Number 94-3316839
Entity Address, Address Line One 8000 Marina Boulevard
Entity Address, Address Line Two 4th Floor
Entity Address, City or Town Brisbane
Entity Address, State or Province CA
Entity Address, Postal Zip Code 94005
City Area Code (415)
Local Phone Number 287-2300
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Pre Commencement Issuer Tender Offer false
Security 12b Title Common Stock, $0.001 Par Value
Trading Symbol CDNA
Security Exchange Name NASDAQ
Entity Emerging Growth Company false

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