BIOJECT MEDICAL TECHNOLOGIES INC
EXHIBIT 10.7
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<TYPE>EX-10.7
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<FILENAME>v82444exv10w7.txt
<DESCRIPTION>EXHIBIT 10.7
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                                                                    EXHIBIT 10.7


               AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT

THIS AGREEMENT is dated March 14, 2002, between:

        BIOJECT MEDICAL TECHNOLOGIES INC. ("BMT"), a Corporation incorporated
        under the laws of the State of Oregon having its principal offices at
        7620 SW Bridgeport Rd., Portland, Oregon 97224

        BIOJECT INC., a Corporation incorporated under the laws of the State of
        Oregon having its principal offices at 7620 S.W. Bridgeport Road,
        Portland, Oregon, 97224 (collectively referred to as the "Company")

AND:

        John Gandolfo
        62 Terrace Road
        Wayne, NJ 07470
        (the "Executive")

RECITALS:

1.      The Company desires to secure the services and expertise of the
        Executive and to ensure the availability of the Executive to the
        Company; and

2.      The Executive desires to serve in the employ of the Company on a
        full-time basis for the period and upon the terms and conditions
        provided for in this agreement.

3.      The Executive and the Company are parties to that certain Executive
        Employment Agreement dated October 3, 2001 relating to Executive's
        employment with the Company (the "Original Agreement"). The Executive
        and the Company desire to make certain changes to and completely restate
        the Original Agreement.

NOW THEREFORE, in consideration of the premises and mutual covenants contained
herein, the parties noted above agree amend, restate and supersede the Original
Agreement as follows:

SECTION 1

1.1     EMPLOYMENT

        The Company appoints the Executive to and retains the Executive for the
        position of Chief Financial Officer and Vice President of Finance for
        the Company, and the



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        Executive accepts such appointment. This appointment becomes effective
        on October 15, 2001.

1.2     APPROVAL BY THE BOARD

        The Company represents, if required by its Bylaws, that the appointment
        of the Executive to the position referred to in Section 1.1 will be
        approved by the Board of Directors of the Company (the "Board") and that
        all corporate action required to effect the appointment will be taken.

1.3     DEFINITIONS

        As used in this agreement:

        a.     "Confidential Information" means any of the company's customers,
               employees, products, processes, services, financial information,
               marketing techniques, merchandising, business strategies, or
               plans, research, development, systems, inventions or any other
               trade secret or information pertaining to any of the preceding
               terms.

        b.     "Conflicting Product" means any product, process or service of
               any person or organization other than the Company, in existence
               or under development, which resembles or competes with the
               current or projected products, processes or services of the
               Company.

        c.     "Conflicting Organization" means any person or organization
               engaged or about to become engaged in research, development,
               production, marketing or selling of a Conflicting Product.

        d.     "Inventions" means discoveries, concepts, and ideas, whether
               patentable or not, including but not limited to, procedures,
               processes, methods, formulas, and techniques, as well as
               improvements thereof or know-how related thereto, concerning any
               present or prospective activities of the Company with which the
               Employee becomes acquainted as a result of his employment by the
               Company.


SECTION 2 - DUTIES/RESPONSIBILITIES

2.1     DUTIES/RESPONSIBILITIES

        During the employment term and any renewals thereof, the Executive will
        devote such time, attention, skill and efforts as may be necessary to
        assure the full performance of his duties and responsibilities, to the
        best of his abilities, with such



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        authority as is customarily associated with the position of Chief
        Financial Officer and Vice President of Finance. The Executive hereby
        accepts and agrees to such engagement of services, and will devote
        himself solely to the operation of the Company's business. The Executive
        may continue his existing involvement in an advisory or board capacity
        with non- competing organizations.

2.2     REPORTING

        In conducting his duties under this Agreement, the Executive shall
        report to the Chief Executive Officer and Chairman of the Board of
        Directors of the Company.

2.3     LOCATION OF EMPLOYMENT

        The Executive shall conduct his duties under this Agreement primarily at
        the offices of the Company in New Jersey, or such other geographical
        locations as shall be reasonably required in order to assure the
        efficient and proper operation of the Company. In the event that the
        primary location of the Executive's conducting his duties is moved
        outside the state of New Jersey, the Executive will be offered a choice
        to either relocate to the new location, or to accept a severance package
        as described in Section 4.2 (b) (ii).


SECTION 3 - COMPENSATION

3.1     SALARY

        For the Executive's services to the Company, the Executive shall be
        entitled to receive a minimum annual gross salary of $305,000. Not less
        than once during each year of employment, the Chief Executive Officer
        shall review the Executive's performance, duties and compensation for
        the purpose of promotion and/or increasing the compensation payable to
        the Executive. Executive's salary shall be paid in bi-weekly
        installments during the calendar year for the term of this Agreement.
        The Company shall deduct or withhold from such payments to the Executive
        the sums as are required under applicable laws for worker's
        compensation, income taxes and other benefits in accordance with Company
        policy.

3.2     BONUS PROGRAM

        The Executive will receive a signing bonus of $100,000.00, which is
        payable within 10 days of the date the Executive begins his employment
        with the Company.

        Exclusive of the signing bonus described above, the Executive shall not
        be eligible to earn a cash bonus until the fiscal year following the
        year the Company has



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        achieved profitability. In the interim, the Executive is eligible to
        earn bonuses in the form of stock options for fiscal years in which the
        Company achieves its business performance objectives, including
        operational, financial and budget projections. Specific bonus
        requirements and objectives will be determined by the Chief Executive
        Officer, and are subject to approval by the Board.

3.3     REIMBURSEMENT OF EXPENSES

        The Company shall reimburse the Executive for all reasonable
        out-of-pocket expenses, including, without limitation, all travel and
        entertainment expenses payable or incurred by the Executive in
        connection with his duties as an employee of Bioject under this
        Agreement. It is the policy of the Company for employees to travel as
        inexpensively as possible, utilizing economy airfare and standard rental
        cars. All payments or reimbursements shall be made promptly upon
        submission by the Executive of vouchers, bills or receipt for all
        expenses.

3.4     DISABILITY

        Should Executive become disabled and unable to perform substantially all
        of his duties under this agreement, as documented by an independent
        physician selected jointly by the Executive and the Company, the Company
        will continue paying the Executive any bonus earned and previously
        awarded, together with his then- current salary at seventy-five percent
        (75%) of current salary for a period of not greater than six (6) months
        from the disability date. Should the disability continue, payments by
        the company will then be reduced to fifty percent (50%) of current
        salary for any remaining period of disability not to exceed an
        additional six (6) months. Health and dental insurance and other benefit
        coverage will continue for the duration of these payments, for a maximum
        time period not to exceed twelve (12) months. Should payments to
        Executive under worker's compensation and/or disability insurance
        programs, when combined with Company payments, exceed seventy-five
        percent (75%) of employee's current salary, the Company will reduce its
        payment by the excess amount.


SECTION 4 - TERMS OF EMPLOYMENT

4.1     DURATION

        The term of this Agreement shall commence on October 15, 2001. It shall
        continue for an initial term of two, consecutive one-year periods,
        subject to the early termination provisions of this Section 4. Upon
        expiration of the initial term, this Agreement will be automatically
        renewed for successive one-year terms unless either the Executive or the
        Company shall, upon three months written notice to the other, elect not
        to renew this Agreement for any year. Non-renewal



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        of the Agreement by the Company shall be deemed a termination pursuant
        to Section 4.2 (a) (ii), and shall be subject to the severance
        compensation provisions related to termination under that Section.

4.2     TERMINATION BY THE COMPANY

        (a)    The Company may terminate this Agreement:

               (i)    Immediately if it is determined by the Board of Directors
                      that the Executive's actions: (1) constitute a material
                      breach of his duties hereunder, followed by Executive's
                      failure to cure such breach within a reasonable period of
                      time after receiving written notice thereof, or (2)
                      constitute a criminal act reflecting adversely on the
                      business or reputation of the Company or (3) have resulted
                      in the Executive, in his personal capacity, being indicted
                      or sanctioned or his entering into a consent decree, in
                      connection with any investigation of, allegation of
                      wrongdoing by, or other formal proceeding against the
                      Executive, by the United States Food and Drug
                      Administration or the United States Securities and
                      Exchange Commission, whether related to the business of
                      the Company or to any other past employment or activity of
                      the Executive; or,

               (ii)   With or without other cause at any time by giving sixty
                      (60) days prior written notice to the Executive; or

        (b)    Upon termination of this Agreement by the Company:

               (i)    Pursuant to Sections 4.2(a)(i):

                      A.     The salary and company sponsored benefits payable
                             to the Executive pursuant to Section 3.1 shall be
                             paid in regular bi- weekly installments for sixty
                             (60) days following the date of termination;

                      B.     All other forms of compensation payable to the
                             Executive pursuant to Section 3 shall terminate on
                             the date of termination, except that as
                             expeditiously as possible following the
                             termination, the Company shall pay or reimburse the
                             Executive for all expenses incurred prior to the
                             termination pursuant to Section 3.3, together with
                             any bonuses earned by and previously awarded to the
                             Executive pursuant to Section 3.2 prior to the date
                             of termination.



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               (ii)   Pursuant to Section 4.2(a)(ii), Section 2.3, Section 4.1
                      and Section 4.5:

                      A.     The salary and company sponsored benefits payable
                             to the Executive pursuant to Section 3.1 shall be
                             paid for the period commencing on the date of the
                             termination, and continuing for:

                                    Twelve (12) months following the date of
                                    termination.

                      B.     All other forms of compensation payable to the
                             Executive pursuant to Section 3 shall terminate,
                             except that as expeditiously as possible after the
                             termination the Company shall pay or reimburse the
                             Executive for all expenses incurred prior to the
                             termination pursuant to Section 3.3, together with
                             any bonuses earned by and previously awarded to the
                             Executive pursuant to Section 3.2, prior to the
                             date of termination.

4.3     TERMINATION BY EXECUTIVE

        The Executive may terminate this Agreement by giving sixty (60) days
        prior written notice to the Company. Upon termination of this Agreement
        by the Executive pursuant to this Section:

        (a)    The salary payable to the Executive pursuant to Section 3.1 shall
               be prorated to the date of the termination;

        (b)    Except for the severance package made available to the Executive
               pursuant to Section 2.3 and Section 4.2 (b) (ii), all other forms
               of compensation payable to the Executive pursuant to Section 3
               shall terminate on the date of the termination. As expeditiously
               as possible after termination of the Executive's employment, the
               Company shall pay or reimburse the Executive for all expenses
               incurred prior to the termination pursuant to Section 3.3.

        (c)    Executive shall utilize his best efforts to continue to perform
               all duties assigned by the Company in the manner stated in
               paragraph 2.1 hereof, prior to the date of termination.

4.4     TERMINATION UPON DEATH

        This Agreement shall terminate immediately upon the Executive's death.
        In the event of the Executive's death:



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        (a)    The Company shall pay to the Executive's estate the salary
               otherwise payable to the Executive pursuant to Section 3.1
               through the last day of the calendar month in which the
               Executive's death occurs and for a period of sixty (60) days
               thereafter.

        (b)    As expeditiously as possible after the Executive's death the
               Company shall pay or reimburse the Executive's estate for all
               expenses incurred pursuant to Sections 3.3 prior to such death,
               together with any bonuses earned by and awarded to the Executive
               pursuant to Section 3.2, prior to the date of such death.

4.5     CHANGE IN CONTROL

        If at any time during the term of this Agreement a Change in Control (as
        defined below) of the Company occurs, then, as to such Change in
        Control, the Company will utilize its best efforts to make appropriate
        provisions to preserve the rights and interests of the Executive
        pursuant to this Agreement. Failure of the Company to preserve such
        rights and interests of the Executive will, at the Executives option, be
        deemed a termination pursuant to Section 4.2 (a) (ii), and will be
        subject to the severance compensation provisions related to termination
        under that Section. For purposes of this Agreement, a "Change in
        Control" shall mean the occurrence of any of the following events:

        (a)    The approval by the shareholders of BMT of:

               (1)    any consolidation, merger or plan of share exchange
                      involving BMT (a "Merger") as a result of which the
                      holders of outstanding securities of BMT ordinarily having
                      the right to vote for the election of directors ("Voting
                      Securities") immediately prior to the Merger do not
                      continue to hold at least 50% of the combined voting power
                      of the outstanding Voting Securities of the surviving or
                      continuing corporation immediately after the Merger,
                      disregarding any Voting Securities issued or retained by
                      such holders in respect of securities of any other party
                      to the Merger;

               (2)    any sale, lease, exchange or other transfer (in one
                      transaction or a series of related transactions) of all,
                      or substantially all, the assets of BMT; or

               (3)    the adoption of any plan or proposal for the liquidation
                      or dissolution of BMT; or



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        (b)    Any "person" or "group" (within the meaning of Sections 13(d) and
               14(d)(2) of the Securities Exchange Act of 1934, as amended (the
               "Act")) shall, as a result of a tender or exchange offer, open
               market purchases or privately negotiated purchases from anyone
               other than BMT, have become the beneficial owner (within the
               meaning of Rule 13d-3 under the Act), directly or indirectly, of
               Voting Securities representing fifty percent (50%) or more of the
               combined voting power of the then outstanding Voting Securities.

4.6     ACTS UPON TERMINATION

        Upon termination of Executive's employment with the Company, all
        computers, equipment, documents, records, notebooks, and similar
        repositories of or containing Confidential Information, including copies
        thereof, then in the Executive's possession, whether prepared by himself
        or others will be delivered to the Company within thirty (30) days of
        such termination. The obligations of the Executive in Sections 6.1 and
        6.2 of this Agreement shall survive any termination of the Executive.


SECTION 5 - STOCK

5.1     GRANT OF STOCK OPTIONS

        As soon as possible following the execution of the Original Agreement,
        the Executive and the Company executed an Incentive Stock Option
        Agreement granting the Executive the following:

               150,000 options to purchase shares of BMT at a strike price equal
               to the fair market value of the Company's stock on the date of
               grant. These options vest as follows: 33.3% (50,000) on each of
               the Executive's first three annual anniversaries of employment
               with the Company, provided he remains employed by the Company
               during each year. All options granted will be subject to the same
               terms and conditions as provided in the Company's incentive stock
               program.

               The Executive will also receive an additional grant of 50,000
               options to purchase shares of BMT on the first anniversary of his
               employment by the Company; provided, however, that if prior to
               such first anniversary, a Change in Control occurs or the Company
               publicly announces that it has entered into an agreement or
               letter of intent for a transaction that will constitute a Change
               in Control if completed, the additional options shall be
               immediately granted with a strike price equal to the closing
               price of the Company's stock on the trading day preceding such
               Change in Control or announcement. These options vest as follows:
               33.3% on each of the



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               Executive's next three annual anniversaries of employment with
               the Company, provided he remains employed by the Company during
               each year. All options granted will be subject to the terms and
               conditions described in the Company's incentive stock program.


        The Stock Option Agreements related to such options will provide that,
        in the event of (A) a Change in Control, (B) termination of employment
        pursuant to Section 4.2 (a) (ii) (including deemed termination pursuant
        to such section pursuant to Section 4.1, or (C) the Executive's having
        opted to receive a severance package in lieu of relocating pursuant to
        Section 2.3, all stock options which have been awarded to the Executive,
        but are not yet vested, will vest immediately.

5.2     REGISTRATION

        It is understood that BMT is a reporting company within the requirements
        of the Securities and Exchange Commission ("SEC") and has elected to
        register the options granted hereunder with the SEC.


SECTION 6 - MISCELLANEOUS

6.1     DISCLOSURE OF INFORMATION AND EMPLOYEE RESTRICTIONS

        Executive agrees to the following:

        a.     Executive agrees that he shall not, during his employment, either
               as an individual or as part of an organization, throughout North
               America or Europe, compete with the Company or render services
               directly or indirectly, to any conflicting organization or
               himself establish or acquire any interest, directly or
               indirectly, in a conflicting organization, nor will he assist any
               other person or entity to do so;

        b.     Executive will not during his employment solicit or sell to any
               of the Company's present or future customers, a conflicting
               product or service nor will he assist any other person or entity
               to do so;

        c.     Except as required in his duties to the Company, the Executive
               will never, during or after his employment, directly or
               indirectly use, disseminate, disclose, lecture upon, or publish
               any Confidential Information without Company's written consent.

        In the event this Agreement is terminated, for whatever reason,
        Executive agrees that he shall not, for two years following the date of
        termination:



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        a.     Either as an individual or as part of an organization, throughout
               Canada or the United States, compete with the Company or render
               services directly or indirectly, to any conflicting organization
               or himself establish or acquire any interest, directly or
               indirectly, in a conflicting organization, nor will he assist any
               other person or entity to do so; and

        b.     He will not employ, without the consent of the Company, directly
               or indirectly, any past or present employees of the Company, nor
               will he assist any other person or entity to do so; and

6.2     ARBITRATION AND JURISDICTION

        As a matter of operating practice, Bioject expects to resolve
        disagreements or conflicts by mutual negotiation in good faith. Subject
        to the remedies stated in Section 6.1, any controversy or claim arising
        out of or relating to this Agreement or any breach of this Agreement
        shall be finally settled by arbitration in accordance with the
        provisions of the Commercial Arbitration Rules of the American
        Arbitration Association. Such arbitration shall be conducted in
        Portland, Oregon by one arbitrator, with one discovery allowed by each
        party to this agreement. This agreement is entered into and shall be
        interpreted and enforced according to the laws of the State of Oregon;
        both parties consent to personal jurisdiction for that purpose.

6.3     NOTICES

        Any notice or other communication required or permitted to be given
        under this Agreement shall be in writing, given by personal delivery or
        sent by first class mail, postage prepaid, addressed as follows:

        To the Executive:           John Gandolfo
                                    62 Terrace Road
                                    Wayne, NJ 07470

        To the Company:             Secretary to the Board of Directors
                                    Bioject Medical Technologies Inc.
                                    7620 S.W. Bridgeport Road
                                    Portland, Oregon 97224

        Either party, by notice as provided above, may change the address to
        which subsequent notice shall be given. Any notice given herein shall be
        deemed received seven (7) days after posting in a post office box;
        PROVIDED, HOWEVER, that if there should be a postal strike, slow-down or
        other labor dispute which may effect the delivery of such notice through
        the mail between the



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        time of mailing and the actual receipt of the notice, then such notice
        shall be effective only if actually delivered.

6.4     ASSIGNMENT

        This Agreement is a personal employment agreement addressing services,
        compensation and benefits. It may not be assigned by either party
        without the prior written consent of the other party; however, during
        his employment term, the Executive may by written assignment assign all
        or any portion of the compensation or benefits to which he is entitled
        under Section 3 to any member of his immediate family or to any
        corporation, partnership or other business entity controlled by the
        Executive. Except as required by law, no right to receive payments under
        this Agreement shall be subject to anticipation, commutation,
        alienation, sale, assignment, encumbrance, charge, pledge or
        hypothecation or to execution, attachment, levy or similar process or
        assignment by operation of law and any attempt, voluntary or
        involuntary, to affect any such action shall be null, void, and of no
        effect.

6.5     INDEMNITY

        The Executive, his heirs, executors, administrators, estate and effects,
        shall at all times be indemnified and held harmless by the Company from
        and against:

        a.     All costs, charges and expenses whatsoever sustained or incurred
               as a result of any action, suit or proceeding, whether civil,
               criminal, administrative, or investigative, that is brought,
               commenced or prosecuted for or in respect of any act, deed,
               matter or thing whatsoever made, done or permitted in or about
               the execution of the Executive's duties; and

        b.     All other costs, charges and expenses sustained or incurred in or
               about or in relation to the affairs of the Company;

        Except such costs, charges or expenses as are occasioned by the criminal
        act, willful neglect or default of duties by the Executive. At all such
        times that the Company obtains and maintains directors and officers
        errors and omissions insurance, Executive shall be a beneficiary of such
        policy(ies).

6.6     AMENDMENT AND SEVERABILITY

        This Agreement may not be amended or otherwise modified except by an
        instrument in writing signed by both parties. All agreements and
        covenants herein contained in this Agreement are deemed to be severable,
        and in the event any portion of this Agreement is declared to be
        invalid, this Agreement shall be interpreted as if such invalid portion
        or covenant were severed and not contained



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        herein, with all other terms of this Agreement remaining valid and
        binding on the parties hereto.

6.7     ENTIRE AGREEMENT

        This agreement specifies all of the terms and conditions of an
        employment agreement entered into between the parties on June 25, 2001,
        which terms and conditions have been negotiated prior to that date.

6.8     BINDING EFFECT

        This Agreement shall be binding upon and inure to the benefit of the
        parties hereto and their respective heirs, personal representatives,
        successors and assigns, except as otherwise expressly provided herein.

6.9     REVIEW OF LEGAL COUNSEL

        The Executive acknowledges that he has had adequate time and opportunity
        to consult with legal counsel of his own selection prior to entering
        into and executing this Agreement.

IN WITNESS WHEREOF the parties have executed this Agreement effective on the day
and year first written above.



-----------------------------------
           John Gandolfo


BIOJECT MEDICAL TECHNOLOGIES INC.

By:
   --------------------------------
Name:
     ------------------------------
Title:
      -----------------------------


BIOJECT INC.

By:
   --------------------------------
Name:
     ------------------------------
Title:
      -----------------------------



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