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EXHIBIT 10.31
AMENDMENT TO EMPLOYMENT AGREEMENT
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This AMENDMENT TO EMPLOYMENT AGREEMENT (the "Second Amendment") made as
of January 1, 1997, between ARIAD Pharmaceuticals, Inc., a Delaware corporation
(the "Company"), and Xxxxxxx X. Xxxxx III (the "Employee").
The Company and the Employee have entered into an Employment Agreement
dated as of January 1, 1992 and amended as of March 2, 1994 (the "Agreement"),
and the parties hereto desire to further amend certain provisions of the
Agreement.
NOW, THEREFORE, in consideration of the premises set forth herein and
for other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties hereto agree to further amend the Agreement as
follows:
I. EMPLOYMENT, DUTIES AND ACCEPTANCE. The second sentence of
Section 1.1 is hereby amended to read as follows:
"The Employee's title shall be designated by the Chief Executive
Officer and initially shall be Executive Vice President and Chief
Operating Officer."
II. TERM OF EMPLOYMENT. The first sentence of Section 2 is hereby
amended to read as follows:
"The term of the Employee's employment under the Agreement is hereby extended to
December 31, 2000 (the "Term"), unless sooner terminated pursuant to Section 4
or 5 of this Agreement; PROVIDED, however, that this Agreement shall
automatically be renewed for successive one-year terms (the Term and, if the
period of employment is so renewed, such additional period(s) of employment are
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collectively referred to herein as the "Term") unless terminated by written
notice given by either party to the other at least 90 days prior to the end of
the applicable Term."
III. COMPENSATION. Section 3.1 is hereby replaced and amended in its
entirety as follows:
"3.1. As full compensation for all services to be rendered
pursuant to this Agreement, the Company agrees to pay the Employee,
during the Term, a salary at the fixed rate of $215,000 per annum during
the first year of the Term and increased each year thereafter, by
amounts, if any, to be determined by the Board of Directors of the
Company (the "Board") in its sole discretion, payable in equal
semi-monthly installments, less such deductions or amounts to be
withheld as shall be required by applicable law and regulations."
IV. TERMINATION BY THE EMPLOYEE. Section 5 is hereby replaced and
amended in its entirety as follows:
"5.1. The Employee may terminate this Agreement, if any one or
more of the following shall occur:
(a) a material breach of the terms of this Agreement by the
Company and such breach continues for 30 days after the Employee gives
the Company written notice of such breach;
(b) the Company shall make a general assignment for benefit
of creditors; or any proceeding shall be instituted by the Company
seeking to adjudicate it as bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief, or composition of it or its debts under law relating
to bankruptcy, insolvency or reorganization or relief of debtors, or
seeking entry of an order for relief of the appointment of a receiver,
trustee, or other similar official for it or for any substantial part of
its property or the Company shall take any corporate action to authorize
any of the actions set forth above in this subsection 5.1(b);
(c) an involuntary petition shall be filed or an action or
proceeding otherwise commenced against the Company seeking
reorganization, arrangement or readjustment of the Company's debts or
for any other relief under the Federal Bankruptcy Code, as amended, or
under any other bankruptcy or insolvency act or law, state or federal,
now or hereafter existing and remain undismissed or unstayed for a
period of 30 days;
(d) a receiver, assignee, liquidator, trustee or similar
officer for the Company or for all or any part of its property shall be
appointed involuntarily, or
(e) a Change in Control as defined in Section 14."
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X. XXXXXXXXX. Section 6 is hereby replaced and amended in its
entirety as follows:
"6. If (i) the Company terminates this Agreement without Cause
or (ii) the Employee terminates this Agreement pursuant to Section
5.1(a), then: (1) except in the case of death or disability, the Company
shall continue to pay Employee his current salary for the remaining
period of the applicable Term; (2) all options granted pursuant to this
Agreement that would have vested during the Term shall vest immediately
prior to such termination; (3) the Company shall continue to provide all
benefits subject to COBRA at its expense for up to one year.
In the event of a consummation of a Change in Control of the
Company, and if the Employee gives notice of termination within 90 days
after such occurrence, then (i) all stock, stock options, stock awards
and similar equity rights granted to the Employee shall immediately vest
and remain fully exercisable through their original term with all
rights; and (ii) the Company shall continue to pay Employee his current
salary for the shorter of (a) six months, or (b) the remaining period of
the applicable Term."
VI. DEFINITIONS. The definition of the Company's "Field of Interest"
in Section 14(b) of the Agreement is hereby amended to read as follows:
"The Company's 'Field of Interest' is: the discovery,
development and commercialization of pharmaceutical products based on
(a) intervention in signal transduction pathways; (b) gene and cell
therapy; and (c) functional genomics. The Company's Field of Interest
may be changed at the sole discretion of the Company from time to time."
The definition of "Change in Control" shall be added as Section
14(e) of the Agreement as follows:
" 'Change in Control' means the occurrence of any of the
following events (without the consent of the Employee):
(i) Any corporation, person or other entity makes a tender or
exchange offer for shares of the Company's Common Stock pursuant to
which such corporation, person or other entity acquires more than 50% of
the issued and outstanding shares of the Company's Common Stock;
(ii) The stockholders of the Company approve a definitive
agreement to merge or consolidate the Company with or into another
corporation or to sell or otherwise dispose of all or substantially all
of the Company's assets; or
(iii) Any person within the meaning of Section 3 (a) (9) or
Section 13 (d) of the Securities Exchange Act of 1934 acquires more than
50% of the combined voting power of Company's issued and outstanding
voting securities entitled to vote in the election of the Board."
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VII. This Amendment shall be governed by and construed and enforced
in accordance with the laws of the Commonwealth of Massachusetts applicable to
agreements made and to be performed entirely in Massachusetts.
VIII. Except as modified by this Second Amendment, the Agreement
remains in full force and effect and unchanged.
IN WITNESS WHEREOF, the parties have executed this Second
Amendment as of the date first written above.
ARIAD PHARMACEUTICALS, INC.
By: /s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx, M.D.
Chairman and Chief Executive Officer
EMPLOYEE
/s/ Xxxxxxx X. Xxxxx III
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Xxxxxxx X. Xxxxx III
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