SEPARATION AGREEMENT
EXHIBIT 99.3
This Agreement is entered into as of July 14, 2006, by and between Aastrom Biosciences, Inc.,
a Michigan corporation (“Employer”) and Xxxxx X. Cour (“Employee”), with respect to the following
facts:
A. Employee is currently employed by Employer pursuant to that certain Amended and Restated
Employment Agreement, dated as of January 12, 2006 (the “Employment Agreement”). Terms which are
defined in the Employment Agreement shall have the same defined meaning when used in this
Separation Agreement.
B. Attached as Exhibit A to the Employment Agreement, and to this Separation Agreement, is a form
of “Release Agreement.”
WHEREFORE, the parties hereby mutually agree as follows:
1. Termination of Employment. Employee and Employer hereby mutually agree to a termination
of Employee’s employment with Employer, effective as of 7:00 p.m. on Friday, July 14, 2006, which
termination is by Employer without “Cause.”
2. Termination Payments.
2.1 Pursuant to Section 6.1 of the Employment Agreement, Employer will pay to Employee his
base salary through July 14, 2006.
2.2 In accordance with Employer’s customary practices and policies, Employer will pay to
Employee for any accrued and unused vacation leave time, which the parties mutually acknowledge and
agree aggregates to $24,454.26.
2.3 Pursuant to Section 6.2.1 of the Employment Agreement, Employer will pay to Employee
severance payments equal to nine months of Employee’s now current salary rate (i.e., $11,354.17 per
month), less customary payroll deductions. This severance payment will be paid in equal
installments over the nine months after July 14, 2006, in accordance with Employer’s normal payroll
periods.
2.4 As an additional benefit, which is not specified in the Employment Agreement, Employer
will reimburse Employee for continued medical, dental and vision insurance coverage under COBRA for
the period July 14, 2006 through April 14, 2007.
2.5 As an additional benefit, which is not specified in the Employment Agreement, Employer
will accelerate the vesting of Employee’s currently existing stock options and restricted stock for
the nine months period from July 14, 2006 through April 14, 2007.
2.6 As an additional benefit, which is not specified in the Employment Agreement, Employer
will give consideration for some discretionary bonus compensation for Employee applicable to the
fiscal year ended June 30, 2006, when the Company considers employee bonus
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matters for all
employees in September 2006. It is understood that such possible bonus remains solely in the
discretion of the Company and its Board of Directors, with there being no promise or assurance for
any such extra bonus compensation.
3. Release. Pursuant to Section 6.4 of the Employment Agreement, Employer’s obligation to
pay, and Employee’s entitlement to receive, the payments and benefits as specified above (other
than Sections 2.1 and 2.2) is conditioned upon Employee signing the release attached hereto as
Exhibit A. Employee hereby approves and agrees to all of the terms and provisions of said Release
Agreement, and Employee hereby signs and delivers said Release Agreement to Employer. As set forth
in Section 8 of the Release Agreement, and as is contemplated by applicable federal law, Employee
may revoke this Agreement and the Release Agreement during the seven day Revocation Period as
defined in the Release Agreement, so this Agreement does not become effective until the Revocation
Period has expired without a revocation. Accordingly, the extra payments and benefits will not
become payable and will be delayed until the expiration of the Revocation Period, and will become
obligations of Employer and entitlements of Employee only if Employee does not elect to terminate
this Agreement and the Release Agreement.
4. Survival. In addition to the terms set forth in this Separation Agreement and in the
Release Agreement, Employee acknowledges and agrees that his obligations under the Employee
Proprietary Information and Invention Agreement which he has previously signed remain applicable,
and that he will continue to honor the terms of such agreement. Notwithstanding the termination of
employment and the Employment Agreement, the parties mutually acknowledge and agree that the
following provisions of the Employment Agreement shall survive the termination of the Employment
Agreement, and shall remain applicable to the extent reasonably appropriate:
Section 6: Payments Upon Termination.
Section 7: General Provisions.
IN WITNESS WHEREOF, the parties have executed this Separation Agreement as of the date set forth
above.
| Employer: | ||||||
| Aastrom Biosciences, Inc. | ||||||
| By: | /s/ R. Xxxxxxx Xxxxxxxxx | |||||
| Employee: | ||||||
| /s/ Xxxxx X. Cour | ||||||
| Xxxxx X. Cour | ||||||
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EXHIBIT A
RELEASE AGREEMENT
RELEASE AGREEMENT
THIS AGREEMENT (“Agreement”) is made by and between Xxxxx X. Cour (“Executive”) and Aastrom
Biosciences, Inc. (the “Company”).
RECITALS
A. Executive’s employment with Company terminates effective July 14, 2006, as of 7:00 p.m.
B. Executive has been given the opportunity to review this Agreement, to consult with legal
counsel, and to ascertain his rights and remedies.
C. Executive and Company, without any admission of liability, desire to settle with finality,
compromise, dispose of, and release any and all claims and demands asserted or which could be
asserted arising out of Executive’s employment at and separation from Company.
In consideration of the foregoing and of the promises and mutual covenants contained herein,
it is hereby agreed between Executive and Company as follows:
AGREEMENT
1. In exchange for the good and valuable consideration set forth in that certain (i)
Employment Agreement, made as of January 12, 2006, between the Company and Executive (the
“Employment Agreement”), and (ii) Separation Agreement, dated as of July , 2006, between the
Company and Executive, Executive hereby releases, waives and discharges any and all manner of
action, causes of action, claims, rights, charges, suits, damages, debts, demands, obligations,
attorneys fees, and any and all other liabilities or claims of whatsoever nature, whether in law or
in equity, known or unknown, including, but not limited to, age discrimination under The Age
Discrimination In Employment Act of 1967 (as amended), employment discrimination prohibited by
other federal, state or local laws, and any other claims, which Executive has claimed or may claim
or could claim in any local, state or federal or other forum, against Company, its directors,
officers, employees, agents, attorneys, successors and assigns as a result of or relating to
Executive’s employment at and separation from Company and as an officer of Company as a result of
any acts or omissions by Company or any of its directors, officers, employees, agents, attorneys,
successors or assigns (“Covered Acts or Omissions”) which occurred prior to the date of this
Agreement; excluding only (i) those to compel the payment of amounts due to Executive as provided
in the Employment Agreement, (ii) enforcement of any rights of Executive under any stock option
agreements with the Company or (iii) those for indemnification under the Company’s articles of
incorporation, bylaws or applicable law by reason of his service as an officer or director of the
Company.
2. Executive agrees to immediately return to Company all property, assets, manuals, materials,
information, notes, reports, agreements, memoranda, customer lists, formulae, data, know-how,
inventions, trade secrets, processes, techniques, and all other assets, materials and information
of any kind or nature, belonging or pertaining to Company (“Company Information and Property”),
including, but not limited to, computer programs and diskettes or other media for
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electronic
storage of information containing Company Information and Property, in Executive’s possession, and
Executive shall not retain copies of any such Company Information and Property. Executive further
agrees that from and after the date hereof he will not remove from Company’s offices any Company
Information and Property, nor retain possession or copies of any Company Information and Property.
Notwithstanding the foregoing, Executive may retain (and the Company hereby assigns and
transfers to Executive) the existing lap top computer bearing asset tag A001197, together with
attached peripheral equipment and licenses to the installed operating system and software which
Executive has been using; and Executive hereby agrees to maintain the confidentiality of and to not
use any of the Company’s information which is on or in the computer, all in accordance with the
Employee Proprietary Information and Invention Agreement which was signed previously by Executive.
Further, Company hereby assigns and transfers to Executive his cell phone, and Company agrees to
use reasonable efforts to transfer the currently assigned telephone number to Executive’s personal
account at the start of the next billing cycle.
3. Executive agrees that he shall never make any statement that negatively affects the
goodwill or good reputation of the Company, or any officer or director of Company, except as
required by law, and except that such statements may be made to members of the Board of Directors
of the Company.
4. Executive covenants and agrees that he shall never commence or prosecute, or knowingly
encourage, promote, assist or participate in any way, except as required by law, in the
commencement or prosecution, of any claim, demand, action, cause of action or suit of any nature
whatsoever against Company or any officer, director, employee or agent of Company (“Covered
Litigation”) that is based upon any claim, demand, action, cause of action or suit released
pursuant to this Agreement or involving or based upon the Covered Acts and Omissions.
5. Executive further agrees that he has read this Agreement carefully and understands all of
its terms.
6. Executive understands and agrees that he was advised to consult with an attorney and did so
prior to executing this Agreement.
7. Executive understands and agrees that he has been given twenty-one (21) days within which
to consider this Agreement.
8. Executive understands and agrees that he may revoke this Agreement for a period of seven
(7) calendar days following the execution of this Agreement (the “Revocation Period”). This
Agreement is not effective until this revocation period has expired. Executive understands that
any revocation, to be effective, must be in writing and either (a) postmarked within seven (7) days
of execution of this Agreement and addressed to Aastrom Biosciences, Inc., 00 Xxxxx Xxxxx Xxxxx,
Xxx Xxxxx, Xxxxxxxx 00000 or (b) hand delivered within seven (7) days of execution of this
Agreement to Aastrom Biosciences, Inc., 00 Xxxxx Xxxxx Xxxxx, Xxx Xxxxx, Xxxxxxxx 00000.
Executive understands that if revocation is made by mail, mailing by certified mail, return receipt
requested, is recommended to show proof of mailing.
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9. In agreeing to sign this Agreement and the Separation Agreement, Executive is doing so
completely voluntarily and of his own free-will and without any encouragement or pressure from
Company; and Executive agrees that in doing so he has not relied on any oral statements or
explanations made by Company or its representatives.
10. Both parties agree not to disclose the terms of this Agreement to any third party, except
as is required by law, or as is necessary for purposes of securing counsel from either parties’
attorneys or accountants.
11. This Agreement shall not be construed as an admission of wrongdoing by either party.
12. This Agreement (together with the Separation Agreement) contains the entire agreement
between Executive and Company regarding the matters set forth herein. Any modification of this
Agreement must be made in writing and signed by Executive and each of the entities constituting the
Company.
13. This Agreement shall be governed by and construed in accordance with the domestic laws of
the State of Michigan, without giving effect to any choice of law or conflict of law provision or
rule (whether of the State of Michigan or any other jurisdiction) that would cause the application
of the laws of any jurisdiction other than the State of Michigan.
14. In the event any provision of this Agreement or portion thereof is found to be wholly or
partially invalid, illegal or unenforceable in any judicial proceeding, then such provision shall
be deemed to be modified or restricted to the extent and in the manner necessary to render the same
valid and enforceable, or shall be deemed excised from this Agreement, as the case may require, and
this Agreement shall be construed and enforced to the maximum extent permitted by law, as if such
provision had been originally incorporated herein as so modified or restricted, or as if such
provision had not been originally incorporated herein, as the case may be.
15. If there is a breach or threatened breach of the provisions of this Agreement, Company
may, in addition to other available rights and remedies, apply to any court of competent
jurisdiction for specific performance and/or injunctive relief in order to enforce, or prevent any
violation of, any of the provisions of this Agreement.
16. In the event that Executive violates the terms of this Agreement, in addition to other
available rights and remedies, the Company shall be released of all of its remaining obligations
under the Severance Agreement.
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The parties hereto have entered into this Agreement as of July , 2006.
| AASTROM BIOSCIENCES, INC. | ||||||
| By: | ||||||
| R. Xxxxxxx Xxxxxxxxx, Ph.D. Chairman and Chief Executive Officer |
||||||
| EXECUTIVE | ||||||
| Xxxxx X. Cour | ||||||
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