Exhibit 10.12
SYNTApharma
April 8, 2004
Xx. Xxxxxxxxx Xxx
[ADDRESS]
Dear Xx. Xxx:
The purpose of this letter agreement is to set forth our mutual
understanding and agreement with respect to your resignation from employment
with Synta Pharmaceuticals Corp. (the "Company"). In consideration of the mutual
covenants set forth herein, the receipt and sufficiency of which you
acknowledge, we have agreed as follows:
1. RESIGNATION FROM EMPLOYMENT. Your resignation from employment shall be
effective as of the close of business, Thursday, January 1, 2004 (your
"resignation date"), and you shall have relinquished as of that date any
and all positions that you have held with the Company, including but not
limited to President and Chief Operating Officer of the Company. You shall
not be considered an employee of the Company for any purpose after that
date and shall have no authority to act on behalf of the Company.
2. TERMINAL PAY. You agree that you have received all compensation to which
you are entitled in connection with your employment through your
resignation date. You agree to make no claims for further compensation from
the Company of any type, including bonus payments, commission payments, and
vacation pay. You acknowledge that, except to the extent provided herein,
the Company is under no obligation to provide you with the consideration
described below, including, but not limited to, the severance payment.
3. SEVERANCE PAYMENT. The Company shall pay you a lump sum amount of
$200,000.00 (less all applicable federal, state or local tax withholding,
F.I.C.A., and any other applicable payroll deductions), subject to the
Company's receipt of this letter agreement and General Release signed by
you and the expiration of the seven (7) day revocation period contained in
paragraph 16 hereof. The Company shall also pay you monthly installments
totaling $250,000.00 commencing in March 2004 for eighteen (18) months
consisting of seventeen (17) payments in the amount of $13,888.89 and the
final payment in the amount of $13,888.87. In the event that your death
shall precede the Company's full payment of any of the amounts set forth in
this Section 3. then any unpaid amounts under this section shall continue
to be paid upon the schedule set forth above to your surviving spouse or,
if there is no surviving spouse, to your estate, unless the Company
receives a written instrument signed by you designating a beneficiary and
providing the beneficiary's social security number (if any) and home
address.
4. STOCK OPTIONS. You acknowledge that, pursuant to Incentive Stock Option
Agreement No. 004 dated December 13, 2002 ("ISOA No. 004") and Incentive
Stock Option
Agreement No. 099 dated June 17, 2003 ("ISOA No. 099"), your right to
exercise ISOA No. 004 for an aggregate of 812,500 shares (the "Original
Vested Shares") of the Company's common stock, $.0001 par value per share
(the "Common Stock"), vested as of your resignation date. You agree that as
of your resignation date and subject to the approval of the Compensation
Committee of the Company's Board of Directors:
(i) ISOA No. 099 shall terminate; and
(ii) the terms of ISOA No. 004 shall be amended as follows:
a. All references to "1,500,000 shares" on the face of ISOA No.
004 will be deleted and replaced with "1,000,000 shares";
b. Section 3 of ISOA No. 004 will be deleted in its entirety
and replaced with the following:
"3. VESTING SCHEDULE. The Option shall be exercisable
with respect to 1,000,000 of the Stock Rights Shares
immediately."
c. Section 4 of the ISOA No. 004 will be deleted in its
entirety and replaced with the following:
"4. TERM OF OPTION. Subject to earlier termination as
provided in this Agreement or the Plan, the Option shall
expire on the tenth anniversary of the Grant Date."
(iii) upon the effective date of the amendments set forth in paragraph
4(ii) above, ISOA No. 004 shall cease to be treated as an
incentive stock option for purposes of the Company's 2001 Stock
Option Plan and for tax purposes pursuant to Section 422 of the
Internal Revenue Code of 1986, as amended.
(iv) the first aggregate of 187,500 shares you exercise in connection
with ISOA No. 004, as amended, shall not consist of any Original
Vested Shares.
A copy of the First Amendment To Incentive Stock Option Agreement
No. 004 is attached hereto as Exhibit A.
5. MEDICAL INSURANCE CONTINUATION. At your option, you may continue to be
covered under the Company's group medical insurance plan for up to eighteen
(18) months after your resignation date, subject to the terms and
conditions provided for in the Consolidated Omnibus Budget Reconciliation
Act of 1985, as amended ("COBRA"). The Company shall, at your option, pay
the entire cost of your group medical insurance premiums during the entire
eighteen (18) months of your COBRA continuation period or until such
earlier time as you become eligible for alternate medical insurance
coverage from a new employer provided you have timely and properly elected
COBRA coverage in accordance with the Company's COBRA election procedures,
notice of which shall be
sent to you under separate cover. You agree promptly to notify the Company
in writing if and when you become eligible for alternate medical coverage
during this eighteen (18) month period.
6. TRANSFER OF RESPONSIBILITIES. You shall cooperate fully with the Company
and its personnel to provide an orderly transfer of your duties and
responsibilities. This cooperation includes but is not limited to timely
compliance with all reasonable requests for information.
7. CONFIDENTIALITY. You agree, to the extent permitted by law, to keep
confidential and not to disclose the existence or terms of this letter
agreement or sums paid under this letter agreement to anyone or to any
organization, except you may disclose such information to your spouse,
attorney, and financial advisor, provided you have received in advance
their promises to maintain this information in strict confidence; provided,
however, that nothing in this Agreement will prevent you from cooperating
with or participating in any proceeding before the EEOC, the MCAD or any
other federal, state or local agency or entity. You also agree that you
will not, without the Company's prior written consent, reveal or disclose
to any person or entity outside of the Company or use for your own benefit
or for the benefit of any other person or entity, any fact or information
which was disclosed to or developed by you during the course of your
employment with the Company, and is not generally available to the public,
including but not limited to information and facts concerning the business
plans, customers, future customers, suppliers, licensors, licensees,
partners, investors, affiliates, training methods and materials, financial
information, sales prospects, client lists, Inventions (as defined in
paragraph 11), or any other scientific, technical, trade or business secret
or confidential or proprietary information of the Company ("Confidential
Information").
8. RETURN OF PROPERTY. You acknowledge that you have returned to the Company
all property of the Company that is in your possession or under your
control, including, without limitation, the laptop computer, printer, other
computer accessories, pager, corporate credit card, telephone card, Company
keys, and any and all written or digital-based files, documents,
communications with the Company's directors, officers, employees and
consultants, and other information with respect to the Company's
management, business operations or customers, including all files,
documents, or other information containing Confidential Information. You
further acknowledge and agree that payment of your final severance payment
at the end of the eighteen (18) month severance period will be conditioned
upon your return of the company-issued automobile to the Company, in good
condition, normal wear and tear excluded, by July 1, 2005. It is understood
that you may continue to use the company-issued automobile for the duration
of the eighteen (18) month lease period.
9. COOPERATION IN LITIGATION. At the Company's request, you agree to assist,
consult with, and cooperate with the Company in any litigation or
administrative proceeding or inquiry that involves the Company, subject to
reimbursement for your reasonable out of pocket expenses, such as travel,
meals, or lodging.
10. NON-DISPARAGEMENT. You further agree, to the extent permitted by law, that
you will not, at any time after the date hereof, make any remarks or
comments, orally or in writing, to the Company's shareholders, officers,
directors, employees, agents, or others, which or who have, or could
reasonably be anticipated to have, business dealings with the Company,
which remarks or comments reasonably could be construed to be derogatory or
disparaging to the Company or any of its shareholders, officers, directors,
employees, attorneys or agents, or which reasonably could be anticipated to
be damaging or injurious to the Company's reputation or good will or to the
reputation or good will of any person associated with the Company. The
Company agrees, to the extent permitted by law, that neither the Chief
Executive Officer or Scientific Founder will, at any time after the date
hereof, make any remarks or comments, orally or in writing, to third
parties which remarks or comments reasonably could be construed to be
derogatory or disparaging to you which reasonably could be anticipated to
be damaging or injurious to your reputation or good will.
11. OWNERSHIP OF INVENTIONS AND DEVELOPMENTS. You agree that all ideas,
discoveries, creations, manuscripts and properties, innovations,
improvements, know-how, inventions, designs, developments, apparatus,
techniques, algorithms, software, mask works, methods, and formulae which
you worked upon, conceived, made, developed or improved, during your
employment by the Company whether or not reduced to practice and whether or
not patentable, copyrightable, or otherwise protectable, alone or in
conjunction with any other party, and whether or not at the request or upon
the suggestion of the Company (all of the foregoing being hereinafter
referred to as the "Inventions"), are the sole and exclusive property of
the Company. The Company is and will be the sole owner of all patents,
copyrights and other proprietary rights in and with respect to such
Inventions. To the fullest extent permitted by law, such Inventions will be
deemed works made for hire. You hereby transfer and assign to the Company
any proprietary rights which you may have or acquire in any such Inventions
and you waive any moral rights or other special rights which you may have
or accrue therein. You agree to execute any documents and take any actions
that may be required to effect and confirm such transfer and assignment and
waiver. In the event that the Company is unable for any reason to secure
your signature to any lawful and necessary document required to perfect its
rights in and to any Inventions as set forth in this paragraph 12, you
hereby designate the Company as your agent for, and grant to the Company a
power of attorney with full power of substitution, which power of attorney
shall be deemed coupled with an interest, for the purpose of effecting the
foregoing assignments from you to the Company.
12. NON-SOLICITATION. You agree that you will not, while receiving severance
payments from the Company, directly or indirectly, whether as owner,
partner, shareholder, consultant, agent, employee, co-venturer or
otherwise, engage or participate in the hiring of any Company employees or
consultants or engage or participate in the solicitation of or attempt to
solicit any Company employees or consultants resulting in the termination
of their employment or relationship with the Company or resulting in their
working for any other business, person or company. For purposes of this
Paragraph 12, employees and consultants shall include those who were
employed or had a relationship with the Company during the twelve month
period prior to the resignation date.
13. BREACH OF AGREEMENT. You understand and agree that any material breach of
your obligations under this letter agreement will immediately render the
Company's obligations and agreements hereunder null and void, all payments
pursuant to paragraphs 3 and 5 shall immediately cease, and, to the extent
permitted by law, you shall repay to the Company all sums you have been
paid or sums paid on your behalf pursuant to paragraphs 3 and 5.
14. MUTUAL GENERAL RELEASE. You, for yourself and your heirs, legal
representatives, beneficiaries, assigns and successors in interest, hereby
knowingly and voluntarily release, remise and forever discharge the Company
and its successors, assigns, former or current shareholders, officers,
directors, employees, agents, attorneys and representatives ("Company
Released Parties") whether in their individual or official capacities, from
any and all actions or causes of action, suits, debts, claims, complaints,
contracts, controversies, agreements, promises, damages, claims for
attorneys' fees, costs, interest, punitive damages or reinstatement,
judgments and demands whatsoever, in law or equity, you now have, may have
or ever had, known or unknown from the beginning of the world to this date,
including, without limitation, any claims under the Age Discrimination in
Employment Act, 29 U.S.C. Section 621 ET SEQ.; Title VII of the Civil
Rights Act of 1964, 42 U.S.C. Section 2000e ET SEQ.; the Employee
Retirement Income Security Act of 1974, as amended, 29 U.S.C. Section 1000
ET SEQ.; Massachusetts General Laws, Chapters 149, 151B, 214; the
Massachusetts Civil Rights Act; the Massachusetts Equal Rights Act; the
Americans with Disabilities Act, 42 U.S.C. Section 12101 et seq.; claims
for breach of contract or based on tort; and any other statutory,
regulatory or common law causes of action ("the Released Claims"). The
Company hereby knowingly and voluntarily releases, remises and forever
discharges you from any and all actions or causes of action, suits, debts,
claims, complaints, contracts, controversies, agreements, promises,
damages, claims for attorneys' fees, costs, interest or punitive damages,
judgments and demands whatsoever, in law or equity, the Company now has,
may have or ever had, known or unknown from the beginning of the world to
this date, including, without limitation, claims for breach of contract or
based on tort, and any other statutory, regulatory or common law causes of
action. THE PARTIES HEREBY ACKNOWLEDGE AND UNDERSTAND THAT THIS IS A
GENERAL RELEASE.
15. MUTUAL COVENANT NOT TO SUE. To the extent permitted by law, you
specifically agree not to commence any legal action against any of the
Company Released Parties arising out of or in connection with the Released
Claims. To the extent permitted by law, you expressly agree that if you
commence such an action in violation of this Agreement, you shall indemnify
the Company Released Parties for the full and complete costs of defending
such an action and enforcing this Agreement, including reasonable
attorneys' fees (whether incurred in a third party action or in an action
to enforce this Agreement), court costs, and other related expenses. You
further agree that, to the extent permitted by law, if you commence such an
action despite the provisions of this Agreement, you shall be obligated to
return to the Company the full amount of all sums paid to you, or on your
behalf, pursuant to paragraphs 3 and 5. To the extent permitted by law, the
Company specifically agrees not to commence any legal action against you
arising out of or in connection with the Released Claims. To the extent
permitted by law, the Company
expressly agrees that if the Company commences such an action in violation
of this Agreement, the Company shall indemnify you for the full and
complete costs of defending such an action and enforcing this Agreement,
including reasonable attorneys' fees (whether incurred in a third party
action or in an action to enforce this Agreement), court costs, and other
related expenses.
16. ACKNOWLEDGMENT. You acknowledge and agree that you understand the meaning
of this letter agreement and that you freely and voluntarily enter into it
and the General Release contained herein. You agree that no fact, evidence,
event, or transaction, whether known or unknown, shall affect in any manner
the final and unconditional nature of the agreements and releases set forth
herein. You acknowledge that you have been advised that you have twenty-one
(21) days to consider this General Release and to consult with an attorney
prior to executing it. For a period of seven (7) days after executing this
General Release, you may revoke this General Release by providing written
notice of said revocation to Xx. Xxxx X. Xxxxxxx at the address of the
Company set forth above and this General Release shall not become effective
or enforceable until said seven-day period has expired.
17. MISCELLANEOUS. This letter agreement shall be construed in accordance with
the laws of the Commonwealth of Massachusetts without regard to choice or
conflict of law principles. A waiver of any breach of or failure to comply
fully with any provision of this letter agreement by either party shall not
operate or be construed as a waiver of any subsequent breach thereof or
failure so to comply. If any portion or provision of this letter agreement
shall to any extent be deemed invalid or unenforceable, the remainder of
this letter agreement shall not be affected thereby and each portion and
provision of this letter agreement shall be valid and enforceable to the
fullest extent permitted. To avoid any possible misunderstanding, the
Company intends this letter agreement to be a comprehensive statement of
the terms of your resignation. This letter agreement supersedes any prior
understanding or statement made to you by the Company regarding your
positions with the Company or your arrangements with the Company for the
period after your resignation. For the same reason, any modifications of
the terms set forth in this letter agreement must be in writing and signed
by you and by me on behalf of the Company.
Please indicate your agreement to the terms of this letter agreement by
signing and dating the last page of the enclosed copy of this letter agreement,
and return it to me not later than the close of business on May 12, 2004, which
you acknowledge to be twenty-one (21) days from the date of your receipt of this
letter agreement.
Sincerely,
/s/ XX. XXXX X. XXXXXXX
---------------------------
Xx. Xxxx X. Xxxxxxx
Chief Executive Officer
AGREED TO AND EXECUTED UNDER SEAL THIS 21 day of April, 2004.
/s/ XX. XXXXXXXXX XXX
---------------------------
Xx. Xxxxxxxxx Xxx
EXHIBIT A
FIRST AMENDMENT TO INCENTIVE STOCK OPTION AGREEMENT NO. 004
This First Amendment to Incentive Stock Option Agreement No. 004 (the
"Amendment") is dated as of April 8. 2004 and is entered into by and between
SYNTA PHARMACEUTICALS CORP., a Delaware corporation (the "Company"), and
XXXXXXXXX XXX, an individual (the "Grantee").
Reference is made to that certain Incentive Stock Option Agreement No. 004 dated
December 13, 2002, by and between the Company and the Grantee (the "Option") as
issued pursuant to the 2001 Stock Plan adopted by the Company (the "Stock
Plan"). Reference also is made to that certain Separation Agreement dated as of
April 8, 2004 and by and between the Company and the Grantee (collectively, the
"Separation Agreement"). Capitalized terms used, but not defined, herein shall
have the meanings as set forth in the Option.
WHEREAS, Xxxxxxx's employment with the Company terminated upon January 1, 2004
(the "Resignation Date");
WHEREAS, pursuant to the terms of the Option, Xxxxxxx's right to exercise the
Option for an aggregate of 812,500 shares (the "Original Vested Shares") vested
upon the Resignation Date; and
WHEREAS, the Company and the Grantee wish to amend the Option pursuant to the
terms of the Separation Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged by the parties, the parties hereby agree as
follows:
1. The Option is hereby amended as follows:
a. All references to "1,500,000 shares" on the face of the Option are
hereby deleted and replaced with "1,000,000 shares".
b. Section 3 of the Option is deleted in its entirety and hereby replaced
with the following:
"3. VESTING SCHEDULE. The Option shall be exercisable with respect to
1,000,000 of the Stock Rights Shares immediately, provided that the first
aggregate of 187,500 Stock Rights Shares that the Participant exercises
shall not be Original Vested Shares."
c. Section 4 of the Option is deleted in its entirety and hereby replaced
with the following:
"4. TERM OF OPTION. Subject to earlier termination as provided in this
Agreement or the Plan, the Option shall expire on the tenth anniversary of
the Grant Date."
2. All other terms and conditions of the Option remain in full force and
effect, and are not modified in any way except as expressly set forth herein.
However, in the event of a conflict between the terms and conditions of the
Option and this Amendment, the terms of this Amendment shall govern.
3. The Grantee hereby acknowledges that the Option as amended by this
Amendment will not be an incentive stock option that complies with Section 422
of the Internal Revenue Code of 1986, as amended.
4. The Grantee further acknowledges that the exercise of the amended Option by
the Grantee could have negative tax consequences for the Grantee, and that the
Grantee has had sufficient opportunity to discuss the tax consequences of the
foregoing amendments to the Option with his tax advisor(s) prior to entering
into this Amendment.
5. This Amendment shall be governed by and construed in accordance with the
laws of the State of Delaware, without regard to conflict of laws principles.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the
date first set forth above.
GRANTEE COMPANY
SYNTA PHARMACEUTICALS CORP.
/s/ XXXXXXXXX XXX /s/ XXXX X. XXXXXXX
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Xxxxxxxxx Xxx By: Xxxx X. Xxxxxxx
Its: Chief Executive Officer
