AMENDMENT NO. 2 TO EXECUTIVE EMPLOYMENT AGREEMENT
Exhibit
10.4
AMENDMENT
NO. 2 TO
This
Amendment No. 2 (the “Amendment”) to Executive Employment Agreement
(the “Agreement”)
is effective as of December 23, 2008, by and between Micromet, Inc. (hereinafter
the “Company”) and Xxxxxxx Xxxxxxxx (hereinafter
“Executive”) Capitalized
terms used but not defined in the Amendment shall have the meanings given to
them in the Agreement.
BACKGROUND
The parties hereto have entered into
that certain Executive Employment Agreement dated as of August 30, 2008, as
amended (the “Agreement”),
and deem it to be in their respective best interests to amend the Agreement as
provided below.
NOW,
THEREFORE, in consideration of the foregoing premises and for other good and
valuable consideration, receipt and sufficiency of which is hereby acknowledged,
the parties hereto agree as follows:
1. Section
2.4 shall be amended and restated to read in full as follows:
“2.4 Insurance. The
Company will reimburse Executive for the cost of his life insurance in place as
of the date of this Agreement, and his long term disability insurance in
place as of the date of this Agreement (and any increase in coverage of such
insurance or supplemental long term disability insurance entered into after the
effective date of this Amendment and approved by the Company), or corresponding
insurance coverage by different insurers at comparable or lesser cost. In
addition, the Company will have the right to take out life, health, accident,
“key-man” or other insurance covering Executive, in the name of the Company and
at the Company’s expense and for the Company’s benefit, in any amount deemed
appropriate by the Company. Executive will assist the Company in
obtaining such insurance, including, without limitation, submitting to any
required examinations and providing information and data required by insurance
companies.”
2. Section
2.6(c)(iii) shall be amended and restated to read in full as
follows:
“(iii) If
this Agreement is terminated by the Company without Cause or by Executive for
Good Reason within six (6) months prior to or twenty-four (24) months following
a Change of Control, all of Executive’s outstanding unvested Stock Awards will
be automatically vested and exercisable on the later of the date of termination
or the Change of Control. If any such unvested Stock Awards have been
terminated, the Company will make a cash payment to the Executive, no later than
ten (10) days after the effective date of the Change of Control, equal to the
economic value of the terminated Stock Award to Executive at the time of the
Change of Control (calculated for stock options as the difference between the
exercise price of the option and the fair market value of the shares underlying
the option at the time of the Change of Control, and for stock awards as the
fair market value of the shares at the time of the Change of Control less any
amounts paid to Executive for the repurchase of such shares).”
2. Section
7 shall be amended and restated to read in full as follows:
“7. Release
As a
condition precedent to receipt of any Severance Benefits, Executive will provide
the Company with an executed and effective general release substantially in the
form attached hereto as Exhibit B (the “Release”), or a release in
such other form as the parties may agree upon at the time. Such
Release must be executed and delivered to the Company by no later than
forty-five (45) days after the date of Executive’s termination from employment,
and Executive shall not be entitled to any Severance Benefits if he delivers the
Release after that time.”
3. Section
10.5 shall be amended and restated to read in full as follows:
“10.5 Surviving
Clauses. Sections 2.6(c), 3, 5, 6, 7, 8, 9 and 10 (including
the definitions of any defined terms referenced therein) will survive any
termination or expiration of this Agreement.”
4. The
following Section 10.14 shall be added:
“Section
10.14 Application of Section
409A.
(a) Notwithstanding
anything to the contrary set forth herein, any payments and benefits provided
under this Agreement that constitute “deferred compensation” within the meaning
of Section 409A of the Internal Revenue Code of 1986, as amended, and the
regulations and other guidance thereunder and any state law of similar effect
(collectively “Section 409A”) shall not commence in connection with Executive’s
termination of employment unless and until the Executive has also incurred a
“separation from service” (as such term is defined in Treasury Regulation
Section 1.409A-1(h) (“Separation From Service”), unless the Company reasonably
determines that such amounts may be provided to Executive without causing him to
incur the additional 20% tax under Section 409A.
(b) If the
Company (or, if applicable, the successor entity thereto) determines that any
severance payments constitute “deferred compensation” under Section 409A and
Executive is, on the termination of service, a “specified employee” of the
Company or any successor entity thereto, as such term is defined in Section
409A(a)(2)(B)(i) of the Code, then, solely to the extent necessary to avoid the
incurrence of the adverse personal tax consequences under Section 409A, the
timing of the severance payments shall be delayed until the earlier to occur of:
(i) the date that is six months and one day after Executive’s Separation From
Service, or (ii) the date of Executive’s death (such applicable date, the
“Specified Employee Initial Payment Date”). On the Specified Employee
Initial Payment Date, the Company (or the successor entity thereto, as
applicable) shall (A) pay to Executive a lump sum amount equal to the sum of the
severance payments that Executive would otherwise have received through the
Specified Employee Initial Payment Date if the commencement of the severance
payments had not been so delayed pursuant to this Section and (B) commence
paying the balance of the severance pay in accordance with the applicable
payment schedules set forth in this Agreement.
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(c) To the
extent that any cash payment for which the Company or its successor may become
obligated to pay under Section 2.6(c)(iii) above is deferred compensation for
purposes of Section 409A, then the definition of Change of Control for purposes
of triggering a payment to Executive under that provision shall be limited to
those events that constitute “change in control events” as specified in Treasury
Regulation 1.409A-3 if necessary to avoid the imposition of the additional 20%
tax under section 409A.
(d) The
Company’s obligations to make any reimbursements or provide in-kind benefits to
Executive shall be subject to the following restrictions: (a) Executive must
provide documentation of any reimbursable expenses in accordance with the
Company’s then existing policies and procedures, (b) the expenses paid or
reimbursed by the Company in one calendar year shall not affect the expenses
paid or reimbursed in another calendar year, and (c) the reimbursement for any
expenses shall be made within a reasonable period of time following the date on
which the Company receives written documentation of the expense, provided that
all expenses will be reimbursed on or before the last day of the calendar year
following the calendar year in which the expense was incurred.”
[Signature
page follows]
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IN WITNESS WHEREOF, the
parties have executed this Amendment as of the date first above
written.
| Micromet, Inc. | ||
|
|
By:
|
/s/ XXXXXXXXX XXXX |
| Name | Xxxxxxxxx Xxxx | |
| Title: | President & CEO | |
| Xxxxxxx Xxxxxxxx | ||
| /s/ XXXXXXX XXXXXXXX | ||
