STRICTLY CONFIDENTIAL
Exhibit 10.15
STRICTLY CONFIDENTIAL
October 3, 2012
Xxxxxx Xxxxxx
c/o Cubist Pharmaceuticals, Inc.
00 Xxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Re: Separation Agreement and Release
Dear Xxxxxx:
As we have discussed, your employment with Cubist Pharmaceuticals, Inc. (alternatively, “Cubist” or the “Company”) has ended as of October 3, 2012 (the “Departure Date”).
1. Effect of Departure. On your Departure Date, you were paid all wages and other compensation due, including payment for the 18 hours of vacation you earned, but did not use, through the Departure Date as determined from the books of the Company. Except as set forth below, your participation in all of the Company’s employee benefit plans will end as of your Departure Date, in accordance with the terms of those plans.
2. Severance Pay and Other Benefits
(a) Consistent with section 2 of your Retention Letter dated as of October 12, 2010, and upon the effective date of this Separation Agreement and Release (this “Agreement”) following the seven (7) day revocation date specified below, the Company will provide you with severance pay in the amount of eighteen (18) months’ salary (“Separation Pay”). Consistent with your Retention Letter, the Separation Pay will be payable as follows: (i) in the first payroll cycle following December 3, 2012, you will receive the first eight (8) weeks of Separation Pay in a lump sum payment, and (ii) thereafter you will receive the remainder of the Separation Pay in accordance with our normal payroll cycles in eleven (11) equal semi-monthly installments. You will not be
able to make any salary deferrals for contribution to the Cubist 401(k) plan from the Separation Pay.
(b) The “qualifying event” under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”) shall be deemed to have occurred on the Departure Date. Consistent with your Retention Letter, upon, and subject to, completion of the appropriate COBRA election forms, and subject to all the requirements of COBRA, for the eighteen (18) month period following the Departure Date (the “Continuation Period”), you will remain eligible to participate in the Company’s health and dental insurance plans under the same terms and conditions applicable to active, full-time employees. Provided that you elect to continue such participation in these plans in a timely manner, Cubist will continue to contribute to the premium cost of your participation and that of your eligible dependents until (A) the expiration of the Continuation Period, (B) the date you become eligible for coverage under the health and/or dental plans of another employer, or (C) the date you otherwise cease to be eligible to continue participation in Cubist’s plans under COBRA, whichever occurs first, provided that you pay the remainder of the premium cost of such participation on a timely basis when billed and provided further that you notify Cubist promptly if you become eligible for participation in the health and/or dental plans of another employer or otherwise cease to be eligible to continue participation in Cubist’s plans under COBRA (e.g., upon becoming eligible for Medicare) prior to the expiration of the Continuation Period. After the Continuation Period, you will have the right to continue your medical and dental insurance for the remainder of the COBRA period, if any, subject to the requirements of COBRA, at your own cost (as described in the COBRA qualifying notice to be provided to you under separate cover).
(c) Cubist will provide you with an Executive “Career Transition” program offered by Essex Partners to begin on a mutually agreeable date; provided, that you must commence such program not later than December 31, 2012.
(d) Pursuant to the Company’s Amended and Restated 2000 Equity Incentive Plan (the “2000 Plan”) and the 2010 Equity Incentive Plan (the “2010 Plan”) and equity incentive award notices that you have received, vesting of all stock options and restricted stock units granted to you during your employment with the Company will cease as of the Departure Date and you will have 90 days from the Departure Date to exercise the vested portion of any stock options that were exercisable as of the Departure Date. All of your stock options and restricted stock unit awards will continue to be governed by, as applicable, the 2000 Plan or the 2010 Plan, and equity incentive award notices between you and the Company.
(e) You will receive an additional cash payment during 2013 but not later than March 15, of $157,125, payable in a lump sum.
(f) All payments set forth in this Section 2 shall be subject to all applicable federal, state and/or local withholding and/or payroll taxes, and Cubist may withhold from any amounts payable to you (including any amounts payable pursuant to this Agreement) in order to comply with such withholding obligations. You further authorize Cubist to deduct any health insurance premiums that you are required to pay under Section 2(b) from your Severance Pay.
3. Reference Requests. Cubist will respond to any reference requests from potential employers that are directed to Human Resources by confirming your title and dates of employment at Cubist. To the extent that requests for references are directed to Chief Executive Officer Xxxxxxx Xxxxxx, Xx. Xxxxxx will respond, if in writing, by utilizing the letter of reference attached to this Agreement as Attachment A; if orally, Xx. Xxxxxx will provide a reference for you that is consistent with the statements set forth in Attachment A.
4. Accord and Satisfaction. You agree that the Separation Pay and other benefits described in this Agreement shall be in full and complete payment and satisfaction of any and all monetary sums and other obligations which are now, or might hereafter have become, owing to you for services rendered by you during your employment or in connection with your termination of employment including, without limitation, all claims for back wages, salary, commissions, vacation pay, sick pay, draws, incentive pay, bonuses, commissions, intellectual property rights, equity incentives, stock options, severance pay, any and all other forms of compensation or benefits, attorney’s fees, or other costs or sums of any kind or nature. You agree that your separation from the Company is final and that the Company has no obligation to consider you for rehire or reinstatement.
5. Your Continuing Obligations. You acknowledge and agree that, as Cubist General Counsel and Secretary, you remain bound by your obligations to maintain attorney/client confidences, and you further acknowledge that the Company does not hereby waive any attorney/client privilege. You acknowledge you have had access to information concerning the Company, its clients, and its affiliates which is confidential or proprietary in nature (the “Confidential Information”), and you hereby acknowledge and agree that you will continue to protect the Confidential Information in accordance with the provisions of the employee confidentiality agreement that you signed when you commenced employment with the Company (the “Employee Confidentiality Agreement”). By executing this Agreement, you reaffirm all of your continuing obligations under the Employee Confidentiality Agreement.
6. Confidentiality of Agreement. You agree that the terms of this Agreement shall remain strictly confidential, except for those terms which are required by law to be disclosed. It shall not be considered a violation of this Section 6 of the Agreement for you to disclose the terms of this Agreement to your spouse or to obtain legal or financial advice, provided that your spouse and/or your legal or financial advisors agree not to further disclose the terms of this Agreement to others.
7. Non-Disparagement. You agree that you will not intentionally disparage the Company or those people or organizations whom or which you know are currently associated with it and that you will not otherwise do or say anything that is intended to harm its business or reputation. The Company agrees that its current Chief Executive Officer, President and Chief Operating Officer and Executive Vice President, Research & Development, and Chief Scientific Officer, will not intentionally disparage you or otherwise do or say anything that is intended to harm your reputation.
8. Return of Documents and Equipment. In signing this Agreement, you agree that you will return to the Company any and all documents, materials and information related to the business (including all electronic versions), whether present or otherwise, of the Company and its affiliates, and all copies, and all keys, credit cards, computers, phones, handheld devices and other tangible property of the Company and its affiliates, in your possession or control. This shall not apply to Company documents that pertain to your compensation or performance of your duties, or any other documents that would be included in your personnel file.
9. Cooperation
(a) In signing this Agreement, you agree that you will cooperate fully with Cubist’s employees and business partners in smoothly, effectively, and completely transitioning your work as the Company may designate; the parties agree that any such transition assistance shall conclude by October 31, 2012. You further agree that you will make yourself available to the Company for reasonable periods of time (at mutually convenient times, taking into account your personal and/or professional commitments), either by telephone or, if you and the Company believes necessary, in person upon reasonable notice, to assist the Company in connection with any matter relating to services performed by you on behalf of the Company that is in connection with the defense or prosecution of any claims or actions now in existence or which may be brought or threatened in the future against or on behalf of the Company, its directors, shareholders, officers, or employees. The Company shall reimburse you for reasonable documented travel expenses incurred should your presence be required in person. You further agree that should you be contacted (directly or indirectly) by any individual or any person representing an individual or entity that, to your knowledge, is or may be legally or competitively adverse to the Company in connection with any actual or potential claims or legal or regulatory proceedings, you will promptly notify the Company’s General Counsel of that fact in writing (a “Notification of Adverse Action”), but in no event later than the fifth business day after you are contacted, and you hereby represent and warrant that you have not been so contacted as of the date you signed this Agreement (the “Execution Date”). Such Notification of Adverse Action shall include a reasonable description of the content of the communication with the representative of the legally or competitively adverse individual or entity. Your obligation to provide a Notification of Adverse Action shall cease as of April 3, 2014.
(b) Nothing herein shall prohibit or bar you from providing truthful testimony in any legal proceeding or in communicating with any governmental agency or representative or from making any truthful disclosure required, authorized or permitted under law; provided however, that in providing such testimony or making such disclosures or communications, you will use your best efforts to ensure that this Section 9 is complied with to the maximum extent possible.
(c) Indemnification. The Company agrees to abide by the indemnification and hold harmless provisions of the Company’s Restated Certificate of Incorporation and Amended and Restated By-Laws as they pertain to you. To the extent you were a covered insured by any Company insurance policy, nothing herein negates such coverage or indemnity provided by such policy (including under any applicable directors and officers liability policy or employment practices liability policy). Any
reasonable expense incurred by you while cooperating in the investigation, preparation, defense or prosecution of any complaint, lawsuit, charge, claim or any other judicial or investigative proceeding in which you have been identified as a material witness or are deemed by the Company to have relevant knowledge shall, subject to the receipt of appropriate documentation by the Company, be fully reimbursed to you by the Company. To the extent that it is necessary for you to retain counsel other than the Company’s counsel with respect to any such proceeding, and if, under the provisions of the Company’s insurance policy, the Company will pay for the services of that counsel, then such counsel shall be selected by the Company and you, with neither party unreasonably withholding their approval, and paid directly by the Company.
10. Release of Claims
The Company wants to be certain that this Agreement will resolve any and all concerns that you might have and therefore requests that you carefully consider the terms of this Agreement, including the release of claims set forth below, which is a specific condition to your receipt of the Severance Pay and other benefits set forth in this Agreement. As a result, the Company encourages you to seek the advice of an attorney before you sign this Agreement.
(a) In exchange for the Separation Pay and other benefits to be provided you under this Agreement, you and your respective agents, heirs, legatees, successors and assigns (collectively hereinafter “you”), except as set forth below, hereby unconditionally and irrevocably release, remise, and forever discharge Cubist, (1) and all persons acting by, through, under or in concert with Cubist, of and from any and all actions, causes of actions, suits, debts, charges, complaints, claims, liabilities, obligations, promises, agreements, controversies, damages, and expenses (including attorney fees and costs actually incurred), of any nature whatsoever, in law or equity (collectively “Claims”), which you had, now have, or hereafter may have against the Company from the beginning of time through the Execution Date. Without limiting the generality of the foregoing waiver and release of claims, you specifically waive and release Cubist from any Claim including, without limitation:
(1) Claims under any federal, state (including, without limitation, Massachusetts) or local discrimination, fair employment practices or other employment related statute, regulation or executive order (as they may have been amended through the Execution Date) prohibiting discrimination or harassment based upon any status protected by law, including, without limitation, those laws and regulations that prohibit discrimination or harassment based on age, race, national origin, gender, marital status, disability, veteran status or sexual orientation. Without limitation, specifically included in this paragraph are any Claims arising under the Title VII, the Age Discrimination in Employment Act, the Older Workers Benefit Protection Act, the Civil Rights Acts of 1866 and 1871, Title VII of the Civil
(1) For purposes of this Section, “Cubist” includes Cubist Pharmaceuticals, Inc., and any of its divisions, affiliates (which means all persons and entities directly or indirectly controlling, controlled by or under common control with Cubist Pharmaceuticals, Inc.), subsidiaries and all other related entities, and its and their directors, officers, employees, trustees, attorneys, agents, representatives successors and assigns.
Rights Act of 1964, the Civil Rights Act of 1991, the Equal Pay Act, the Americans with Disabilities Act, and Massachusetts General Laws Chapter 151B;
(2) Claims under any other federal, state (including, without limitation, Massachusetts) or local employment-related statute, regulation or executive order (as they may have been amended through the Execution Date) relating to wages, hours or any other terms and conditions of employment (including, without limitation, the Fair Labor Standards Act, the National Labor Relations Act, the Employee Retirement Income Security Act of 1974, the Consolidated Omnibus Budget Reconciliation Act of 1985 and any similar statute the Worker Adjustment and Retraining Notification Act and any similar federal, state or local statute, regulation, or executive order);
(3) Claims under any federal, state (including, without limitation, Massachusetts) or local common law theory including, without limitation, wrongful discharge, breach of express or implied contract, promissory estoppel, unjust enrichment, breach of a covenant of good faith and fair dealing, violation of public policy, torts, defamation, interference with contractual relations, intentional or negligent infliction of emotional distress, invasion of privacy, misrepresentation, deceit, fraud or negligence;
(4) Claims under any federal, state (including, without limitation, Massachusetts and Delaware) or local securities law, including, without limitation, the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, and any similar statute;
(5) Claims under the Federal False Claims Act, any state or local false claims act or any federal, state or local qui tam provisions of false claims or false statements statutes; and
(6) All other claims of any kind or nature.
Notwithstanding the foregoing, this paragraph shall not release Cubist from any obligation expressly set forth in this Agreement, shall not act as a waiver or release of any Claims that you cannot by law waive or release, including, without limitation, workers’ compensation claims and claims to vested ERISA benefits, and shall not act as a waiver or release of any indemnifications rights. You acknowledge and agree that, but for providing this waiver and release of Claims, you would not be receiving the Separation Pay or other benefits being provided to you under the terms of this Agreement.
(b) You further agree, to the fullest extent permitted by law, that you will not xxx or commence any proceeding (judicial or administrative), or participate in any action, suit or proceeding (unless compelled by legal process or court order), against Cubist with respect to any Claim you have released the Company from under this Agreement. You also warrant and represent that as of the Execution Date, you have not taken or engaged in any of the acts described in the foregoing sentences. If, notwithstanding the foregoing promises, you violate this provision, you shall be required, to the maximum extent permitted by law, to indemnify and hold harmless Cubist from and against any and all
demands, assessments, judgments, costs, damages, losses and liabilities, and attorneys’ fees and other expenses which result from, or are incident to, such violation.
(c) It is the Company’s desire and intent to make certain that you fully understand the provisions and effects of this Agreement. To that end, you have been encouraged and given the opportunity to consult with legal counsel for the purpose of reviewing the terms of this Agreement. Also, because you are over the age of 40, and consistent with the provisions of the Age Discrimination in Employment Act (“ADEA”), which prohibits discrimination on the basis of age, the Company is providing you with at least twenty-one (21) days in which to consider and accept the terms of this Agreement by signing below and returning it to Xxxxxxx Xxxxxx at Cubist, 00 Xxxxxx Xxxxxx, Xxxxxxxxx, XX 00000. You understand that you do not waive any rights or claims under the ADEA that may arise after the Execution Date. In addition, you may rescind your assent to this Agreement if, within seven (7) days after the Execution Date, you deliver by hand or send by mail (certified, return receipt and postmarked within such 7-day period) a notice of rescission to Xxxxxxx Xxxxxx at the above-referenced address.
(d) Consistent with the federal discrimination laws, nothing in this release shall be deemed to prohibit you from challenging the validity of this release under the federal discrimination laws or from filing a charge or complaint of employment related discrimination with the Equal Employment Opportunity Commission (“EEOC”) or from participating in any investigation or proceeding conducted by the EEOC. Further, nothing in this release or Agreement shall be deemed to limit the Company’s right to seek immediate dismissal of such charge or complaint on the basis that your signing of this Agreement constitutes a full release of any individual rights under the federal discrimination laws, or to seek restitution to the extent permitted by law of the economic benefits provided to you under this Agreement in the event you successfully challenge the validity of this release and prevail in any claim under the federal discrimination laws.
(e) You acknowledge and agree that: (i) you have not been subject to any undue or improper influence interfering with the exercise of your free will in deciding whether to execute this Agreement; (ii) you have carefully read and fully understand all of the provisions of this Agreement; (iii) you knowingly and voluntarily agree to all of the terms set forth in this Agreement; and (iv) in entering into this Agreement, you are not relying on any representation, promise or inducement made by Cubist with the exception of those promises contained in this Agreement.
(f) In exchange for the agreements and promises set forth herein, Cubist hereby unconditionally and irrevocably releases, remises, and forever discharge you and all persons acting by, through, under or in concert with you, of and from any and all Claims which Cubist had, now has, or hereafter may have against you from the beginning of time through the Execution Date.
Notwithstanding the foregoing, this paragraph shall not release you from any obligation expressly set forth in this Agreement, and shall not act as a waiver or release of any Claims that arise out of your criminal or fraudulent acts or omissions or that Cubist cannot by law waive or release.
11. Representations and Governing Law
(a) This Agreement sets forth the complete and sole agreement between the parties and supersedes any and all other agreements or understandings, whether oral or written, except the Employee Confidentiality Agreement and any applicable restricted stock unit and stock option agreements (as well as the applicable equity incentive plan(s)), which shall remain in full force and effect in accordance with their terms. This Agreement may not be changed, amended, modified, altered or rescinded except upon the express written consent of both you and an authorized Cubist officer. Any waiver of any provision of this Agreement shall not constitute a waiver of any other provision of this Agreement unless expressly so indicated otherwise. The language of all parts of this Agreement shall in all cases be construed as a whole according to its fair meaning and not strictly for or against any of the parties.
(b) This Agreement shall be deemed to be made and entered into in the Commonwealth of Massachusetts. This Agreement and any claims arising out of this Agreement (or any other claims arising out of the relationship between the parties) shall be governed by and construed in accordance with the laws of the Commonwealth of Massachusetts and shall in all respects be interpreted, enforced and governed under the internal and domestic laws of such Commonwealth, without giving effect to the principles of conflicts of laws of such Commonwealth. Any claims or legal actions by one party against the other shall be commenced and maintained in any state or federal court located in such Commonwealth, and you hereby submit to the jurisdiction and venue of any such court. In any such proceeding you agree to waive trial by jury and consent to have all legal and factual matters decided by a judge.
12. Remedies Upon Breach
If you commit a material breach, or threaten to commit a material breach, of any of the provisions of this Agreement that impose obligations upon you, including, without limitation, Sections 5, 6, 7, 8, 9, 10(a) and 10(b), the Company shall have the following rights and remedies (provided that, prior to seeking the relief described below, the Company provides written notice to you of the specific nature of the breach and a reasonable (i.e., no less than ten business days) opportunity to cure, to the extent that the matter is curable):
(a) The right and remedy to have the provisions of this Agreement specifically enforced by any court having equity jurisdiction, it being acknowledged and agreed that any such breach or threatened breach shall cause irreparable injury to the Company and that money damages shall not provide an adequate remedy to the Company;
(b) The right and remedy to require you to account for and pay over to the Company all Separation Pay that you have been paid, provided that a court of competent jurisdiction has so ordered; and
(c) The right and remedy to immediately stop the Company’s payment of all Severance Pay and/or benefits described in this Agreement.
Each of the rights and remedies set forth above shall be independent of the other, and shall be severally enforceable, and all of such rights and remedies shall be in addition to, and not in lieu of, any other rights and remedies available to the Company under law or in equity.
Similarly, if the Company commits a material breach, or threatens to commit a material breach, of any of the provisions of this Agreement that impose obligations upon it, then you shall have the same rights as the Company does under section 12(a) above, and shall be released from your obligations under this Agreement (and any agreement referenced herein) entirely (provided that, prior to seeking the relief described below, you provide written notice to the Company of the specific nature of the breach and a reasonable (i.e., no less than ten business days) opportunity to cure, to the extent that the matter is curable).
13. Effective Date. For a period of seven (7) days following the Execution Date, you may revoke this Agreement and this Agreement shall not become effective or enforceable until this revocation period has expired.
14. Severability of Agreement Provisions. The provisions of this Agreement, including, without limitation, Section 5 of the Agreement, are severable. In the event that any one or more of the provisions, or the application thereof in any circumstances is held invalid, illegal, or unenforceable in any respect for any reason, the validity and enforceability of any such provision in every other respect and of the remaining provisions of this Agreement shall not be in any way impaired or affected, it being intended that all of the rights and privileges contained in this Agreement shall be enforceable to the fullest extent permitted by law, it is expressly agreed that the Company shall then be entitled to the maximum relief allowable by law as to geography, duration and scope of relief.
15. Return Date. If the terms of this Agreement are acceptable to you, please sign both copies of this Agreement and return one copy to me no later than twenty-one (21) days from the date hereof. If you wish to waive the 21 day period to consider this offer, an appropriate waiver form is attached for your use.
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Very truly yours, |
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/s/ Xxxxxxx X. Xxxxxx |
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Xxxxxxx X. Xxxxxx |
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Senior Vice President, Human Resources |
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I, XXXXXX XXXXXX, REPRESENT THAT I HAVE READ THE FOREGOING AGREEMENT, THAT I FULLY UNDERSTAND THE TERMS AND CONDITIONS OF SUCH AGREEMENT AND THAT I AM VOLUNTARILY EXECUTING THE SAME. IN ENTERING INTO THIS AGREEMENT, I DO NOT RELY ON ANY REPRESENTATION, PROMISE OR INDUCEMENT MADE BY THE RELEASEES WITH THE
EXCEPTION OF THE CONSIDERATION DESCRIBED IN THIS DOCUMENT.
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/s/ Xxxxxx Xxxxxx |
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Xxxxxx Xxxxxx |
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Dated: 11/7/2012 |
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