Exhibit 10.3
[TO BE TYPED ON DYAX LETTERHEAD]
DATE
NAME AND ADDRESS
Dear_____________________:
In recognition of the fact that your contributions to the past and future
growth and success of Dyax Corp (the "Company"), a Delaware corporation, have
been and are expected to be substantial, we want to assure the Company of your
continued services for the benefit of the Company, particularly in the face of a
change-in-control of the Company.
This letter agreement (this "Agreement") therefore sets forth those
benefits which the Company will provide to you in the event your employment
within the Company is terminated after a "Change in Control" (as defined in
Paragraph 2 (i)) of the Company under the circumstances described below.
1. TERM.
If a Change in Control should occur while you are still an employee of the
Company, then this Agreement shall continue in effect from the date of such
Change in Control for so long as you remain an employee of the Company, but in
no event for more than 12 months following such Change in Control. If your
employment is terminated by the Company without Cause (as defined in Paragraph
3(ii)) prior to a Change in Control, this Agreement shall expire 90 days after
the date that your employment is terminated. In addition, this Agreement may be
terminated by the Company at any time upon 120 days written notice to you. The
termination or expiration of the term of this Agreement shall not adversely
affect your rights under this Agreement that have accrued prior to any such
termination or expiration.
2. CHANGE IN CONTROL.
(i) For purposes of this Agreement, a Change in Control of the Company
(a "Change in Control") shall be deemed to have occurred only if any of the
following events occur:
(a) the acquisition of 50% or more of the Common Stock of
the Company (including shares convertible into Common Stock) by any
"person" (as such term is defined in Section 3(a)(9) of the
Securities Exchange Act of 1934 (as amended, the "Exchange Act"));
(b) a merger or similar combination after which 50% or more
of the voting stock of the Company or any other surviving
corporation that is the
successor to the Company is not held by the persons having
beneficial ownership (within the meaning of Rule 13d-3 under the
Exchange Act) of the Company immediately prior to such merger or
combination; or
(c) the sale, lease, or exchange of all or substantially all
of the Company's property or assets, or the dissolution or
liquidation of the Company;
provided, however, that a spin-off transaction in which the property or
assets of the Company are transferred to a subsidiary of the Company and
ownership of the stock of the subsidiary is merely transferred pro rata to
the stockholders of the Company or its successor shall not be deemed to be
a Change in Control of the Company.
3. TERMINATION FOLLOWING CHANGE IN CONTROL.
If a Change in Control shall have occurred while you are still an employee
of the Company, you shall be entitled to the payments and benefits provided in
Paragraph 4 hereof upon the subsequent termination of your employment within
twelve (12) months of such Change in Control, by you or by the Company unless
such termination is (a) because of your death or "Disability" (as defined
below), (b) by the Company for "Cause" (as defined below), or (c) by you other
than for "Good Reason" (as defined below), in any of which events you shall not
be entitled to receive benefits under this Agreement.
(i) "DISABILITY". If, as a result of your incapacity due to physical or
mental illness, you shall have been deemed "disabled" by the
institution appointed by the Company to administer the Company's
Long-Term Disability Plan (or successor plan) because you shall have
been absent from your duties with the Company on a full-time basis
for such months and shall not have returned to full-time performance
of your duties within thirty days after written notice is given you,
the Company may terminate your employment for Disability.
(ii) "CAUSE". For the purpose of this Agreement, the Company shall have
"Cause" to terminate your employment upon
(a) The willful and continued failure by you substantially to
perform your duties with the Company (other than any such failure
resulting from your incapacity due to physical or mental illness or
any failure resulting from your terminating your employment with the
Company for "Good Reason" (as defined below)) after a written demand
for substantial performance is delivered to you by the Company which
specifically identifies the manner in which the Company believes
that you have not substantially performed your duties,
(b) Willful gross misconduct or dishonesty; or
(c) Conviction of a felony or a crime involving moral turpitude.
(iii) "GOOD REASON". You may terminate your employment for Good Reason.
For purpose of this Agreement, "Good Reason" shall mean:
(a) The material diminution of your duties with the Company from
that immediately prior to the Change in Control;
(b) A reduction by the Company in your base salary in effect
immediately prior to the Change in Control;
(c) Any requirement by the Company that the location at which
you perform your principal duties for the Company be changed to a
new location that is more than 50 miles from the location at which
you perform your principal duties for the Company immediately prior
to the Change in Control.
(iv) NOTICE OF TERMINATION. Any termination by the Company pursuant to
subparagraphs (i) or (ii) above or by you pursuant to subparagraph
(iii) above shall be communicated by written Notice of Termination
to the other party hereto. For purposes of this Agreement, a "Notice
of Termination" shall mean a notice which shall indicate the
specific termination provision in this Agreement relied upon and
shall set forth in reasonable detail the facts and circumstances
claimed to provide a basis of your termination under the provision
so indicated.
(v) DATE OF TERMINATION. "Date of Termination" shall mean:
(a) If this Agreement is terminated for Disability, thirty days
after Notice of Termination is given (provided that you shall not
have returned to the performance of your duties on a full-time basis
during such thirty-day period),
b) If your employment is terminated pursuant to subparagraph
(iii) above, the date specified in the Notice of Termination, and
(c) If your employment is terminated for any other reason, the
date on which a Notice of Termination is given (or, if a Notice of
Termination is not given, the date of such termination).
(vi) TERMINATION IN ANTICIPATION OF A CHANGE IN CONTROL. If your
employment is terminated by the Company without Cause within 90 days
prior to a Change of Control and such termination (i) was at the
request of a third party who had indicated an intention or had taken
steps reasonably calculated to effect a Change of Control and who
subsequently effectuates a Change of Control (a "Third Party") or
(ii) otherwise occurred as a condition to, or in anticipation of, a
Change of Control which actually occurs, then for all purposes of
this Agreement, the date of a Change of Control for purposes of this
Agreement shall mean the date immediately prior to the date of such
termination of your employment and shall entitle you to the benefits
provided under Section 4 of this Agreement as though it were a
termination without Cause after a Change in Control.
4. COMPENSATION UPON TERMINATION AFTER A CHANGE IN CONTROL.
(i) If, after a Change in Control, your employment shall be terminated
for Cause, the Company shall pay you your full base salary through
the Date of Termination at
the rate in effect at the time Notice of Termination is given and
the Company shall have no further obligations to you under this
Agreement.
(ii) If, after a Change in Control, the Company shall terminate your
employment, other than pursuant to Paragraph 3(i) or (ii) hereof or
by reason of death, or you shall terminate your employment for Good
Reason:
(a) The Company shall pay you as severance pay (and without
regard to the provisions of any benefit plan) six (6) months of
salary continuation at the base rate in effect at the time of
termination (together with the payments provided in paragraphs (b),
(c) and (d) below, the "Severance Payments");
(b) For a six (6) month period after such termination, the
Company shall arrange to provide you with life, dental, accident and
group health insurance benefits substantially similar to those that
you were receiving immediately prior to such termination to the
extent that the Company's plans then permit the Company to provide
you with such benefits. Notwithstanding the foregoing, the Company
shall not provide any such benefits to you to the extent that an
equivalent benefit is received by you from another employer during
such period, and you shall report any such benefit actually received
by you to the Company;
(c) The exercisability of all outstanding stock options and
restricted stock awards with respect to Common Stock of the Company
then held by you shall accelerate in full; and
(d) You shall be entitled to full executive outplacement
assistance with an agency selected by the Company.
(iv) You shall not be required to mitigate the amount of any payment
provided for in this Paragraph 4 by seeking other employment or
otherwise, nor shall the amount of any payment provided for in this
Paragraph 4 be reduced by any compensation earned by you as the
result of employment by another employer after the Date of
Termination, or otherwise, except to the extent provided in Section
4(ii) (b) above.
5. LIMIT ON SEVERANCE PAYMENTS.
In the event that any payment or benefit received or to be received by you
in connection with a Change in Control or the termination of your employment
(whether pursuant to the terms of this Agreement or any other plan, arrangement
or agreement with the Company, any person whose actions result in a Change in
Control or any person affiliated with the Company or such person) (collectively
with the Severance Payments, "Total Payments") would not be deductible (in whole
or part) as a result of section 280G of the Internal Revenue Code of 1986, as
amended (the "Code") by the Company, an affiliate or other person making such
payment or providing such benefit, the Severance Payments shall be reduced until
no portion of the Total Payments is not deductible, or the Severance Payments
are reduced to zero. For purposes of this limitation (a) no portion of the Total
Payments the receipt or enjoyment of
which you shall have effectively waived in writing prior to the date of payment
of the Severance Payments shall be taken into account, (b) no portion of the
Total Payments shall be taken into account which in the opinion of tax counsel
selected by the Company's independent auditors serving as such immediately prior
to the Change in Control does not constitute a "parachute payment" within the
meaning of section 280G(b)(2) of the Code, (c) the Severance Payments shall be
reduced only to the extent necessary so that the Total Payments (other than
those referred to in clauses (a) or (b)) in their entirety constitute reasonable
compensation for services actually rendered within the meaning of section
280G(b)(4) of the Code or are otherwise not subject to disallowance as
deductions, in the opinion of the tax counsel referred to in clause (b); and (d)
the value of any non-cash benefit or any deferred payment or benefit included in
the Total Payments shall be determined by the Company's independent auditors
based on Sections 280G and 4999 of the Code and on proposed final regulations
for applying those Code Section, or on substantial authority within the meaning
of Section 6662 of the Code.
6. NOTICE.
For the purpose of this Agreement, notices and all other communications
provided for in this Agreement shall be in writing and shall be delivered to
each party at each party's respective address set forth on the first page of
this Agreement, and shall be deemed effectively given or delivered: (i) upon
personal delivery to the party to be notified, (ii) three (3) days after having
been sent by registered or certified mail, return receipt requested, postage
prepaid, or (iii) one (1) business day after deposit with a nationally
recognized overnight courier, specifying next day delivery, with written
verification of receipt; provided that all notices to the Company should be
directed to the attention of the Chairman of the Board of the Company, with a
copy to the Chief Financial Officer of Dyax Corp., in each case at 000
Xxxxxxxxxx Xxxxxx, Xxxxxxxxx, XX, 00000.
7. ENTIRE AGREEMENT.
This Agreement represents the entire agreement of the parties with respect
to the subject matter hereof and supersedes any other agreement between the
parties with respect to such subject matter.
8. COUNTERPARTS.
This Agreement may be executed in one or more counterparts, each of which
shall be deemed to be an original but all of which together will constitute one
in the same instrument.
9. MISCELLANEOUS.
(i) No provision of this Agreement may be modified, waived, or
discharged unless such waiver, modification, or discharge is agreed
to in writing signed by you and such officer as may be specifically
designated by the Board of Directors of the Company.
(ii) No waiver by either party hereto at any time of any breach by the
other party hereto of, or compliance with, any condition or
provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any time prior to subsequent time.
(iii) The validity, interpretation, construction and performance of this
Agreement shall be governed by the laws of the Commonwealth of
Massachusetts.
(iv) The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any
other provision of this Agreement, which shall remain in full force
and effect.
(v) The Company may withhold from any amounts payable under this
Agreement such federal, state, local or foreign taxes as shall be
required to be withheld pursuant to any applicable law or
regulation.
If this Agreement correctly sets forth our agreement on the subject matter
hereof, kindly sign and return to the Company the enclosed copy of this
Agreement which will then constitute our agreement on this subject.
Sincerely,
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Xxxxx X. Xxxxx, Chairman and Chief Executive
Officer
I acknowledge receipt and agree with the foregoing terms and conditions.
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Name:
