EXHIBIT 10.21
CONFIDENTIAL
SEPARATION AGREEMENT AND RELEASE
This Separation Agreement and Release (hereafter "Agreement") is entered into by
and between Arena Pharmaceuticals, Inc. (hereafter, as defined below, "Company")
and Xxxxxxx X. Xxxxxxx, Xx. (hereafter "Executive"), an individual who resides
in California. As used in this Agreement, "Company" shall include and encompass
all of the past, present, or future parent, affiliated, related and/or
subsidiary companies of Arena Pharmaceuticals, Inc. (including without
limitation XxxxXxxxxxxxx.xxx, Inc., Aressa Pharmaceuticals, Inc. and BRL
Screening, Inc.), and their past, present, and future directors, shareholders,
officers, employees, agents, attorneys and representatives. In consideration of
the mutual promises and undertakings of the parties, it is agreed as follows:
1. FINAL DAY OF EMPLOYMENT. Executive's final day of employment with the
Company is September 30, 2001 (the "Separation Date"). Executive hereby resigns
as an officer and director, as applicable, of the Company, including, without
limitation, XxxxXxxxxxxxx.xxx, Inc., as of September 30, 2001. Following this
date, Executive shall cease to be employed by the Company in any capacity, and
shall cease to be an officer and/or director of the Company. In addition,
Executive's Services Agreement with Xxxxxxxxxxxxx.xxx, Inc. (the "Services
Agreement"), a true and correct copy of which is attached hereto as Exhibit "A",
shall terminate effective the Separation Date.
2. PAYMENT. In consideration for the release provided in Paragraph 4 and
the performance of the consulting services identified in paragraph 8 below,
following the Company's receipt of a fully executed copy of this Agreement and
the expiration of the revocation period identified in paragraph 13 below, the
Company will:
Pay Executive through November 15, 2001 severance pay in an amount
equivalent to Executive's regular weekly salary as of the
Separation Date. Such payment shall be made on those days
Executive would have received payment of wages were he still
employed by the Company, beginning on the first payday after
this Agreement becomes effective, or the Separation Date,
whichever is later. Executive will be responsible for all
taxes associated with severance payments received from the
Company.
Arrange to provide to the Executive, through November 15, 2001,
without cost, health and dental insurance benefits
substantially similar to those which the Executive is
receiving immediately prior to the Separation Date; or, as an
alternative, the Company may elect to pay the Executive cash
in lieu of such coverage in an amount equal to the Executive's
cost (taking into account the tax effect to the Executive) of
continuing such coverage, where such coverage may not be
continued (or where such continuation would adversely affect
the tax status of the plan pursuant to which the coverage is
provided). The COBRA health care continuation coverage period
under Section 4980B of the Internal Revenue Code of 1986, as
amended (the "Code") will begin to run at the earlier of (i)
November
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15, 2001, or (ii) when a cash payment is made in lieu of such
coverage. Benefits otherwise receivable by the Executive
pursuant to this paragraph 2(b), shall be reduced to the
extent comparable benefits are actually received by the
Executive without cost between the Separation Date and
November 15, 2001 (and any such benefits actually received by
the Executive shall be reported to the Company by the
Executive); provided that this reduction shall not apply to
any benefits with respect to which the Company has made a cash
payment in lieu of coverage.
3. STOCK OPTIONS, ETC. Executive agrees and acknowledges that Exhibit B
accurately sets forth all of his (i) unexercised options to purchase shares of
the Company's Common Stock and the restricted stock which have been granted or
issued under the Company's equity compensation plans or otherwise (the "Employee
Options"), or (ii) restricted stock issued to Executive pursuant to the Services
Agreement (the "ChemNavigator Shares") as of September 30, 2001, and which
expire or are subject to forfeiture or repurchase upon the termination of
Executive's employment in accordance with the terms of such Employee Options or
Services Agreement, as applicable. In consideration of Executive's agreement to
the terms of this Agreement, (x) the Employee Options shall continue to vest in
accordance with their terms through September 30, 2001, and shall remain
exercisable for a period of 90 days thereafter, at which time any unexercised
Employee Options shall terminate and be of no further force or effect, (y)
46,250 shares of Company stock that Executive received upon the exercise of
unvested Employee Options shall vest as of September 11, 2001 and the Company
hereby waives its right to repurchase such shares, and (z) the ChemNavigator
Shares that are unvested or subject to repurchase or forfeiture as of September
30, 2001 shall be repurchased by XxxxXxxxxxxxx.xxx on such date at a purchase
price of $.0001 per share pursuant to the terms of the Services Agreement.
Executive hereby acknowledges receipt of $8.75 from XxxxXxxxxxxxx.xxx and
directs XxxxXxxxxxxxx.xxx to cancel the outstanding certificate issued to
Executive and issue a new certificate for 87,500 shares of XxxxXxxxxxxxx.xxx
common stock. Executive agrees that all unvested, unexercised Employee Options
terminate or are forfeited at September 30, 2001.
Executive acknowledges that his right to participate in the
2001 Arena Employee Stock Purchase Plan (the "Stock Purchase
Plan") terminates on the Separation Date. Executive
acknowledges and agrees that he has previously elected to
participate in the Stock Purchase Plan at the level of 5% of
his Compensation (as defined in the Stock Purchase Plan) and
that pursuant to the terms of the Stock Purchase Plan, the
next Exercise Date on which Executive will purchase shares
pursuant to the Stock Purchase Plan will be September 28,
2001. Executive further acknowledges and agrees that the
number of shares purchased on that date shall be based on the
market price of the stock on that date and that unless
Executive elects to withdraw and has done so effectively
pursuant to the terms of the Stock Purchase Plan, Executive
will purchase such additional shares of stock on that date.
4. RELEASE BY EXECUTIVE. In consideration for the valuable benefits
provided in paragraphs 2 and 3 above, Executive voluntarily and knowingly
releases and discharges the Company from any and all claims or causes of action,
known or unknown, in law or in equity, based upon any fact, circumstance, or
event occurring or existing at or prior to Executive's execution of this
Agreement. This release specifically includes but is not limited to any claims
or actions arising out of or during Executive's employment with the Company
and/or the separation of the
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employment. This includes a release of any rights or claims Executive may have
under the Age Discrimination in Employment Act, which prohibits age
discrimination in employment; Title VII of the Civil Rights Act of 1964, which
prohibits discrimination and harassment in employment based on race, color,
national origin, religion, ancestry, or sex; the Equal Pay Act, which prohibits
paying men and women unequal pay for equal work; the Americans with Disabilities
Act, which prohibits discrimination on the basis of physical or mental
disability; the Family and Medical Leave Act, which permits leave for specified
purposes and job restoration; and, every other federal, state or local law or
regulation or common law prohibiting employment discrimination and/or harassment
(such as the California Fair Employment & Housing Act and Family Rights Act) or
limiting or prohibiting termination of employment or prescribing the method of
payment or amount of wages and other compensation for work. This also includes a
release by Executive of any claims for wrongful discharge, both in tort and
contract (whether oral or written, express or implied), fraud, or other tort.
This release covers both claims that Executive knows about and those Executive
may not know about. THIS RELEASE INCLUDES, AMONG OTHERS, CLAIMS BASED ON AGE
DISCRIMINATION IN VIOLATION OF THE FEDERAL AGE DISCRIMINATION IN EMPLOYMENT ACT
AND APPLICABLE STATE LAW. SUCH LAWS PROHIBIT AN EMPLOYER FROM TAKING ADVERSE
ACTION AGAINST AN EMPLOYEE, INCLUDING TERMINATING EMPLOYMENT, ON THE BASIS OF
THE EMPLOYEE'S AGE OF 40 OR MORE. BY AGREEING TO THE RELEASE AND WAIVER IN THIS
PARAGRAPH, EXECUTIVE IS AGREEING TO FOREGO ANY CLAIM AND AGREEING NOT TO XXX ON
THE GROUND, AMONG OTHERS, THAT THE TERMINATION OF EXECUTIVE'S EMPLOYMENT BY THE
COMPANY VIOLATED THE ADEA. This release does not include any right Executive may
have to indemnification pursuant to (i) California Labor Code section 2802, or
(ii) the Indemnification Agreement in the form substantially provided and to be
entered into by and between the Company and Executive (the "Indemnification
Agreement"), or (iii) the Company's bylaws as now in effect with regard to any
actions which may be brought against him by parties other than the Company in
connection with his employment by the Company, provided that he cooperates fully
with the Company as a witness or otherwise in connection with any such actions.
5. RELEASE BY THE COMPANY. The Company voluntarily and knowingly releases
and discharges Executive from any and all claims or causes of action, known or
unknown, in law or in equity, based upon any fact, circumstance, or event
occurring or existing at or prior to Executive's execution of this Agreement,
except claims or causes of action arising from or based on fraud by Executive,
or the gross misconduct or criminal acts of Executive. This release specifically
includes but is not limited to any claims or actions arising out of or during
Executive's employment with the Company and/or the separation of the employment,
except those relating to the fraud, gross misconduct or criminal acts of
Executive.
6. WAIVER. Executive and the Company each expressly waives all rights
afforded by any statute (such as Section 1542 of the Civil Code of California)
which limits the effect of a release with respect to unknown claims. Executive
and the Company each understands the significance of this release of unknown
claims and waiver of statutory protection against a release of unknown claims
(such as under Section 1542). Section 1542 of the Civil Code of the State of
California states as follows:
"A general release does not extend to claims which
the creditor does not know or suspect to exist in his
favor at the time of executing the release, which if
known by him must have materially affected his
settlement with the debtor."
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Notwithstanding the provisions of Section 1542, and for the purpose of
implementing a full and complete release, Executive and the Company each
expressly acknowledges that this release is intended to include in its effect,
without limitation, all claims which he does not know or suspect to exist in his
favor at the time of execution hereof, and that this release contemplates the
extinguishment of any such claim or claims; PROVIDED, that in the case of the
Company, this release shall not extend to claims arising from or based on fraud
by Executive, or the gross misconduct or criminal acts of Executive.
7. TRADE SECRETS AND CONFIDENTIAL INFORMATION. In further consideration
for the benefits provided in paragraphs 2 and 3 above, Executive acknowledges
and agrees that he will not reveal to any person or entity or use at any time in
the future any trade secrets, proprietary or confidential information,
manufacturing processes, marketing information, or customer information which he
may have obtained during his employment with the Company. Such trade secrets and
proprietary and confidential information include, but are not limited to,
internal company reports, software, quality control standards and processes,
environmental control standards and processes, research and development
processes, personnel information, and technology information of any kind.
Executive understands and agrees that his breach of the agreement in this
paragraph may result in legal action by the Company seeking legal or equitable
relief against him or any person or entity to whom he discloses or for whom he
uses the information covered in this paragraph. Executive further acknowledges
and agrees that the Company may suspend and not make any remaining payments
under paragraph 2 if and when he violates this paragraph; PROVIDED that the
Company gives Executive prior written notice to Executive of the nature of the
alleged violation, including the Company's basis for believing Executive has
violated the provisions of this paragraph, and of the Company's intent to
suspend payments; PROVIDED, FURTHER, that if Executive disputes the alleged
violation pursuant to the provisions of paragraph 15 herein, the Company shall
continue making such payments; PROVIDED, FURTHER, that in the event Executive is
found to have violated the provisions of this paragraph pursuant to the
provisions of paragraph 15 herein, Executive shall pay to the Company an amount
equal to all such payments made to Executive after the date the violation
occurred, along with other damages, if any.
8. CONSULTING SERVICES. In further consideration for the benefits provided
in paragraphs 2 and 3 above, Executive agrees to act as a consultant for the
Company for a period between the Separation Date and November 15, 2001 (the
"Consultancy Term"). The parties acknowledge that the Executive will be an
independent contractor during the consultancy term and, consequently, the
Executive will not receive any benefits provided to employees (other than those
provided for in paragraph 2(b) above). During the Consultancy Term, the
Executive will serve as a non-employee consultant to the Company and will
perform services, including without limitation, providing advice and information
concerning the Company's business, as reasonably requested and required by the
Chief Executive Officer of the Company and/or his designee, from time to time
upon reasonable prior notice; PROVIDED, that Executive shall not be required to
perform such services in excess of ten (10) hours per week. In addition, the
Executive will respond to inquiries from the Company about any matters
concerning the Company or its affairs that occurred or arose during the period
of the Executive's employment by the Company or during the Consultancy Term, and
the Executive will cooperate with the Company in investigating, prosecuting and
defending any charges, claims, demands, liabilities, causes of action, lawsuits
and other proceedings by, against or involving the Company relating to any
period during which the Executive was employed by or serving as a consultant to
the Company or relating to matters of which the Executive had knowledge or
should have knowledge by virtue
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of his or her employment by or consultancy for the Company. The Company will
reimburse the Executive for all reasonable expenses incurred in complying with
this paragraph in accordance with the Company's employee business expense
approval procedures then in effect.
9. NON-DISPARAGEMENT. Executive and the Company acknowledge and agree that
neither will make any negative or disparaging statements about the other, or in
the case of Executive, about any of the Company's directors, officers, or
employees (or any of the Company's parents, subsidiaries, and affiliates or any
of their directors, officers, and employees), provided that it shall not be a
violation of this paragraph for Executive, or the Company or its directors,
officers or employees, to make truthful statements when required to do so by
court order, by the proper inquiry of a State or Federal governmental agency, or
by a subpoena to testify issued by a court of competent jurisdiction.
10. NON-ADMISSION. The Company has entered into this Agreement with
Executive to effect a mutually acceptable termination of his employment with the
Company. Neither the Company nor Executive believes or admits that it or he,
respectively, has done anything wrong.
11. ENTIRE AGREEMENT. It is agreed and understood that this Agreement
contains and comprises the entire understanding of the parties on the subjects
covered herein and that there are no additional or other promises,
representations, terms or provisions other than those expressly contained herein
or in the Confidentiality and Invention Agreement or the Indemnification
Agreement executed by Executive. This Agreement shall not be modified except in
writing signed by each of the parties.
12. ENFORCEABILITY. If any term in this Agreement is determined to be
unenforceable, that term and the remaining terms of this Agreement shall
nevertheless be enforced to the fullest extent permitted by law. The
unenforceability of any term shall not affect the enforceability of any
remaining terms.
13. ACKNOWLEDGMENT OF TIME TO CONSIDER AND REVOKE AND RIGHT TO COUNSEL. In
signing this Agreement, Executive acknowledges that:
He has been advised in writing to consult with an attorney before
signing this Agreement.
He is entitled to not less than twenty-one (21) days to consider
whether to enter into the Agreement.
He understands that this Agreement shall not become effective or
enforceable until seven (7) days after Executive's execution
and return to the Company of this Agreement. He also
understands that he may revoke this Agreement during this
seven (7) day period. To be effective, the revocation must be
in writing and DELIVERED to the Company's Chief Executive
Officer at the Company's Corporate Headquarters, within this
seven (7) day period.
He understands that on the eighth day after Executive's execution
of this Agreement, unless revoked earlier, this Agreement will
become effective and enforceable without any further
affirmative action by either himself or the Company.
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14. INDEMNIFICATION. The Company will enter into an Indemnification
Agreement with Executive in the same form as that made generally available to
the Company's officers and directors when and as approved by the Company's Board
of Directors. The Company currently intends to enter into such Indemnification
Agreements during the last quarter of 2001. With respect to Executive, the
effective date of any such Indemnification Agreement shall e September 30, 2001.
15. ARBITRATION. Any dispute or controversy arising from or relating to
this Agreement shall be decided exclusively by final and binding arbitration in
the County of San Diego, State of California, in accordance with the National
Rules for the Resolution of Employment Disputes of the American Arbitration
Association. The arbitrator shall be selected by agreement between Executive and
the Company, but if the parties do not agree on an arbitrator within 30 days
after the date of the notice requesting arbitration, the arbitrator shall be
selected pursuant to the rules of that Association. At the request of either
Executive or the Company, arbitration proceedings shall be conducted in the
utmost secrecy, and, in such case, all documents, testimony and records shall be
received, heard and maintained confidential by Executive and the Company and by
their respective attorneys and experts who shall agree, in advance and in
writing, to receive all such information confidentially and to maintain the
secrecy of such information until such information shall become generally known.
Each party shall pay its own expenses for the arbitration, and the fee and
expenses of the arbitrator shall be shared equally.
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{SIGNATURE PAGE TO SEPARATION AND RELEASE AGREEMENT}
In witness of which, the parties have executed this Separation Agreement and
Release on the date set forth below.
ARENA PHARMACEUTICALS, INC.
BRL SCREENING, INC.
ARESSA PHARMACEUTICALS, INC.
By: /s/ Xxxx Xxxx Dated: September 11, 2001
-----------------------------------
Xxxx Xxxx
President & CEO
XXXXXXXXXXXXX.XXX, INC.
CNC HOLDINGS, INC.
By: /s/ Xxxxx Xxxxxx Dated: September 11, 2001
-----------------------------------
Xxxxx Xxxxxx
President & CEO
PLEASE READ THIS AGREEMENT CAREFULLY. IT CONTAINS A RELEASE OF ALL KNOWN AND
UNKNOWN CLAIMS. EXECUTIVE ACKNOWLEDGES THAT HE HAS READ THIS AGREEMENT,
UNDERSTANDS IT AND IS VOLUNTARILY ENTERING INTO IT.
Agreed and Accepted:
/s/ Xxxxxxx X. Xxxxxxx Dated: September 11, 2001
---------------------------------------
Xxxxxxx X. Xxxxxxx, Xx.
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{SIGNATURE PAGE TO SEPARATION AND RELEASE AGREEMENT}
EXHIBIT A
SERVICES AGREEMENT
XXXXXXXXXXXXX.XXX, INC.
THIS SERVICES AGREEMENT is entered into as of May 26, 1999, by and
between XXXXXXXXXXXXX.XXX, INC. a Delaware corporation ("CNC"), and XXXXXXX X.
XXXXXXX, XX. ("Consultant").
1. CNC wishes to obtain the services of Consultant for certain
purposes and Consultant wishes to provide such services, all
subject to the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the mutual promises hereinafter set
forth, and intending to be legally bound hereby, CNC and Consultant hereby agree
as follows:
1. SERVICES TO BE PROVIDED. During the term of this Agreement,
Consultant shall perform for CNC the services described on
EXHIBIT A attached hereto and made a part hereof (the
"Services").
2. TERM. The initial term of this Agreement shall begin and
terminate as set forth in EXHIBIT A.
3. COMPENSATION; NO BENEFITS.
(a) As compensation for Consultant's performance of the services
to be performed by Consultant under this Agreement, CNC shall
pay Consultant the amounts specified in EXHIBIT A attached
hereto, in accordance with the schedule set forth in EXHIBIT
A. Consultant shall be responsible for all expenses incurred
in connection with the performance of the Services, including
travel, hotel and meal expenses, UNLESS the travel, hotel and
meal expenses are approved in advance by CNC and the expenses
are incurred in accordance with CNC's reimbursement policies.
(b) Consultant is not an employee of CNC and will not be entitled
to participate in or receive any benefit or right as an CNC
employee under any CNC employee benefit and welfare plans,
including, without limitation, employee insurance, pension,
savings and security plans as a result of Consultant entering
into this Agreement.
4. OWNERSHIP OF RESULTS.
(a) All findings, conclusions and data and all
inventions, discoveries, trade secrets, techniques, processes and know-how,
whether or not patentable, that are made by Consultant, either alone or with
others, in the performance of the Services or which result, to any extent, from
use of CNC's premises or property (collectively, "Inventions") shall become the
exclusive property of CNC. Consultant hereby assigns, transfers and conveys all
of his/her right, title and interest in and to any and all Inventions to CNC.
(b) Upon the request and at the expense of CNC,
Consultant will execute and deliver any and all instruments and documents and
take such other acts as may be necessary or desirable to document such transfer
or to enable CNC to apply for, prosecute and enforce patents, trademark
registrations or copyrights in any jurisdiction with respect to any Inventions
or to obtain any extension, validation, re-issue, continuance or renewal of any
such intellectual property right. Without limiting the foregoing, Consultant
shall assign, grant and convey unto CNC all of his/her right, title and
interest, now existing or that may exist in the future, in and to any copyrights
in any findings, reports, data compilations and other information and material
resulting from the performance of the Services. Consultant shall not submit
applications for copyright registration in any country for any information or
materials created by Consultant pursuant to this Agreement.
(c) The provisions of this paragraph 4 shall survive the
expiration or sooner termination of the term of this Agreement.
5. CONFIDENTIALITY. Consultant will not, either during or after
the term of this Agreement disclose to any third person or use any confidential
or proprietary information of CNC or its corporate collaborators for any purpose
other than the performance of the Services, without the prior written
authorization of CNC. This obligation shall not apply to information that is in
the public domain through no fault of Consultant. For purposes of this paragraph
5, "confidential or proprietary information" includes, without limitation, the
structure and activity of chemical compositions, biomaterials, micro-organisms,
cells, cell lines and the progeny and derivatives thereof, patent applications,
marketing methods and plans, pricing information, manufacturing information and
other unpublished information related to the business or the financial condition
of CNC and its affiliates and corporate collaborators. The provisions of this
paragraph 5 shall survive the expiration or sooner termination of the terms of
this Agreement.
6. TERMINATION. Notwithstanding the provisions of paragraph 2,
either Party may terminate this Agreement for any reason whatsoever, upon thirty
(30) days written notice to the other Party. In such event, CNC shall be
responsible for any portion of the compensation owed to Consultant under
paragraph 3 for any Services rendered prior to the effective date of such
termination.
7. RETURN OF CNC PROPERTY. Consultant will return to CNC any
property of CNC in his/her possession, at any time when so requested by CNC and
in any event upon termination of this Agreement. Consultant will not remove any
CNC property from CNC premises without written authorization from CNC.
8. NO CONFLICTING AGREEMENTS. Consultant represents that
Consultant is not a party to any existing agreements that would prevent
Consultant from entering into and performing this Agreement. Consultant will not
enter into any other agreement that is in conflict with his/her obligations
under this Agreement. Consultant shall not seek funding to support the Services
from any third party (including the U.S. Government), without the prior written
consent of CNC.
9. INDEPENDENT CONTRACTOR. Consultant is an independent
contractor under this Agreement. Neither Party shall have the power to bind the
other Party to any agreement, contract, obligation or liability.
10. ENTIRE AGREEMENT, AMENDMENT AND ASSIGNMENT. This Agreement is
the sole agreement between Consultant and CNC with respect to the Services to be
performed hereunder and it supersedes all prior agreements and understandings
with respect thereto, whether oral or written. No modification to any provision
of this Agreement shall be binding unless in writing and signed by both
Consultant and a duly authorized representative of CNC. All of the terms and
provisions of this Agreement shall be binding upon and inure to the benefit of
and be enforceable by the respective heirs, executors, administrators, legal
representatives, successors and assigns of the Parties hereto,
except that the duties and responsibilities of Consultant hereunder are of
personal nature and shall not be assignable or delegable in whole or in part by
Consultant.
11. GOVERNING LAW. This Agreement shall be governed by and
interpreted in accordance with laws of the State of California, without giving
effect to any conflict of law provisions.
12. NOTICES. All notices and other communications required or
permitted hereunder or necessary or convenient in connection herewith shall be
in writing and shall be deemed to have been given when hand delivered, sent by
facsimile or mailed by registered or certified mail, as follows (provided that
notice of change of address shall be deemed given only when received):
If to CNC, to:
XxxxXxxxxxxxx.xxx, Inc.
0000 Xxxxx Xxxxx Xxxxx
Xxx Xxxxx, XX 00000
Attention: Xxxxx Xxxxxx
Facsimile No.: (000) 000-0000
With a copy to: Corporate Secretary
If to Consultant, to:
Xxxxxxx X. Xxxxxxx, Xx.
c/o Arena Pharmaceuticals, Inc.
0000 Xxxxx Xxxxx Xxxxx
Xxx Xxxxx, XX 00000
FACSIMILE NO.: (000) 000-0000
or to such other names or addresses as CNC or Consultant, as the case may be,
shall designate by notice to each other person entitled to receive notices in
the manner specified in this paragraph.
13. COUNTERPARTS. This Agreement shall become binding when any one
or more counterparts hereof, individually or taken together, shall bear the
signatures of Consultant and CNC. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original as against any
party whose signature appears thereon, but all of which together shall
constitute but one and the same instrument.
14. SEVERABILITY. If any provision of this Agreement or
application thereof to anyone or under any circumstances is adjudicated to be
invalid or unenforceable in any jurisdiction, such invalidity or
unenforceability shall not affect any other provision or application of this
Agreement which can be given effect without the invalid or unenforceable
provision or application and shall not invalidate or render unenforceable such
provision or application in any other jurisdiction.
IN WITNESS WHEREOF, the undersigned, intending to be legally bound,
have duly executed, or caused to be duly executed, this Agreement as of the date
first above written.
XXXXXXXXXXXXX.XXX, INC.
By: /s/ Xxxx Xxxx By: /s/ Xxxxxxx X. Xxxxxxx, Xx.
-------------------------------- ---------------------------
XXXX XXXX Xxxxxxx X. Xxxxxxx, Xx.
President
XxxxXxxxxxxxx.Xxx, Inc.
0000 Xxxxx Xxxxx Xxxxx
XXX XXXXX, XX 00000
Date: May 26, 1999 Date: May 26, 1999
EXHIBIT A
DESCRIPTION OF CONSULTING SERVICES AND COMPENSATION
SCOPE OF SERVICES:
Consultant shall provide Company with legal services support. Consultant shall
only be required to provide a maximum of 200 hours per year for Services.
COMPENSATION
Consultant shall be issued One Hundred Seventy Five Thousand (175,000) shares of
Company Common Stock, par value $.0001 ("Founders Shares").
TERM:
48 months
SCHEDULE OF PAYMENTS:
The Founders Shares shall be issued to Consultant by the Company as follows:
Consultant shall make payment to the Company for the Founders Shares
($17.50), in full, within thirty (30) days of this Agreement.
Founders Shares shall vest as follows:
May 26, 2000: 43,750
May 26, 2001: 43,750
May 26, 2002: 43,750
May 26, 2003: 43,750
Accelerated vesting of all unvested shares shall occur at any of the
following events:
1) on the completion of an acquisition or asset transfer
of the Company (other than through the issuance by
the Company of preferred stock), whereby at least
50.1% of the assets of the Company are acquired or
transferred ("completion" being evidenced by the
signing of a definitive agreement between the Company
and the acquiring or transferee party); or
2) on the closing of a firm commitment underwritten
public offering pursuant to an effective registration
statement on Form S-1 or any equivalent or successor
form under the Securities Act, covering the
offer and sale of Common Stock for the account of the
Company to the public at a price per share (prior to
underwriter commissions and offering expenses) of not
less than $10.00 per share (appropriately
adjusted for any recapitalizations, stock splits,
stock combinations, stock dividends and the like)
which results in aggregate net cash proceeds to the
Company in excess of Fifteen Million Dollars
($15,000,000).
Company reserves the right to re-purchase from Consultant any un-vested
Founders Shares (at $.0001 per un-vested share) in the event that
Consultant discontinues employment with Arena Pharmaceuticals, Inc.
/s/ RPB
-------------------
CONSULTANT
INITIALS
EXHIBIT B
As of September 30, 2001:
Total Unexercised Total Vested Shares Issued XxxxXxxxxxxxx.xxx
Options Unexercised Upon Exercise of Shares (subject
Outstanding Options Unvested Options to repurchase)
----------- ------- ---------------- --------------
87,500 12,500 46,250 87,500