1
LA JOLLA PHARMACEUTICAL COMPANY
EXHIBIT 10.42
February 9, 0000
Xxxxxxxx Xxxxxx
Xx Jolla Pharmaceutical Company
0000 Xxxxx Xxxxx Xxxxx
Xxx Xxxxx, XX 00000
Re: Severance Agreement
Dear Xxxxxxxx,
As a supplement to the offer letter and agreement dated August 13, 1998
between La Jolla Pharmaceutical Company ("LJP") and Xxxxxxxx Xxxxxx ("Xxxxxx")
related to Xxxxxx'x employment by LJP, Xxxxxx and LJP hereby agree as follows:
In connection with her employment with LJP, Xxxxxx'x new title will be
Vice President of Human Resources.
If Xxxxxx'x employment is terminated by LJP without cause (as defined
below), or if a Change in Control of LJP (as defined below) occurs and Xxxxxx'x
employment with LJP or its successor "terminates in connection with" (as defined
below) that Change in Control and in the absence of any event or circumstance
constituting Cause, then:
(i) Xxxxxx will be entitled to receive from LJP a severance
payment equal to her then-current base salary for a period
of six full calendar months from the date of termination and
an additional three full calendar months if and when after
the first six months she has not found suitable employment,
payable consistent with LJP's normal payroll practices,
provided that such payment will be contingent upon execution
and delivery by Xxxxxx and LJP of a mutual release, in form
satisfactory to LJP, of all claims arising in connection
with Xxxxxx'x employment with LJP and termination thereof,
and
(ii) Xxxxxx will be entitled to receive for a period of six full
calendar months from the date of termination and an
additional three full calendar months if and when after the
first six months she has not found suitable employment,
medical and dental benefits coverage for Xxxxxx and/or her
dependents through the Company's available plans at the time
and Xxxxxx will be responsible to continue payment of all
applicable deductions for premium costs. After the Company's
obligation to pay the premiums for health and dental
coverage Xxxxxx and/or her dependents will be eligible to
continue plan participation under COBRA.
(iii) Notwithstanding anything to the contrary in the option plan
(the "PLAN") pursuant to which all of Xxxxxx'x existing
options were granted, the Options shall automatically vest
and become fully exercisable as of the date of
2
termination of Executive's employment (the TERMINATION
DATE"), notwithstanding any vesting or performance
conditions applicable thereto, and shall remain exercisable
for a period of one year following the Termination Date or
such longer period as is provided by the Plan or grant
pursuant to which the Options were granted. However,
notwithstanding the foregoing, in no case will the Options
be exercisable beyond the duration of the original term
thereof, and if the Options qualify as an incentive stock
option under the Internal Revenue Code and applicable
regulations thereunder, the exercise period thereof shall
not be extended in such a manner as to cause the Options to
cease to qualify as an incentive stock option unless
Executive elects to forego incentive stock option treatment
and extend the exercise period thereof as provided herein.
For purposes hereof, "CHANGE IN CONTROL" of LJP has the meaning set
forth in the Plan in its form as the date of grant of the Options.
For purposes hereof, "CAUSE" means Xxxxxx has (i) engaged in serious
criminal activity or other wrongful conduct that has an adverse impact
on LJP, (ii) disregarded instructions given to him under the authority
of LJP's Board of Directors, (iii) performed services for any person or
entity other than LJP and appropriate civic organizations, or (iv)
otherwise materially breached her employment or fiduciary
responsibilities to LJP.
For purposes hereof, Xxxxxx'x employment with LJP or its successor will
be deemed to "TERMINATE IN CONNECTION WITH" a Change in Control if,
within 180 days after the consummation of the Change of Control, (i)
Xxxxxx is removed from Xxxxxx'x employment by, or resigns her employment
upon the request of, a person exercising practical voting control over
LJP or its successor following the Change in Control or a person acting
upon authority or at the instruction of such person; or (ii) Xxxxxx'x
position is eliminated as a result of a reduction in force made to
reduce over-capacity or unnecessary duplication of personnel and Xxxxxx
is not offered a replacement position with LJP or its successor as a
Vice President with compensation and functional duties substantially
similar to the compensation and duties in effect immediately before the
Change in Control; or (iii) Xxxxxx resigns her employment with the
Company or its successor rather than comply with a relocation of her
primary work site more than 50 miles from LJP's headquarters.
In Witness Whereof, LJP and Xxxxxx have entered into this
agreement as of May 18, 2001.
LA JOLLA PHARMACEUTICAL COMPANY
By: /s/ XXXXXX X. XXXXX /s/ XXXXXXXX XXXXXX
---------------------------- -----------------------------------
Xxxxxx X. Xxxxx Xxxxxxxx Xxxxxx
Chairman & CEO Vice President of Human Resources
