AMENDMENT TO OFFER LETTER
Exhibit 10.17
AMENDMENT TO OFFER LETTER
This Amendment to Offer Letter is made and entered into effective as of July 17, 2023 (the “Amendment Effective Date”), by and between Alumis Inc., a company organized under the laws of Delaware (the “Company”), and its Chief Development Officer Xxxx Xxxxxxx.
WHEREAS, the parties entered into an Offer Letter for employment dated March 15, 2021 (the “Offer Letter”); and
WHEREAS, the parties now wish to amend the Offer Letter;
NOW, THEREFORE, the parties agree as follows:
1. Attachment A of the Offer Letter shall be replaced by the attached Attachment A.
The parties agree to the foregoing terms effective as of the Amendment Effective Date.
XXXX XXXXXXX |
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Signature: | /s/ Xxxx Xxxxxxx | By: | /s/ Xxxxxx Xxxxxx | |
Date: 7/18/2023 | 11:50 AM PDT | Name: Xxxxxx Xxxxxx | |||
Title: President and Chief Executive Officer | ||||
Date: 7/18/2023 | 11:45 AM PDT |
ATTACHMENT A
Definitions, Terms and Conditions
a. At-Will Employment. Your employment with the Company is at-will, meaning either you or the Company can terminate your employment at any time, with or without cause, and with or without notice. Neither you nor the Company can change the “at will” nature of your employment, unless the CEO or the Board of the Company and you sign a written contract that explicitly changes your status as an “at will” employee.
b. Payment & Benefits Upon Termination. Your entitlement to payment and benefits upon termination is as follows:
(i) Termination Without “Cause” or “Constructive Termination”. If your employment is terminated involuntarily without Cause (as defined in 3.a, below) or in the event of your “Constructive Termination” (as defined in Section 3.c below) and you are subject to a “Separation” under Section 409A (as defined in Section 4 below):
(A) you will receive payment for any earned and unpaid salary as of the date of your termination of employment; and,
(B) in the event you execute and do not revoke the general release of claims (“Release”), in the form attached hereto as Attachment B, you will be offered the Separation Compensation (as defined in Section 2, below). Subject to the terms of Section 7 below, You will not be entitled to or offered any form of additional severance pay or benefits other than the Separation Compensation (e.g., you will not be entitled to pay or benefits under any employee severance plan that is generally applicable to employees).
(ii) Voluntary Termination. If you voluntarily terminate your employment or give notice that you will voluntarily terminate your employment at a future date (and whether or not the Company accelerates the effective date of your resignation date that you provide to an earlier termination date), you will receive payment(s) for all earned and unpaid salary. You will not be entitled to the Separation Compensation, or any other form of severance pay or benefits.
(iii) Termination for Cause. If your employment is terminated for Cause, you will receive payment(s) for all earned and unpaid salary as of your termination. You will not be entitled to the Separation Compensation, or any other form of severance pay or benefits.
2. Separation Compensation. If you are entitled to Separation Compensation under Section 1 above, your “Separation Compensation” will include each of the following, as well as the applicable vesting acceleration terms described in Section 7:
a. Salary Continuance. You will be offered pay equal to nine months of your regular base salary subject to applicable payroll deductions and withholdings (“Salary Continuance”).
Your first salary continuance payment equal to one (1) month of your regular base salary shall commence on the thirtieth (30th) day following your termination of employment (unless a longer period is required by law to make the Release effective, in which case the first Salary Continuance payment shall be made on the sixtieth (60th) day following your termination of employment) provided the Release is effective at such time, and the remainder shall be paid in monthly installments beginning on the 1st day of the second month following your termination of employment, and on the 1st day of each month thereafter, until the total payment obligation is fulfilled. If the 60-day consideration and revocation period spans two calendar years, then the monthly installments will commence, if applicable, on the first payroll date in the second calendar year following expiration of the applicable revocation period.
b. Acceleration of Vesting. Subject to the terms of your applicable equity grant agreements, the vesting applicable to any equity grants made by the Company to you shall accelerate as to that number of shares underlying such equity grant or grants that would have vested on the first anniversary of the date your employment terminates, such acceleration effective immediately prior to such termination.
c. Other Benefits. The Company will reimburse you for your expenses in continuing medical insurance benefits for you and your family (meaning medical, dental, optical, and mental health, but not life, insurance) under the Company’s then-existing benefit plans (or otherwise in obtaining coverage substantially comparable to the coverage provided to you prior to the termination) over the period beginning on the date your employment terminates and ending on the earlier of (a) your period of Salary Continuance as provided above, or (b) the date you commence employment with another entity.
3. Definitions.
a. Cause. For the purposes of this letter agreement, “Cause” means your “Separation” by the Company for any of the following reasons: (i) your willful or gross neglect and material failure to perform your duties and responsibilities to the Company, including but not limited to a failure to cooperate with the Company in any investigation or formal proceeding; (ii) your commission of any act of fraud, embezzlement, dishonesty or any other intentional misconduct in connection with your responsibilities as an employee that is materially injurious to the Company; (iii) the unauthorized use or disclosure by you of any proprietary information or trade secrets of the Company or any other party to whom you owe an obligation of nondisclosure as a result of your relationship with the Company; (iv) you are convicted of, or enter a no contest plea to, a felony; or (v) your breach of any of your material obligations under any Company policy, written agreement or covenant with the Company (including this letter agreement). A termination of employment under subparts (i), (iii) and (v) shall not be deemed cause unless you have first been given specific written notice of subpart and facts relied upon and thirty days to cure. The determination as to whether you are being terminated for Cause, and whether you have cured any such actions or inactions during any thirty day cure period with respect to subparts (i), (iii) and (v) and with respect to subpart (v) whether such breach is capable of being cured, shall be made in good faith by the Board of Directors. The foregoing definition does not in any way limit the Company’s ability to terminate your employment at any time as provided in Section 1.a above.
b. Change of Control. For purposes of this letter agreement, “Change of Control” of the Company is defined as: (i) the date any non-affiliated “person” (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended) becomes, subsequent to the date hereof, the “beneficial owner” (as defined in Rule 13d-3 under said Act), directly or indirectly, of securities of the Company representing 50% or more of the total voting power represented by the Company’s then outstanding voting securities, other than pursuant to a sale by the Company of its securities in a transaction or series of related transactions the primary purpose of which is to raise capital for the Company; (ii) the date of the consummation of a merger or consolidation of the Company with any other corporation that has been approved by the stockholders of the Company, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) more than fifty percent (50%) of the total voting power represented by the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation; or (iii) the date of the consummation of the sale or disposition by the Company of all or substantially all the Company’s assets.
c. Constructive Termination. For the purposes of this letter agreement, “Constructive Termination” means your Separation as the result of resignation for any of the following, except as otherwise agreed in writing by you: (i) a material reduction in your job duties, position and responsibilities, taken as a whole, other than in connection with an Excluded Change of Control; (ii) the Company requires you to relocate to a facility or location more than thirty-five (35) miles from the location from the primary location at which you were working for the Company immediately before the required change of location; (iii) any reduction of your base salary in effect immediately prior to such reduction (other than as part of an across-the-board, proportional reduction), or (iv) the Company materially breaches the terms of this Agreement. Notwithstanding anything else contained herein, in the event of the occurrence of a condition listed above you must provide notice to the Company within sixty (60) days of the occurrence of a condition listed above and allow the Company thirty (30) days after your delivery of notice to the Company in which to cure such condition. Additionally, in the event the Company fails to cure the condition within the cure period provided, you must terminate employment with the Company within ten (10) days of the end of the cure period.
d. Excluded Change of Control. For purposes of this letter agreement, an “Excluded Change of Control” shall mean (i) a Change of Control involving any transaction with Aclaris Therapeutics Inc. or (ii) a Change of Control with a Special Purpose Acquisition Company formed by, or affiliated with, Foresite Capital Management or its affiliated funds (a “Foresite SPAC”) on or prior to September 15, 2023.
4. Code Section 409A. For purposes of this letter agreement, a “Separation” will be determined consistent with the rules relating to a “separation from service” as defined in Section 409A of the Code and the regulations thereunder (“Section 409A”). Notwithstanding anything else provided herein, to the extent any payments provided under this letter agreement in connection with your termination of employment constitute deferred compensation subject to Section 409A, and you are deemed at the time of such termination of employment to be a “specified employee” under Section 409A, then such payment shall not be made or commence until the earlier of (i) the expiration of the 6-month period measured from your Separation from the Company or (ii) the date of your death following such a Separation; provided, however, that such deferral shall only be effected to the extent required to avoid adverse tax treatment to you including, without limitation, the additional tax for which you would otherwise be liable under Section 409A(a)(1)(B) in the absence of such a deferral. The first payment thereof will include a catch-up payment covering the amount that would have otherwise been paid during the period between your termination of employment and the first payment date but for the application of this provision, and the balance of the installments (if any) will be payable in accordance with their original schedule. To the extent that any provision of this letter agreement is ambiguous as to its compliance with Section 409A, the provision will be read in such a manner so that all payments hereunder comply with Section 409A. To the extent any payment under this letter agreement may be classified as a “short-term deferral” within the meaning of Section 409A, such payment shall be deemed a short-term deferral, even if it may also qualify for an exemption from Section 409A under another provision of Section 409A. Payments pursuant to this section are intended to constitute separate payments for purposes of Section 1.409A-2(b )(2) of the Treasury Regulations.
5. Code Section 280G. In the event that the severance and any other benefits provided for in this letter agreement or otherwise payable to you (i) constitute “parachute payments” within the meaning of Section 280G of the Code, and (ii) would be subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then your benefits under this letter agreement shall be either:
a. delivered in full; or
b. delivered as to such lesser extent that would result in no portion of such benefits being subject to the Excise Tax, (with first a pro rata reduction of (i) cash payments subject to Section 409A of the Code as deferred compensation and (ii) cash payments not subject to Section 409A of the Code, and then a pro rata cancellation of (i) equity-based compensation subject to Section 409A of the Code as deferred compensation and (ii) equity-based compensation not subject to Section 409A of the Code), whichever of the foregoing amounts, taking into account the applicable federal, state and local income taxes and the Excise Tax, results in your receipt on an after-tax basis, of the greatest amount of benefits, notwithstanding that all or some portion of such benefits may be taxable under Section 4999 of the Code.
Unless you and the Company otherwise agree in writing, the determination of your excise tax liability and the amount required to be paid under this Section shall be made in writing by an accounting firm to be selected by reasonable agreement between you and the Company, whose determination shall be conclusive and binding upon you and the Company for all purposes. For purposes of making the calculations required by this Section, the accountants may make reasonable assumptions and approximations concerning applicable taxes and may rely on reasonable, good faith interpretations concerning the application of Section 280G and 4999 of the Code. You and the Company shall furnish to the accountants such information and documents as the accountants may reasonably request in order to make a determination under this Section. The Company shall bear all costs the accountants may reasonably incur in connection with any calculations contemplated by this Section.
6. Other Agreements. This Attachment A sets forth the terms of the benefits you are eligible to receive in the event your employment with the Company is terminated in the manner described herein and supersedes any prior representations or agreements, whether written or oral. In the event of a conflict between the terms of this Attachment A and any other agreement you have entered into with the Company (including the cover letter to this Attachment A), the terms of this Attachment A shall apply. Notwithstanding the foregoing, in the event of a conflict between the terms of this Attachment A and the documents reflecting your Option, the terms of the equity documentation shall govern. The definitions, terms and conditions contained in this Attachment A may not be modified or amended except by a written agreement, signed by an authorized representative at the direction of the Board of Directors of the Company and by you.
7. Change of Control Vesting Acceleration and Severance. In the event of a Change of Control of the Company (other than an Excluded Change of Control), the Option shall vest with respect to 50% of any then unvested shares subject to the Option as of immediately prior to the closing of such Change of Control, provided you are still providing services to the Company at such time. In addition, if following a Change of Control you are subject to a Separation without Cause or a Constructive Termination within twelve months following such Change of Control, then the Option shall vest in full; for avoidance of doubt, a Change of Control under this sentence shall include an Excluded Change of Control. The additional vesting of the Option contemplated by the preceding sentence shall be effective on the effective date of the Release referenced in Section 1 required as a condition to Separation Compensation.
FORM OF
RELEASE AGREEMENT
This Release Agreement (this “Agreement”) is dated as of _________, 202_ by and between Alumis Inc. (the “Company”) and (“Executive;” or “You” and together with the Company, the “Parties”).
WHEREAS, the Company and Executive entered into an offer letter, dated ______ __, 202__ (the “Offer Letter”);
1. Resignation. You hereby resign as [INSERT TITLE] of the Company effective as of the Termination Date. You and the Company agree that Your termination is a Separation without Cause or a Constructive Termination (as such terms are defined in Attachment A to the Offer Letter).
2. Final Pay. On the Termination Date, the Company will pay You $_______ __, less all applicable withholdings. This amount represents all of Your salary earned through the Termination Date and all of Your accrued but unused vacation time or PTO. You acknowledge that, prior to the execution of this Agreement, and other than as set forth in Attachment A to Your Offer Letter, You are not entitled to receive any additional money from the Company, and that the only payments that You are entitled to receive from the Company in the future are those specified in this Agreement and Attachment A.
(a) Executive Release. In consideration for the Separation Compensation set forth in Section 3 (above) and other benefits provided to You in this Agreement, to the fullest extent permitted by law, You waive, release and promise never to assert any claims or causes of action, whether or not now known, against the Company or its predecessors, successors or past or present subsidiaries, stockholders, directors, officers, employees, consultants, attorneys, agents, assigns, employee benefit plans, and each of their respective indirect and direct affiliates, stockholders, directors, officers, managers, members, employees, consultants, attorneys, agents and assigns with respect to any matter, including (without limitation) any matter related to Your employment with the Company, the termination of that employment, or Your ownership of the Company’s capital stock, right to purchase or the actual purchase or receipt of shares of the Company’s capital stock, including (without limitation) claims to attorneys’ fees or costs, claims of wrongful discharge, constructive discharge, emotional distress, defamation, invasion of privacy, fraud, breach of contract or breach of the covenant of good faith and fair dealing and any claims of discrimination or harassment based on sex, age, race, national origin, disability or any other basis under Title VII of the Civil Rights Act of 1964, the California Fair Employment and Housing Act, the California Fair Pay Act, the Equal Pay Act, the Age Discrimination in Employment Act of 1967, the Americans with Disabilities Act, the National Labor Relations Act, the Family and Medical Leave Act, the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), the Workers Adjustment and Retraining Notification (“WARN”) Act, the Families First Coronavirus Response Act, the CARES Act, the California WARN Act, and all other laws and regulations relating to employment. However, this release covers only those claims that arose prior to the execution of this Agreement and only those claims that may be waived by applicable law. Execution of this Agreement does not bar any claim that arises hereafter, including (without limitation) a claim for breach of this Agreement and does not bar any claim by Executive for indemnification by the Company for claims, losses or costs arising from or related to his service as an officer and director of the Company.
(b) Waiver. You expressly waive and release any and all rights and benefits under Section 1542 of the California Civil Code (or any analogous law of any other state), which reads as follows:
A general release does not extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party.
If to the Company:
Attn: Chair of the Board of Directors
If to Executive: Last address on file with the Company.
19. Governing Law/Jurisdiction. The terms of this Agreement and the resolution of any disputes as to the meaning, effect, performance or validity of this Agreement or arising out of, related to, or in any way connected with, this Agreement, Your employment with the Company or any other relationship between You and the Company (the “Disputes”) will be governed by California law, excluding laws relating to conflicts or choice of law. Executive and the Company submit to the exclusive personal jurisdiction of the federal and state courts located in San Francisco, California in connection with any Dispute or any claim related to any Dispute.
[Signature Page to Follow]
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Date: | By: | |||
Name: | ||||
Title: |
I agree to the terms of this Agreement, and I am voluntarily signing this release of all claims. I acknowledge that I have read and understand this Agreement, and I understand that I cannot pursue any of the claims and rights that I have waived in this Agreement at any time in the future.
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EXECUTIVE: | ||
Date: | |||
Name: |