EXHIBIT 10.31
[MILLENNIUM LETTERHEAD]
March 1, 2004
Xxxxxx X. Xxxxxxx
c/o Millennium Pharmaceuticals, Inc.
00 Xxxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Dear Xx. Xxxxxxx:
This letter memorializes the agreement ("Agreement") between you and
Millennium Pharmaceuticals, Inc. ("Millennium") regarding your retirement from
employment with Millennium effective as of December 31, 2003 (the "Retirement
Date").
1. Pursuant to your retirement and the letter agreement between us
dated December 24, 2002 ("December Letter"), Millennium will provide you with
the following: (a) continuation of your Millennium base salary at the annual
rate of $500,000 ("Base Salary"), for a period of 18 months from the Retirement
Date; (b) a bonus in the amount of $400,000, which equals 80% of your Base
Salary; (c) provided that you elect continued coverage under federal COBRA law,
payment of the portion of premiums of your group health insurance coverage,
including coverage for your eligible dependents, that Millennium paid prior to
the Retirement Date, for a period of 12 months following the Retirement Date,
subject to the limitations stated in Section 4(c) of the COR Therapeutics, Inc.
Key Employees Change in Control Severance Plan ("COR Severance Plan"); and (d)
all other rights and benefits currently afforded generally to retired Millennium
employees under Millennium's equity incentive programs or otherwise. Millennium
will make the base salary continuation payments in regular installments on the
normal payroll dates of Millennium, or over a shorter period as determined by
Millennium. Millennium will pay you the bonus at the same time as such payments
for other executives of Millennium. All amounts that you receive under this
paragraph 1 will be subject to all required tax withholding.
2. Because the Retirement Date is prior to February 12, 2004, any
outstanding options to purchase shares of the common stock of Millennium
("Pre-Merger Options") held by you on February 12, 2002 (immediately after the
Merger) immediately vested and became exercisable in full as of the Retirement
Date. All such Pre-Merger Options will otherwise remain subject to the terms and
conditions set forth in the applicable stock option plans and stock option
agreements, including but not limited to your right to exercise all such
Pre-Merger Options within three (3) months after the
termination of your service to Millennium as an employee, consultant or
Millennium Director, whichever is later.
3. You expect to remain in your role as a Director of Millennium. Under
Millennium's 2000 Stock Incentive Plan (the "2000 Plan") you are eligible to
continue vesting into any options you have received under that plan
("Post-Merger Options") so long as you serve as a Millennium Director. You have,
however, agreed that all of the Post-Merger Options that you held as of the
Retirement Date will cease vesting on the earlier to occur of: a) the end of
your service as a Millennium Director or b) one year from the Retirement Date.
The Post-Merger Options will remain subject to the terms and conditions set
forth in the 2000 Plan and applicable stock option agreements, including but not
limited to your right to exercise all vested shares of Post-Merger Options
within three years after the Retirement Date. Any options you receive after the
date hereof will vest and be exercisable in accordance with their terms. You
will not receive the normal stock option grants for new outside directors of
Millennium, but assuming you remain a Director of Millennium at the times of the
2004 on-going Millennium Director option grants, you will receive a pro rata
portion of the standard non-employee Director annual option grants for 2004
(calculated in accordance with Board approved policies), in the aggregate amount
of 7,500 shares granted in three installments on May1, 2004, June 1, 2004 and
July 1, 2004, and subject to increase if and to the extent said rate is
increased subsequent to such date. Thereafter, assuming your ongoing service on
the Millennium Board of Directors, you will be eligible for on-going option
grants to Millennium's non-employee Directors in accordance with the policies
adopted by Millennium's Board of Directors.
4. Except as provided herein, this Agreement supersedes the December
Letter and the COR Severance Plan, and the parties specifically acknowledge and
agree that the rights and obligations contained in the December Letter and the
COR Severance Plan (including, but not limited to, Section 4(f) ("Offsets"))
shall be of no further force or effect.
5. If any payment or benefit you would receive pursuant to this
agreement, when combined with any other payment or benefit you receive pursuant
to the termination of your employment with Millennium ("Payment") would (i)
constitute a "parachute payment" within the meaning of Section 280G of the
Internal Revenue Code of 1986, as amended (the "Code"), and (ii) but for this
sentence, be subject to the excise tax imposed by Section 4999 of the Code (the
"Excise Tax"), then such Payment will be either (x) the full amount of Payment
or (y) such lesser amount (with cash payments being reduced before stock option
compensation) as would result in no portion of the Payment being subject to the
Excise Tax, whichever of the foregoing amounts, taking into account the
applicable federal, state and local employment taxes, income taxes, and the
Excise Tax results in your receipt, on an after-tax basis, of the greater amount
of the Payment notwithstanding that all or some portion of the Payment may be
subject to the Excise Tax.
6. In consideration of receiving the consideration outlined herein, you
hereby release and forever discharge and hold Millennium, as well as its current
and former
successors, employees, officers, directors, shareholders, parents, subsidiaries,
affiliates and agents, harmless of all claims or suits of any nature whatsoever,
including, but not limited to, any claims under federal, state and local laws
that prohibit discrimination (including without limitation, claims of
discrimination based on race, age, religion, national origin, sex, disability or
handicap, and sexual orientation) and any claims with respect to breach of
contract (express and/or implied), wrongful termination, Worker Adjustment and
Retraining Notification Act and related state statute notification obligations,
the Older Workers Benefit Protection Act of 1990 and related state statutes,
intentional or negligent infliction of emotional distress, interference with
contractual or advantageous business relations, loss of consortium, invasion of
privacy, defamation, payment of wages, debts, costs and expenses, attorneys'
fees and other damages, and any claims arising out of or in any way related to
your employment with Millennium, which you now have, may have, or may have had
from the beginning of time to the Retirement Date. Nothing in this paragraph
shall be construed in any way to release Millennium from its obligation to
indemnify you from any third party action brought against you based on your
employment with or service as a Director to Millennium pursuant to any
applicable agreement or applicable law or to reduce or eliminate any coverage
you may have under Millennium's director and officer liability policies, if any.
7. As required by the Older Workers Benefit Protection Act of 1990, you
acknowledge: (i) that you have been advised and given the opportunity to consult
with your own counsel prior to signing this Agreement; (ii) that you have been
given 21 days from the receipt of this Agreement to consider whether to sign it;
(iii) that you have been advised that even after you sign this Agreement, you
may revoke it within 7 days of the date of your signing, by delivering a signed
revocation notice to Millennium's Vice-President of Human Resources; (iv) that
this Agreement shall not become effective and in force until eight (8) days
after you sign it, and (v) that you will not be entitled to receive the payments
described herein until after the 7-day revocation period has expired, and that,
should you in fact revoke your acceptance, none of the payments outlined in
Paragraph 1 will be made.
8. This Agreement may be amended or modified only by a written
instrument executed by you and Millennium. This agreement will be interpreted
and enforced in accordance with the laws of the Commonwealth of Massachusetts.
Please acknowledge your agreement by countersigning this letter below.
Sincerely,
MILLENNIUM PHARMACEUTICALS, INC.
By: /s/ XXXXXXX XXXX
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Name: Xxxxxxx Xxxx
Title: EVP and Chief Financial Officer
AGREED TO:
/s/ XXXXXX X. XXXXXXX
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Xxxxxx X. Xxxxxxx
Dated: 3/2/04
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