Exhibit 10.l

December 8, 2014

Robert W. Crane

17 Trailside Circle

Sudbury, MA 01776

Re: Separation Agreement

Dear Bob:

The purpose of this letter agreement (the “Agreement”) is to set forth the terms
of your separation from GI Dynamics, Inc. (the “Company”). Payment of the
Separation Benefit described below is contingent on your agreement to and
compliance with the terms of this Agreement. As explained more fully in
Section 8 below, you have forty five (45) days in which to sign this Agreement,
and this Agreement shall become effective on the eighth (8th) day following such
signing date (the “Effective Date”).

1. Separation of Employment. Your employment with the Company shall end on
March 8, 2015 (the “Separation Date”). The period between the Effective Date and
the Separation Date shall be referred to herein as the Transition Period. You
acknowledge and agree that the Separation Date was discussed and agreed between
you and the Company, following the Company’s provision of ninety (90) days’
advance notice of a separation pursuant to your offer letter agreement. In light
of the foregoing, you acknowledge and agree that you shall not be entitled to
any additional notice period or severance payment before or after the Separation
Date other than as described herein, and that you shall have no authority and
shall not represent yourself as an employee or agent of the Company following
the Separation Date.

2. Transition Period. During the Transition Period you shall remain employed by
the Company. During this period of time, the Company may in its discretion
request that you come into the office and that you remain available, upon
reasonable notice, to provide assistance with the transition of your duties and
responsibilities (including but not limited to the transition of matters,
functions, documents, files, and related items and tasks) to Company personnel.
Subject to the terms of this Agreement, your employment during the Transition
Period shall continue pursuant to the terms and conditions that currently apply
to your employment with the Company. For instance, you shall continue to be paid
at your current base salary in accordance with the Company’s normal payroll
practices, you shall continue your participation in the Company’s benefit plans
under the same terms and conditions as you currently are participating, and you
shall be expected to abide by applicable Company agreements, policies and
procedures.

You will receive an annual bonus for the calendar year ended December 31, 2014
of 83% of your Eligible Bonus depending upon whether there is a U.S. listing by
year end (Exhibit A). Such bonus shall be paid to you within forty five
(45) days following the close of the fiscal year to which it relates, and in no
event later than March 15th of the calendar year immediately following the
calendar year in which it was earned.

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3. Separation Benefit. In exchange for the mutual covenants set forth in this
Agreement, and subject to your compliance with the terms of this Agreement, the
Company shall provide you with the following (the “Separation Benefit”),
following the Separation Date:

(a) Payment of an amount equal to twelve (12) months of your gross monthly base
salary, less all applicable federal, state, local and other employment-related
deductions, such payments to be made in approximately equal installments on the
Company’s regularly scheduled paydays beginning on the first such payday
following the Separation Date.

(b) In the event that you choose to exercise your right under COBRA1/ to
continue your participation in the Company’s health insurance plan (which you
may do, to the extent permitted by COBRA, regardless of whether you accept this
Agreement), the Company shall pay its normal share of the costs for such
coverage for a period of twelve (12) months beginning on the Separation Date to
the same extent that such insurance is provided to persons then currently
employed by the Company. Your co-pay, if any, shall be deducted from your
severance payments described in Section 2(a) above or, if no such payments
remain to be paid, shall be paid by you directly to the Company pursuant to the
terms of the COBRA notice provided to you on your last day of employment.
Notwithstanding any other provision of this Agreement, this obligation shall
cease on the date you become eligible to receive health insurance benefits
through any other employer, and you agree to provide the Company with written
notice immediately upon becoming eligible for such benefits. Your acceptance of
any payment on your behalf or coverage provided hereunder shall be an express
representation to the Company that you have no such eligibility.

You acknowledge and agree that the Separation Benefit is not intended to and
shall not constitute a severance plan, and shall confer no benefit on anyone
other than the parties hereto. You further acknowledge that except for the
Separation Benefit, your final wages, and any accrued but unused vacation, which
shall be paid to you in accordance with the Company’s regular payroll practices
and applicable law, you are not now and shall not in the future be entitled to
any other compensation from the Company including, without limitation, other
wages, commissions, bonuses, vacation pay, holiday pay, paid time off or any
other form of compensation or benefit.

4. Equity. The terms and conditions of the Company’s 2003 Omnibus Stock Plan and
the 2011 Employee, Director and Consultant Equity Incentive Plan (the “Stock
Plans”) and any agreements executed by you pursuant thereto (together, the
“Stock Option Agreements”) are incorporated herein by reference and shall
survive the signing of this Agreement. You acknowledge and agree that, as of the
Separation Date, you shall be vested in 693,607 options pursuant to such Stock
Plans and Stock Option Agreements. Pursuant to the Stock Plans and your Option
Agreement, you are permitted to exercise any unexercised

 

 

1/ “COBRA” is the Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended.

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vested options ninety (90) days following the Separation Date. Following the
Separation Date you shall not have any right to vest in any additional stock or
stock options under the Stock Plans, Stock Option Agreements or any other
Company stock or stock option plan (of whatever name or kind) that you may have
participated in or were eligible to participate in during your employment.
Notwithstanding your separation, you shall remain subject to the Company’s
insider trading rules and Australian securities laws, including but not limited
to restrictions regarding trading securities while in possession of material
non-public information regarding the Company.

 

  (a) You request, and the Company agrees to take such action as shall cause,
each stock option issued to you under either Stock Plan that is designated as an
“incentive stock option” (each an “ISO”), except with respect to any part of
such ISO that is or has been exercised in accordance with applicable law and the
terms of the applicable Stock Plan and Option Agreement, to be converted into a
non-qualified option pursuant to the provisions of the applicable Stock Plan
(each a “Converted Option”); provided, however, that each such Converted Option
shall continue to vest and be exercisable in accordance with their terms only
for so long as you continue to provide services as an employee, director or
consultant to the Company and any post-termination period (60 or 90 days)
permitted pursuant to the applicable Stock Plan and Option Agreement; provided
you shall be entitled to exercise all vested options at least through
December 8, 2015.

5. Your Confidentiality, Non-Disparagement and Related Obligations. You
expressly acknowledge and agree to the following:

(a) That you shall adhere to the terms of your Nondisclosure, Non-Solicitation
and Non-Compete Agreement with the Company (attached hereto), which is expressly
incorporated herein and survives the signing of this Agreement.

(b) That on the Separation Date, or earlier if requested by the Company, you
shall return to the Company all confidential Company documents, files and
property (and any copies thereof), and that you shall otherwise abide by any and
all common law and/or statutory obligations relating to protection of the
Company’s trade secrets and/or confidential and proprietary information at all
times. You shall be entitled to keep your phone, phone number and any computer
equipment currently in your possession.

(c) That all non-public information relating in any way to the negotiation of
this Agreement, including the terms and amount of financial consideration
provided for in this Agreement, shall be held confidential by you and shall not
be publicized or disclosed to any person (other than an immediate family member,
legal counsel or financial advisor, provided that any such individual to whom
disclosure is made agrees to be bound by these confidentiality obligations),
business entity or government agency (except as mandated by state or federal
law), except that nothing in this section shall prohibit you from participating
in an investigation with a state or federal agency if requested by the agency to
do so.

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(d) That you shall not make any statements that are professionally or personally
disparaging about, or adverse to, the interests of the Company (including its
officers, directors, employees and consultants) including, but not limited to,
any statements that disparage any person, product, service, finances, financial
condition, capability or any other aspect of the business of the Company, and
that you shall not engage in any conduct which could reasonably be expected to
harm professionally or personally the reputation of the Company (including its
officers, directors, employees and consultants).

(e) That a breach of this section shall constitute a material breach of this
Agreement and, in addition to any other legal or equitable remedy available to
the Company, shall entitle the Company to recover any Separation Benefit paid to
you under this Agreement.

6. Cooperation. You agree that during the twelve (12) month period following the
Separation Date, you shall cooperate fully with the Company in connection with
any matter or event relating to your employment or events that occurred during
your employment, including, without limitation: (a) cooperating in the defense
or prosecution of any claims or actions now in existence or which may be brought
or threatened in the future against or on behalf of the Company (including any
claims or actions against its affiliates and its and their officers and
employees); (b) being available, upon reasonable notice, to meet with the
Company regarding matters in which you have been involved (including but not
limited to contract matters and audits); (c) preparing for, attending and
participating in any legal proceeding (including but not limited to depositions,
consultation, discovery, trial, acting as a witness, and providing affidavits);
(d) assisting with any audit, inspection, proceeding or other inquiry; and
(e) transferring your work knowledge to the Company (including but not limited
to providing a description of your job functions and any information required to
perform the same, such as contact information, passwords, scheduling
requirements, deadlines and the like). You further agree that should you be
contacted (directly or indirectly) by any person or entity adverse to the
Company, you shall promptly notify Michael Dale at the Company. You shall be
reimbursed for any reasonable out-of pocket costs approved in advance by the
Company and incurred in connection with providing such cooperation under this
section.

7. Your Release of Claims.

(a) Release. You waive and release the Company from any waivable claim arising
from or related to your employment relationship with the Company up through the
Effective Date including, without limitation: (i) claims under any Massachusetts
(or any other state) or federal discrimination, fair employment practices, or
other employment related statute, regulation or executive order (as they may
have been amended through the Effective Date), including but not limited to the
Age Discrimination in Employment Act, the Older Workers Benefit Protection Act,
the Civil Rights Acts of 1866 and 1871, Title VII of the Civil Rights Act of
1964, the Civil Rights Act of 1991, the Equal Pay Act, the Americans With
Disabilities Act, the Massachusetts Fair Employment Practices Statute, and any
similar Massachusetts or other state or federal statute; (ii) claims under any
other Massachusetts (or

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any other state) or federal employment related statute, regulation or executive
order (as they may have been amended through the Effective Date) relating to
wages, hours or any other terms and conditions of employment, including but not
limited to the National Labor Relations Act, the Family and Medical Leave Act,
the Employee Retirement Income Security Act of 1974, COBRA, the Massachusetts
Wage Act, and any similar Massachusetts or other state or federal statute;
(iii) claims under any Massachusetts (or any other state) or federal common law
theory, including, without limitation, wrongful discharge, breach of express or
implied contract, promissory estoppel, unjust enrichment, breach of a covenant
of good faith and fair dealing, violation of public policy, defamation,
interference with contractual relations, intentional or negligent infliction of
emotional distress, invasion of privacy, misrepresentation, deceit, fraud or
negligence or any claim to attorneys’ fees under any applicable statute or
common law theory of recovery; and (iv) any other claim arising under other
state or federal law.

(b) Release Limitations; Participation in Agency Proceedings. Notwithstanding
the foregoing, this section does not: (i) release the Company from any
obligation expressly set forth in this Agreement; (ii) waive or release any
legal Claims which you may not waive or release by law, including without
limitation obligations under workers compensation laws; or (iii) prohibit you
from challenging the validity of this release under federal law, from filing a
charge or complaint of employment related discrimination with the Equal
Employment Opportunity Commission (“EEOC”) or similar state agency, or from
participating in any investigation or proceeding conducted by the EEOC or
similar state agency.

Your waiver and release, however, are intended to be a complete bar to any
recovery or personal benefit by or to you with respect to any Claim (except
those which cannot be released under law), including those raised through a
charge with the EEOC. Accordingly, nothing in this section shall be deemed to
limit the Company’s right to seek immediate dismissal of such charge or
complaint on the basis that your signing of this Agreement constitutes a full
release of any individual rights under the federal discrimination laws, or to
seek restitution to the extent permitted by law of the economic benefits
provided to you under this Agreement in the event you successfully challenge the
validity of this release and prevail in any Claim under the federal
discrimination laws.

(c) Acknowledgement. You acknowledge and agree that, but for providing the
waiver and release in this section, you would not be receiving the economic
benefits being provided to you under the terms of this Agreement.

8. ADEA/OWBPA Review and Revocation Period. You and the Company acknowledge that
you are over the age of 40 and that you, therefore, have specific rights under
the Age Discrimination in Employment Act (“ADEA”) and the Older Workers Benefit
Protection Act (the “OWBPA”), which prohibit discrimination on the basis of age.
It is the Company’s desire and intent to make certain that you fully understand
the provisions and effects of this Agreement, which includes a release of claims
under the ADEA and OWBPA. To that end, you have been encouraged and given the
opportunity to consult with legal counsel for the purpose of reviewing the terms
of this Agreement. In addition, consistent with the provisions of the ADEA and
OWBPA, the Company also is providing you with forty five

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(45) days in which to consider and accept the terms of this Agreement by signing
below and returning it to Joan Resnicow, GI Dynamics, Inc., 25 Hartwell Avenue,
Lexington, MA 02421. Additionally, you may rescind your assent to this Agreement
if, within seven (7) days after you sign this Agreement, you deliver by hand or
send by mail (certified, return receipt and postmarked within such 7 day period)
a notice of rescission to Joan Resnicow at the above-referenced address.

9. Waiver of Employment. You hereby waive and release forever any right or
rights you may have to employment with the Company and any affiliate thereof at
any time following the Separation Date, and agree not to seek or make
application for employment with the Company or any affiliate thereof.

10. Taxes. The Company does not guarantee the tax treatment or tax consequences
associated with any payment or benefit arising under this Agreement, including
but not limited to consequences related to Section 409A of the Internal Revenue
Code of 1986, as amended (“Code Section 409A”).

11. Entire Agreement; Modification; Waiver; Choice of Law; Enforceability. You
acknowledge and agree that, other than the agreements expressly incorporated
herein and stated as surviving this Agreement, this Agreement supersedes any and
all prior or contemporaneous oral and/or written agreements between you and the
Company, and sets forth the entire agreement between you and the Company. No
variations or modifications hereof shall be deemed valid unless reduced to
writing and signed by the parties hereto. The failure of the Company to seek
enforcement of any provision of this Agreement in any instance or for any period
of time shall not be construed as a waiver of such provision or of the Company’s
right to seek enforcement of such provision in the future. This Agreement shall
be deemed to have been made in Massachusetts, shall take effect as an instrument
under seal within Massachusetts, and shall be governed by and construed in
accordance with the laws of Massachusetts, without giving effect to conflict of
law principles. You agree that any action, demand, claim or counterclaim
relating to the terms and provisions of this Agreement, or to its breach, shall
be commenced in Massachusetts in a court of competent jurisdiction, and you
further acknowledge that venue for such actions shall lie exclusively in
Massachusetts and that material witnesses and documents would be located in
Massachusetts. Both parties hereby waive and renounce in advance any right to a
trial by jury in connection with such legal action. The provisions of this
Agreement are severable, and if for any reason any part hereof shall be found to
be unenforceable, the remaining provisions shall be enforced in full.

12. Knowing and Voluntary Agreement. By executing this Agreement, you are
acknowledging that you have been afforded sufficient time to understand the
terms and effects of this Agreement, that your agreements and obligations
hereunder are made voluntarily, knowingly and without duress, and that neither
the Company nor its agents or representatives have made any representations
inconsistent with the provisions of this Agreement.

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This Agreement may be signed on one or more copies, each of which when signed
shall be deemed to be an original, and all of which together shall constitute
one and the same Agreement. If the foregoing correctly sets forth our
understanding, please sign, date and return the enclosed copy of this Agreement
to Joan Resnicow within forty five (45) days. If we do not receive your
acceptance on or before this date, the Agreement shall terminate and be of no
further force or effect.

 

Sincerely, GI Dynamics, Inc. By: /s/    Michael Dale         Date: January 21,
2015

Acknowledged and Agreed:

 

/s/    Robert Crane         Signed Name Robert Crane Printed Name Jan 21, 2015
Date

 

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Exhibit A

Calculation of 2014 Bonus

Bonus is calculated assuming a weighting of 20% for the Corporate Objectives and
80% for the Individual Objectives. The calculations are detailed below.

 

Individual Objectives:

Objective

Weight Accomplished? Accomplished
Weight

Cash burn of $51.9 or less

35% Yes 35%

Capital Raise of $25mm or more

35% Yes 35%

Expenses below $10.8

10% Yes 10%

List on US Exchange by year-end (1)

10% NO 0

SOX compliance by year-end

10% Yes 10% Indiv Total 90% Indiv Weight 80%         

 

72%

Corporate Objectives:

Objective

Weight Accomplished? Accomplished
Weight

Revenue of $4.6mm

25% No 0%

Cash burn of $51.9 or less

20% Yes 20%

Capital Raise of $25mm or more

20% Yes 20%

Complete enrollment in pivotal trial

20% No 0%

LMR of new material

15% Yes 15% Corp Total 55% Corp Weight 20%         

 

11%

Percent of 2014 Objectives Achieved

83%

  (1) This milestone is not final and in the event it is not achieved, the
Percent of 2014 Objectives Achieved shall be 83%.