Exhibit 10.25

 

April 15, 2005

 

VIA EMAIL AND FEDERAL EXPRESS

 

James Hayden

 

Dear James:

 

On behalf of Pharsight Corporation (“Pharsight” or the “Company”), I am pleased
to offer you the position of Senior Vice President, Global Sales, reporting
directly to me, with a start date of April 18, 2005 or as otherwise mutually
agreed.

 

We are confident that you will make an outstanding addition to our team. There
are many professional and technical challenges and the company is still small
enough and growing rapidly enough to provide ample opportunity for professional
development and an increasing role in the leadership of the firm. Pharsight also
offers you the opportunity to participate in the company’s growth, on both a
financial and intellectual basis.

 

Base Salary and Bonus Potential

 

Your base salary will be $180,000 annually, and will be paid semi-monthly. In
FY2006 (which began April 1, 2005), you will be eligible for a variable
performance bonus, based on quota attainment and performance objectives to be
determined, targeted at $140,000, with total compensation targeted at $320,000.
This bonus is tied to company corporate performance goals as well as specific
goals to be determined based upon your individual responsibilities, and will be
pro-rated from your date of hire for FY2006 to reflect the date on which you
joined the Company as Senior Vice President, Global Sales. The Company’s
Compensation Committee will determine in its sole discretion whether you have
earned an annual bonus, and the amount of any earned annual bonus, provided that
you are employed by Pharsight and in good standing at the time of annual
payment.

 

The Company may modify your compensation from time to time as it deems
necessary.

 

Employee Benefits

 

You will be eligible for Pharsight’s employee benefits programs, including
health, dental, life and disability insurance and 401(k) plan.

 

Stock Options

 

In addition, I will recommend to the Board that you be granted an option to
purchase two hundred thousand (200,000) shares of Pharsight common stock with an
exercise price equal to the fair market value of such shares in accordance with
the terms of the Company’s 2000 Equity Incentive Plan. Such options will vest
over a four (4) year period as follows: 25% will vest on the first anniversary
date of grant and the remainder will vest in equal monthly installments
thereafter until fully vested (“Vesting Schedule”). However, upon a Change of
Control (as defined in the Company’s 2000 Equity Incentive

 

--------------------------------------------------------------------------------

Offer Letter for James Hayden

April 15, 2005

Page 2

 

Plan), the Vesting Schedule will accelerate by one (1) year (“Accelerated
Vesting”). Accelerated Vesting will immediately vest upon a Change of Control,
the number of options equal to the amount, which would have vested one year from
the occurrence of such event. Accelerated Vesting described herein will
supplement, but not supersede section 12(c) of the Company’s 2000 Equity
Incentive Plan as amended and restated.

 

Confidential Information and Inventions Assignment Agreement; Company Policies
and Procedures

 

As a condition of your employment with Pharsight, you will be required to sign
the Company’s Confidential Information and Inventions Assignment Agreement, two
originals of which are enclosed. Please sign both originals and return one to me
with your acceptance of this offer.

 

In order to comply with Federal labor law requirements (IRCA), you will be
required to provide the Company documentary evidence of your identity and
eligibility for employment in the United States. Such documentation must be
provided to us within three (3) business days of your date of hire, or our
employment relationship with you may be terminated.

 

In addition, you will continue to be required to abide by the Company’s policies
and procedures, as may be in effect from time to time and as reflected in the
Company’s Employee Handbook.

 

At-Will Employment Relationship

 

Your employment continues to be terminable at-will, and either you or the
Company may terminate your employment relationship at any time, with or without
Cause (defined below) or advance notice.

 

Severance Benefits

 

In the event that your employment is involuntarily terminated by the Company
without Cause, as your sole severance benefits, the Company will continue to pay
your base salary and health care benefits in effect on the termination date for
six (6) months (the “Severance Payments”). As a condition of your receipt of the
Severance Payments, you must first enter into a separation agreement with the
Company that includes your general release of all known and unknown claims, in a
form provided by the Company. The Severance Payments will be paid on the
Company’s normal payroll schedule and will be subject to standard deductions and
withholdings.

 

For the purposes of this letter, “Cause” for your termination shall mean: (a)
your conviction of any felony or of any crime involving dishonesty; (b) your
participation in any fraud or act of dishonesty against the Company; (c) failure
to perform your assigned duties or responsibilities as an employee (other than a
failure resulting from a “disability” as that term is defined in Section
22(e)(3) of the Internal Revenue Code of 1986, as amended (the “Code”) after
written notice thereof from the Company setting forth your failure to perform
such duties or responsibilities; (d) your intentional damage to, or willful
misappropriation of, any property of the Company; (e) your material breach of
any written agreement with the Company (including this Agreement or your
Confidential Information and Invention Assignment Agreement); or (f) conduct,
that in the good faith and reasonable determination of the Board demonstrates
gross unfitness to serve.

 

In addition, if, within six (6) months of a Change in Control (defined below),
you resign from your employment with the Company and such resignation qualifies
as a Resignation for Good Reason (defined below), you shall be entitled to
receive the Severance Benefits, provided that you must first enter into a
separation agreement with the Company that includes your general release of all
known and unknown claims, in a form provided by the Company.

 

--------------------------------------------------------------------------------

Offer Letter for James Hayden

April 15, 2005

Page 3

 

For the purposes of this letter, the occurrence of either of the following
events shall constitute a “Change in Control”: (a) the sale or lease of all or
substantially all of the assets of the Company; or (b) an acquisition of the
Company by another corporation or entity by consolidation, merger or other
reorganization in each case in which the holders of the Company’s outstanding
voting stock immediately prior to such transaction own, immediately after such
transaction, securities representing less than fifty percent (50%) of the voting
power of the corporation or other entity purchasing such assets or surviving
such transaction.

 

For purposes of this letter, a “Resignation for Good Reason” shall mean a
resignation by you due to any of the following events which occur after and as a
direct result of a Change in Control: (1) a material reduction in compensation,
unless such a reduction is applied, by resolution of the Board of Directors, to
all members of the Company’s officers; (2) a material adverse change in your
title due to a demotion; (3) a material adverse reduction in your role and
responsibilities; or (4) a requirement for you to relocate as a part of your
position.

 

You will not be eligible for any severance benefits in the event of a
termination with Cause or any resignation that does not qualify as a Resignation
for Good Reason.

 

I am providing two originals of this letter. Please sign and return one to
indicate your acceptance. This offer is valid through April 22, 2005. We are
excited about the prospect of having you on the Pharsight team.

 

Sincerely,

PHARSIGHT CORPORATION

/s/ Shawn O’Connor

Shawn O’Connor

President and Chief Executive Officer

 

--------------------------------------------------------------------------------

Offer Letter for James Hayden

April 15, 2005

Page 4

 

I accept employment with Pharsight Corporation subject to the terms and
conditions hereof. I understand that the terms set forth in this letter
supersede all oral discussions I may have had with anyone in the Company.

 

ACCEPTED:

/s/ James Hayden

James Hayden

April 19, 2005

Date