Exhibit 10.4

 

SEVERANCE AGREEMENT

 

This Agreement is entered into as of the 1st day of December, 2008 (the
“Effective Date”) by and between ImmunoGen, Inc., a Massachusetts corporation
(the “Company”) and James J. O’Leary, M.D. (the “Executive”).

 

WHEREAS, the Company recognizes that the Executive’s service to the Company is
very important to the future success of the Company;

 

WHEREAS, the Executive desires to enter into this Agreement to provide the
Executive with certain financial protection in the event that his employment
terminates under certain conditions following a change in control of the
Company; and

 

WHEREAS the Board of Directors of the Company (the “Board”) has determined that
it is in the best interests of the Company to enter into this Agreement.

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Company and the Executive hereby agree as
follows:

 

1.             DEFINITIONS.

 

(A)           CAUSE.  FOR PURPOSES OF THIS AGREEMENT, “CAUSE” SHALL MEAN THAT
THE EXECUTIVE HAS (I) INTENTIONALLY COMMITTED AN ACT OR OMISSION THAT MATERIALLY
HARMS THE COMPANY; (II) BEEN GROSSLY NEGLIGENT IN THE PERFORMANCE OF THE
EXECUTIVE’S DUTIES TO THE COMPANY; (III) WILLFULLY FAILED OR REFUSED TO FOLLOW
THE LAWFUL AND PROPER DIRECTIVES OF THE BOARD OR THE CEO; (IV) BEEN CONVICTED
OF, OR PLEADED GUILTY OR NOLO CONTENDRE, TO A FELONY; (V) COMMITTED AN ACT
INVOLVING MORAL TURPITUDE; (VI) COMMITTED AN ACT RELATING TO THE EXECUTIVE’S
EMPLOYMENT OR THE COMPANY INVOLVING, IN THE GOOD FAITH JUDGMENT OF THE BOARD,
MATERIAL FRAUD OR THEFT; (VII) BREACHED ANY MATERIAL PROVISION OF THIS AGREEMENT
OR ANY NONDISCLOSURE OR NON-COMPETITION AGREEMENT BETWEEN THE EXECUTIVE AND THE
COMPANY, AS ALL OF THE FOREGOING MAY BE AMENDED PROSPECTIVELY FROM TIME TO TIME;
OR (VIII) BREACHED A MATERIAL PROVISION OF ANY CODE OF CONDUCT OR ETHICS POLICY
IN EFFECT AT THE COMPANY, AS ALL OF THE FOREGOING MAY BE AMENDED PROSPECTIVELY
FROM TIME TO TIME.

 

(b)           Change in Control.  For purposes of this Agreement, a “Change in
Control” shall mean the occurrence of any of the following events; provided that
“Change in Control” shall be interpreted in a manner, and limited to the extent
necessary, so that it will not cause adverse tax consequences for either party
with respect to Section 409A of the Internal Revenue Code of 1986, as amended
(the “Code”), and Treasury Regulations 1.409A-3(i)(5), and any successor
statute, regulation and guidance thereto:

 

(i)            Ownership.  Any “Person” (as such term is used in
Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended)
becomes 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

 

Executive Severance Agreement (18)

 

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outstanding voting securities (excluding for this purpose any such voting
securities held by the Company or its Affiliates (as defined in the Company’s
2006 Employer, Director and Consultant Equity Incentive Plan) or by any employee
benefit plan of the Company) pursuant to a transaction or a series of related
transactions which the Board does not approve; or

 

(ii)           Merger/Sale of Assets.  (A) A merger or consolidation of the
Company whether or not approved by the Board, 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 or the parent of such corporation) at least 50% of the total
voting power represented by the voting securities of the Company or such
surviving entity or parent of such corporation, as the case may be, outstanding
immediately after such merger or consolidation; or (B) the stockholders of the
Company approve an agreement for the sale or disposition by the Company of all
or substantially all of the Company’s assets; or

 

(iii)          Change in Board Composition.  A change in the composition of the
Board, as a result of which fewer than a majority of the directors are Incumbent
Directors.  “Incumbent Directors” shall mean directors who either (A) are
directors of the Company as of November 11, 2006, or (B) are elected, or
nominated for election, to the Board with the affirmative votes of at least a
majority of the Incumbent Directors at the time of such election or nomination
(but shall not include an individual whose election or nomination is in
connection with an actual or threatened proxy contest relating to the election
of directors to the Company).

 

(C)           DISABILITY.  FOR PURPOSES OF THIS AGREEMENT, “DISABILITY” SHALL
MEAN THAT THE EXECUTIVE (I) IS UNABLE TO ENGAGE IN ANY SUBSTANTIAL GAINFUL
ACTIVITY BY REASON OF ANY MEDICALLY DETERMINABLE PHYSICAL OR MENTAL IMPAIRMENT
WHICH CAN BE EXPECTED TO RESULT IN DEATH OR CAN BE EXPECTED TO LAST FOR A
CONTINUOUS PERIOD OF NOT LESS THAN TWELVE (12) MONTHS, OR (II) IS, BY REASON OF
ANY MEDICALLY DETERMINABLE PHYSICAL OR MENTAL IMPAIRMENT WHICH CAN BE EXPECTED
TO RESULT IN DEATH OR CAN BE EXPECTED TO LAST FOR A CONTINUOUS PERIOD OF NOT
LESS THAN TWELVE (12) MONTHS, RECEIVING INCOME REPLACEMENT BENEFITS FOR A PERIOD
OF NOT LESS THAN THREE (3) MONTHS UNDER A COMPANY-SPONSORED GROUP DISABILITY
PLAN.  WHETHER THE EXECUTIVE HAS A DISABILITY WILL BE DETERMINED BY A MAJORITY
OF THE BOARD BASED ON EVIDENCE PROVIDED BY ONE OR MORE PHYSICIANS SELECTED BY
THE BOARD AND APPROVED BY THE EXECUTIVE, WHICH APPROVAL SHALL NOT BE
UNREASONABLY WITHHELD.

 

(D)           GOOD REASON.  FOR PURPOSES OF THIS AGREEMENT, “GOOD REASON” SHALL
MEAN THE OCCURRENCE OF ONE OR MORE OF THE FOLLOWING WITHOUT THE EXECUTIVE’S
CONSENT: (I) A CHANGE IN THE PRINCIPAL LOCATION AT WHICH THE EXECUTIVE PERFORMS
HIS DUTIES FOR THE COMPANY TO A NEW LOCATION THAT IS AT LEAST FORTY (40) MILES
FROM THE PRIOR LOCATION; (II) A MATERIAL CHANGE IN THE EXECUTIVE’S AUTHORITY,
FUNCTIONS, DUTIES OR RESPONSIBILITIES AS AN EXECUTIVE OF THE COMPANY, WHICH
WOULD CAUSE HIS POSITION WITH THE COMPANY TO BECOME OF LESS RESPONSIBILITY,
IMPORTANCE OR SCOPE THAN HIS HIGHEST POSITION WITH THE COMPANY AT ANY TIME FROM
THE DATE OF THIS AGREEMENT TO IMMEDIATELY PRIOR TO THE CHANGE IN CONTROL,
PROVIDED, HOWEVER, THAT SUCH MATERIAL CHANGE IS NOT IN CONNECTION WITH THE
TERMINATION OF THE EXECUTIVE’S EMPLOYMENT BY THE COMPANY FOR CAUSE OR DEATH OR
DISABILITY AND FURTHER PROVIDED THAT IT SHALL NOT BE CONSIDERED A MATERIAL
CHANGE IF THE COMPANY BECOMES A SUBSIDIARY OF ANOTHER ENTITY AND THE EXECUTIVE
CONTINUES TO HOLD A POSITION IN THE SUBSIDIARY THAT IS AT LEAST AS HIGH AS THE
HIGHEST POSITION HE HELD WITH THE COMPANY AT ANY TIME FROM THE DATE OF THIS
AGREEMENT TO

 

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IMMEDIATELY PRIOR TO THE CHANGE IN CONTROL; (III) A MATERIAL REDUCTION IN THE
EXECUTIVE’S ANNUAL BASE SALARY OR (IV) A MATERIAL REDUCTION IN THE EXECUTIVE’S
TARGET ANNUAL BONUS AS COMPARED TO THE TARGET ANNUAL BONUS SET FOR THE PREVIOUS
FISCAL YEAR.

 

2.             TERM OF AGREEMENT.  THE TERM OF THIS AGREEMENT (THE “TERM”) SHALL
COMMENCE ON THE EFFECTIVE DATE AND SHALL CONTINUE IN EFFECT FOR TWO (2) YEARS;
PROVIDED, HOWEVER, THAT COMMENCING ON SECOND ANNIVERSARY OF THE EFFECTIVE DATE
AND CONTINUING EACH ANNIVERSARY THEREAFTER, THE TERM SHALL AUTOMATICALLY BE
EXTENDED FOR ONE (1) ADDITIONAL YEAR UNLESS, NOT LATER THAN NINE (9) MONTHS
BEFORE THE CONCLUSION OF THE TERM, THE COMPANY OR THE EXECUTIVE SHALL HAVE GIVEN
NOTICE NOT TO EXTEND THE TERM; AND FURTHER PROVIDED, HOWEVER, THAT IF A CHANGE
IN CONTROL SHALL HAVE OCCURRED DURING THE TERM, THE TERM SHALL EXPIRE ON THE
LAST DAY OF THE TWENTY-FOURTH (24TH) MONTH FOLLOWING THE MONTH IN WHICH SUCH
CHANGE IN CONTROL OCCURRED.  NOTICE OF TERMINATION OR TERMINATION OF THIS
AGREEMENT SHALL NOT CONSTITUTE CAUSE OR GOOD REASON (BOTH TERMS AS DEFINED
ABOVE).

 

3.             TERMINATION; NOTICE; SEVERANCE COMPENSATION.

 

(A)           IN THE EVENT THAT WITHIN A PERIOD OF TWO (2) MONTHS BEFORE OR
TWO (2) YEARS FOLLOWING THE CONSUMMATION OF A CHANGE IN CONTROL THE COMPANY
ELECTS TO TERMINATE THE EXECUTIVE’S EMPLOYMENT OTHER THAN FOR CAUSE (BUT NOT
INCLUDING TERMINATION DUE TO THE EXECUTIVE’S DISABILITY), THEN THE COMPANY SHALL
GIVE THE EXECUTIVE NO LESS THAN SIXTY (60) DAYS ADVANCE NOTICE OF SUCH
TERMINATION (THE “COMPANY’S NOTICE PERIOD”); PROVIDED THAT THE COMPANY MAY ELECT
TO REQUIRE THE EXECUTIVE TO CEASE PERFORMING WORK FOR THE COMPANY SO LONG AS THE
COMPANY CONTINUES THE EXECUTIVE’S FULL SALARY AND BENEFITS DURING THE COMPANY’S
NOTICE PERIOD.

 

(B)           IN THE EVENT THAT WITHIN A PERIOD OF TWO (2) MONTHS BEFORE OR
TWO (2) YEARS FOLLOWING THE CONSUMMATION OF A CHANGE IN CONTROL THE EXECUTIVE
ELECTS TO TERMINATE HIS EMPLOYMENT FOR GOOD REASON, THEN THE EXECUTIVE SHALL
GIVE THE COMPANY NO LESS THAN THIRTY (30) DAYS AND NO MORE THAN SIXTY (60) DAYS
ADVANCE NOTICE OF SUCH TERMINATION (THE “EXECUTIVE’S NOTICE PERIOD”); PROVIDED
THAT THE COMPANY MAY ELECT TO REQUIRE THE EXECUTIVE TO CEASE PERFORMING WORK FOR
THE COMPANY SO LONG AS THE COMPANY CONTINUES THE EXECUTIVE’S FULL SALARY AND
BENEFITS DURING THE EXECUTIVE’S NOTICE PERIOD.  IN ORDER TO EFFECT A TERMINATION
FOR GOOD REASON PURSUANT TO THIS AGREEMENT, THE EXECUTIVE MUST NOTICE HIS INTENT
TO TERMINATE FOR GOOD REASON NOT LATER THAN NINETY (90) DAYS FOLLOWING THE
OCCURRENCE OF THE GOOD REASON.

 

(C)           IN THE EVENT THAT WITHIN A PERIOD OF TWO (2) MONTHS BEFORE OR
TWO (2) YEARS FOLLOWING THE CONSUMMATION OF A CHANGE IN CONTROL THE EXECUTIVE’S
EMPLOYMENT WITH THE COMPANY IS TERMINATED BY THE COMPANY OTHER THAN FOR CAUSE
(BUT NOT INCLUDING TERMINATION DUE TO THE EXECUTIVE’S DEATH OR DISABILITY), OR
BY THE EXECUTIVE FOR GOOD REASON, THEN, CONTINGENT UPON THE EXECUTIVE’S
EXECUTION OF A RELEASE OF CLAIMS AGAINST THE COMPANY IN A FORM REASONABLY
ACCEPTABLE TO THE COMPANY (THE “RELEASE”) THE EXECUTIVE SHALL BE ENTITLED TO, IN
ADDITION TO ANY AMOUNTS DUE TO THE EXECUTIVE FOR SERVICES RENDERED PRIOR TO THE
TERMINATION DATE:

 

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(I)  THE EXECUTIVE’S TARGET ANNUAL BONUS FOR THE FISCAL YEAR IN WHICH SUCH
TERMINATION OCCURS AT ONE HUNDRED PERCENT (100%) OF SUCH TARGET ANNUAL BONUS,
PRO-RATED BY THE NUMBER OF CALENDAR DAYS IN WHICH THE EXECUTIVE IS EMPLOYED BY
THE COMPANY DURING THE APPLICABLE YEAR, INCLUDING ANY APPLICABLE NOTICE PERIOD,
AND LESS ANY AMOUNT OF THE TARGET ANNUAL BONUS FOR THE APPLICABLE YEAR
PREVIOUSLY PAID TO THE EXECUTIVE, WHICH SHALL BE PAID NO LATER THAN SIXTY (60)
DAYS AFTER THE EXECUTIVE’S TERMINATION OF EMPLOYMENT, PROVIDED THAT THE RELEASE
IS EXECUTED AND EFFECTIVE BY THEN; AND

 

(II)  A LUMP SUM PAYMENT FROM THE COMPANY IN AN AMOUNT EQUAL TO ONE AND
ONE-HALF (1.5) TIMES THE EXECUTIVE’S ANNUAL SALARY, WHICH SHALL BE PAID NO LATER
THAN SIXTY (60) DAYS AFTER THE EXECUTIVE’S TERMINATION OF EMPLOYMENT, PROVIDED
THAT THE RELEASE IS EXECUTED AND EFFECTIVE BY THEN;

 

(III)  ALL OUTSTANDING OPTIONS, RESTRICTED STOCK AND OTHER SIMILAR RIGHTS HELD
BY THE EXECUTIVE, WHICH SHALL BECOME ONE HUNDRED PERCENT (100%) VESTED; AND

 

(iv)  continuation of medical insurance coverage for the Executive and the
Executive’s family, subject to COBRA and subject to the Executive’s payment of a
premium co-pay related to the coverage that is no less favorable than the
premium co-pay charged to active employees of the Company electing the same
coverage, for eighteen (18) months from the Separation Date; provided that the
Company shall have no obligation to provide such coverage if the Executive fails
to elect COBRA benefits in a timely fashion or if the Executive becomes eligible
for medical coverage with another employer.

 

FOR PURPOSES OF THIS AGREEMENT, “ANNUAL SALARY” SHALL MEAN THE EXECUTIVE’S
ANNUAL BASE SALARY THEN IN EFFECT OR, IF HIGHER, IN EFFECT AT THE TIME OF THE
CHANGE IN CONTROL, EXCLUDING REIMBURSEMENTS AND AMOUNTS ATTRIBUTABLE TO STOCK
OPTIONS AND OTHER NON-CASH COMPENSATION; AND THE “SEVERANCE COMPENSATION” SHALL
MEAN THE COMPENSATION SET FORTH IN (II), (III), AND (IV) ABOVE.

 

(D)           NOTWITHSTANDING ANY OTHER PROVISION WITH RESPECT TO THE TIMING OF
PAYMENTS, IF, AT THE TIME OF THE EXECUTIVE’S TERMINATION, THE EXECUTIVE IS
DEEMED TO BE A “SPECIFIED EMPLOYEE” (WITHIN THE MEANING OF CODE SECTION 409A,
AND ANY SUCCESSOR STATUTE, REGULATION AND GUIDANCE THERETO) OF THE COMPANY, THEN
LIMITED ONLY TO THE EXTENT NECESSARY TO COMPLY WITH THE REQUIREMENTS OF CODE
SECTION 409A, ANY PAYMENTS TO WHICH THE EXECUTIVE MAY BECOME ENTITLED UNDER THIS
AGREEMENT WHICH ARE SUBJECT TO CODE SECTION 409A (AND NOT OTHERWISE EXEMPT FROM
ITS APPLICATION) WILL BE WITHHELD UNTIL THE FIRST (1ST) BUSINESS DAY OF THE
SEVENTH (7TH) MONTH FOLLOWING THE TERMINATION OF THE EXECUTIVE’S EMPLOYMENT, AT
WHICH TIME THE EXECUTIVE SHALL BE PAID AN AGGREGATE AMOUNT EQUAL TO THE
ACCUMULATED, BUT UNPAID, PAYMENTS OTHERWISE DUE TO THE EXECUTIVE UNDER THE TERMS
OF THIS AGREEMENT.

 

(E)           IF ANY PAYMENT OR BENEFIT THE EXECUTIVE WOULD RECEIVE UNDER THIS
AGREEMENT, WHEN COMBINED WITH ANY OTHER PAYMENT OR BENEFIT THE EXECUTIVE
RECEIVES PURSUANT TO A CHANGE IN CONTROL (“PAYMENT”) WOULD (I) CONSTITUTE A
“PARACHUTE PAYMENT” WITHIN THE MEANING OF CODE SECTION 280G, 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 SHALL BE EITHER (X) THE FULL AMOUNT OF
SUCH PAYMENT OR (Y) SUCH LESS AMOUNT 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 EMPLOYMENTS TAXES,
INCOME TAXES, AND THE EXCISE TAX RESULTS IN THE EXECUTIVE’S RECEIPT, ON AN
AFTER-TAX BASIS, OF THE

 

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GREATER AMOUNT OF THE PAYMENT, NOTWITHSTANDING THAT ALL OR SOME PORTION OF THE
PAYMENT MAY BE SUBJECT TO THE EXCISE TAX.  THE COMPANY SHALL DETERMINE IN GOOD
FAITH WHICH PAYMENT(S) OR BENEFIT(S) TO REDUCE BASED ON WHAT PROVIDES THE BEST
ECONOMIC RESULT FOR THE EXECUTIVE.  THE COMPANY SHALL PROVIDE THE EXECUTIVE WITH
SUFFICIENT INFORMATION TO MAKE SUCH DETERMINATION AND TO FILE AND PAY ANY
REQUIRED TAXES.

 

4.             NO DUPLICATION OF COMPENSATION.  THE SEVERANCE COMPENSATION SHALL
REPLACE, AND BE PROVIDED IN LIEU OF, ANY SEVERANCE OR SIMILAR COMPENSATION THAT
MAY BE PROVIDED TO THE EXECUTIVE UNDER ANY OTHER AGREEMENT OR ARRANGEMENT IN
RELATION TO TERMINATION OF EMPLOYMENT; PROVIDED, HOWEVER, THAT THIS PROHIBITION
AGAINST DUPLICATION SHALL NOT BE CONSTRUED TO OTHERWISE LIMIT THE EXECUTIVE’S
RIGHTS TO PAYMENTS OR BENEFITS PROVIDED UNDER ANY PENSION PLAN (AS DEFINED IN
SECTION 3(2) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED), DEFERRED COMPENSATION, STOCK, STOCK OPTION OR SIMILAR PLAN SPONSORED
BY THE COMPANY.

 

5.             NO MITIGATION.  IF THE EXECUTIVE’S EMPLOYMENT WITH THE COMPANY
TERMINATES FOLLOWING A CHANGE IN CONTROL, THE EXECUTIVE IS NOT REQUIRED TO SEEK
OTHER EMPLOYMENT OR TO ATTEMPT IN ANY WAY TO REDUCE ANY AMOUNTS PAYABLE TO THE
EXECUTIVE BY THE COMPANY PURSUANT TO SECTION 3 OR SECTION 15.  EXCEPT AS SET
FORTH IN SECTION 4, THE AMOUNT OF ANY PAYMENT OR BENEFIT PROVIDED FOR IN THIS
AGREEMENT SHALL NOT BE REDUCED BY ANY COMPENSATION EARNED BY THE EXECUTIVE AS
THE RESULT OF EMPLOYMENT BY ANOTHER EMPLOYER, BY RETIREMENT BENEFITS, BY OFFSET
AGAINST ANY AMOUNT CLAIMED TO BE OWED BY THE EXECUTIVE TO THE COMPANY, OR
OTHERWISE.

 

6.             CONFIDENTIALITY, NON-COMPETITION, AND ASSIGNMENT OF INVENTIONS. 
THE COMPANY’S OBLIGATIONS UNDER THIS AGREEMENT ARE CONTINGENT UPON THE
EXECUTIVE’S EXECUTION OF THE COMPANY’S PROPRIETARY INFORMATION, INVENTIONS, AND
COMPETITION AGREEMENT (THE “PROPRIETARY INFORMATION AGREEMENT”).  THE PARTIES
AGREE THAT THE OBLIGATIONS SET FORTH IN THE PROPRIETARY INFORMATION AGREEMENT
SHALL SURVIVE TERMINATION OF THIS AGREEMENT AND TERMINATION OF THE EXECUTIVE’S
EMPLOYMENT, REGARDLESS OF THE REASON FOR SUCH TERMINATION.

 

7.             ENFORCEABILITY.  IF ANY PROVISION OF THIS AGREEMENT SHALL BE
DEEMED INVALID OR UNENFORCEABLE AS WRITTEN, THIS AGREEMENT SHALL BE CONSTRUED,
TO THE GREATEST EXTENT POSSIBLE, OR MODIFIED, TO THE EXTENT ALLOWABLE BY LAW, IN
A MANNER WHICH SHALL RENDER IT VALID AND ENFORCEABLE.  NO INVALIDITY OR
UNENFORCEABILITY OF ANY PROVISION CONTAINED HEREIN SHALL AFFECT ANY OTHER
PORTION OF THIS AGREEMENT.

 

8.             NOTICES.  EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED HEREIN, ANY
NOTICE REQUIRED OR PERMITTED BY THIS AGREEMENT SHALL BE IN WRITING AND SHALL BE
DELIVERED AS FOLLOWS WITH NOTICE DEEMED GIVEN AS INDICATED: (I)  BY PERSONAL
DELIVERY WHEN DELIVERED PERSONALLY; (II) BY OVERNIGHT COURIER UPON WRITTEN
VERIFICATION OF RECEIPT; (III) BY TELECOPY OR FACSIMILE TRANSMISSION UPON
ACKNOWLEDGMENT OF RECEIPT OF ELECTRONIC TRANSMISSION; OR (IV) BY CERTIFIED OR
REGISTERED MAIL, RETURN RECEIPT REQUESTED, UPON VERIFICATION OF RECEIPT.
 NOTICES TO THE EXECUTIVE SHALL BE SENT TO THE LAST KNOWN ADDRESS IN THE
COMPANY’S RECORDS OR SUCH OTHER ADDRESS AS THE EXECUTIVE MAY SPECIFY IN
WRITING.  NOTICES TO THE COMPANY SHALL BE SENT TO THE COMPANY’S CEO AND LEAD
DIRECTOR, OR TO SUCH OTHER COMPANY REPRESENTATIVE AS THE COMPANY MAY SPECIFY IN
WRITING.

 

9.             CLAIMS FOR BENEFITS.  ALL CLAIMS BY THE EXECUTIVE FOR BENEFITS
UNDER THIS AGREEMENT SHALL BE DIRECTED TO AND DETERMINED BY THE BOARD AND SHALL
BE IN WRITING.  ANY DENIAL BY THE BOARD OF A CLAIM FOR BENEFITS UNDER THIS
AGREEMENT SHALL BE DELIVERED TO THE EXECUTIVE IN WRITING AND SHALL SET FORTH THE
SPECIFIC REASONS FOR THE DENIAL AND THE SPECIFIC PROVISIONS OF THIS AGREEMENT
RELIED UPON.  THE

 

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BOARD SHALL AFFORD A REASONABLE OPPORTUNITY TO THE EXECUTIVE FOR A REVIEW OF THE
DECISION DENYING A CLAIM AND SHALL FURTHER ALLOW THE EXECUTIVE TO APPEAL TO THE
BOARD A DECISION OF THE BOARD WITHIN SIXTY (60) DAYS AFTER NOTIFICATION BY THE
BOARD THAT THE EXECUTIVE’S CLAIM HAS BEEN DENIED.

 

10.           MODIFICATIONS AND AMENDMENTS.  THE TERMS AND PROVISIONS OF THIS
AGREEMENT MAY BE MODIFIED OR AMENDED ONLY BY WRITTEN AGREEMENT EXECUTED BY THE
COMPANY AND THE EXECUTIVE.  THE COMPANY AND THE EXECUTIVE AGREE THAT THEY WILL
JOINTLY EXECUTE AN AMENDMENT TO MODIFY THIS AGREEMENT TO THE EXTENT NECESSARY TO
COMPLY WITH THE REQUIREMENTS OF CODE SECTION 409A, OR ANY SUCCESSOR STATUTE,
REGULATION AND GUIDANCE THERETO; PROVIDED THAT NO SUCH AMENDMENT SHALL INCREASE
THE TOTAL FINANCIAL OBLIGATION OF THE COMPANY UNDER THIS AGREEMENT.

 

11.           WAIVERS AND CONSENTS.  THE TERMS AND PROVISIONS OF THIS AGREEMENT
MAY BE WAIVED, OR CONSENT FOR THE DEPARTURE THEREFROM GRANTED, ONLY BY A WRITTEN
DOCUMENT EXECUTED BY THE PARTY ENTITLED TO THE BENEFITS OF SUCH TERMS OR
PROVISIONS.  NO SUCH WAIVER OR CONSENT SHALL BE DEEMED TO BE OR SHALL CONSTITUTE
A WAIVER OR CONSENT WITH RESPECT TO ANY OTHER TERMS OR PROVISIONS OF THIS
AGREEMENT, WHETHER OR NOT SIMILAR.  EACH SUCH WAIVER OR CONSENT SHALL BE
EFFECTIVE ONLY IN THE SPECIFIC INSTANCE AND FOR THE PURPOSE FOR WHICH IT WAS
GIVEN, AND SHALL NOT CONSTITUTE A CONTINUING WAIVER OR CONSENT.

 

12.           BINDING EFFECT; ASSIGNMENT.  THE AGREEMENT WILL BE BINDING UPON
AND INURE TO THE BENEFIT OF (A) THE HEIRS, EXECUTORS AND LEGAL REPRESENTATIVES
OF THE EXECUTIVE UPON THE EXECUTIVE’S DEATH AND (B) ANY SUCCESSOR OF THE
COMPANY.  ANY SUCH SUCCESSOR OF THE COMPANY WILL BE DEEMED SUBSTITUTED FOR THE
COMPANY UNDER THE TERMS OF THE AGREEMENT FOR ALL PURPOSES.  FOR THIS PURPOSE,
“SUCCESSOR” MEANS ANY PERSON, FIRM, CORPORATION OR OTHER BUSINESS ENTITY WHICH
AT ANY TIME, WHETHER BY PURCHASE, MERGER OR OTHERWISE, DIRECTLY OR INDIRECTLY
ACQUIRES ALL OR SUBSTANTIALLY ALL OF THE ASSETS OR BUSINESS OF THE COMPANY. 
NONE OF THE RIGHTS OF THE EXECUTIVE TO RECEIVE ANY FORM OF COMPENSATION PAYABLE
PURSUANT TO THE AGREEMENT MAY BE ASSIGNED OR TRANSFERRED EXCEPT BY WILL OR THE
LAWS OF DESCENT AND DISTRIBUTION.  ANY OTHER ATTEMPTED ASSIGNMENT, TRANSFER,
CONVEYANCE OR OTHER DISPOSITION OF THE EXECUTIVE’S RIGHT TO COMPENSATION OR
OTHER BENEFITS WILL BE NULL AND VOID.

 

13.           GOVERNING LAW.  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE
LAW OF THE COMMONWEALTH OF MASSACHUSETTS, WITHOUT GIVING EFFECT TO THE CONFLICT
OF LAW PRINCIPLES THEREOF.

 

14.           JURISDICTION AND SERVICE OF PROCESS.  ANY LEGAL ACTION OR
PROCEEDING WITH RESPECT TO THIS AGREEMENT SHALL BE BROUGHT IN THE COURTS OF THE
COMMONWEALTH OF MASSACHUSETTS OR OF THE UNITED STATES OF AMERICA FOR THE
DISTRICT OF MASSACHUSETTS.  BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF
THE PARTIES HERETO ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY
AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS.

 

15.           ATTORNEYS’ FEES.  THE COMPANY SHALL PAY TO THE EXECUTIVE ALL LEGAL
FEES AND EXPENSES INCURRED BY THE EXECUTIVE IN DISPUTING IN GOOD FAITH ANY ISSUE
HEREUNDER RELATING TO THE TERMINATION OF THE EXECUTIVE’S EMPLOYMENT, IN SEEKING
IN GOOD FAITH TO OBTAIN OR ENFORCE ANY BENEFIT OR RIGHT PROVIDED BY THIS
AGREEMENT.  SUCH PAYMENTS SHALL BE MADE WITHIN FIVE (5) BUSINESS DAYS AFTER
DELIVERY OF THE EXECUTIVE’S WRITTEN REQUESTS FOR PAYMENT ACCOMPANIED WITH SUCH
EVIDENCE OF FEES AND EXPENSES INCURRED AS THE COMPANY REASONABLY MAY REQUIRE.

 

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16.           WITHHOLDING.  THE COMPANY IS AUTHORIZED TO WITHHOLD, OR TO CAUSE
TO BE WITHHELD, FROM ANY PAYMENT OR BENEFIT UNDER THE AGREEMENT THE FULL AMOUNT
OF ANY APPLICABLE WITHHOLDING TAXES.

 

17.           TAX CONSEQUENCES.  THE COMPANY DOES NOT GUARANTEE THE TAX
TREATMENT OR TAX CONSEQUENCES ASSOCIATED WITH ANY PAYMENT OR BENEFIT ARISING
UNDER THIS AGREEMENT.

 

18.           ACKNOWLEDGMENT.  THE EXECUTIVE ACKNOWLEDGES THAT HE HAS HAD THE
OPPORTUNITY TO DISCUSS THIS MATTER WITH AND OBTAIN ADVICE FROM HIS PRIVATE
ATTORNEY, HAS HAD SUFFICIENT TIME TO, AND HAS CAREFULLY READ AND FULLY
UNDERSTANDS ALL THE PROVISIONS OF THE AGREEMENT, AND IS KNOWINGLY AND
VOLUNTARILY ENTERING INTO THE AGREEMENT.

 

19.           COUNTERPARTS.  THIS AGREEMENT MAY BE EXECUTED IN TWO OR MORE
COUNTERPARTS, EACH OF WHICH SHALL BE DEEMED AN ORIGINAL, BUT ALL OF WHICH
TOGETHER SHALL CONSTITUTE ONE AND THE SAME INSTRUMENT.

 

20.           SECTION 409A.  THE PARTIES HERETO INTEND THAT THIS AGREEMENT
COMPLY WITH THE REQUIREMENTS OF CODE SECTION 409A AND RELATED REGULATIONS AND
TREASURY PRONOUNCEMENTS.  IF ANY PROVISION PROVIDED HEREIN RESULTS IN THE
IMPOSITION OF AN ADDITIONAL TAX UNDER THE PROVISIONS OF CODE SECTION 409A, THE
EXECUTIVE AND THE COMPANY AGREE THAT SUCH PROVISION WILL BE REFORMED TO AVOID
IMPOSITION OF ANY SUCH ADDITIONAL TAX IN THE MANNER THAT THE EXECUTIVE AND THE
COMPANY MUTUALLY AGREE IS APPROPRIATE TO COMPLY WITH CODE SECTION 409A.

 

 

IN WITNESS WHEREOF, the parties have executed and delivered this Severance
Agreement as of the day and year first above written.

 

 

COMPANY:

 

 

 

IMMUNOGEN, INC.

 

 

 

 

 

/s/ Mitchel Sayare

 

Name: Mitchel Sayare, Ph.D.

 

Title: Chairman and Chief Executive Officer

 

 

 

 

 

EXECUTIVE:

 

 

 

 

 

/s/ James O’Leary

 

Name: James J. O’Leary, M.D.

 

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