EXHIBIT 10.1

FORM OF

CHANGE IN CONTROL AGREEMENT

This Change in Control Agreement (“Agreement”) is made as of the _______ day of
_____________, 2017 by and between Alnylam Pharmaceuticals, Inc., a Delaware
corporation (the “Company”), and __________________ (the “Executive”).

1.Purpose.  The Company considers it essential to the best interests of its
stockholders to promote and preserve the continuous employment of key management
personnel.  The Board of Directors of the Company (the “Board”) recognizes that,
as is the case with many corporations, the possibility of a Change in Control
(as defined in Section 2 hereof) exists and that such possibility, and the
uncertainty and questions that it may raise among management, may result in the
departure or distraction of key management personnel to the detriment of the
Company and its stockholders.  Therefore, the Board has determined that
appropriate steps should be taken to reinforce and encourage the continued
attention and dedication of members of the Company’s key management, including
the Executive, to their assigned duties without distraction in the face of
potentially disturbing circumstances arising from the possibility of a Change in
Control.  Nothing in this Agreement shall be construed as creating an express or
implied contract of employment and, except as otherwise agreed in writing
between the Executive and the Company, the Executive shall not have any right to
be retained in the employ of the Company.

2.Change in Control.  A “Change in Control” shall be deemed to have occurred
upon the occurrence of any one of the following events:

(a)any “person,” as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended (the “Act”) (other than the Company,
any of its subsidiaries, or any trustee, fiduciary or other person or entity
holding securities under any employee benefit plan or trust of the Company or
any of its subsidiaries), together with all “affiliates” and “associates” (as
such terms are defined in Rule 12b-2 under the Act) of such person, shall become
the “beneficial owner” (as such term is defined in Rule 13d-3 under the Act),
directly or indirectly, of securities of the Company representing 50 percent or
more of the combined voting power of the Company’s then outstanding securities
having the right to vote in an election of the Board (“Voting Securities”) (in
such case other than as a result of an acquisition of securities directly from
the Company); or

(b)the date a majority of the members of the Board is replaced during any
24-month period by directors whose appointment or election is not endorsed by a
majority of the members of the Board before the date of the appointment or
election; or

(c)the consummation of (i) any consolidation or merger of the Company where the
stockholders of the Company, immediately prior to the consolidation or merger,
would not, immediately after the consolidation or merger, beneficially own (as
such term is defined in Rule 13d-3 under the Act), directly or indirectly,
shares representing in the aggregate 50 percent or more of the voting shares of
the Company issuing cash or securities in the consolidation or merger (or of its
ultimate parent corporation, if any), other than a merger or consolidation which

 

ACTIVE/91802714.1

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

 

 

would result in a majority of the board of directors of the combined entity
being comprised of members of the board of directors of the pre-transaction
Company and the chief executive officer of the combined entity being the chief
executive officer of the pre-transaction Company, in each case immediately
following the consummation of such merger or consolidation and continuing for
one year following such consummation, or (ii) any sale or other transfer (in one
transaction or a series of transactions contemplated or arranged by any party as
a single plan) of all or substantially all of the assets of the Company.

Notwithstanding the foregoing, a “Change in Control” shall not be deemed to have
occurred for purposes of the foregoing clause (a) solely as the result of an
acquisition of securities by the Company that, by reducing the number of shares
of Voting Securities outstanding, increases the proportionate number of shares
of Voting Securities beneficially owned by any person to 50 percent or more of
the combined voting power of all then outstanding Voting Securities; provided,
however, that if any person referred to in this sentence shall thereafter become
the beneficial owner of any additional shares of Voting Securities (other than
pursuant to a stock split, stock dividend, or similar transaction or as a result
of an acquisition of securities directly from the Company) and immediately
thereafter beneficially owns 50 percent or more of the combined voting power of
all then outstanding Voting Securities, then a “Change in Control” shall be
deemed to have occurred for purposes of the foregoing clause (a).

3.Terminating Event.  A “Terminating Event” shall mean any of the events
provided in this Section 3:

(a)Termination by the Company.  Termination by the Company of the employment of
the Executive with the Company for any reason other than for Cause, death or
Disability.  For purposes of this Agreement, “Cause” shall mean:

(i)conduct by the Executive constituting a material act of misconduct in
connection with the performance of his/her duties, including, without
limitation, misappropriation of funds or property of the Company or any of its
subsidiaries or affiliates other than the occasional, customary and de minimis
use of Company property for personal purposes; or

(ii)the commission by the Executive of any felony or a misdemeanor involving
moral turpitude, deceit, dishonesty or fraud, or any conduct by the Executive
that would reasonably be expected to result in material injury or reputational
harm to the Company or any of its subsidiaries and affiliates if the Executive
were retained in his/her position; or

(iii)continued non-performance by the Executive of his/her duties to the Company
(other than by reason of the Executive’s physical or mental illness, incapacity
or disability) which has continued for more than 30 days following written
notice of such non-performance from the Company’s Chief Executive Officer, or,
if the Executive is the Company’s Chief Executive Officer, from the Board; or

(iv)a material breach of any provision of any agreement(s) between the Executive
and the Company relating to noncompetition, nonsolicitation, nondisclosure

2

ACTIVE/91802714.1

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

 

 

and/or assignment of inventions, including the Executive’s Employee
Nondisclosure, Noncompetition and Assignment of Intellectual Property Agreement;
or

(v)a material violation by the Executive of the Company’s written policies,
including but not limited to any Code of Conduct, Anti-Bribery or Insider
Trading Policy; or

(vi)failure to cooperate in any material respect with a bona fide internal
investigation of a potential material matter or an investigation by regulatory
or law enforcement authorities, after being instructed by the Company to
cooperate, or the willful destruction or willful failure to preserve documents
or other materials known to be relevant to such investigation or the willful
inducement of others to fail to cooperate or to produce documents or other
materials in connection with such investigation.

A Terminating Event shall not be deemed to have occurred pursuant to this
Section 3(a) solely as a result of the Executive being an employee of any direct
or indirect successor to the business or assets of the Company, rather than
continuing as an employee of the Company following a Change in Control.  For
purposes hereof, the Executive will be considered “Disabled” if, as a result of
the Executive’s incapacity due to physical or mental illness, the Executive
shall have been absent from his/her duties to the Company on a full‑time basis
for 180 calendar days in the aggregate in any 12-month period.

(b)Termination by the Executive for Good Reason.  Termination by the Executive
of the Executive’s employment with the Company for Good Reason.  For purposes of
this Agreement, “Good Reason” shall mean that the Executive has complied with
the “Good Reason Process” (hereinafter defined) following, the occurrence of any
of the following events:  

(i)a material diminution in the Executive’s responsibilities, authority or
duties;

(ii)a material diminution in the Executive’s base salary except for
across-the-board salary reductions based on the Company’s financial performance
similarly affecting all or substantially all senior management employees of the
Company;

(iii)a material change in the geographic location at which the Executive
provides services to the Company; or

(iv)the material breach by the Company of this Agreement or any other material
written agreement with the Executive.

“Good Reason Process” shall mean that (i) the Executive reasonably determines in
good faith that a “Good Reason” condition has occurred; (ii) the Executive
notifies the Company in writing of the first occurrence of the Good Reason
condition within 60 days of the first occurrence of such condition; (iii) the
Executive cooperates in good faith with the Company’s efforts, for a period not
less than 30 days following such notice (the “Cure Period”), to remedy the
condition; (iv) notwithstanding such efforts, the Good Reason condition
continues to exist; and (v) the Executive terminates his/her employment within
60 days after the end of the Cure Period.  If the

3

ACTIVE/91802714.1

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

 

 

Company cures the Good Reason condition during the Cure Period, Good Reason
shall be deemed not to have occurred.

4.Change in Control Payment.  In the event a Terminating Event occurs within 12
months after a Change in Control, subject to the Executive signing a separation
agreement containing, among other provisions, a general release of claims in
favor of the Company and related persons and entities, confidentiality, return
of property and non-disparagement, in a form and manner satisfactory to the
Company (the “Separation Agreement and Release”) and the Separation Agreement
and Release becoming irrevocable, all within 60 days after the Date of
Termination, the following shall occur:

(a)the Company shall pay the Executive a lump sum amount in cash equal to 1.5
times the sum of (i) the Executive’s annual base salary in effect immediately
prior to the Terminating Event (or the Executive’s annual base salary in effect
immediately prior to the Change in Control, if higher) and (ii) the Executive’s
target bonus for the fiscal year in which the Change in Control occurred.

(b)if the Executive was participating in the Company’s group health plan
immediately prior to the Date of Termination and elects COBRA health
continuation, then the Company shall pay to the Executive a monthly cash payment
for 18 months or the Executive’s COBRA health continuation period, whichever
ends earlier, in an amount equal to the monthly employer contribution that the
Company would have made to provide health insurance to the Executive if the
Executive had remained employed by the Company; and

(c)Notwithstanding anything to the contrary in any applicable option agreement
or stock-based award agreement, all stock options and other stock-based awards
held by the Executive shall immediately accelerate and become fully exercisable
or nonforfeitable as of the Executive’s Date of Termination.  The Executive
shall also be entitled to any other rights and benefits with respect to
stock‑related awards, to the extent and upon the terms provided in the employee
stock option or incentive plan or any agreement or other instrument attendant
thereto pursuant to which such options or awards were granted.

The amounts payable under this Section 4 shall be paid or commence to be paid
within 60 days after the Date of Termination; provided, however, that if the
60-day period begins in one calendar year and ends in a second calendar year,
such payment shall be paid or commence to be paid in the second calendar year by
the last day of such 60-day period.

5.Additional Limitation.

(a)Anything in this Agreement to the contrary notwithstanding, in the event that
the amount of any compensation, payment or distribution by the Company to or for
the benefit of the Executive, whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement or otherwise, calculated
in a manner consistent with Section 280G of the Code and the applicable
regulations thereunder (the “Aggregate Payments”), would be subject to the
excise tax imposed by Section 4999 of the Code, then the Aggregate Payments
shall be reduced (but not below zero) so that the sum of all of the Aggregate
Payments shall be $1.00 less than the amount at which the Executive becomes
subject to the excise tax imposed by Section

4

ACTIVE/91802714.1

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

 

 

4999 of the Code; provided that such reduction shall only occur if it would
result in the Executive receiving a higher After Tax Amount (as defined below)
than the Executive would receive if the Aggregate Payments were not subject to
such reduction.  In such event, the Aggregate Payments shall be reduced in the
following order, in each case, in reverse chronological order beginning with the
Aggregate Payments that are to be paid the furthest in time from consummation of
the transaction that is subject to Section 280G of the Code:  (1) cash payments
not subject to Section 409A of the Code; (2) cash payments subject to Section
409A of the Code; (3) equity-based payments and acceleration; and (4) non-cash
forms of benefits; provided that in the case of all the foregoing Aggregate
Payments all amounts or payments that are not subject to calculation under
Treas. Reg. §1.280G-1, Q&A-24(b) or (c) shall be reduced before any amounts that
are subject to calculation under Treas. Reg. §1.280G-1, Q&A-24(b) or (c).

(b)For purposes of this Section 5, the “After Tax Amount” means the amount of
the Aggregate Payments less all federal, state, and local income, excise and
employment taxes imposed on the Executive as a result of the Executive’s receipt
of the Aggregate Payments.  For purposes of determining the After Tax Amount,
the Executive shall be deemed to pay federal income taxes at the highest
marginal rate of federal income taxation applicable to individuals for the
calendar year in which the determination is to be made, and state and local
income taxes at the highest marginal rates of individual taxation in each
applicable state and locality, net of the maximum reduction in federal income
taxes which could be obtained from deduction of such state and local taxes.

(c)The determination as to whether a reduction in the Aggregate Payments shall
be made pursuant to Section 5(a) shall be made by a nationally recognized
accounting firm selected by the Company (the “Accounting Firm”), which shall
provide detailed supporting calculations both to the Company and the Executive
within 15 business days of the Date of Termination, if applicable, or at such
earlier time as is reasonably requested by the Company or the Executive.  Any
determination by the Accounting Firm shall be binding upon the Company and the
Executive.

6.Section 409A.

(a)Anything in this Agreement to the contrary notwithstanding, if at the time of
the Executive’s “separation from service” within the meaning of Section 409A of
the Code, the Company determines that the Executive is a “specified employee”
within the meaning of Section 409A(a)(2)(B)(i) of the Code, then to the extent
any payment or benefit that the Executive becomes entitled to under this
Agreement on account of the Executive’s separation from service would be
considered deferred compensation subject to the 20 percent additional tax
imposed pursuant to Section 409A(a) of the Code as a result of the application
of Section 409A(a)(2)(B)(i) of the Code, such payment shall not be payable and
such benefit shall not be provided until the date that is the earlier of (A) six
months and one day after the Executive’s separation from service, or (B) the
Executive’s death.  

(b)The parties intend that this Agreement will be administered in accordance
with Section 409A of the Code.  To the extent that any provision of this
Agreement is ambiguous as to its compliance with Section 409A of the Code, the
provision shall be read in such a manner

5

ACTIVE/91802714.1

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

 

 

so that all payments hereunder comply with Section 409A of the Code.  The
parties agree that this Agreement may be amended, as reasonably requested by
either party, and as may be necessary to fully comply with Section 409A of the
Code and all related rules and regulations in order to preserve the payments and
benefits provided hereunder without additional cost to either party.

(c)All in-kind benefits provided and expenses eligible for reimbursement under
this Agreement shall be provided by the Company or incurred by the Executive
during the time periods set forth in this Agreement.  All reimbursements shall
be paid as soon as administratively practicable, but in no event shall any
reimbursement be paid after the last day of the taxable year following the
taxable year in which the expense was incurred.  The amount of in-kind benefits
provided or reimbursable expenses incurred in one taxable year shall not affect
the in-kind benefits to be provided or the expenses eligible for reimbursement
in any other taxable year.  Such right to reimbursement or in-kind benefits is
not subject to liquidation or exchange for another benefit.

(d)To the extent that any payment or benefit described in this Agreement
constitutes “non-qualified deferred compensation” under Section 409A of the
Code, and to the extent that such payment or benefit is payable upon the
Executive’s termination of employment, then such payments or benefits shall be
payable only upon the Executive’s “separation from service.”  The determination
of whether and when a separation from service has occurred shall be made in
accordance with the presumptions set forth in Treasury Regulation Section
1.409A-1(h).

(e)The Company makes no representation or warranty and shall have no liability
to the Executive or any other person if any provisions of this Agreement are
determined to constitute deferred compensation subject to Section 409A of the
Code but do not satisfy an exemption from, or the conditions of, such Section.

7.Term.  This Agreement shall take effect on the date first set forth above and
shall terminate upon the earlier of (a) the termination of the Executive’s
employment for any reason prior to a Change in Control, (b) the termination of
the Executive’s employment with the Company after a Change in Control for any
reason other than the occurrence of a Terminating Event, or (c) the date which
is 12 months after a Change in Control if the Executive is still employed by the
Company.

8.Withholding.  All payments made by the Company to the Executive under this
Agreement shall be net of any tax or other amounts required to be withheld by
the Company under applicable law.

9.Notice and Date of Termination.

(a)Notice of Termination.  After a Change in Control and during the term of this
Agreement, any purported termination of the Executive’s employment (other than
by reason of death) shall be communicated by written Notice of Termination from
one party hereto to the other party hereto in accordance with this Section
9.  For purposes of this Agreement, a “Notice of Termination” shall mean a
notice which shall indicate the specific termination provision in this Agreement
relied upon.  

6

ACTIVE/91802714.1

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

 

 

(b)Date of Termination.  “Date of Termination” shall mean:  (i) if the
Executive’s employment is terminated by his/her death, the date of the
Executive’s death; (ii) if the Executive’s employment is terminated on account
of Executive’s Disability or by the Company with or without Cause, the date on
which Notice of Termination is given; (iii) if the Executive’s employment is
terminated by the Executive without Good Reason, 30 days after the date on which
a Notice of Termination is given, and (iv) if the Executive’s employment is
terminated by the Executive with Good Reason, the date on which a Notice of
Termination is given after the end of the Cure Period.  Notwithstanding the
foregoing, in the event that the Executive gives a Notice of Termination to the
Company, the Company may unilaterally accelerate the Date of Termination and
such acceleration shall not result in a termination by the Company for purposes
of this Agreement.

10.No Mitigation.  The Company agrees that, if the Executive’s employment by the
Company is terminated during the term of this Agreement, 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 4 hereof.  Further,
the amount of any payment 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.

11.Arbitration of Disputes.  Any controversy or claim arising out of or relating
to this Agreement or the breach thereof or otherwise arising out of the
Executive’s employment or the termination of that employment (including, without
limitation, any claims of unlawful employment discrimination whether based on
age or otherwise) shall, to the fullest extent permitted by law, be settled by
arbitration in any forum and form agreed upon by the parties or, in the absence
of such an agreement, under the auspices of the American Arbitration Association
(“AAA”) in Boston, Massachusetts in accordance with the Employment Dispute
Resolution Rules of the AAA, including, but not limited to, the rules and
procedures applicable to the selection of arbitrators.  The parties agree that,
to the extent permitted under applicable law, the arbitrator shall award
reasonable attorneys’ fees and costs to the prevailing party. In the event that
any person or entity other than the Executive or the Company may be a party with
regard to any such controversy or claim, such controversy or claim shall be
submitted to arbitration subject to such other person or entity’s
agreement.  Judgment upon the award rendered by the arbitrator may be entered in
any court having jurisdiction thereof.  This Section 11 shall be specifically
enforceable. Notwithstanding the foregoing, this Section 11 shall not preclude
either party from pursuing a court action for the sole purpose of obtaining a
temporary restraining order or a preliminary injunction in circumstances in
which such relief is appropriate; provided that any other relief shall be
pursued through an arbitration proceeding pursuant to this Section 11.

12.Consent to Jurisdiction.  To the extent that any court action is permitted
consistent with or to enforce Section 11 of this Agreement, the parties hereby
consent to the jurisdiction of the Superior Court of the Commonwealth of
Massachusetts and the United States District Court for the District of
Massachusetts.  Accordingly, with respect to any such court action, the
Executive (a) submits to the personal jurisdiction of such courts; (b) consents
to service of process; and (c) waives any other requirement (whether imposed by
statute, rule of court, or otherwise) with respect to personal jurisdiction or
service of process.

7

ACTIVE/91802714.1

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

 

 

13.Protected Disclosures.  The Executive understands that nothing contained in
this Agreement or any other agreement limits the Executive’s ability to
communicate with any federal, state or local governmental agency or commission,
including to provide documents or other information, without notice to the
Company.  The Executive also understands that nothing in this Agreement or any
other agreement limits the Executive’s ability to share compensation information
concerning the Executive or others, except that this does not permit the
Executive to disclose compensation information concerning others that the
Executive obtains because the Executive’s job responsibilities require or allow
access to such information.

14.Defend Trade Secrets Act of 2016.  The Executive understands that pursuant to
the federal Defend Trade Secrets Act of 2016, the Executive shall not be held
criminally or civilly liable under any federal or state trade secret law for the
disclosure of a trade secret that (a) is made (i) in confidence to a federal,
state, or local government official, either directly or indirectly, or to an
attorney; and (ii) solely for the purpose of reporting or investigating a
suspected violation of law; or (b) is made in a complaint or other document
filed in a lawsuit or other proceeding, if such filing is made under seal

15.Integration.  This Agreement constitutes the entire agreement between the
parties with respect to the subject matter hereof and supersedes in all respects
all prior agreements between the parties concerning such subject matter [,
provided that your Employee Nondisclosure, Noncompetition and Assignment of
Intellectual Property Agreement referred to in Section 3(a)(iv) hereof shall
remain in full force and effect and is not superseded by this Agreement].

16.Successor to the Executive.  This Agreement shall inure to the benefit of and
be enforceable by the Executive’s personal representatives, executors,
administrators, heirs, distributees, devisees and legatees.  In the event of the
Executive’s death after a Terminating Event but prior to the completion by the
Company of all payments due him under this Agreement, the Company shall continue
such payments to the Executive’s beneficiary designated in writing to the
Company prior to the Executive’s death (or to his/her estate, if the Executive
fails to make such designation).

17.Enforceability.  If any portion or provision of this Agreement (including,
without limitation, any portion or provision of any Section of this Agreement)
shall to any extent be declared illegal or unenforceable by a court of competent
jurisdiction, then the remainder of this Agreement, or the application of such
portion or provision in circumstances other than those as to which it is so
declared illegal or unenforceable, shall not be affected thereby, and each
portion and provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law.

18.Waiver.  No waiver of any provision hereof shall be effective unless made in
writing and signed by the waiving party.  The failure of any party to require
the performance of any term or obligation of this Agreement, or the waiver by
any party of any breach of this Agreement, shall not prevent any subsequent
enforcement of such term or obligation or be deemed a waiver of any subsequent
breach.

8

ACTIVE/91802714.1

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

 

 

19.Notices.  Any notices, requests, demands and other communications provided
for by this Agreement shall be sufficient if in writing and delivered in person
or sent by a nationally recognized overnight currier service of by registered or
certified mail, postage prepaid, return receipt requested, to the Executive at
the last address the Executive has filed in writing with the Company, or to the
Company at its main office, attention of the Board of Directors.

20.Amendment.  This Agreement may be amended or modified only by a written
instrument signed by the Executive and by a duly authorized representative of
the Company.

21.Effect on Other Plans.  An election by the Executive to resign after a Change
in Control under the provisions of this Agreement shall not be deemed a
voluntary termination of employment by the Executive for the purpose of
interpreting the provisions of any of the Company's benefit plans, programs or
policies.  Nothing in this Agreement shall be construed to limit the rights of
the Executive under the Company’s benefit plans, programs or policies except as
otherwise provided in Section 5 hereof, and except that the Executive shall have
no rights to any severance benefits under any Company severance pay plan.  In
the event that the Executive is party to an employment agreement with the
Company providing for change in control payments or benefits, the Executive may
receive payment under this Agreement only and not both.  The Executive shall
make such an election in the event of a Change in Control.

22.Governing Law.  This is a Massachusetts contract and shall be construed under
and be governed in all respects by the laws of the Commonwealth of
Massachusetts, without giving effect to the conflict of laws principles of such
Commonwealth.  With respect to any disputes concerning federal law, such
disputes shall be determined in accordance with the law as it would be
interpreted and applied by the United States Court of Appeals for the First
Circuit.

23.Successor to Company.  The Company shall require any successor (whether
direct or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business or assets of the Company expressly to assume
and agree to perform this Agreement to the same extent that the Company would be
required to perform it if no succession had taken place.  Failure of the Company
to obtain an assumption of this Agreement at or prior to the effectiveness of
any succession shall be a material breach of this Agreement.

24.Counterparts.  This Agreement may be executed in any number of counterparts,
each of which when so executed and delivered shall be taken to be an original;
but such counterparts shall together constitute one and the same document.

IN WITNESS WHEREOF, the parties have executed this Agreement effective on the
date and year first above written.

 

ALNYLAM PHARMACEUTICALS, INC.

 

 

 

By:

 

 

 

 

Name:

 

 

Title:

 

[Executive]

[Title]

 

9

ACTIVE/91802714.1