Exhibit 10.4

 

November 26, 2013

 

Mr. David B. Johnston

57 Pilgrim Road

Marblehead, MA 01945

 

Dear David:

 

I am delighted to offer you the full-time position of Executive Vice President
and Chief Financial Officer at ImmunoGen, Inc. (“ImmunoGen” or the “Company”). 
Upon commencement of your employment, which shall be no later than December 31,
2013, you will initially be paid at a bi-weekly rate of $13,461.54, which
annualized equals $350,000.00 per year, less applicable federal, state and/or
local payroll and withholding taxes.  In addition to your annual salary, subject
to the terms of this letter, ImmunoGen will pay you a sign-on bonus in the
amount of $70,000 (the “Sign-On Bonus”), which will be paid to you in
conjunction with your first salary payment following your date of hire.

 

In addition, you will be eligible for a discretionary annual bonus of up to
forty percent (40%) of your annual salary.  Your bonus for this fiscal year
ending June 30, 2014 will be prorated from the date of hire.  Each year
following, bonuses are at the discretion of the Board of Directors, and are
based on Company and individual performance.

 

Also in consideration of your employment by the Company, I will recommend to the
Compensation Committee, for their approval, the grant of a stock option award
covering 150,000 shares of our common stock under the Company’s 2006 Employee,
Director and Consultant Equity Incentive Plan (the “2006 Plan”).  This award
will vest at a rate of one-quarter of the shares covered by the award per year
over four years beginning on the first anniversary of the date of grant, which
will be your first date of employment with ImmunoGen.  The per share exercise
price for the option award will be the closing sale price of our shares as
reported on NASDAQ on the date of grant.

 

In addition, you can expect to receive, subject to the approval of the
Compensation Committee, and in conjunction with the Company’s annual equity
awards to employees generally in July or August 2014, the grant of a stock
option award under the 2006 Plan in the range of 90,000 to 110,000 shares.  This
award will vest at a rate of one-third of the shares covered by the award per
year over three years beginning on the first anniversary of the date of grant,
and the per share exercise price of this option award will be the closing sale
price of our shares as reported on NASDAQ on the date of grant.  In subsequent
years you can expect to receive, subject to the approval of the Compensation
Committee, annual equity awards similar to those granted to other senior
executives of comparable status.

 

As a member of the executive management, you will be eligible for a severance
arrangement that, under certain circumstances, will provide you with certain
benefits in the event of a change of control of the Company, as set forth in the
form of Change in Control Severance Agreement (the “Change in Control Severance
Agreement”) accompanying this letter.

 

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You will also be entitled to participate in the Company’s benefit plans to the
same extent as, and subject to the same terms, conditions and limitations as are
generally applicable to, full-time employees of ImmunoGen of similar rank and
tenure.  These benefits currently include at this time paid vacation time, life,
health, dental and disability insurance.  With respect to your annual vacation
allotment, however, you will immediately be eligible to accrue, monthly, up to
four (4) weeks of paid vacation per year, of which 10 days can be rolled over
from year to year.  For a more detailed understanding of the benefits and the
eligibility requirements, please consult the summary plan descriptions for the
applicable programs, which will be made available to you upon request.  Please
note that your compensation and or benefits may be modified in any way, at any
time, by ImmunoGen at its sole discretion, with or without prior notice, to the
extent any such modification affects similarly situated ImmunoGen executives in
the same manner.

 

Your duties as an employee of the Company shall be as determined by me in
consultation with you.  You agree to devote your best efforts during all
business time to the performance of such responsibilities and you will not
perform any professional work outside your work for the Company without
pre-approval from the Company.

 

ImmunoGen is required by the Immigration and Naturalization Service to verify
that each employee is eligible to work in the United States.  To that end, a
list of acceptable forms of identification is attached.  Please bring with you
one item on List A, or a combination of one item on List B and List C.

 

In addition, your offer of employment is contingent upon the successful
completion of a general background and reference check and drug test.  As such,
please complete the enclosed authorizations and other required forms.

 

While we anticipate that our relationship will be a long and mutually rewarding
one, your employment, of course, will be at will, terminable by either you or
the Company at any time.  In this regard, you will be eligible for a severance
arrangement that, under certain circumstances, will provide you with certain
benefits if your employment is terminated by the Company without cause in
circumstances where your Change in Control Severance Agreement would not apply,
as set forth in the form of Employment Agreement accompanying this letter.

 

If, within 12 months of your date of hire, you terminate your employment with
the Company (other than by reason of death or disability), or your employment is
terminated by the Company for Cause (as such term is defined in your Employment
Agreement), you will promptly reimburse ImmunoGen for a portion of your Sign-On
Bonus equal to the product of (a) $70,000, multiplied by (b) a fraction, the
numerator of which is 365 minus the number of days from date you start
employment with ImmunoGen to the effective date of termination of your
employment, and the denominator of which is 365.

 

On your first day of employment, you will be required to sign our Proprietary
Information, Inventions and Competition Agreement and the Company’s Insider
Trading Policy, acknowledging that you understand and agree to be bound by these
agreements.  Copies of each accompany this letter.

 

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You are also asked to acknowledge and agree that your employment by the Company
will not violate any agreement which you may have with any third party.  Please
acknowledge your understanding and agreement with the terms of your employment
as set forth in this letter by signing below.

 

I look forward to a long and productive relationship with you.

 

 

 

Sincerely,

 

 

 

 

 

/s/ Daniel M. Junius

 

 

 

 

 

Daniel M. Junius

 

President and Chief Executive Officer

 

 

Acknowledged and Agreed to:

 

 

 

 

 

 

 

/s/ David B. Johnston

 

 

David B. Johnston

Date:

 

 

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