Exhibit 10.4

 

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STRICTLY CONFIDENTIAL

 

May 7, 2008

 

Christopher D.T. Guiffre

 

                Re:          Separation Agreement and Release

 

Dear Chris:

 

As we have discussed, your employment with Cubist Pharmaceuticals, Inc.
(alternatively, “Cubist” or the “Company”) will end on May 31, 2008 (the
“Departure Date”).

 

Effect of Departure

 

On your Departure Date, you will be paid all wages and other compensation due,
including payment for all accrued but unused vacation, through the Departure
Date. Except as set forth below, your participation in all of the Company’s
employee benefit plans will end as of your Departure Date, in accordance with
the terms of those plans.

 

Severance Benefits

 

To assist you through this transition and in consideration of your acceptance of
all terms of this Separation Agreement and Release (this “Agreement”), the
Company is offering to provide you with severance pay in the amount of eighteen
(18) months’ salary (“Separation Pay”).  The Separation Pay will be payable in
accordance with our normal payroll cycles in twelve (12) equal semi-monthly
installments, and will be reduced by any taxes and other amounts that the
Company is legally required to withhold.  You will not be able to make any
salary deferrals for contribution to the Cubist 401(k) from the Separation Pay.
 Payments of your Separation Pay will begin on the first payroll date following
the Departure Date.

 

In addition, upon completion of the appropriate COBRA election forms, and
subject to all the requirements of COBRA, the Company shall continue for
eighteen (18) months following the Departure Date (the “Continuation Period”)
your participation in the Company’s medical and dental insurance plans at the
Company’s cost (except for your portion of the premium which shall be remitted
to the Company via payroll during the period in which you are receiving
Severance Pay and by you by personal check to the Company during the period of
the Continuation Period in which you are not receving Severance Pay) to the same
extent that such insurance is provided to active Company employees from time to
time.  After the Continuation Period, you will have the right to continue your
medical insurance, subject to the requirements of COBRA, at your own cost (as
described in the COBRA qualifying notice provided to you under separate cover). 
The “qualifying event” under COBRA shall be deemed to have occurred on the
Departure Date. “COBRA” is the Consolidated Omnibus Budget Reconciliation Act of
1985, as amended.

 

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Complete Satisfaction

 

You agree that the Separation Pay as described in this Agreement shall be in
full and complete satisfaction of any and all monetary sums and other
obligations which are now, or might hereafter have become, owing to you for
services rendered by you during your employment or in connection with your
termination of employment.  You agree that your separation from the Company is
final and that the Company has no obligation to consider you for rehire or
reinstatement.

 

Your Continuing Obligations

 

You acknowledge you have had access to information concerning the Company, its
clients, and its affiliates, which is confidential or proprietary in nature (the
“Confidential Information”).  You agree that you will continue to protect the
Confidential Information in accordance with the provisions of the employee
confidentiality agreement that you signed when you commenced employment with the
Company (the “Employee Confidentiality Agreement”), and by executing this
Agreement, you reaffirm your obligations under the Employee Confidentiality
Agreement.

 

You further agree that for a period of one (1) year following the Departure Date
you will not, without the prior written consent of the Company’s CEO, which
shall not be unreasonably withheld, directly or indirectly, either as principal,
partner, stockholder, officer, director, member, employee, consultant, business
or scientific advisory board member, agent, representative or in any other
capacity, own, manage, operate or control, or be concerned with, connected with,
engaged by, employed by, or otherwise associated with, engage in, or have a
financial interest in, any business which engages directly or indirectly in the
research, development, manufacture, distribution, license or commercialization
of antibacterial drugs anywhere in the United States or in any other country
where the Company conducts business.

 

You further agree that the terms and existence of this Agreement shall remain
strictly confidential except to the extent required to obtain legal or
accounting advice or to comply with legal obligations.

 

Non-Disparagement

 

You agree that you will not disparage the Company or any of the people or
organizations associated with it and that you will not otherwise do or say
anything that would harm its business or reputation.

 

Return of Documents

 

In signing this Agreement, you agree that you will return to the Company any and
all documents, materials and information related to the business (including all
electronic versions), whether present or otherwise, of the Company and its
affiliates, and all copies, and all keys, credit cards, computers, phone, and
other tangible property of the Company and its affiliates, in your possession or
control.

 

Cooperation

 

In signing this Agreement, you agree that you will cooperate fully with other
Cubist employees, including your successor, and Cubist business partners in
smoothly, effectively, and completely transitioning your work. You further agree
that you will make yourself available to the Company for reasonable periods of
time after the Departure Date, either by telephone or, if you and the Company
believes necessary, in person upon reasonable notice, to assist the Company in
connection with any matter relating to services performed by you

 

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on behalf of the Company, and 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, its directors, shareholders, officers, or
employees.  The Company shall reimburse you for reasonable documented travel
expenses incurred should your presence be required in person.  You further agree
that should you be contacted (directly or indirectly) by any individual or any
person representing an individual or entity that is or may be legally or
competitively adverse to the Company in connection with any claims or legal
proceedings, you will promptly notify the CEO and General Counsel of that fact
in writing, but in no event later than the next business day or immediately if
you already have been so contacted. Such notification shall include a reasonable
description of the content of the communication with the legally or
competitively adverse individual or entity.

 

Release of Claims

 

The Company wants to be certain that this Agreement will resolve any and all
concerns that you might have and therefore requests that you carefully consider
the terms of this Agreement, including the release of claims set forth below
and, in that connection, encourages you to seek the advice of an attorney before
you sign this Agreement.

 

In exchange for the Separation Pay to be provided you under this Agreement, you
and your respective agents, heirs, legatees, successors and assigns
(collectively hereinafter “you”), except as set forth below, hereby
unconditionally and irrevocably release, remise, and forever discharge
Cubist,(1) and all persons acting by, through, under or in concert with Cubist,
of and from any and all actions, causes of actions, suits, debts, charges,
complaints, claims, liabilities, obligations, promises, agreements,
controversies, damages, and expenses (including attorney fees and costs actually
incurred), of any nature whatsoever, in law or equity (collectively “Claims”),
which you had, now have, or hereafter may have against the Company from the
beginning of time through the date on which you execute this Agreement (the
“Execution Date”).

 

Without limiting the generality of the foregoing waiver and release of claims,
you specifically waive and release Cubist from any Claim under the Federal False
Claims Act, any state or local false claims act or any federal, state or local
qui tam provisions of false claims or false statements statutes, or any Claim
arising from or related to your employment relationship with the Company or the
termination thereof including, without limitation:

 

(a)           Claims under any federal, state (including, without limitation,
Massachusetts) or local discrimination, fair employment practices or other
employment related statute, regulation or executive order (as they may have been
amended through the Execution Date) prohibiting discrimination or harassment
based upon any protected status including, without limitation, age, race,
national origin, gender, marital status, disability, veteran status or sexual
orientation.  Without limitation, specifically included in this paragraph are
any Claims arising under the federal Age Discrimination in Employment Act, the
Older Workers Benefit Protection Act, the Civil Rights Acts of 1866 and 1871,
Title VII

 

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(1)           For purposes of this Section, “Cubist” and/or the “Company”
includes Cubist Pharmaceuticals, Inc., and any of its divisions, affiliates
(which means all persons and entities directly or indirectly controlling,
controlled by or under common control with Cubist Pharmaceuticals, Inc.),
subsidiaries and all other related entities, and its and their directors,
officers, employees, trustees, agents, successors and assigns.

 

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of the Civil Rights Act of 1964, the Civil Rights Act of 1991, the Equal Pay
Act, the Americans with Disabilities Act, the Worker Adjustment and Retraining
Notification Act and any similar statute;

 

(b)           Claims under any other federal, state (including, without
limitation, Massachusetts) or local employment-related statute, regulation or
executive order (as they may have been amended through the Execution Date)
relating to wages, hours or any other terms and conditions of employment
(including, without limitation, the Fair Labor Standards Act, the National Labor
Relations Act, the Employee Retirement Income Security Act of 1974, the
Consolidated Omnibus Budget Reconciliation Act of 1985 and any similar statute;

 

 (c)           Claims under any federal, state (including, without limitation,
Massachusetts) or local 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;

 

(d)          Claims under any federal, state (including, without limitation,
Massachusetts and Delaware) or local securities law, including, without
limitation, the Securities Act of 1933, as amended, the Securities Exchange Act
of 1934, as amended, and any similar statute; and

 

(e)          Claims arising under federal, state or local law.

 

Notwithstanding the foregoing, this paragraph shall not release Cubist from any
obligation expressly set forth in this Agreement and shall not act as a waiver
or release of any Claims that you cannot by law waive or release, including,
without limitation, workers’ compensation claims.  You acknowledge and agree
that, but for providing this waiver and release of Claims, you would not be
receiving the Separation Pay being provided to you under the terms of this
Agreement.

 

You further agree, to the fullest extent permitted by law, that you will not sue
or commence any proceeding (judicial or administrative), or participate in any
action, suit or proceeding (unless compelled by legal process or court order),
against Cubist with respect to any claim released by above.  You also warrant
and represent that as of the date you sign this Agreement, you have not taken or
engaged in any of the acts described in the foregoing sentences.  If,
notwithstanding the foregoing promises, you violate this provision, you shall be
required, to the maximum extent permitted by law, to indemnify and hold harmless
Cubist from and against any and all demands, assessments, judgments, costs,
damages, losses and liabilities, and attorneys’ fees and other expenses which
result from, or are incident to, such violation

 

It is the Company’s desire and intent to make certain that you fully understand
the provisions and effects of this Agreement.  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.

 

Consistent with the federal discrimination laws, nothing in this release shall
be deemed to prohibit you from challenging the validity of this release under
the federal discrimination laws or from filing a charge or complaint of
employment related discrimination with the Equal Employment Opportunity
Commission (“EEOC”) or from participating in any investigation or proceeding
conducted by the EEOC.  Further, nothing

 

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in this release or Agreement 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.

 

Acknowledgments; Return Date

 

In signing this Agreement, you give the Company assurance that you have had a
full and reasonable opportunity to consider its terms; that you have read and
understood all of those terms; and that your acceptance of this Agreement is
freely and voluntarily given.

 

If the terms of this Agreement are acceptable to you, please sign both copies of
this Agreement and return one copy to me no later than twenty-one (21) days from
the date hereof.

 

Except as specifically described in this Agreement, this Agreement constitutes
the entire agreement between you and the Company and replaces all prior and
contemporaneous agreements, communications and understandings, whether written
or oral, with respect to your employment and its termination and all related
matters.

 

This Agreement will be binding upon and will inure to the benefit of the
Company, its successors and assigns, and you, your heirs, personal
representatives and assigns.  This Agreement may be modified only by writing
signed by you and the Company.

 

Very truly yours,

 

/s/ Maureen Powers

 

Maureen H. Powers

Vice President, Human Resources

 

 

Accepted and agreed:

 

 

/s/ Christopher D.T. Guiffre

 

Signature of Employee

 

 

Date: 5/7/08

 

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