Exhibit 10.1

 

October 4, 2016

 

 

William K. McVicar, Ph.D.

  

 

Re:Transition Agreement

 

Dear Bill:

This letter confirms that you will be transitioning from your role as Executive
Vice President, Chief Scientific Officer at Inotek Pharmaceuticals Corporation  
(“Inotek” or the “Company”).  On behalf of the Company and its Board of
Directors (the “Board”), please accept our sincere appreciation for your years
of service and contributions to the Company.  With that in mind, this letter
proposes an agreement setting forth the terms of your transition (the
“Agreement”).

As explained in more detail below, the Agreement contemplates that you will
remain employed during a transition period and will be eligible to receive
severance benefits upon the conclusion of that transition period provided that
certain conditions have been satisfied.

As you know, you and the Company entered into August 23, 2007 letter agreement
with respect to the terms and conditions of your employment, as amended on
December 23, 2008 and October 9, 2009 (collectively the “Letter
Agreement”).  Among other things, the Letter Agreement provides that you will be
entitled to certain severance pay in the event your employment is terminated by
the Company without Cause if you execute a comprehensive release of claims in a
form provided by the Company.  Provided you satisfy the Conditions set forth
below, the ending of your employment pursuant to this Agreement will be treated
as a termination without Cause for purposes of the Letter Agreement and this
Agreement and the Certificate Updating Release of Claims attached as Exhibit A
shall be the comprehensive release referred to in the Letter Agreement.    

With those understandings, the Agreement between you and the Company is as
follows:

1.Transition from Employment

(a)Transition Period.  If you sign and do not revoke this Agreement, your
at-will employment will continue, along with the compensation and benefits
specified in Section 1(c) below, until April 4, 2017 unless you are sooner
terminated by the Company for Cause or you sooner resign.  The actual last day
of your employment, whether it is on April 4, 2017 or an earlier date (as
described in the previous sentence), shall be referred to herein as the
“Separation Date,” and the time period between October 4, 2016 and the
Separation Date shall be referred to herein as the “Transition Period.”  For
purposes of this Agreement, “Cause” have the meaning set forth in the Letter
Agreement.

(b)Transition Services.  The Company will continue to employ you on an at-will
basis through the Transition Period.  You will no longer serve as the Company’s
Executive Vice President, Chief Scientific Officer but, instead, will serve a
Senior Advisor.  You will continue to work and provide services to the Company
on an as-needed basis and will be provided with flexibility in connection with
your search for a non-competitive job.  Your duties and other details

 

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associated with your employment during the Transition Period will be determined
by the Company’s Chief Executive Officer (“CEO”).  It is expected that your job
duties will be focused on effectively transitioning information to others in the
organization and that you will be able to perform most of these job duties
remotely.  Accordingly, you will not be required or expected to report to the
office except for meetings and other in-person business events to the extent
specifically requested by the CEO.  During the Transition Period you will be
permitted to perform consulting work for persons or entities outside of the
Field of Interest but only if you first obtain prior written approval from the
Company’s CEO.      

(c)Compensation and Benefits.  During the Transition Period, you will (i)
continue to receive your current base salary; (ii) remain eligible to
participate in the Company’s group employee benefit plans; and (iii) continue to
vest in your outstanding equity grants consistent with the terms and conditions
of the Company’s stock plan and applicable stock option agreement (collectively
the “Equity Documents”) as a regular full-time employee. You will receive a
Bonus Payment for 2016, pro-rated based on January 1- October 4, 2016 (the
“Prorated Bonus”). The Pro-rated Bonus shall be paid at the time other Company
employees receive 2016 Bonus Payments.  As Senior Advisor, you will no longer be
a member of the Company’s senior management team and, accordingly, you will not
be eligible to participate in the any executive incentive compensation plans and
you will not be eligible for any bonus compensation for 2017 or otherwise.  You
agree that you will not earn or be entitled to accrue paid time off during the
Transition Period.  

2.Severance Benefits

Provided that you satisfy each of the Conditions (defined below), the Company
shall provide you with the following “Severance Benefits”:

(a)Severance Pay.  The Company shall pay you severance pay (“Severance Pay”)
consisting of salary continuation at your final base salary rate, less
applicable tax-related deductions and withholdings, effective for the twelve
(12) month period immediately following the Separation Date (the “Severance Pay
Period”). The Company shall pay you Severance Pay in substantially equal
installments on the Company’s regular payroll dates during the Severance Pay
Period beginning on the first payroll date that follows the Effective Release
Date as defined in the Certificate Updating Release of Claims attached as
Exhibit A.

(b)COBRA Premiums.  If you elect COBRA continuation coverage, the Company shall
pay the same portion of premiums that it pays for active employees for the same
level of group medical and dental coverage as in effect for you on the
Separation Date until the end of the Severance Pay Period.  You will be
responsible for paying the remaining portion of the premiums for such coverage
as if you remained employed.  You authorize the deduction of the portion for
which you are responsible from your Severance Pay.  You may continue coverage
for yourself and any beneficiaries after the end of the Severance Pay Period at
your own expense for the remainder of the COBRA continuation period; to the
extent you and they remain eligible.

For purposes of this Agreement, the “Conditions” are as follows: (i) this
Agreement must become fully effective; (ii) you must not be terminated for Cause
on or before April 4, 2017 or resign without the Company’s written consent
before April 4, 2017, provided such consent shall not be unreasonably withheld;
(iii) you must remain in compliance with your obligations under this Agreement
(including, without limitation, your obligation to perform your Transition
Services under Section 1(b)) and your obligations under the Confidentiality
Agreement and the other

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Restrictive Covenants set forth in Section 3 of this Agreement; (iv) you must
execute and return Certificate Updating Release of Claims attached as Exhibit A
within five (5) day period that immediately follows the Separation Date.  

3.Restrictive Covenants

You acknowledge that your obligations under the Confidentiality Agreement that
you entered into dated September 5, 2007 (attached hereto as Exhibit B) are in
full force and effect both during and after the Transition Period, including,
without limitation, your obligations to maintain the confidentiality of
Confidential Information (as defined in the Confidentiality Agreement), to
return documents and other property of the Company promptly upon the Company’s
request but in no event later than the Separation Date, and to refrain from
prohibited solicitation activities for a period of twelve (12) months following
the Separation Date (the “Restricted Period”). In addition, as a material term
of this Agreement you agree that, during the Transition Period, you will not
directly or indirectly, whether as owner, partner, stockholder, director,
manager, consultant, agent, employee, co-venturer or otherwise, engage,
participate or invest in any business activity anywhere in the world that
develops, manufactures or markets any products, or performs any services within
the Field of Interest provided that this shall not prohibit any possible
investment in publicly traded stock of a company representing less than one
percent (1%) of the stock of such company.  For purposes of this Agreement the
Field of Interest shall be fields of glaucoma and other diseases of the
eye.  Further, and for the avoidance of doubt, Allergan, Valeant/Bauch&Lomb,
Aerie, Eyegate, Ocular, Ohr, Regeneron, Shire, Santen, QLT, Ophthotech,
Novartis/Alcon, Merck, Pfizer, GSK, Johnson&Johnson, Abbott Labs, Alimira,
Akorn, Acucela, Spark, EnVisia, Glaukos and Affibody AB,(a Swedish company with
registration no. 556665-6913, Gunnar Asplunds Allé 24, SE-171 69 Solna, Sweden)
are within the Field of Interest and you shall not perform services for any of
these companies in any capacity during the Transition Period. This list is
illustrative only and is not a not a comprehensive list of the Company’s
competitors.  

You agree to take no action or make any statements, written or oral that are
disparaging about or adverse to the business interests of the Company or its
employees, officers, products or services, provided this shall not in any way
affect your obligation to testify truthfully.  You further agree that, if were
you to breach any of the covenants contained in this Agreement or the
Confidentiality Agreement, the terms of which are incorporated by reference as
material terms of this Agreement, in addition to the Company’s other legal and
equitable remedies, the Company may end of your employment for Cause (if you are
still employed) and/or suspend or cease any Severance Benefits to which you
might otherwise be entitled.  Any such termination of your employment and/or
suspension or termination of the Severance Benefits by the Company in the event
of a breach by you shall not affect your ongoing obligations to the Company.  

4.Release of Claims

In consideration for, among other terms, the Company’s offer to continue to
employ you during the Termination Period and the Severance Benefits, to which
you acknowledge you would otherwise not be entitled, you voluntarily release and
forever discharge the Company, its affiliated and related entities, its and
their respective predecessors, successors and assigns, its and their respective
employee benefit plans and fiduciaries of such plans, and the current and former
officers, directors, shareholders, employees, attorneys, accountants and agents
of each of the foregoing in their official and personal capacities (collectively
referred to as the “Releasees”) generally from all claims, demands, debts,
damages and liabilities of every name

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and nature, known or unknown (“Claims”) that, as of the date when you sign this
Agreement, you have, ever had, now claim to have or ever claimed to have had
against any or all of the Releasees.  This release includes, without limitation,
all Claims:

•

relating to your employment by the Company and the decision that your employment
with the Company will end no later than April 4, 2017;

•

of wrongful discharge or violation of public policy;

•

of breach of contract;

•

of defamation or other torts;

•

of retaliation or discrimination under federal, state or local law (including,
without limitation, Claims of discrimination or retaliation under the Age
Discrimination in Employment Act, the Americans with Disabilities Act, and Title
VII of the Civil Rights Act of 1964);

•

under any other federal or state statute (including, without limitation, Claims
under the Fair Labor Standards Act);

•

for wages, bonuses, incentive compensation, commissions, additional stock
grants, unvested stock options, vacation pay or any other compensation or
benefits, either under the Massachusetts Wage Act, M.G.L. c. 149, §§148-150C, or
otherwise; and

•

for damages or other remedies of any sort, including, without limitation,
compensatory damages, punitive damages, injunctive relief and attorney’s fees;

 

provided, however, that this release shall not affect your rights under this
Agreement, your vested rights under the Company’s employee benefit plans, your
rights under the Equity Documents, or your rights under the Inotek
Pharmaceuticals Corporation Officer Indemnification Agreement that you and the
Company entered into dated June 24, 2015 (the “Indemnification Agreement “) nor
shall it release claims that cannot be released as a matter of law.

5.Future Cooperation

You agree to cooperate reasonably with the Company (including its outside
counsel) in connection with (i) the contemplation, prosecution and defense of
all phases of existing, past and future litigation about which the Company
believes you may have knowledge or information; and (ii) responding to requests
for information from regulatory agencies or other governmental authorities
(together “Cooperation Services”).  You further agree to make yourself available
to provide Cooperation Services at mutually convenient times during and outside
of regular business hours as reasonably deemed necessary by the Company’s
counsel.  The Company shall not utilize this section to require you to make
yourself available to an extent that would unreasonably interfere with full-time
employment responsibilities that you may have.  Cooperation Services include,
without limitation, appearing without the necessity of a subpoena to testify
truthfully in any legal proceedings in which the Company calls you as a
witness.  The Company shall reimburse you for any reasonable travel expenses
that you incur due to your performance of Cooperation Services, after receipt of
appropriate documentation consistent with the Company’s business expense
reimbursement policy.

6.Protected Disclosures and Other Protected Actions  

Nothing contained in this Agreement limits your ability to file a charge or
complaint with any federal, state or local governmental agency or commission (a
“Government Agency”).  In addition, nothing contained in this Agreement limits
your ability to communicate with any Government Agency or otherwise participate
in any investigation or proceeding that may be conducted by any Government
Agency, including your ability to provide documents or other information,
without notice to the Company, nor does anything contained in this Agreement

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apply to truthful testimony in litigation.  If you file any charge or complaint
with any Government Agency and if the Government Agency pursues any claim on
your behalf, or if any other third party pursues any claim on your behalf, you
waive any right to monetary or other individualized relief (either individually,
or as part of any collective or class action).  For the avoidance of doubt, this
Agreement does not limit your right to receive an award for providing
information to the Securities Exchange Commission.    

7.Other Provisions  

(a)Jurisdiction.  You and the Company hereby agree that the state and federal
courts in Suffolk County, Massachusetts shall have the exclusive jurisdiction to
consider any matters related to this Agreement, including without limitation any
claim of a violation of this Agreement.  With respect to any such court action,
you submit to the jurisdiction of such courts and you acknowledge that venue in
such courts is proper.      

(b)Governing Law; Interpretation.  This Agreement shall be interpreted and
enforced under the laws of the Commonwealth of Massachusetts, without regard to
conflict of law principles.  In the event of any dispute, this Agreement is
intended by the parties to be construed as a whole, to be interpreted in
accordance with its fair meaning, and not to be construed strictly for or
against either you or the Company or the “drafter” of all or any portion of this
Agreement.  

(c)Enforceability.  If any portion or provision of this Agreement (including,
without limitation, any portion or provision of any section of the
Confidentiality 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.  

(d)Waiver.  No waiver of any provision of this Agreement shall be effective
unless made in writing and signed by the waiving party.  The failure of a party
to require the performance of any term or obligation of this Agreement, or the
waiver by a 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.  

(e)Entire Agreement.  This Agreement constitutes the entire agreement between
you and the Company regarding the subject matter herein. This Agreement
supersedes any previous agreements or understandings between you and the
Company, except the Confidentiality Agreement, the Equity Documents, any and all
assignment(s) of invention(s), the Indemnification Agreement and any other
obligations specifically preserved in this Agreement.  In signing this
Agreement, you are not relying upon any promises or representations made by
anyone at or on behalf of the Company except as set forth in this Agreement.  

(f)Time for Consideration; Effective Date.  You understand and acknowledge that
you have been given the opportunity to consider this Agreement for more than
twenty-one (21) days from your receipt of this Agreement before signing it (the
“Consideration Period”) and that any changes to this Agreement did not restart
or otherwise affect the Consideration Period. In signing this Agreement, you
acknowledge that you have knowingly and voluntarily entered into this
Agreement.  To accept this Agreement, you must return a signed original or a
signed PDF copy of this Agreement so that it is received by the undersigned by
5PM EST on October 27, 2016.   If you do not sign the Agreement, your employment
will end and the ending of the

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employment relationship will be governed by the Letter Agreement.  If you sign
this Agreement, for the period of seven (7) days from the date when you sign
this Agreement, you have the right to revoke this Agreement by written notice to
the undersigned.  For such a revocation to be effective, it must be delivered so
that it is received by the undersigned at or before the expiration of the seven
(7) day revocation period.  This Agreement shall not become effective or
enforceable during the revocation period.  This Agreement shall become effective
on the first business day following the expiration of the revocation period (the
“Effective Date”).    

(g)Counterparts.  This Agreement may be executed in separate counterparts.  When
all counterparts are signed, they shall be treated together as one and the same
document.

Please indicate your agreement to the terms of this Agreement by signing and
returning to me the original or a PDF copy of this letter within the time period
set forth above.

Very truly yours,

Inotek

 

 

By: /s/ David P. SouthwellOctober 27, 2016

David P. SouthwellDate

President and Chief Executive Officer

 

 

You are advised to consult with an attorney before signing this Agreement. This
is a legal document.  Your signature will commit you to its terms.  By signing
below, you acknowledge that you have carefully read and fully understand all of
the provisions of this Agreement and that you are knowingly and voluntarily
entering into this Agreement.  

 

/s/ William K. McVicarOctober 27, 2016

William K. McVicar, PhDDate

 

 

 

 

 

 

 

 

 

 

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EXHIBIT A

CERTIFICATE UPDATING RELEASE OF CLAIMS

 

I, William K. McVicar, hereby acknowledge and certify that I entered into a
Transition Agreement with Inotek Pharmaceuticals Corporation (the “Company”),
dated October 4, 2016 (the “Agreement”).  Pursuant to the Agreement, I am
required to execute this certificate, which updates the release of claims set
forth in Section 4 of the Agreement (this “Certificate”) in order to satisfy the
Conditions for Severance Benefits as set forth in Section 2 of the
Agreement.  I, therefore, agree as follows:

 

 

1.

A copy of this Certificate was attached to the Agreement as Exhibit A.

 

2.

In consideration of the benefits described in Section 2 of the Agreement, for
which I become eligible only if I sign this Certificate, I hereby extend the
release of claims set forth in Section 4 of the Agreement to any and all claims
that arose after the date I signed the Agreement through the date I signed this
Certificate (the “Effective Release Date”), subject to all other exclusions and
terms set forth in the Agreement.  

 

3.

I have carefully read and fully understand all of the provisions of this
Certificate, I knowingly and voluntarily agree to all of the terms set forth in
this Certificate, and I acknowledge that in entering into this Certificate, I am
not relying on any representation, promise or inducement made by the Company or
its representatives with the exception of those promises contained in this
Certificate and the Agreement.

 

4.

I agree that this Certificate is part of the Agreement.  

 

________________________________________

William K. McVicar, PhD

 

 

________________________________________

DATE

 

 

 

 

 

 

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EXHIBIT B

[Confidentiality Agreement]