Exhibit 10.1

 

GRAPHIC [g180521ksi001.jpg]

 

November 12, 2015

 

Hani Zeini

Address: last address on file with the Company

 

RE:  Separation Agreement

 

Dear Hani,

 

This letter sets forth the terms and conditions of our agreement (the
“Agreement”) regarding the separation of your employment with Sientra, Inc. (the
“Company”).  This Agreement will become effective on the “Effective Date” as
defined in Section 12 herein.  You and the Company hereby agree as follows:

 

1.                                      SEPARATION.  You have submitted and the
Company has accepted your resignation as Chief Executive Officer and President
of the Company, and all other positions and offices held by you except as set
forth in Section 2 below, effective November 12, 2015 (the “Separation Date”). 
As soon as practicable following the Separation Date, the Company will pay to
you your accrued but unpaid Base Salary and accrued but unpaid vacation after
having provided you with a reasonable opportunity to review the Company’s
calculations.

 

2.                                      CONTINUING BOARD AND CONSULTING SERVICE.
Notwithstanding your resignation of employment with the Company, you will
continue to serve as a non-independent, non-employee member of the Board of
Directors of the Company (the “Board”) and you will retain your title as
“Founder” of the Company. Commencing the day following the end of the Consulting
Period, you will begin to be compensated for your service as a member of the
Board in the same way that the other non-employee directors serving on the Board
are compensated; provided, however, that you will be treated as a newly
appointed director as of such date and will receive the compensation provided to
newly appointed directors (in terms of timing, form and amount).  In addition,
the Company agrees to retain you as a consultant to the Company under the terms
specified in a Consulting Agreement of even date herewith (the “Consulting
Agreement”).

 

3.                                      SEPARATION BENEFITS.  In exchange for
your covenants and releases herein, and provided that this Agreement becomes
effective as specified in Section 12 below, the Company will provide you with
the following separation benefits (collectively, the “Separation Benefits”),
which are equivalent in amount to those described in Section 6.3(a) and (b) of
the Employment Agreement between you and the Company effective October 15, 2014
(the “Employment Agreement”). Notwithstanding Section 6.3(c) of the Employment
Agreement, the unvested portion of all Company equity awards granted to you will
not accelerate as of the Separation Date as such equity awards shall continue to
vest for so long as you continue to provide service to the Company as either a
member of the Board or a consultant.

 

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

 

Hani Zeini

November 12, 2015

Page Two

 

(a)                                 Severance.  The Company shall pay you,
within thirty (30) days following the Effective Date, a lump sum payment of
$871,000, which is equivalent to the sum of (i) twelve (12) months of your base
salary as in effect on the Separation Date; and (ii) the annual bonus earned by
you in connection with the completion of the fiscal year prior to the Separation
Date.

 

(b)                                 Health Care Coverage. Provided further that
you timely elect continued coverage under COBRA, the Company shall pay your
COBRA premiums to continue your coverage (including coverage for eligible
dependents, if applicable) (“COBRA Premiums”) through the period (the “COBRA
Premium Period”) starting on the Separation Date and ending on the earliest to
occur of: (i) twelve (12) months following the Separation Date; (ii) the date
you become eligible for group health insurance coverage through a new employer;
or (iii) the date you cease to be eligible for COBRA continuation coverage for
any reason, including plan termination.  In the event you become covered under
another employer’s group health plan or otherwise cease to be eligible for COBRA
during the COBRA Premium Period, you must immediately notify the Company of such
event.  Notwithstanding the foregoing, if the Company determines, in its sole
discretion, that it cannot pay the COBRA Premiums without a substantial risk of
violating applicable law (including, without limitation, Section 2716 of the
Public Health Service Act), the Company shall in lieu thereof provide to you a
taxable monthly payment in an amount equal to the monthly COBRA premium that you
would be required to pay to continue your group health coverage in effect on the
date of your employment termination (which amount shall be based on the premium
for the first month of COBRA coverage), which payments shall be made on the last
day of each month regardless of whether you elect COBRA continuation coverage
and shall end on the earlier of (x) the date upon which you obtain other
employment or (y) the last day of the 12th calendar month following the
Separation date.

 

(c)                                  Tax Withholding. All compensation described
in this Section 3 will be subject to the Company’s collection of all applicable
federal, state and local income and employment withholding taxes.

 

(d)                                 Final Expense Report. You will have thirty
(30) days from the Separation Date to submit a final expense report for business
expenses incurred through the Separation Date.  Reimbursement for such expenses
will be made to you within five (5) days after receipt of the expense report.

 

(e)                                  Post-Service Option Exercise Period.  With
respect to your outstanding options to purchase common stock of the Company and
any options you may be granted as a non-employee director, notwithstanding
anything to the contrary in the governing plan or award agreement, you will be
permitted to exercise such options until the later of (i) the final day of the
post-termination exercise period provided in the relevant option agreement
(including any longer period applicable in the case of death or disability, if
your service terminates by reason of death or disability); or (ii) March 31,
2017; provided, however, that no option shall be exercisable later than the
expiration of the term of such option.

 

(f)                                   Legal Fees.  The Company agrees to pay
your reasonable legal fees incurred in connection with the negotiation of this
Agreement and the Consulting Agreement directly to your counsel promptly upon
presentation of a statement(s) of fees actually incurred.

 

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

 

Hani Zeini

November 12, 2015

Page Three

 

4.                                      OTHER COMPENSATION AND BENEFITS.  Except
as expressly provided herein or pursuant to the terms of any plan providing for
retirement benefits, including, without limitation, any 401(k) plan, sponsored
by the Company for your benefit, you acknowledge and agree that you are not
entitled to and will not receive any additional compensation, wages,
reimbursement, severance, or benefits from the Company.

 

5.                                      TERMINATION OF THE COMPANY’S
OBLIGATIONS.  Notwithstanding any provisions in this Agreement to the contrary
and except as consented to above, the Company’s obligations hereunder shall
cease and be rendered a nullity immediately should you fail to comply with any
of the provisions of this Agreement.

 

6.                                      COMPANY PROPERTY.  You represent and
confirm that no later than the final day of the Consulting Period (as defined in
the Consulting Agreement) you will return to the Company all Company documents
(and all copies thereof) and other property of the Company in your possession or
control, including, but not limited to, computer security access, files,
business plans, notes, financial information, financial information, data,
computer-recorded information, tangible property, including entry cards, keys
and any other materials of any nature pertaining to your work with the Company,
and any documents or data of any description (or any reproduction of any
documents or data) containing or pertaining to any proprietary or confidential
material of the Company; provided that you shall be permitted to retain copies
of documents relating to the terms and conditions of your employment with the
Company (for example, copies of Stock Option Agreements).

 

7.                                      CONFIDENTIAL INFORMATION AND PROPRIETARY
INFORMATION OBLIGATIONS.  You acknowledge signing the Company’s
Confidentiality, Inventions and Non-Interference Agreement (the “CINA”)
containing a confidentiality agreement in connection with your employment with
the Company.  You represent that you have complied with and will continue to
comply with the terms of the CINA.

 

8.                                      NON-DISPARAGEMENT; INQUIRIES.  You shall
not make any disparaging comments or statements about the Company, its services,
its products, its work, the members of its Board, or executive management.  The
Company will follow its standard neutral reference policy in response to any
inquiries regarding you from prospective employers, i.e., only dates of
employment and position(s) held will be disclosed.  The Company agrees to direct
the members of the Board and executive officers of the Company not to make any
disparaging comments about you, your professional capabilities or your service
to the Company.  Nothing in this Agreement shall preclude you or the Company (or
its employees, officers, directors, or agents) from responding accurately and
fully to any question, inquiry or request for information when required by legal
process.

 

9.                                      COOPERATION AND ASSISTANCE.  You agree
that you will not voluntarily provide assistance, information, encouragement, or
advice, directly or indirectly (including through agents or attorneys), to any
person or entity in connection with any claim by or against the Company, nor
shall you induce or encourage any person or entity to do so.  The foregoing
sentence shall not prohibit you from testifying truthfully under subpoena.  You
warrant that you have not previously provided assistance, information,
encouragement, or advice, directly or

 

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

 

Hani Zeini

November 12, 2015

Page Four

 

indirectly, to any person or entity in connection with any claim by or against
the Company.  You agree to provide (voluntarily and without legal compulsion)
prompt cooperation and accurate and complete information to the Company in the
event of litigation involving the Company or its officers or directors and to
respect and preserve all privileges held by or available to the Company.  The
Company agrees to compensate you for your time spent consulting with and
traveling to any litigation-related proceeding at a reasonable the rate to be
agreed between you and the Company plus reimbursement of reasonable travel
costs.

 

10.                               INJUNCTIVE RELIEF.  The parties agree that any
remedy at law will be inadequate for any breach by you or the Company of the
covenants under Sections 7, 8, and 9 of this Agreement, and that each party
shall be entitled to an injunction both preliminary and final, and any other
appropriate equitable relief to enforce her or its rights set forth in these
Sections.  Such remedies shall be cumulative and non-exclusive, being in
addition to any and all other remedies either party may have.

 

11.                               RELEASE OF CLAIMS.

 

(a)                                 General Release.  In exchange for the
consideration provided to you under this Agreement to which you would not
otherwise be entitled, including but not limited to the Separation Benefits, you
hereby generally and completely release the Company and its current and former
directors, officers, employees, shareholders, partners, agents, attorneys,
predecessors, successors, parent and subsidiary entities, insurers, affiliates,
investors and assigns (collectively, the “Released Parties”) of and from any and
all claims, liabilities and obligations, both known and known, that arise out of
or are in any way related to events, acts, conduct, or omissions occurring prior
to or on the date you sign this Agreement (collectively, the “Released Claims”).

 

(b)                                 Scope of Release.  The Released Claims
include, but are not limited to: (i) all claims arising out of or in any way
related to your employment with the Company, the Employment Agreement, or the
termination of your employment: (ii) all claims related to your compensation or
benefits from the Company, including salary, bonuses, commissions, vacation pay,
expense reimbursements, severance pay, fringe benefits, stock, stock options, or
any other ownership interests in the Company: (iii) all claims for breach of
contract, wrongful termination, and breach of the implied covenant of good faith
and fair dealing; (iv) all tort claims, including claims for fraud, defamation,
emotional distress, wrongful termination, and discharge in violation of public
policy; and (v) all federal, state, and local statutory claims, including claims
for discrimination, harassment, retaliation, attorneys’ fees, or other claims
arising under the federal Civil Rights Act of 1964 (as amended), the federal
Americans with Disabilities Act of 1990, the Age Discrimination in Employment
Act (“ADEA”), the federal Family and Medical Leave Act (as amended) (“FMLA”),
the California Family Rights Act (“CFRA”), the California Labor Code (as
amended), the California Unruh Act, and the California Fair Employment and
Housing Act (as amended).

 

(c)                                  Excluded Claims.  Notwithstanding the
foregoing, the following are not included in the Released Claims (the “Excluded
Claims”): (i) any rights or claims for indemnification you may have pursuant to
any written indemnification agreement with the

 

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

 

Hani Zeini

November 12, 2015

Page Five

 

Company to which you are a party, the charter, bylaws, or operating agreements
of the Company, or under applicable law; (ii) any rights or claims which are not
waivable as a matter of law; and (iii) any claims for breach of this Agreement. 
In addition, nothing in this Agreement prevents you from filing, cooperating
with, or participating in any proceeding before the Equal Employment Opportunity
Commission, the Department of Labor, the California Department of Fair
Employment and Housing, or any other government agency, except that you
acknowledge and agree that you hereby waive your right to any monetary benefits
in connection with any such claim, charge or proceeding.  You represent and
warrant that, other than the Excluded Claims, you are not aware of any claims
you have or might have against any of the Released Parties that are not included
in the Released Claims.

 

(d)                                 Acknowledgements.  You acknowledge that
(i) the consideration given to you in exchange for the waiver and release in
this Agreement is in addition to anything of value to which you were already
entitled; (ii) that you have been paid for all time worked, have received all
the leave, leaves of absence and leave benefits and protections for which you
are eligible, and have not suffered any on-the-job injury for which you have not
already filed a claim; (iii) you have been given sufficient time to consider
this Agreement and to consult an attorney or advisor of your choosing; and
(iv) you are knowingly and voluntarily executing this Agreement waiving and
releasing any claims you may have as of the date you execute it.

 

(e)                                  Company, on behalf of itself, and each of
its parents, subsidiaries and affiliates, and each of them, hereby covenants not
to sue you and fully releases and discharges you, your descendants, dependents,
heirs, executors, administrators, assigns, and successors with respect to and
from any and all claims, demands, rights, liens, agreements or contracts
(written or oral), covenants, actions, suits, causes of action, obligations,
debts, costs, expenses, attorneys’ fees, damages, judgments, orders and
liabilities of whatever kind or nature in law, equity or otherwise, to the
extent known by the Company or any member of the Board (other than you) as of
the Separation Date (each, a “Claim”) (including, without limitation, any Claim
arising out of or in any way connected with your service as an officer,
director, or employee of Company, or any other transactions, occurrences, acts
or omissions or any loss, damage or injury whatever), resulting from any act or
omission by or on the part of you, committed or omitted prior to the date of
Company’s execution of this Agreement.

 

12.                               ADEA WAIVER.  You knowingly and voluntarily
waive and release any rights you may have under the ADEA (defined above).  You
also acknowledge that the consideration given for your releases in this
Agreement is in addition to anything of value to which you were already
entitled.  You are advised by this writing that:  (a) your waiver and release do
not apply to any claims that may arise after you sign this Agreement; (b) you
should consult with an attorney prior to executing this release (and you have
done so); (c) you have twenty-one (21) days within which to consider this
release (although you may choose to voluntarily execute this release earlier);
(d) you have seven (7) days following the execution of this release to revoke
this Agreement; and (e) this Agreement will not be effective until the eighth
day after you sign this Agreement, provided that you have not earlier revoked
this Agreement (the “Effective Date”).  You will not be entitled to receive any
of the benefits specified by this Agreement unless and until it becomes
effective.

 

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

 

Hani Zeini

November 12, 2015

Page Six

 

13.                               SECTION 1542 WAIVER.  In giving the applicable
releases set forth herein, which include claims which may be unknown at present,
each party acknowledges that you or it have or has read and
understand(s) Section 1542 of the Civil Code of the State of California which
reads as follows:

 

A general release does not extend to claims which the creditor does not know or
suspect to exist in his or her favor at the time of executing the release, which
if known by him or her must have materially affected his or her settlement with
the debtor.

 

Each party expressly waives and relinquishes all rights and benefits under this
section and any law or legal principle of similar effect in any jurisdiction
with respect to claims released hereby.

 

14.                               NO ADMISSIONS.  The parties hereto hereby
acknowledge that this is a compromise settlement of various matters, and that
the promised payments in consideration of this Agreement shall not be construed
to be an admission of any liability or obligation by either party to the other
party or to any other person whomsoever.

 

15.                               ENTIRE AGREEMENT.  This Agreement and the
Consulting Agreement constitute the complete, final and exclusive embodiment of
the entire Agreement between you and the Company with regard to the subject
matter hereof.  It is entered into without reliance on any promise or
representation, written or oral, other than those expressly contained herein. 
It may not be modified except in writing signed by you and the Chairman of the
Board of the Company.  Each party has carefully read this Agreement, has been
afforded the opportunity to be advised of its meaning and consequences by his or
its respective attorneys, and signed the same of his or its free will.

 

16.                               SUCCESSORS AND ASSIGNS.  This Agreement shall
bind the heirs, personal representatives, successors, assigns, executors, and
administrators of each party, and inure to the benefit of each party, its
agents, directors, officers, employees, servants, heirs, successors and assigns.

 

17.                               APPLICABLE LAW.  This Agreement shall be
deemed to have been entered into and shall be construed and enforced in
accordance with the laws of the State of California as applied to contracts made
and to be performed entirely within California.

 

18.                               SEVERABILITY.  If a court or arbitrator of
competent jurisdiction determines that any term or provision of this Agreement
is invalid or unenforceable, in whole or in part, the remaining terms and
provisions hereof shall be unimpaired.  Such court or arbitrator will have the
authority to modify or replace the invalid or unenforceable term or provision
with a valid and enforceable term or provision that most accurately represents
the parties’ intention with respect to the invalid or unenforceable term or
provision.

 

19.                               INDEMNIFICATION.  You will indemnify and save
harmless the Company from any loss incurred directly or indirectly by reason of
the falsity or inaccuracy of any representation

 

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

 

Hani Zeini

November 12, 2015

Page Seven

 

made herein.  The Company will indemnify and save harmless you from any loss
incurred directly or indirectly by reason of the falsity or inaccuracy of any
representation made herein.  The Company and you acknowledge and agree that the
terms of the Company’s standard form of indemnification agreement for members of
the Board and executive officers of the Company have applied to you in your role
as an executive officer of the Company, and the Company hereby affirms its
continuing agreements and obligations as set forth in such indemnification
agreement with you.

 

20.                               AUTHORIZATION.  You and the Company warrant
and represent that there are no liens or claims of lien or assignments in law or
equity or otherwise of or against any of the claims or causes of action released
herein and, further, that each of them are fully entitled and duly authorized to
give their complete and final general release and discharge.

 

21.                               COUNTERPARTS.  This Agreement may be executed
in two counterparts, each of which shall be deemed an original, all of which
together shall constitute one and the same instrument.

 

22.                               SECTION HEADINGS.  The section and paragraph
headings contained in this Agreement are for reference purposes only and shall
not affect in any way the meaning or interpretation of this Agreement.

 

23.                               PHOTOCOPIES.  A photocopy of this executed
Agreement shall be as valid, binding, and effective as the original Agreement.

 

24.                               SECTION 409A.  It is intended that all of the
benefits and payments payable under this Agreement satisfy, to the greatest
extent possible, an exemption from Section 409A of the Internal Revenue Code of
1986, as amended (“Section 409A”), and this Agreement will be construed to the
greatest extent possible as consistent with those exemptions, and to the extent
not so exempt, this Agreement (and any definitions hereunder) will be construed
to the greatest extent possible in a manner that complies with Section 409A. For
purposes of Section 409A, your right to receive any installment payments under
this Agreement (whether severance payments, reimbursements or otherwise) shall
be treated as a right to receive a series of separate payments and, accordingly,
each installment payment hereunder shall at all times be considered a separate
and distinct payment. Notwithstanding any provision to the contrary in this
Agreement, if you are deemed by the Company at the time of your separation from
service to be a “specified employee” for purposes of Section 409A, and if any of
the payments upon separation from service set forth herein and/or under any
other agreement with the Company are deemed to be “deferred compensation”, then
to the extent delayed commencement of any portion of such payments is required
in order to avoid a prohibited distribution under Section 409A and the related
adverse taxation under Section 409A, such payments shall not be provided to you
prior to the earliest of (i) the expiration of the six-month period measured
from the date of your separation from service, (ii) the date of your death or
(iii) such earlier date as permitted under Section 409A without the imposition
of adverse taxation. If the release revocation period spans two calendar years,
payments will commence in the second of those two calendar years to the extent
required to comply with Section 409A.

 

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

 

Please confirm your assent to the foregoing terms and conditions of our
Agreement by signing and returning a copy of this letter to me.

 

Sincerely,

 

 

 

SIENTRA, INC.

 

 

 

By:

/s/ Matthew Pigeon

 

 

 

 

 

Matthew Pigeon

 

 

(Printed Name)

 

 

 

Title:

Chief Financial Officer

 

 

Having read and reviewed the foregoing, I hereby agree to and accept the terms
and conditions of this Agreement as stated above.

 

/s/ Hani Zeini

 

November 12, 2015

Hani Zeini

Date

 

[Signature Page to Separation Agreement – Hani Zeini]

 

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