**Exhibit 10.32**

 

**IMCLONESYSTEMS INCORPORATED**

**CHANGE-IN-CONTROLPLAN**

**(AsAmended February 16, 2006)**

 

1.0**                                 PURPOSEOF PLAN**

 

1.1**                                 Purpose**.The purpose of the ImClone Systems Incorporated Change-in-Control Plan (the “Plan”)is to:

 

(a)                                  retaincertain highly qualified individuals as employees of ImClone SystemsIncorporated and/or its subsidiaries (the “Company”);

 

(b)                                 maintainthe focus of such employees on the business of the Company and to mitigate thedistractions caused by the possibility that the Company may be the targetof an acquisition strategy; and

 

(c)                                  providecertain benefits to such employees if a change in control of the Company occursand/or any employee’s employment is terminated in connection with such changein control.

 

The Plan is intended to qualify as an “employee benefit plan” (as suchterm is defined under Section 3(3) of the Employee Retirement IncomeSecurity Act of 1974, as amended (“ERISA”)) and accordingly will be subject toERISA. In addition, the Plan is intended to qualify as a “top-hat” plan (assuch term is commonly used under the ERISA regulations promulgated by the U.S.Department of Labor) since it is intended to provide benefits only to a selectgroup of management or highly compensated employees of the Company.

 

2.0**                                 DEFINITIONS**

 

The following terms shall have the following meanings unless thecontext indicates otherwise:

 

2.1                                 *“Beneficiary”* shall mean a beneficiarydesignated in writing by a Participant to receive any Change-in-ControlBenefits in accordance with Sections 5 or 6 below. If no beneficiary isdesignated by the Participant, then the Participant’s estate shall be deemed tobe the Participant’s Beneficiary.

 

2.2                                 *“Board”* shall mean the Board of Directorsof the Company.

 

2.3                                 *“Bonus”* shall mean the 3-year average ofthe actual annual bonuses paid to the Participant during the 36-month periodimmediately preceding the Change-in-Control Date, with such amount increased(if applicable) to take into account any elective or mandatory deferrals. For aParticipant who has not been employed by the Company for the full 36-monthperiod prior to the Change-in-Control Date, the average annual bonus amountshall be calculated based on the number of full years of employment. For aParticipant who has not been employed long enough to receive an annual bonus,the annual bonus amount shall be equal to the target annual bonus.

 

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2.4                                 *“Cause”* shall mean – unless otherwisedefined in an employment agreement between the Participant and the Company orSubsidiary – the occurrence of any of the following:

 

(1)                                  anindictment of the Participant involving a felony or a misdemeanor involvingmoral turpitude; or

 

(2)                                  willfulmisconduct or gross negligence by the Participant resulting, in either case, inharm to the Company or any Subsidiary; or

 

(3)                                  failureby the Participant to carry out the directions of the Board or the Participant’simmediate supervisor, as the case may be; or

 

(4)                                  fraud,embezzlement, theft or dishonesty by the Participant against the Company or anySubsidiary or a material violation by the Participant of a policy or procedureof the Company, resulting, in any case, in harm to the Company or anySubsidiary.

 

2.5                                 *“Change in Control”* shall mean theoccurrence of one of the following events:

 

(1)                                  individualswho, on the Effective Date, constitute the Board (the “Incumbent Directors”)cease for any reason to constitute at least a majority of the Board, providedthat any person becoming a director subsequent to the Effective Date whoseelection or nomination for election was approved by a vote of at leasttwo-thirds of the Incumbent Directors then on the Board (either by a specificvote or by approval of the proxy statement of the Company in which such personis named as a nominee for director, without objection to such nomination) shallbe an Incumbent Director; provided, however, that no individual initiallyelected or nominated as a director of the Company as a result of an actual orthreatened election contest with respect to directors or as a result of anyother actual or threatened solicitation of proxies by or on behalf of anyperson other than the Board shall be an Incumbent Director;

 

(2)                                  any“person” (as such term is defined in Section 3(a)(9) of theSecurities Exchange Act of 1934 (the “Exchange Act”) and as used in Sections13(d)(3) and 14(d)(2) of the Exchange Act) is or becomes, after theEffective Date, a “beneficial owner” (as defined in Rule 13d-3 under theExchange Act), directly or indirectly, of securities of the Company representing40% or more of the combined voting power of the Company’s then outstandingsecurities eligible to vote for the election of the Board (the “Company VotingSecurities”); provided, however, that an event described in this Section 2.5(2) shallnot be deemed to be a Change in Control if any of following becomes such abeneficial owner:

 

(A)                              theCompany or any majority-owned subsidiary (provided, that this exclusion appliessolely to the ownership levels of the Company or the majority-ownedsubsidiary),

 

(B)                                anytax-qualified, broad-based employee benefit plan sponsored or maintained by theCompany or any majority-owned subsidiary,

 

(C)                                anyunderwriter temporarily holding securities pursuant to an offering of suchsecurities, or

 

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(D)                               anyperson pursuant to a Non-Qualifying Transaction (as defined in Section 2.5(3) below);

 

(3)                                  theconsummation of a merger, consolidation, statutory share exchange or similar form ofcorporate transaction involving the Company or any of its Subsidiaries thatrequires the approval of the Company’s stockholders, whether for suchtransaction or the issuance of securities in the transaction (a “BusinessCombination”), unless immediately following such Business Combination:

 

(A)                              50%or more of the total voting power of:

 

(x)                                   thecorporation resulting from such Business Combination (the “SurvivingCorporation”), or

 

(y)                                 ifapplicable, the ultimate parent corporation that directly or indirectly hasbeneficial ownership of 100% of the voting securities eligible to electdirectors of the Surviving Corporation (the “Parent Corporation”),

 

is represented by Company Voting Securities that were outstandingimmediately prior to such Business Combination (or, if applicable, isrepresented by shares into which such Company Voting Securities were convertedpursuant to such Business Combination), and such voting power among the holdersthereof is in substantially the same proportion as the voting power of suchCompany Voting Securities among the holders thereof immediately prior to theBusiness Combination;

 

(B)                                noperson (other than any employee benefit plan (or related trust) sponsored ormaintained by the Surviving Corporation or the Parent Corporation), is orbecomes the beneficial owner, directly or indirectly, of 40% or more of thetotal voting power of the outstanding voting securities eligible to electdirectors of the Parent Corporation (or, if there is no Parent Corporation, theSurviving Corporation); and

 

(C)                                atleast a majority of the members of the board of directors of the ParentCorporation (or if there is no Parent Corporation, the Surviving Corporation)following the consummation of the Business Combination were Incumbent Directorsat the time of the Board’s approval of the execution of the initial agreementproviding for such Business Combination

 

(any Business Combination which satisfies all of the criteria specifiedin (A), (B) and (C) above shall be deemed to be a “Non-QualifyingTransaction”); or

 

(4)                                  stockholderapproval of a liquidation or dissolution of the Company, unless the votingcommon equity interests of an ongoing entity (other than a liquidating trust)are beneficially owned, directly or indirectly, by the Company’s shareholdersin substantially the same proportions as such shareholders owned the Company’soutstanding voting common equity interests immediately prior to suchliquidation and such ongoing entity assumes all existing obligations of theCompany under this Plan.

 

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Notwithstanding the foregoing, a Change in Control of the Company shallnot be deemed to occur solely because any person acquires beneficial ownershipof more than 40% of the Company Voting Securities as a result of theacquisition of Company Voting Securities by the Company which reduces thenumber of Company Voting Securities outstanding; provided, that, if after suchacquisition by the Company such person becomes the beneficial owner of CompanyVoting Securities that increases the percentage of outstanding Company VotingSecurities beneficially owned by such person, a Change in Control of theCompany shall then occur.

 

2.6                                 *“Change-in-Control Benefits”* shall meanthe benefits described in Sections 5 and 6 below.

 

2.7                                 *“Change-in-Control Date”* shall mean thedate that a Change in Control first occurs.

 

2.8                                 *“Change-in-Control Termination”* shall meana termination of the Participant’s employment:

 

(1)                                  bythe Company without Cause during the period beginning 3 months prior to theChange-in-Control Date and ending 18 months after the Change-in-Control Date,or

 

(2)                                  ifthe Participant has been designated by the Committee as a Tier 1 Participant ora Tier 2 Participant in accordance with Section 3.2 below, by theParticipant for Good Reason during the period beginning 3 months prior to thedate of the Change in Control and ending 18 months after the Change-in-ControlDate.

 

2.9                                 *“Code”* shall mean the Internal RevenueCode of 1986, as amended from time to time.

 

2.10                           *“Committee”* shall mean (i) the Boardor (ii) a committee or subcommittee of the Board appointed by the Boardfrom among its members. The Committee may be the Board’s compensationcommittee.

 

2.11                           *“Company”* shall mean ImClone SystemsIncorporated, a Delaware corporation, including any successor entity or anysuccessor to the assets of the Company that has assumed the Plan.

 

2.12                           “*Competitive Activity*” shall mean theParticipant’s engaging in an activity – whether as an employee, consultant,principal, member, agent, officer, director, partner or shareholder (except asa less than 1% shareholder of a publicly traded company) – that is competitivewith any business of the Company or any Subsidiary conducted by the Company orsuch Subsidiary at any time during the Noncompetition/Nonsolicitation Period;*provided, however*, that the Participant may beemployed by or otherwise associated with:

 

(i)                                     abusiness of which a subsidiary, division, segment, unit, etc. is in competitionwith the Company or any Subsidiary but as to which such subsidiary, division,segment, unit, etc. the Participant has absolutely no direct or indirectresponsibilities or involvement, or

 

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(ii)                                  acompany where the Competitive Activity is:

 

(A)                              fromthe perspective of such company,*de minimis*with respect to the business of such company and its affiliates, and

 

(B)                                fromthe perspective of the Company or any Subsidiary, not in material competitionwith the Company or any Subsidiary.

 

2.13                           *“Effective Date”* shall mean the date theBoard adopts the Plan.

 

2.14                           *“Employee”* shall mean a regular full-timeemployee of the Company or any Subsidiary.

 

2.15                           *“Good Reason”* shall mean – unlessotherwise defined in an employment agreement between the Participant and theCompany or Subsidiary – the occurrence of any of the following within the60-day period preceding a Termination Date:

 

(1)                                  amaterial adverse diminution of the Participant’s titles, authority, duties orresponsibilities, or the assignment to the Participant of titles, authority,duties or responsibilities that are materially inconsistent with his or hertitles, authority, duties and/or responsibilities in a manner materiallyadverse to the Participant; or

 

(2)                                  areduction in the Participant’s base salary, annual target bonus, or maximumbonus without the Participant’s prior written consent (other than any reductionapplicable to Employees generally); or

 

(3)                                  anactual change in the Participant’s principal work location by more than 75miles and more than 75 miles from the Participant’s principal place of abode asof the date of such change in job location without the Participant’s priorwritten consent; or

 

(4)                                  afailure of the Company to obtain the assumption in writing of its obligationunder the Plan by any successor to all or substantially all of the assets ofthe Company within 45 days after a merger, consolidation, sale or similartransaction that qualifies as a Change in Control.

 

2.16                           *“Health Continuation Period”* shall meanthe period commencing on the Termination Date and continuing until the end ofthe applicable period as shown on Schedule A..

 

2.17                           “*Noncompetition/Nonsolicitation Period”*shall mean the period commencing on the Termination Date and continuing untilthe end of the applicable period as shown on Schedule A.

 

2.18                           *“Participant”* shall mean any Employee whohas been designated to participate in the Plan under Section 3 below.

 

2.19                           *“Plan”* shall mean the ImClone SystemsIncorporated Change-in-Control Plan.

 

2.20                           *“Salary”* shall mean the highest annualbase salary paid to the Participant during the 12-month period immediatelypreceding the earlier of (i) the Termination Date or the Change-in-

 

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Control Date, with such amount increased (if applicable) to take intoaccount any elective or mandatory deferrals.

 

2.21                           *“Severance Multiplier”* shall mean themultiplier that shall be used to determine cash severance paid to a Participantin accordance with Schedule A and Section 6.2 below.

 

2.22                           *“Subsidiary”* shall mean a corporation ofwhich the Company directly or indirectly owns more than 50 percent of the “votingstock” (meaning the capital stock of any class or classes having generalvoting power under ordinary circumstances, in the absence of contingencies, toelect the directors of a corporation) or any other business entity in which theCompany directly or indirectly has an ownership interest of more than 50percent.

 

2.23                           *“Terminated Participant”* shall mean aParticipant whose employment with the Company and/or a Subsidiary has beenterminated and which qualifies as a Change-in-Control Termination.

 

2.24                           *“Termination Date”* shall mean the date aTerminated Participant’s employment with the Company and/or a Subsidiary isterminated.

 

2.25                           *“Tier 1 Participant”* shall mean aParticipant who has been designated by the Committee as a Tier 1 Participant inaccordance with Section 3.2 below.

 

2.26                           *“Tier 2 Participant”* shall mean aParticipant who has been designated by the Committee as a Tier 2 Participant inaccordance with Section 3.2 below.

 

2.27                           *“Tier 3 Participant”* shall mean aParticipant who has been designated by the Committee as a Tier 3 Participant inaccordance with Section 3.2 below.

 

2.28                           *“Tier 4 Participant”* shall mean aParticipant who has been designated by the Committee as a Tier 4 Participant inaccordance with Section 3.2 below.

 

3.0**                                 ELIGIBILITYAND PARTICIPATION**

 

3.1**                                 Eligibility**.All Employees of the Company shall be eligible to participate in the Plan.

 

3.2**                                 Participation**.Participants shall consist of such Employees as the Committee in its solediscretion designates to participate in the Plan;*provided, however*, that the Committee shall not designatean Employee as a new Participant following a Change-in-Control Date. At thetime the Committee designates an Employee as a Participant, the Committee shallalso designate whether such Employee is a Tier 1 Participant, a Tier 2Participant, a Tier 3 Participant or a Tier 4 Participant. The Committee may,in its sole discretion, terminate a Participant’s participation in the Plan atany time prior to the beginning of the 180-day period ending on theChange-in-Control Date.

 

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4.0**                                 ADMINISTRATION**

 

4.1**                                 Responsibility**.The Committee shall have the responsibility, in its sole discretion, to control,operate, manage and administer the Plan in accordance with its terms.

 

4.2**                                 Authorityof the Committee**. The Committee shall have the maximum discretionaryauthority permitted by law that may be necessary to enable it to dischargeits responsibilities with respect to the Plan, including but not limited to thefollowing:

 

(a)                                  todetermine eligibility for participation in the Plan;

 

(b)                                 todesignate Participants;

 

(c)                                  todetermine and establish the formula to be used in calculating a Participant’sChange-in-Control Benefits;

 

(d)                                 tocorrect any defect, supply any omission, or reconcile any inconsistency in thePlan in such manner and to such extent as it shall deem appropriate in its solediscretion to carry the same into effect;

 

(e)                                  toissue administrative guidelines as an aid to administer the Plan and makechanges in such guidelines as it from time to time deems proper;

 

(f)                                    tomake rules for carrying out and administering the Plan and make changes insuch rules as it from time to time deems proper;

 

(g)                                 tothe extent permitted under the Plan, grant waivers of Plan terms, conditions,restrictions, and limitations;

 

(h)                                 tomake reasonable determinations as to a Participant’s eligibility for benefitsunder the Plan, including determinations as to Cause and Good Reason; and

 

(i)                                     totake any and all other actions it deems necessary or advisable for the properoperation or administration of the Plan.

 

4.3**                                 Actionby the Committee**. The Committee may act only by a majority of itsmembers. Any determination of the Committee may be made, without ameeting, by a writing or writings signed by all of the members of the Committee.In addition, the Committee may authorize any one or more of its members toexecute and deliver documents on behalf of the Committee.

 

4.4**                                 Delegationof Authority**. The Committee may delegate to one or more of itsmembers, or to one or more agents, such administrative duties as it may deemadvisable;*provided, however*,that any such delegation shall be in writing. In addition, the Committee, orany person to whom it has delegated duties as aforesaid, may employ one ormore persons to render advice with respect to any responsibility the Committeeor such person may have under the Plan. The Committee may employ suchlegal or other counsel, consultants and agents as it may deem

 

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desirable for the administration of the Plan and may rely upon anyopinion or computation received from any such counsel, consultant or agent. Expensesincurred by the Committee in the engagement of such counsel, consultant oragent shall be paid by the Company, or the Subsidiary whose employees havebenefited from the Plan, as determined by the Committee.

 

4.5**                                 Determinationsand Interpretations by the Committee**. All determinations andinterpretations made by the Committee shall be binding and conclusive to themaximum extent permitted by law on all Participants and their heirs,successors, and legal representatives.

 

4.6**                                 Information**.The Company shall furnish to the Committee in writing all information theCommittee may deem appropriate for the exercise of its powers and dutiesin the administration of the Plan. Such information may include, but shallnot be limited to, the full names of all Participants, their earnings and theirdates of birth, employment, retirement or death. Such information shall beconclusive for all purposes of the Plan, and the Committee shall be entitled torely thereon without any investigation thereof.

 

4.7**                                 Self-Interest**.No member of the Committee may act, vote or otherwise influence a decisionof the Committee specifically relating to his or her benefits, if any, underthe Plan.

 

4.8                                 **Liability**. No member of the Board, nomember of the Committee and no employee of the Company shall be liable for anyact or failure to act hereunder, except in circumstances involving his or herbad faith, gross negligence or willful misconduct, or for any act or failure toact hereunder by any other member or employee or by any agent to whom duties inconnection with the administration of the Plan have been delegated.

 

4.9                                 **Indemnification**. The Company shallindemnify members of the Committee and any agent of the Committee who is anemployee of the Company, against any and all liabilities or expenses to whichthey may be subjected by reason of any act or failure to act with respectto their duties on behalf of the Plan, except in circumstances involving suchperson’s bad faith, gross negligence or willful misconduct.

 

5.0**                                 SINGLE-TRIGGERBENEFITS**

 

5.1**                                 Equity-BasedCompensation**. Unless otherwise provided in any written agreement betweenthe Company and a Participant, all equity-based compensation awards held by theParticipants as of the Change-in-Control Date shall become fully vested and/orexercisable as of such date, unless the Committee, in its sole discretion,determines (i) that such awards will be substituted, replaced, rolledover, or converted into equity-based compensation awards of the acquiringand/or surviving entity and (ii) the economic value and benefit of theequity-based compensation awards immediately prior to the Change-in-ControlDate are equal to the economic value and benefit of the equity-basedcompensation awards immediately after the Change-in-Control Date, on anaward-by-award basis.

 

5.2                                 **Deferred Compensation**. Unless otherwiseprovided in any written agreement between the Company and a Participant, aParticipant’s unvested nonqualified deferred compensation as of theChange-in-Control Date shall become fully vested and nonforfeitable as of suchdate.

 

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5.3**                                 Paymentof Change-in-Control Benefits to Beneficiaries**. In the event of theParticipant’s death, all Change-in-Control Benefits that would have been paidto the Participant under this Section 5 but for his or her death, shall bepaid to the Participant’s Beneficiary.

 

5.4**                                 OtherBenefits.**Notwithstanding anything contained in the Plan to the contrary,the Company or the Committee may, in its sole discretion, provide benefits inaddition to the benefits described under this Section 5.

 

6.0**                                 DOUBLE-TRIGGERBENEFITS**

 

6.1**                                 AccruedObligations**. Unless otherwise provided in any written agreement between theCompany and the Participant, on the later to occur of (i) aChange-in-Control Date or (ii) a Termination Date, the Company shall payto the Terminated Participant during the 30-day period following the later of(x) the Change-in-Control Date or (y) the Termination Date, a lump sum cashpayment equal to the Participant’s earned but unpaid Salary and/or Bonus, plusunreimbursed expenses, plus any and all other Company obligations that areaccrued and due and owing to the Terminated Participant.

 

6.2**                                 CashSeverance**. Unless otherwise provided in any written agreement between theCompany and the Participant, on the later to occur of (i) aChange-in-Control Date or (ii) a Termination Date, the Company shall payto the Terminated Participant during the 30-day period following the later of(x) the Change-in-Control Date or (y) the Termination Date, a lump sum cashpayment equal to the sum of:

 

(A)                              apro rata annual target bonus with respect to the year that the Termination Dateoccurs, plus

 

(B)                                theproduct of (x) the Severance Multiplier times (y) the sum of the TerminatedParticipant’s (a) Salary plus (b) Bonus.

 

6.3**                                 Long-TermIncentive Compensation.**Unless otherwise provided in any written agreementbetween the Company and a Participant, any and all long-term incentivearrangements that did not vest and/or become payable in accordance with Section 5above shall be paid to the Participant in accordance with the terms andconditions of such long-term incentive arrangement, or if such arrangement doesnot provide express terms and conditions relating to the consequences of aChange in Control, then:

 

(a)                                  allequity-based compensation awards held by the Terminated Participant as of theTermination Date shall become fully vested and/or exercisable as of such date,and

 

(b)                                 awardsunder any long-term incentive arrangement shall be paid to the TerminatedParticipant based on a pro rata portion of the completed performance cycle orvesting period, as applicable, as of the Termination Date and using actualperformance as of the Termination Date (as applicable).

 

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6.4**                                 Pension-BenefitArrangements**. Unless otherwise provided in any written agreement betweenthe Company and a Participant, benefits under all nonqualified pension-benefitarrangements, including nonqualified deferred compensation arrangements, may notbe paid to the Terminated Participant prior to the first anniversary of theChange-in-Control Date. Notwithstanding the preceding sentence, the Committee may acceleratesuch payment, in its sole discretion, after having received advice from theCompany’s tax counsel.

 

6.5**                                 Welfare-BenefitArrangements**. Unless otherwise provided in any written agreement betweenthe Company and a Participant, the Company shall provide a TerminatedParticipant with continued health coverage during the Health ContinuationPeriod as shown on Schedule A. Unless otherwise provided for in anywritten agreement between the Company and a Terminated Participant, or asotherwise agreed to by the Committee in its sole discretion, all other welfarebenefits shall cease as of the Termination Date. Following the end of theapplicable Health Continuation Period, the Terminated Participant shall beeligible to receive COBRA health continuation coverage in accordance with rules andprovisions under the Consolidated Omnibus Budget Reconciliation Act of 1985.

 

6.6**                                 OutplacementServices**. The Company shall provide a Terminated Participant withoutplacement services during the 6-month period following the Termination Date.

 

6.7**                                 Paymentof Change-in-Control Benefits to Beneficiaries**. In the event of theTerminated Participant’s death, all Change-in-Control Benefits that would havebeen paid to the Terminated Participant under this Section 6 but for hisor her death, shall be paid to the Terminated Participant’s Beneficiary.

 

6.8**                                 OtherBenefits.**Notwithstanding anything contained in the Plan to the contrary,the Company or the Committee may, in its sole discretion, provide benefits inaddition to the benefits described under this Section 6.

 

6.9**                                 CodeSection 409A. **The Company intends that all payments under thePlan be made on a basis that complies with Section 409A of the Code. Accordingly,in the event that any Participant is considered a “Specified Employee” asdefined in Section 409A of the Code or the guidance issued thereunder (“Section 409A”),and any payments to the Participant under the Plan are considered “deferredcompensation” under Section 409A of a type requiring payment six monthsafter the date of the Participant’s separation from service (within the meaningof Section 409A), then to the extent required by Section 409A, suchpayment shall be delayed until six (6) months after the date of theParticipant’s separation from service. The Company makes no guarantee withrespect to the tax treatment of payments hereunder, and the Company shall notbe responsible in any event with regard to non-compliance with Code Section 409A.

 

7.0**                                 PARTICIPANTOBLIGATIONS**

 

7.1                                 **Waiver and Release**. As a conditionprecedent for receiving the double-trigger benefits provided under Section 6above, a Terminated Participant shall execute a waiver and releasesubstantially in the form attached to the Plan as Exhibit B.

 

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7.2                                 **Noncompetition.**During theNoncompetition/Nonsolicitation Period, a Terminated Participant shall not atany time, directly or indirectly, engage in Competitive Activity.

 

7.3                                 **Nonsolicitation**. During theNoncompetition/Nonsolicitation Period, a Terminated Participant shall not atany time, directly or indirectly, solicit (x) any customer or client of theCompany or any Subsidiary with respect to a Competitive Activity or (y) anyemployee of the Company or any Subsidiary for the purpose of causing suchemployee to terminate his or her employment with the Company or suchSubsidiary.

 

7.4                                 **Enforcement.**If a Terminated Participantviolates or threatens to violate Section 7.2 or Section 7.3 above,the Company shall not have an adequate remedy at law. Accordingly, the Companyshall be entitled to such equitable and injunctive relief as may beavailable to restrain the Terminated Participant and any business, firm,partnership, individual, corporation or entity participating in the breach orthreatened breach from the violation of the provisions of Section 7.2 or7.3 above. Nothing in the Plan shall be construed as prohibiting the Company frompursuing any other remedies available at law or in equity for breach orthreatened breach of Section 7.2 or 7.3 above, including the recovery ofdamages.

 

7.5                                 **Confidentiality**. At all times prior to andafter the Change-in-Control Date, a Participant shall not disclose to anyone ormake use of any trade secret or proprietary or confidential information of theCompany, including such trade secret or proprietary or confidential informationof any customer or other entity to which the Company owes an obligation not todisclose such information, which he or she acquires during his or heremployment with the Company, including but not limited to records kept in theordinary course of business, except:

 

(i)                                     assuch disclosure or use may be required or appropriate in connection withhis or her work as an employee of the Company;

 

(ii)                                  whenrequired to do so by a court of law, by any governmental agency havingsupervisory authority over the business of the Company or by any administrativeor legislative body (including a committee thereof) with apparent jurisdictionto order him or her to divulge, disclose or make accessible such information;

 

(iii)                               asto such confidential information that becomes generally known to the public ortrade without his or her violation of this Section 7.5; or

 

(iv)                              tothe Participant’s spouse and/or his or her personal tax and financial advisorsas reasonably necessary or appropriate to advance the Participant’s tax,financial and other personal planning (each an “Exempt Person”),*provided, however*, that any disclosure oruse of any trade secret or proprietary or confidential information of theCompany by an Exempt Person shall be deemed to be a breach of this Section 7.5by the Participant.

 

7.6                                 **Return of Company Property**. Immediately followingthe Termination Date, a Participant shall immediately return all Companyproperty in his or her possession, including but not limited to all computerequipment (hardware and software), telephones, facsimile machines, palm pilotsand other communication devices, credit cards, office keys, security accesscards,

 

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badges, identification cards and all copies (including drafts) of anydocumentation or information (however stored) relating to the business of theCompany, its customers and clients or its prospective customers and clients.

 

7.7                                 **Cooperation**. Following the TerminationDate, a Participant shall give his or her assistance and cooperation willingly,upon reasonable advance notice with due consideration for his or her otherbusiness or personal commitments, in any matter relating to his or her positionwith the Company, or his or her expertise or experience as the Company may reasonablyrequest, including his or her attendance and truthful testimony where deemedappropriate by the Company, with respect to any investigation or the Company’sdefense or prosecution of any existing or future claims or litigations or otherproceeding relating to matters in which he or she was involved or potentiallyhad knowledge by virtue of his or her employment with the Company. In no eventshall his or her cooperation materially interfere with his or her services fora subsequent employer or other similar service recipient. The Company agreesthat (i) it will promptly reimburse the Terminated Participant for his orher reasonable and documented expenses in connection with his or her renderingassistance and/or cooperation under this Section 7.7, upon his or herpresentation of documentation for such expenses and (ii) the TerminatedParticipant will be reasonably compensated for any continued material servicesas required under this Section 7.7.

 

8.0**                                 CLAIMS**

 

8.1**                                 ClaimsProcedure**. If any Participant or Beneficiary, or his or her legalrepresentative, has a claim for benefits which is not being paid, such claimantmay file a written claim with the Committee setting forth the amount andnature of the claim, supporting facts, and the claimant’s address. Writtennotice of the disposition of a claim by the Committee shall be furnished to theclaimant within 90 days after the claim is filed. In the event of specialcircumstances, the Committee may extend the period for determination forup to an additional 90 days, in which case it shall so advise the claimant. Ifthe claim is denied, the reasons for the denial shall be specifically set forthin writing, pertinent provisions of the Plan shall be cited, including anexplanation of the Plan’s claim review procedure, and, if the claim isperfectible, an explanation as to how the claimant can perfect the claim shallbe provided.

 

8.2**                                 ClaimsReview Procedure**. If a claimant whose claim has been denied wishes furtherconsideration of his or her claim, he or she may request the Committee toreview his or her claim in a written statement of the claimant’s position filedwith the Committee no later than 60 days after receipt of the writtennotification provided for in Section 8.1 above. The Committee shall fullyand fairly review the matter and shall promptly advise the claimant, inwriting, of its decision within the next 60 days. Due to special circumstances,the Committee may extend the period for determination for up to anadditional 60 days.

 

8.3**                                 DisputeResolution**. Any disputes arising under or in connection with the Plan shallbe resolved by binding arbitration, to be held in New York City in accordancewith the rules and procedures of the American Arbitration Association. Judgmentupon the award rendered by the arbitrator may be entered in any courthaving jurisdiction thereof.

 

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8.4**                                 Reimbursementof Expenses**. If there is any dispute between the Company and a Participantwith respect to a claim under the Plan, the Company shall reimburse suchParticipant all reasonable fees, costs and expenses incurred by suchParticipant with respect to such disputed claim;*provided, however*, that (i) such Participant is theprevailing party with respect to such disputed claim or (ii) the disputedclaim is settled.

 

9.0**                                 TAXES**

 

9.1**                                 WithholdingTaxes**. The Company shall be entitled to withhold from any and all paymentsmade to a Participant under the Plan all federal, state, local and/or othertaxes or imposts which the Company determines are required to be so withheldfrom such payments or by reason of any other payments made to or on behalf ofthe Participant or for his or her benefit hereunder.

 

9.2**                                 GoldenParachute Excise Tax Gross-Up**. The Committee shall designate which, ifany, of paragraphs (a), (b), (c) or (d) of this Section 9.2, orsuch other alternative as the Committee shall determine, in each case withoutduplication, applies to the Participant. Such designation shall be made at thetime the Participant is designated by the Committee as a Participant under thisPlan (except that all Participants in the Plan prior to February 16, 2006are designated for this purpose as having paragraph (b) apply to them), orat such other time as the Committee determines in accordance with theprovisions of the Plan; provided that any subsequent designation under this Section 9.2after the initial designation hereunder shall not be any less favorable to theParticipant than the then existing designation without the written consent ofthe Participant. If no such designation is made by the Committee (or if theCommittee so affirmatively states) then the provisions of this Section 9.2shall not apply to the Participant, and the Company shall have no obligation tothe Participant under this Section 9.2.

 

(a)                                  GrossUp. In the event that a Participant becomes subject to the excise taximposed by Code Section 4999 (the “Parachute Excise Tax”), then theCompany shall pay to the Participant a tax gross-up payment so that afterpayment by the Participant of all federal, state, and local excise, income,employment, Medicare and any other taxes (including any related penalties andinterest) resulting from the payment of the “parachute payments” (defined inCode Section 280G) and the tax gross-up payments to the Participant by theCompany, the Participant retains on an after-tax basis an amount equal to theamount that the Participant would have retained had he or she not been subjectto the Parachute Excise Tax.

 

(b)                                 GrossUp Subject to Limitations. In the event that a Participant becomes subjectto the Parachute Excise Tax, then the Company and the Participant shall carryout the following:

 

(i)                                     ifthe aggregate “parachute payment” (as such term is used under Code Section 280G)exceeds 299.99% of the “base amount” (as such term is used under Code Section 280G)(the “Safe Harbor Amount”) by less than 10% of the Safe Harbor Amount, then theparachute payment shall be reduced to the Safe Harbor Amount, with theParticipant determining in his or her sole discretion which portion of theaggregate parachute payment shall be so reduced; or

 

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(ii)                                  ifthe aggregate parachute payment exceeds the Safe Harbor Amount by 10% or moreof the Safe Harbor Amount, then the Company shall pay to the Participant a taxgross-up payment so that after payment by the Participant of all federal,state, and local excise, income, employment, Medicare and any other taxes(including any related penalties and interest) resulting from the payment ofthe parachute payments and the tax gross-up payments to the Participant by theCompany, the Participant retains on an after-tax basis an amount equal to theamount that the Participant would have retained had he or she not been subjectto the Parachute Excise Tax.

 

(c)                                  Cutback.In the event that a Participant becomes subject to the Parachute Excise Tax,then the parachute payment shall be reduced to the Safe Harbor Amount, with theParticipant determining in his or her sole discretion which portion of theaggregate parachute payment shall be so reduced.

 

(d)                                 BetterOf Cutback or No Protection. In the event that a Participant becomessubject to the Parachute Excise Tax, then the provisions of either of clause (i) or(ii) of this paragraph (d) shall apply, whichever provision resultsin the Participant retaining the greater amount after payment of all taxes,including any Parachute Excise Tax:

 

(i)                                     theparachute payment shall be reduced to the Safe Harbor Amount, with theParticipant determining in his or her sole discretion which portion of theaggregate parachute payment shall be so reduced; or

 

(ii)                                  theparachute payment shall not be reduced, and the Participant shall beresponsible for the payment of all federal, state, and local excise, income,employment, Medicare and any other taxes (including any related penalties andinterest) resulting from the payment of the parachute payments.

 

9.3**                                 NoGuarantee of Tax Consequences**. No person connected with the Plan in anycapacity, including, but not limited to, the Company and any Subsidiary andtheir directors, officers, agents and employees makes any representation,commitment, or guarantee that any tax treatment, including, but not limited to,federal, state and local income, estate and gift tax treatment, will beapplicable with respect to amounts deferred under the Plan, or paid to or forthe benefit of a Participant under the Plan, or that such tax treatment willapply to or be available to a Participant on account of participation in thePlan.

 

10.0                           **TERM OF PLAN; AMENDMENT AND TERMINATION OF PLAN**

 

10.1**                           Termof Plan**. The Plan shall be effective as of the Effective Date and shallremain in effect until the Board terminates the Plan.

 

10.2**                           Amendmentof Plan**. The Plan may be amended by the Board at any time with orwithout prior notice;*provided, however*,that the Plan shall not be amended on a Change-in-Control Date or during the3-year period following such Change-in-Control Date.

 

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10.3                           **Termination of Plan**. The Plan may beterminated or suspended by the Board at any time with or without prior notice;*provided, however*, that the Plan shallnot be terminated or suspended on a Change-in-Control Date or during the 3-yearperiod following such Change-in-Control Date.

 

10.4                           **No Adverse Effect**. If the Plan is amended,terminated, or suspended in accordance with Sections 10.2 or 10.3 above, suchaction shall not adversely affect the benefits of any Participant.

 

11.0**                           MISCELLANEOUS**

 

11.1**                           Offset**.Change-in-Control Benefits shall be reduced by any payment or benefit made orprovided by the Company or any Subsidiary to the Participant pursuant to (i) anyseverance plan, program, policy or arrangement of the Company or any Subsidiarynot otherwise referred to in the Plan, (ii) any employment agreementbetween the Company or any Subsidiary and the Participant, and (iii) anyfederal, state or local statute, rule, regulation or ordinance.

 

11.2**                           NoRight, Title, or Interest in Company Assets**. Participants shall have noright, title, or interest whatsoever in or to any assets of the Company or anyinvestments which the Company may make to aid it in meeting itsobligations under the Plan. Nothing contained in the Plan, and no action takenpursuant to its provisions, shall create or be construed to create a trust ofany kind, or a

 

fiduciary relationship between the Company and any Participant,Beneficiary, legal representative or any other person. To the extent that anyperson acquires a right to receive payments from the Company under the Plan,such right shall be no greater than the right of an unsecured general creditorof the Company. Subject to this Section 11.2, all payments to be madehereunder shall be paid from the general funds of the Company and no special orseparate fund shall be established and no segregation of assets shall be madeto assure payment of such amounts;*provided,however*, that the Company may establish a grantor trust toprovide for the payment of the benefits under the Plan of which the Company isthe grantor within the meaning of subpart E, part I, subchapter J,chapter 1, subtitle A of the Code and under which the assets held by such trustwill be subject to the claims of the Company’s general creditors under federaland state law in the event of the Company’s insolvency.

 

11.3**                           NoRight to Continued Employment.**The Participant’s rights, if any, tocontinue to serve the Company as an employee shall not be enlarged or otherwiseaffected by his or her designation as a Participant under the Plan, and theCompany or the applicable Subsidiary reserves the right to terminate the employmentof any employee at any time. The adoption of the Plan shall not be deemed togive any employee, or any other individual any right to be selected as aParticipant or to continued employment with the Company or any Subsidiary.

 

11.4**                           OtherRights.**The Plan shall not affect or impair the rights or obligations ofthe Company or a Participant under any other written plan, contract,arrangement, or pension, profit sharing or other compensation plan.

 

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11.5**                           GoverningLaw.**The Plan shall be governed by and construed in accordance with thelaws of the State of Delaware without reference to principles of conflict oflaws, except as superseded by ERISA and other applicable federal law.

 

11.6**                           Severability.**If any term or condition of the Plan shall be invalid or unenforceable toany extent or in any application, then the remainder of the Plan, with theexception of such invalid or unenforceable provision, shall not be affectedthereby and shall continue in effect and application to its fullest extent.

 

11.7**                           Incapacity.**If the Committee determines that a Participant or a Beneficiary is unableto care for his or her affairs because of illness or accident or because he orshe is a minor, any benefit due the Participant or Beneficiary may be paidto the Participant’s spouse or to any other person deemed by the Committee tohave incurred expense for such Participant (including a duly appointedguardian, committee or other legal representative), and any such payment shallbe a complete discharge of the Company’s obligation hereunder.

 

11.8**                           Transferabilityof Rights.**The Company shall have the unrestricted right to transfer itsobligations under the Plan with respect to one or more Participants to anyperson, including, but not limited to, any purchaser of all or any part ofthe Company’s business. No Participant or Beneficiary shall have any right tocommute, encumber, transfer or otherwise dispose of or alienate any present orfuture right or expectancy which the Participant or Beneficiary may haveat any time to receive payments of benefits hereunder, which benefits and theright thereto are expressly declared to be non-assignable and nontransferable,except to the extent required by law. Any attempt to transfer or assign a benefit,or any rights granted hereunder, by a Participant or the spouse of aParticipant shall, in the sole discretion of the Committee (after considerationof such facts as it deems pertinent), be grounds for terminating any rights ofthe Participant or Beneficiary to any portion of the Plan benefits notpreviously paid.

 

**[REMAINDEROF PAGE INTENTIONALLY LEFT BLANK]**

 

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**SCHEDULE A**

 
| **TIER** | ** ** | **SEVERANCE  MULTIPLIER** | ** ** | **HEALTH CONTINUATION  PERIOD** | ** ** | **NONCOMPETITION /  NONSOLICITATION PERIOD** | ** ** |
|----------|------------|---------------------------|------------|--------------------------------------|------------|--------------------------------------------------------|------------|
| 1        |       | 3x                        |       | 18 months                            |       | 12 months                                              |       |
| 2        |       | 2x                        |       | 18 months                            |       | 12 months                                              |       |
| 3        |       | 1x                        |       | 12 months                            |       | 12 months                                              |       |
| 4        |       | 0.5x                      |       | 6 months                             |       | 6 months                                               |       |

 

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EXHIBIT B

 

**RELEASE**

 

This RELEASE (“Release”) dated as of this          dayof                    ,20   between ImClone Systems Incorporated, a Delawarecorporation (the “Company”), and               (the“Employee”).

 

WHEREAS, the Employee is a participant in the Company’sChange-in-Control Plan (the “Plan”); and

 

WHEREAS, the Employee’s employment with the Company (has been) (willbe) terminated effective                           ;and

 

WHEREAS, pursuant to Section 7.1 of the Plan, the Employee isentitled to certain compensation and benefits upon such termination, contingentupon the execution of this Release;

 

NOW, THEREFORE, in consideration of the premises and mutual agreementscontained herein and in the Plan, the Company and the Employee agree asfollows:

 

1.                                       TheEmployee, on [his/her] own behalf and on behalf of [his/her] heirs, estate andbeneficiaries, does hereby release the Company, and any of its Subsidiaries oraffiliates, and each past or present officer, director, agent, employee,shareholder, and insurer of any such entities, from any and all claims made, tobe made, or which might have been made of whatever nature, whether known orunknown, from the beginning of time, including those that arose as aconsequence of [his/her] employment with the Company, or arising out of theseverance of such employment relationship, or arising out of any act committedor omitted during or after the existence of such employment relationship, allup through and including the date on which this Release is executed, including,but not limited to, those which were, could have been or could be the subjectof an administrative or judicial proceeding filed by the Employee or on[his/her] behalf under federal, state or local law, whether by statute,regulation, in contract or tort, and including, but not limited to, every claimfor front pay, back pay, wages, bonus, fringe benefit, any form ofdiscrimination (including but not limited to, every claim of race, color, sex,religion, national origin, disability or age discrimination), wrongfultermination, emotional distress, pain and suffering, breach of contract,compensatory or punitive damages, interest, attorney’s fees, reinstatement orreemployment. If any court rules that such waiver of rights to file, orhave filed on [his/her] behalf, any administrative or judicial charges orcomplaints is ineffective, the Employee agrees not to seek or accept any moneydamages or any other relief upon the filing of any such administrative orjudicial charges or complaints. The Employee relinquishes any right to futureemployment with the Company and the Company shall have the right to refuse tore-employ the Employee without liability. The Employee acknowledges and agreesthat even though claims and facts in addition to those now known or believed by[him/her] to exist may subsequently be discovered, it is [his/her]intention to fully settle and release all claims [he/she] may have againstthe Company and the persons and entities described above, whether known,unknown or suspected.

 

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2.                                       TheEmployee acknowledges that [he/she] has been provided at least 21 days toreview the Release and has been advised to review it with an attorney of[his/her] choice. In the event the Employee elects to sign this Release priorto the end of this 21-day period, [he/she] agrees that it is a knowing andvoluntary waiver of [his/her] right to wait the full 21 days. The Employeefurther understands that [he/she] has 7 days after the signing hereof to revokeit by so notifying the Company in writing, such notice to be received by               withinthe 7-day period. The Employee further acknowledges that [he/she] has carefullyread this Release, and knows and understands its contents and its binding legaleffect. The Employee acknowledges that by signing this Release, [he/she] doesso of [his/her] own free will and act and that it is [his/her] intention that[he/she] be legally bound by its terms.

 

IN WITNESS WHEREOF, the parties have executed this Release on the datefirst above written.

 

 
|   | IMCLONE SYSTEMS INCORPORATED |
|--------|------------------------------|
|   |                         |
|   | By:                          |   |   |
|   |                         |  Name: |
|   |                         |  Title: |
|   |                         |
|   |                         |   |
|   | [Employee’s Name]       |

 

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