Exhibit 10.3


 


AMENDED
AND RESTATED


EMPLOYMENT
AGREEMENT


 


THIS AMENDED AND
RESTATED EMPLOYMENT AGREEMENT (the “Agreement”), made this 6th day
of November 2008, is entered into by Sepracor Inc., a Delaware corporation
with its principal place of business at 84 Waterford Drive, Marlborough,
Massachusetts 01752-7231 (the “Company”), and Mark Iwicki residing at 12
Bristol Terrace, Long Valley, New Jersey 07853 (the “Executive”).


 


The Company
desires to employ the Executive and the Executive desires to be employed by the
Company, and in connection therewith the Company and the Executive entered into
an Employment Agreement, dated October 15, 2007 (the “Original Agreement”).  The Company and the Executive wish to amend
and restate the Original Agreement as provided for herein.  In consideration of the mutual covenants and
promises contained herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged by the parties hereto,
the parties agree that the Original Agreement is amended and restated in its
entirety as follows:


 


1.             Term of
Employment.  The Company hereby
agrees to employ the Executive and the Executive hereby accepts employment with
the Company, upon the terms set forth in this Agreement, for the period commencing
on October 15, 2007 (the “Commencement Date”)  and ending on October 15, 2012 (the “Term”).  Notwithstanding
the foregoing, the Term shall be extended automatically without further action
by either party by one (1) additional year (added to the end of the Term)
on each succeeding anniversary of October 15, 2012, unless either party
shall have served written notice upon the other party at least sixty (60) days
preceding the date upon which such Term would end (such period, as it may be
extended, the “Employment Period”), unless sooner terminated in accordance with
the provisions of Section 4.


 

















 


2.             Title and Capacity.  The Executive shall serve as Executive
Vice-President, Chief Commercial Officer of the Company.  Executive shall report directly to the Chief
Executive Officer of the Company and shall, except as permitted hereby, devote
all of his business time and services to the business and affairs of the
Company.  Executive shall also perform
such other duties consistent with his position as Executive Vice-President,
Chief Commercial Officer as may be reasonably assigned by the Chief Executive
Officer and the Board of Directors of the Company (the “Board”) from time to
time.  The Executive agrees to abide by
the rules, regulations, instructions, personnel practices and policies of the
Company and any changes therein that may be adopted from time to time by the
Company.


 


Notwithstanding
anything herein to the contrary, Executive shall be entitled to engage in (a) service
on the board of directors of one company, businesses or trade organization with
prior Board approval, (b) service on the board of directors of
not-for-profit or charitable organizations with prior Board approval, (c) other
charitable activities and community affairs and (d) managing his personal
investments and affairs, in each case to the extent such activities do not
materially interfere with the performance of his duties and responsibilities to
the Company.


 


3.             Compensation and
Benefits.


 


3.1           Salary.  During the term of this Agreement, the
Company agrees to pay to the Executive a base salary at the annualized rate of
$475,000 (“Base Salary”) commencing on the Commencement Date.  The Base Salary shall be subject to annual
review by the Board but shall not be reduced below $475,000 per annum.  Such salary shall be payable to Executive in
bi-weekly installments and in accordance with the Company’s normal payroll
procedures.


 


3.2           Bonus.  The Executive shall receive a one-time “Sign
On” bonus of $175,000 less applicable taxes and withholdings to be paid within
thirty (30) days of the 


 

















 


Commencement Date, provided,
however, if the Executive’s employment is terminated, within twelve (12)
months of the Commencement Date, for Cause by the Company pursuant to Section 4.2
or at the election of the Executive pursuant to Section 4.5, the Executive
will be required to repay the portion of the Sign On bonus retained by
Executive after the payment of all taxes. 
In addition, the Executive shall be eligible for a performance-based
annual bonus for each fiscal year of the Term (the “Annual Bonus”). The Annual
Bonus shall be based upon annual quantitative and qualitative performance
targets as established by the Board in its sole discretion in accordance with
the Company’s bonus plan; provided, that the Executive’s annual bonus
level target shall be set at sixty percent (60%) of Base Salary.  For 2007, Executive shall be entitled to a
guaranteed bonus in the amount of $75,000 payable on or about February 2008.  For 2008, Executive shall be entitled to a
guaranteed Annual Bonus in an amount equal to sixty percent (60%) of his Base
Salary. The Annual Bonus is not earned until the close of business on the last
business day of the Company’s fiscal year. 
Any Annual Bonus payable hereunder shall be payable, if at all, after
the date of the delivery of the audited financial statements for the applicable
fiscal year.  The Company’s fiscal year
currently ends December 31.


 


3.3           Stock and Option Grant.  At the first meeting of the Compensation
Committee of the Board of Directors following the Executive’s first day of
employment, the Company shall grant to the Executive, under the Company’s 2000
Stock Incentive Plan (the “Stock Plan”), 80,000 shares of restricted stock and
an option to purchase 150,000 shares of Company stock (the “Initial Grant”).  The terms and conditions of the Initial Grant
(other than the exercise price per share, which shall be equal to the closing
price of the Company’s stock on the grant date) shall be set forth in the award
agreements attached hereto as Schedules A and B.  The Initial Grant shall vest in five equal
installments on each of the first five anniversaries of the 


 

















 


Commencement Date.  The Board, in its sole discretion, may grant
further incentive compensation awards to the Executive from time to time.  The Company represents and warrants to
Executive that the Company has full power and authority, subject to
Compensation Committee approval, and shares available under the Stock Plan to
make the Initial Grant.


 


3.4           Benefits.  The Executive shall be entitled to
participate in all bonus and benefit programs that the Company establishes and
makes available to its employees, to the extent that the Executive is eligible
under (and subject to the provisions of) the plan documents governing those
programs.  The Executive shall be
entitled to no less than four weeks paid vacation per year, subject to the
other terms of the Company’s standard vacation policy (Schedule C).


 


3.5           Reimbursement of Expenses.  The Company shall reimburse the Executive for
all reasonable travel (which shall be deemed to include first class airfare),
entertainment and other expenses incurred or paid by the Executive during the
one year period beginning on this Commencement Date in connection with, or
related to, the performance of his duties, responsibilities or services under
this Agreement or in connection with Executive’s commuting to and from his
personal residence in New Jersey and the Company’s offices, upon presentation
by the Executive of documentation, expense statements, vouchers and/or such
other supporting information as the Company may request.  All reimbursement payments made pursuant to
this Section 3.5 shall be made on a fully tax grossed-up basis.


 


3.6           Housing
Expenses.  The Company understands
that the Executive intends to maintain his primary residence outside the
Massachusetts area for up to twelve (12) months and then intends to relocate to
the Massachusetts area. Until the third anniversary of the Commencement Date,
the Company agrees to provide the Executive with a housing allowance of 


 

















 


$3,750 per month, which
payments shall be increased on a fully tax grossed-up basis.  The Company also will reimburse the Executive
for reasonable travel, meals and lodging expenses incurred by him for up to two
trips for the purpose of securing such house or apartment within a suitable
distance to the Company’s headquarters. 
Executive shall be entitled to relocation benefits afforded by the
Company to other Company executives if and when Executive decides to permanently
relocate his primary residence to the Massachusetts area.


 


3.7           Executive’s
Legal Fees.  The Company agrees to
pay the Executive’s reasonable legal costs and expenses in connection with
negotiating and drafting this Agreement up to a maximum of $15,000.


 


3.8           Automobile.  The Company agrees to provide the Executive
with an automobile allowance or a leased automobile with a retail value of up
to $60,000, which payments shall be increased on a fully tax grossed-up basis.  In addition, the Company agrees to pay all
insurance, maintenance, fuel and other customary costs associated with
operating the automobile.


 


3.9           Withholding.  All salary, bonus and other compensation
payable to the Executive shall be subject to applicable withholding taxes.


 


4.             Employment Termination.  The employment of the Executive under this
Agreement shall terminate upon the occurrence of any of the following:


 


4.1           On the expiration date of the
Employment Period.


 


4.2           At the election of the Company, for
Cause (as defined below), immediately upon written notice by the Company to the
Executive, which notice shall identify the Cause upon which termination is
based.  For the purposes of this Section 4.2,
Cause for termination shall mean:  (a) the
Executive’s willful and continued failure to substantially perform 


 

















 


his reasonable assigned
duties (other than any such failure resulting from incapacity due to physical
or mental illness or any failure after the Executive gives notice of
termination for Good Reason and Good Reason exists), which failure is not cured
within 30 days after a written demand for substantial performance is received
by the Executive from the Board of Directors of the Company which specifically
identifies the manner in which the Board of Directors believes the Executive has
not substantially performed the Executive’s duties; (b) the Executive’s
willful engagement in illegal conduct or gross misconduct which is materially
and demonstrably injurious to the Company; or (c) a material breach of Section 6
or 7 of this Agreement by the Executive. 
For purposes of this Section 4.2, no act or failure to act by the
Executive shall be considered “willful” unless it is done, or omitted to be
done, in bad faith and without reasonable belief that the Executive’s action or
omission was in the best interests of the Company.


 


4.3           Upon the death or disability of the
Executive.  As used in this Agreement,
the term “disability” shall mean the Executive’s absence from the full-time
performance of the Executive’s duties with the Company for one hundred eighty
(180) consecutive calendar days as a result of incapacity due to mental or
physical illness which is determined to be total and permanent by a physician
selected by the Company or its insurers and acceptable to the Executive or the
Executive’s legal representative.


 


4.4           At the election of the Executive for
Good Reason as defined herein.  The
Executive may terminate his employment for Good Reason at any time during the
twenty-four (24) months following the initial occurrence of the condition giving
rise to Good Reason, with 30-days prior written notice of such termination to
the Company.  Such notice shall provide
factual details of the basis behind such termination and the Company shall have
a thirty (30) day period thereafter to cure such matter.  As used herein, the term “Good Reason” shall
mean:  (a) a 


 

















 


material breach by the
Company of the terms of this Agreement, including the failure to pay Base
Salary or any Annual Bonus when due; or (b) any material adverse change by
the Company in Executive’s titles, authorities, duties, responsibilities or
lines of reporting inconsistent with the terms hereof or the assignment to
Executive by the Company of titles, authorities, duties, responsibilities or
lines of reporting inconsistent with the terms hereof, or (c) a relocation
of the offices of the Company where the Executive is working to an area more
than forty (40) miles from the location of such offices as of the date hereof.


 


4.5           At the election of the Executive
without Good Reason, upon not less than sixty (60) calendar days prior written
notice of termination by the Executive to the Company; provided, however,
that the Company may, in its sole discretion, determine that the termination of
the Executive shall become effective immediately and in which case the
termination shall still be considered at the election of the Executive without
Good Reason.


 


4.6           At the election of the Company,
without Cause, upon not less than sixty (60) days written notice to Executive.


 


4.7           At the election of the Company or the
Executive in connection with a Change in Control, as set forth in the Executive
Retention Agreement between the Company and the Executive (the “ERA”), dated as
of the date hereof.  “Change in Control”
shall have the meaning set forth in the ERA.


 


5.             Effect of
Termination.


 


5.1           Non-Renewal, Termination Without
Good Reason By the Executive or Termination For Cause By the Company.  In the event the Executive’s employment is
terminated by non-renewal pursuant to Section 4.1, for Cause by the
Company pursuant to Section 4.2, or at the election of the Executive
pursuant to Section 4.5, the Company shall pay to the Executive the 


 

















 


compensation and benefits
otherwise payable to him under Section 3 through the last calendar day of
his actual employment by the Company.


 


5.2           Termination for Death or
Disability.  In the event the
Executive’s employment is terminated by death or because of disability pursuant
to Section 4.3, the Company shall pay to the estate of the Executive or to
the Executive, as the case may be, (A) within thirty (30) days of the date
of the Executive’s death or determination of disability, the compensation which
would otherwise be payable to the Executive up to the end of the month in which
the termination of his employment because of death or disability occurs; and (B) an
annual bonus, payable when bonuses are paid for that year, in an amount equal
to the total bonus he would be paid for such year, if any, multiplied by a
fraction, the numerator of which is the number of days in the year that have
elapsed since January 1 and the denominator of which is 365 (a “Pro Rata
Bonus”).  In addition, the Company shall
permit Executive or Executive’s estate or representative to exercise the vested
stock option portion of the Initial Grant for a period of no less than one year
after any such termination of employment.


 


5.3           Termination By the Executive With Good Reason or
By the Company Without “Cause”.  In
the event the Executive’s employment is terminated by the Executive with Good
Reason pursuant to Section 4.4 or by the Company without Cause pursuant to
Section 4.6, the Company shall pay to the Executive the compensation and
benefits otherwise payable to him under Section 3 through the last
calendar day of his actual employment by the Company.  In addition, provided the Executive executes
and does not revoke a Separation Agreement and Release of Claims for the
benefit of the Company substantially in the form set forth on Schedule D
hereto, the Company shall  (a) continue
to pay the Executive the Base Salary for twenty four (24) months in accordance
with the Company’s regular payroll practices; (b) pay the Executive a 


 

















 


Pro Rata Bonus; (c) pay
the Executive, in bi-weekly installments, over a twenty four-month period, an
amount equal in the aggregate to 1.5 times the average Annual Bonus earned
for the two years prior to the date of his termination (in the event Executive
has not been employed for a sufficient period to earn two such bonuses, such
calculation shall be made assuming Executive earned a bonus for any such year
at a target level of performance (taking into account any minimum bonus
amount)); (d) provide to the Executive for 24 months following the date of
his termination payment of COBRA premiums for medical, dental, and vision
benefits pursuant to plans maintained by the Company under which Executive
and/or Executive’s family is eligible to receive benefits; provided, however,
that, notwithstanding the foregoing, the benefits described in this subsection
may be discontinued prior the end of the period, but only to the extent, that
Executive receives substantially similar benefits from a subsequent employer;
and (e) permit Executive to exercise the stock option portion of the
Initial Grant for a period of no less than six months after the date of
termination.


 


5.4           Termination Following a Change in Control.  In the event the Executive’s employment is
terminated pursuant to Section 4.7 by the Company or by the Executive
within 24 months following the Change in Control Date as defined in the ERA,
the Executive will be entitled to the benefits set forth in the ERA in
accordance with the terms of the ERA.


 


5.5           Participation in Executive Retirement Health
Benefit Program.  Following the date
of the Executive’s termination, for any reason whatsoever, and, if applicable,
the twenty- four (24) month period referred to in Section 5.3(d) or
the period referred to in Section 4.2(a)(ii) of the ERA, in the event
the Executive elects to participate in the Company’s executive retiree health
benefit program set forth on Exhibit A hereto (the “Program”), he
will reimburse the Company with respect to his participation in the Program at
the lesser of (a) the actual cost to the 


 

















 


Company of the employee’s
participation and (b) the rate applicable to former employees of the
Company to elect COBRA health coverage.


 


5.6           Payments Subject to Section 409A.


 


(a)           Subject to this Section 5.6,
payments or benefits under Section 5 
shall begin only upon the date of a “separation from service” of the
Executive (determined as set forth below) which occurs on or after the
termination of the Executive’s employment. 
The following rules shall apply with respect to distribution of the
payments and benefits, if any, to be provided to the Executive under Section 5,
as applicable:


 


(i)            It is intended that each installment
of the payments and benefits provided under Section 5  shall be treated as a separate “payment” for
purposes of Section 409A of the Code and the guidance issued thereunder (“Section 409A”).  Neither the Company nor the Executive shall
have the right to accelerate or defer the delivery of any such payments or
benefits except to the extent specifically permitted or required by Section 409A.


 


(ii)           If, as of the date of the “separation
from service” of the Executive from the Company, the Executive is not a “specified
employee” (within the meaning of Section 409A), then each installment of
the payments and benefits shall be made on the dates and terms set forth in Section 5.


 


(iii)          If, as of the date of the “separation
from service” of the Executive from the Company, the Executive is a “specified
employee” (within the meaning of Section 409A), then:


 


(1)           Each
installment of the payments and benefits due under Section 5 that, in
accordance with the dates and terms set forth herein, will in all
circumstances, regardless of when the separation from service occurs, be paid
within the Short-


 

















 


Term
Deferral Period (as hereinafter defined) shall be treated as a short-term
deferral within the meaning of Treasury Regulation Section 1.409A-1(b)(4) to
the maximum extent permissible under Section 409A.  For purposes of this Agreement, the “Short-Term
Deferral Period” means the period ending on the later of the 15th
day of the third month following the end of the Executive’s tax year in which
the separation from service occurs and the 15th day of the third
month following the end of the Company’s tax year in which the separation from
service occurs; and


 


(2)           Each
installment of the payments and benefits due under Section 5 that is not
described in Section 5.6 (a)(iii)(1) and that would,
absent this subsection, be paid within the six-month period following the “separation
from service” of the Executive from the Company shall not be paid until the
date that is six months and one day after such separation from service (or, if
earlier, the Executive’s death), with any such installments that are required
to be delayed being accumulated during the six-month period and paid in a lump
sum on the date that is six months and one day following the Executive’s
separation from service and any subsequent installments, if any, being paid in
accordance with the dates and terms set forth herein; provided, however,
that the preceding provisions of this sentence shall not apply to any
installment of payments and benefits if and to the maximum extent that that
such installment is deemed to be paid under a separation pay plan that does not
provide for a deferral of compensation by reason of the application of Treasury
Regulation 1.409A-1(b)(9)(iii) (relating to separation pay upon an
involuntary separation from service). 
Any installments that qualify for the exception under Treasury
Regulation Section 1.409A-1(b)(9)(iii) must be paid no later than the
last day of the Executive’s second taxable year following his taxable year in
which the separation from service occurs.


 














 


(b)           The determination of whether and when
a separation from service of the Executive from the Company has occurred shall
be made and in a manner consistent with, and based on the presumptions set
forth in, Treasury Regulation Section 1.409A-1(h).  Solely for purposes of this Section 5.6
(b), “Company” shall include all persons with whom the Company would be
considered a single employer under Section 414(b) and 414(c) of
the Code.


 


(c)           All reimbursements and in-kind
benefits provided under the Agreement shall be made or provided in accordance
with the requirements of Section 409A to the extent that such
reimbursements or in-kind benefits are subject to Section 409A.


 


6.             Non-Competition
and Non-Solicitation.


 


(a)           While the Executive is employed by
the Company and for a period of twelve (12) months following the Executive’s
termination or cessation of such employment for any reason, the Executive will
not directly or indirectly:


 


(i)            Engage in any business or enterprise
(whether as an owner, partner, officer, employee, director, investor, lender,
consultant, independent contractor or otherwise, except as the holder of not
more than 5% of the combined voting power of the outstanding stock of a
publicly held company) that (A) is competitive with the Company’s business
and (B) develops, designs, produces, markets, sells or renders any product
or service competitive with any product developed, produced, marketed, sold or
rendered by the Company while the Executive was employed by the Company;


 


(ii)           Either
alone or in association with others, recruit or solicit, any person who was
employed by the Company at any time during the period of the Executive’s
employment with the Company, except for an individual whose employment with the
Company has been terminated for a period of six months or longer; and


 

















 


(iii)          Either
alone or in association with
others, solicit, divert or take away, or attempt to divert or to take away, the
business or patronage of any of the clients, customers or accounts, or
prospective clients, customers or accounts, of the Company which were
contacted, solicited or served by the Executive while he was employed by the
Company.


 


(b)           If
any restriction set forth in this Section 6 is found by any court of competent jurisdiction to be unenforceable
because it extends for too long a period of time or over too great a range of
activities or in too broad a geographic area, it shall be interpreted to extend
only over the maximum period of time, range of activities or geographic area as
to which it may be enforceable.


 


(c)           The
Executive acknowledges that the
restrictions contained in this Agreement are necessary for the protection of
the business and goodwill of the Company and are considered by the Executive to
be reasonable for such purpose.  The
Executive agrees that any breach of this Agreement will cause the Company
substantial and irrevocable damage and therefore, in the event of any such
breach, in addition to such other remedies which may be available, the Company
shall have the right to seek specific performance and injunctive relief without
posting a bond.


 


(d)           The
geographic scope of this Section shall extend to anywhere the Company or
any of its subsidiaries is doing business during the Term or has plans, during
the Term, to do business.


 


(e)           The Executive agrees to provide a copy of this Agreement to all
person and Entities with whom the Executive
seeks to be hired or do business before accepting employment or engagement with
any of them.


 

















 


(f)            If
the Executive violates the provisions
of this Section, the Executive shall continue to be held by the restrictions
set forth in this Section, until a period equal to the period of restriction
has expired without any violation.


 


7.             Proprietary
Information and Developments.


 


7.1           Proprietary
Information.


 


(a)           The Executive agrees that all
information, whether or not in writing, of a private, secret or confidential
nature concerning the Company’s business, business relationships or financial
affairs (collectively, “Proprietary Information”) is and shall be the exclusive
property of the Company.  By way of
illustration, but not limitation, Proprietary Information may include
discoveries, inventions, products, product improvements, product enhancements,
processes, methods, techniques, formulas, compositions, compounds, negotiation
strategies and positions, projects, developments, plans (including business and
marketing plans), research data, clinical data, financial data (including
sales, costs, profits and pricing methods), personnel data, computer programs
(including software used pursuant to a license agreement), customer and
supplier lists, and contacts at or knowledge of customers or prospective
customers of the Company.  Except as
required by applicable law, the Executive will not disclose any Proprietary
Information to any person or entity other than employees of the Company or use
the same for any purposes (other than in the performance of his duties as an
employee of the Company) without prior written approval from the Chief
Executive Officer, either during or after his employment with the Company,
unless and until such Proprietary Information has become public knowledge
without fault by the Executive.


 


(b)           The Executive agrees that all files,
documents, letters, memoranda, reports, records, data, sketches, drawings,
methods, laboratory notebooks, program listings, 


 

















 


computer equipment or
devices, computer programs or other written, photographic, or other tangible
material containing Proprietary Information, whether created by the Executive
or others, which shall come into his custody or possession, shall be and are
the exclusive property of the Company and are to be used by the Executive only
in the performance of his duties for the Company.  All such materials or copies thereof and all
tangible property of the Company in the custody or possession of the Executive
shall be delivered to the Company upon the earlier of (i) a request by the
Company or (ii) termination of his employment.  After such delivery, the Executive shall not
retain any such materials or copies thereof or any such tangible property.


 


(c)           The Executive agrees that his
obligation not to disclose or to use information and materials of the types set
forth in subsections (a) and (b) above, and his obligation to return
materials and tangible property set forth in subsection (b) above, also
extends to such types of information, materials and tangible property of
customers of the Company or suppliers to the Company or other third parties who
may have disclosed or entrusted the same to the Company or to the Executive.


 


7.2           Developments.


 


(a)           The Executive will make full and
prompt disclosure to the Company of all inventions, creations, improvements,
discoveries, trade secrets, secret processes, technology, know-how,
copyrightable materials, methods, developments, software, and works of
authorship or other creative works, whether patentable or not, which are
created, made, conceived or reduced to practice by him or under his direction
or jointly with others during his employment by the Company, whether or not
during normal working hours or on the premises of the Company (all of which are
collectively referred to in this Agreement as “Developments”).


 

















 


(b)           The Executive agrees to assign and
does hereby assign to the Company (or any person or entity designated by the
Company) all his right, title and interest in and to all Developments and all
related patents, patent applications, copyrights and copyright
applications.  However, this subsection (b) shall
not apply to Developments that do not relate to any business or research and
development conducted or planned to be conducted by the Company at the time
such Development is created, made, conceived or reduced to practice and that
are made and conceived by the Executive not during normal working hours, not on
the Company’s premises and not using the Company’s tools, devices, equipment or
Proprietary Information.  The Executive
understands that, to the extent this Agreement shall be construed in accordance
with the laws of any state that precludes a requirement in an employee
agreement to assign certain classes of inventions made by an employee, this
subsection (b) shall be interpreted not to apply to any invention that a
court rules and/or the Company agrees falls within such classes.  The Executive also hereby waives all claims
to moral rights in any Developments.


 


(c)           The Executive agrees to cooperate
fully with the Company and to take such further actions as may be necessary or
desirable, both during and after his employment with the Company, with respect
to the procurement, maintenance and enforcement of copyrights, patents and
other intellectual property rights (both in the United States and foreign
countries) relating to Developments.  The
Executive shall sign all papers, including, without limitation, copyright
applications, patent applications, declarations, oaths, formal assignments,
assignments of priority rights and powers of attorney, that the Company may
deem necessary or desirable in order to protect its rights and interests in any
Development.  The Executive further
agrees that if the Company is unable, after reasonable effort, to secure the
signature of the Executive on any such papers, the Chief Executive Officer of
the Company shall be entitled to execute any such 


 

















 


papers as the agent and
the attorney-in-fact of the Executive, and the Executive hereby irrevocably
designates and appoints the Chief Executive Officer of the Company as his agent
and attorney-in-fact to execute any such papers on his behalf and to take any
and all actions as the Company may deem necessary or desirable in order to
protect its rights and interests in any Development under the conditions
described in this sentence.


 


7.3           United States Government
Obligations.  The Executive
acknowledges that the Company from time to time may have agreements with other
parties or with the United States Government, or agencies thereof, which impose
obligations or restrictions on the Company regarding inventions made during the
course of work under such agreements or regarding the confidential nature of
such work.  The Executive agrees to be
bound by all such obligations and restrictions that are made known to the
Executive and to take all action necessary to discharge the obligations of the
Company under such agreements.


 


7.4           Other Agreements.  The Executive hereby represents that he is
not bound by the terms of any agreement with any previous employer or other
party to refrain from competing, directly or indirectly, with the business of
such previous employer or any other party. 
The Executive further represents that his performance of all the terms
of this Agreement and the performance of his duties as an employee of the
Company does not and will not breach any agreement to keep in confidence
proprietary information, knowledge or data acquired by him in confidence or in
trust prior to his employment with the Company and that the Executive will not
disclose to the Company or induce the Company to use any confidential or
proprietary information, knowledge or material belonging to any previous employer
or others.  The Executive further
represents that his performance of all the terms of this Agreement and the
performance of his duties as an employee of the Company does not and will not
breach any 


 

















 


agreement to refrain from
soliciting employees, customers or suppliers of any former employer or others.


 


8.             Indemnification.  The Company shall indemnify the Executive in
accordance with its Certificate of Incorporation and By-Laws.


 


9.             Survival.  The provisions of Sections 6, 7 and 8
shall survive the termination of this Agreement for any reason.


 


10.           Notices.  Any notices delivered under this Agreement
shall be deemed duly delivered three (3) business days after it is sent by
registered or certified mail, return receipt requested, postage prepaid, or one
(1) business day after it is sent for next-business day delivery via a
reputable nationwide overnight courier service, in each case to the address of
the recipient set forth in the introductory paragraph hereto.  Either party may change the address to which
notices are to be delivered by giving notice of such change to the other party
in the manner set forth in this Section 10.


 


11.           Compliance with Code Section 409A.  This Agreement is intended to comply with the
provisions of Section 409A and the Agreement shall, to the extent
practicable, be construed in accordance therewith.  The Company makes no representation or
warranty and shall have no liability to the Executive or any other person if
any provisions of this Agreement are determined to constitute deferred
compensation subject to Section 409A and do not satisfy an exemption from,
or the conditions of, Section 409A.


 


12.           Pronouns.  Whenever the context may require, any
pronouns used in this Agreement shall include the corresponding masculine,
feminine or neuter forms, and the singular forms of nouns and pronouns shall
include the plural, and vice versa.


 

















 


13.           Entire Agreement.  This Agreement, together with the ERA,
constitutes the entire agreement between the parties and supersedes all prior
agreements and understandings, whether written or oral, relating to the subject
matter of this Agreement, including, without limitation, the Original
Agreement.


 


14.           Amendment.  This Agreement may be amended or modified
only by a written instrument executed by both the Company and the Executive.


 


15.           Governing Law.  This Agreement shall be governed by and
construed in accordance with the laws of the Commonwealth of Massachusetts
(without reference to the conflict of laws provisions thereof).  Any action, suit or other legal proceeding
arising under or relating to any provision of this Agreement shall be commenced
only in a court of the Commonwealth of Massachusetts (or, if appropriate, a
federal court located within the Commonwealth of Massachusetts), and the Company
and the Executive each consents to the jurisdiction of such a court.


 


16.           Successors and Assigns.  This Agreement shall be binding upon and
inure to the benefit of both parties and their respective successors and
assigns, including any corporation with which or into which the Company may be
merged or which may succeed to its assets or business; provided, however,
that the obligations of the Executive are personal and shall not be assigned by
him.


 


17.           Acknowledgment.  The Executive states and represents that he
has had an opportunity to fully discuss and review the terms of this Agreement
with an attorney.  The Executive further
states and represents that he has carefully read this Agreement, understands
the contents herein, freely and voluntarily assents to all of the terms and
conditions hereof, and signs his name of his own free act.


 

















 


18.           Miscellaneous.


 


18.1         No delay or omission by the Company or
Executive in exercising any right under this Agreement shall operate as a
waiver of that or any other right.  A
waiver or consent given by the Company or Executive on any one occasion shall
be effective only in that instance and shall not be construed as a bar to or
waiver of any right on any other occasion.


 


18.2         The captions of the sections of this
Agreement are for convenience of reference only and in no way define, limit or
affect the scope or substance of any section of this Agreement.


 


18.3         In case any provision of this Agreement
shall be invalid, illegal or otherwise unenforceable, the validity, legality
and enforceability of the remaining provisions shall in no way be affected or
impaired thereby.


 


IN WITNESS WHEREOF, the parties hereto have executed
this Agreement as of the day and year set forth above.


 


	
   

  	
  Sepracor
  Inc.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Adrian Adams

  
	
   

  	
  Title:

  	
  President
  and Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/
  Mark Iwicki

  
	
   

  	
  Mark
  Iwicki

  



 

















 


Exhibit A


 


Program Terms


 


The
Executive shall be entitled to continued access to health benefits under, at
the Executive’s election, the Company’s Blue Cross Blue Shield PPO Policy or
BlueChoice Policy (the “Policies”), following the Executive’s retirement from
the Company, for so long as (A) the Company continues to offer such Policy
and (B) the Policy allows for such continued access; and, to the extent
the Company no longer maintains at least one of the Policies, or access is no
longer allowed under either of the Policies, the Company shall allow the
Executive continued access to health benefits under a successor policy, or
otherwise, for so long as it offers health benefits to its employees.


 














 


SCHEDULE A

FORM OF RESTRICTED STOCK AGREEMENT


 


 


SEE ATTACHED AGREEMENT


 

















 


SEPRACOR INC.


 


Restricted
Stock Agreement




	
  Name of Recipient:

  	
   

  
	
   

  	
   

  
	
  Number of shares of restricted common 

  stock awarded:

  	
   

  
	
   

  	
   

  
	
  Grant Date:

  	
   

  






 


                Sepracor Inc. (the “Company”) has selected you to
receive the restricted stock award described above, which is subject to the
provisions of the Company’s 2000 Stock Incentive Plan (the “Plan”) and the
terms and conditions contained in this Restricted Stock Agreement.  Please confirm your acceptance of this
restricted stock award and of the terms and conditions of this Agreement by
signing a copy of this Agreement where indicated below.


	
   

  	
  SEPRACOR INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  [insert name and
  title]

  
	
   

  	
   

  
	
  Accepted and Agreed:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  [insert name of recipient]

  	
   

  
	
   

  	
   

  
				



 

















 


SEPRACOR
INC.


Restricted
Stock Agreement


The terms and
conditions of the award of shares of restricted common stock of the Company
(the “Restricted Shares”) made to the Recipient, as set forth on the cover page
of this Agreement, are as follows:


1.             Issuance of
Restricted Shares.


(a)           The Restricted Shares are issued to
the Recipient, effective as of the Grant Date (as set forth on the cover page
of this Agreement), in consideration of employment services rendered and to be
rendered by the Recipient to the Company.


(b)           The Restricted Shares will initially
be issued by the Company in book entry form only, in the name of the
Recipient.  Following the vesting of any
Restricted Shares pursuant to Section 2 below, the Company shall, if requested
by the Recipient, issue and deliver to the Recipient a certificate representing
the vested Restricted Shares.   The
Recipient agrees that the Restricted Shares shall be subject to the forfeiture
provisions set forth in Section 3 of this Agreement and the restrictions on
transfer set forth in Section 4 of this Agreement.


2.             Vesting.


(a)           Vesting Schedule.  Unless otherwise provided in this Agreement
or the Plan, the Restricted Shares shall vest in accordance with the following
vesting schedule:  20% of the total number
of Restricted Shares shall vest on the first anniversary of your Commencement
Date (as defined in the Employment Agreement entered into between you and the
Company dated as of October 15, 2007) and 20% of the total number of Restricted
Shares shall vest on each successive anniversary thereafter, through and
including the 5th anniversary of the Grant Date.  Any fractional number of Restricted Shares
resulting from the application of the foregoing percentages shall be rounded
down to the nearest whole number of Restricted Shares.


(b)           Acceleration of Vesting.  Notwithstanding the foregoing vesting
schedule, as provided in the Plan, all unvested Restricted Shares shall vest
effective immediately prior to a Change in Control Event (as defined in the
Plan).


3.             Forfeiture of
Unvested Restricted Shares Upon Employment Termination.


                In the event that
the Recipient ceases to be employed by, a director of, or a consultant or
advisor to, the Company for any reason or no reason, with or without cause all
of the Restricted Shares that are unvested as of the time of such employment
termination shall be forfeited immediately and automatically to the Company,
without the payment of any consideration to the Recipient, effective as of such
termination of employment.  The Recipient
shall have no further rights with respect to any Restricted Shares that are so
forfeited.  If the Recipient is employed
by a subsidiary of the Company, any references in this Agreement to employment
with the Company shall instead be deemed to refer to employment with such
subsidiary.


 

















 


4.             Restrictions on
Transfer.


                The Recipient shall not sell, assign, transfer,
pledge, hypothecate or otherwise dispose of, by operation of law or otherwise
(collectively “transfer”) any Restricted Shares, or any interest therein, until
such Restricted Shares have vested, except that the Recipient may transfer such
Restricted Shares as part of the sale of all or substantially all of the shares
of capital stock of the Company (including pursuant to a merger or consolidation).  The Company shall not be required (i) to
transfer on its books any of the Restricted Shares which have been transferred
in violation of any of the provisions of this Agreement or (ii) to treat as
owner of such Restricted Shares or to pay dividends to any transferee to whom
such Restricted Shares have been transferred in violation of any of the
provisions of this Agreement.


5.             Restrictive
Legends.


                The book entry account reflecting the issuance of the
Restricted Shares in the name of the Recipient shall bear a legend or other
notation upon substantially the following terms:


                “These shares of stock are subject to forfeiture
provisions and restrictions on transfer set forth in a certain Restricted Stock
Agreement between the corporation and the registered owner of these shares (or
his or her predecessor in interest), and such Agreement is available for
inspection without charge at the office of the Secretary of the corporation.”


6.             Rights as a
Shareholder.


                Except as otherwise provided in this Agreement, for
so long as the Recipient is the registered owner of the Restricted Shares, the
Recipient shall have all rights as a shareholder with respect to the Restricted
Shares, whether vested or unvested, including, without limitation, any rights
to receive dividends and distributions with respect to the Restricted Shares
and to vote the Restricted Shares and act in respect of the Restricted Shares
at any meeting of shareholders.


7.             Provisions of
the Plan.


                This Agreement is subject to the provisions of the
Plan, a copy of which is furnished to the Recipient with this Agreement.  As provided in the Plan, upon the occurrence
of a Reorganization Event (as defined in the Plan), the rights of the Company
hereunder (including the right to receive forfeited Restricted Shares) shall
inure to the benefit of the Company’s successor and, unless the Board
determines otherwise, shall apply to the cash, securities or other property
which the Restricted Shares were converted into or exchanged for pursuant to
such Reorganization Event in the same manner and to the same extent as they
applied to the Restricted Shares under this Agreement.


8.             Tax Matters.


(a)            Acknowledgments; Section 83(b)
Election.  The Recipient acknowledges
that he or she is responsible for obtaining the advice of the Recipient’s own
tax advisors with respect to the acquisition of the Restricted Shares and the
Recipient is relying solely on such advisors and not on any statements or
representations of the Company or any of its agents with respect to the tax
consequences relating to the Restricted Shares. 
The Recipient understands that the Recipient (and not the Company) shall
be responsible for the Recipient’s tax liability that may arise in connection
with the acquisition, vesting and/or disposition of the Restricted Shares.


 

















 


The Recipient
acknowledges that he or she has been informed of the availability of making an
election under Section 83(b) of the Internal Revenue Code, as amended, with
respect to the issuance of the Restricted Shares and that the Recipient has
decided not to file a Section 83(b) election.


(b)           Withholding. The Recipient
acknowledges and agrees that the Company has the right to deduct from payments
of any kind otherwise due to the Recipient any federal, state, local or other
taxes of any kind required by law to be withheld with respect to the vesting of
the Restricted Shares.  On each date on
which Restricted Shares vest, the Company shall deliver written notice to the
Recipient of the amount of withholding taxes due with respect to the vesting of
the Restricted Shares that vest on such date; provided, however, that the total
tax withholding cannot exceed the Company’s minimum statutory withholding
obligations (based on minimum statutory withholding rates for federal and state
tax purposes, including payroll taxes, that are applicable to such supplemental
taxable income).  The Recipient shall
satisfy such tax withholding obligations by making a cash payment to the
Company on the date of vesting of the Restricted Shares, in the amount of the
Company’s withholding obligation in connection with the vesting of such
Restricted Shares.


9.             Miscellaneous.


(a)           No Right to Continued Employment.  The Recipient acknowledges and agrees that,
notwithstanding the fact that the vesting of the Restricted Shares is
contingent upon his or her continued employment by the Company, this Agreement
does not constitute an express or implied promise of continued employment or
confer upon the Recipient any rights with respect to continued employment by
the Company.


(b)           Governing Law.  This Agreement shall be construed,
interpreted and enforced in accordance with the internal laws of the State of
Delaware without regard to any applicable conflicts of laws provisions.


 

















 


SCHEDULE B

FORM OF STOCK OPTION AGREEMENTS


 


 


SEE ATTACHED AGREEMENT


 


20














 


SEPRACOR INC.


 


Form of Incentive Stock
Option Agreement 


Granted Under 2000
Stock Incentive Plan 


1.             Grant
of Option.


 


                This
agreement evidences the grant by Sepracor Inc., a Delaware corporation (the
“Company”), on the Grant Date indicated on the preceding Certificate of Stock
Option Grant (the “Certificate”) to an employee, consultant, or director of the
Company (the “Participant”), of an option to purchase, in whole or in part, on
the terms provided herein and in the Company’s 2000 Stock Incentive Plan (the
“Plan”), the number of shares (the “Shares”) of common stock, $.10 par value
per share,  of the Company (“Common
Stock”),indicated on the certificate at the price per Share indicated on the
Certificate. Unless earlier terminated, this option shall expire on the Grant
Expiration Date indicated on the Certificate (“Grant Expiration Date”).


 


                It
is intended that the option evidenced by this agreement shall not be an
incentive stock option as defined in Section 422 of the Internal Revenue Code
of 1986, as amended, and any regulations promulgated thereunder (the
“Code”).  Except as otherwise indicated
by the context, the term “Participant”, as used in this option, shall be deemed
to include any person who acquires the right to exercise this option validly under
its terms.


 


2.             Vesting
Schedule.


 


                This
option will become exercisable (“vest”) pursuant to the Vesting Schedule
indicated on the Certificate (“Vesting Schedule”).


 


                The
right of exercise shall be cumulative so that to the extent the option is not
exercised in any period to the maximum extent permissible it shall continue to
be exercisable, in whole or in part, with respect to all shares for which it is
vested until the earlier of the Grant Expiration Date or the termination of
this option under Section 3 hereof or the Plan.


 


3.             Exercise
of Option.


 


(a)            Form of Exercise.
Each election to exercise this option shall be in writing, signed by the
Participant, and received by the Company at its principal office, accompanied
by this agreement, and payment in full in the manner provided in the Plan. The
Participant may purchase less than the number of shares covered hereby,
provided that no partial exercise of this option may be for any fractional
share.


 


(b)           Continuous
Relationship with the Company Required. 
Except as otherwise provided in this Section 3, this option may not be
exercised unless the Participant, at the time he or she exercises this option,
is, and has been at all times since the Grant Date, an [employee or officer
of], or consultant or advisor to, the Company or any parent or subsidiary of
the Company as defined in Section 424(e) or (f) of the Code (an “Eligible
Participant”).


 

















 


(c)            Termination of
Relationship with the Company. If the Participant ceases to be an Eligible
Participant for any reason, then, except as provided in paragraphs (d) and (e)
below, the right to exercise this option shall terminate three months after
such cessation (but in no event after the Grant Expiration Date), provided that
this option shall be exercisable only to the extent that the Participant was
entitled to exercise this option on the date of such cessation.  Notwithstanding the foregoing, if, following
the time the Participant has ceased to be an Eligible Participant, but prior to
the Grant Expiration Date, the Participant materially breaches Section 6 or 7
of the Employment Agreement between the Participant and the Company dated October
15, 2007 (the “Employment Agreement”), the right to exercise this option shall
terminate immediately upon written notice to the Participant from the Company
describing such violation.


 


(d)           Exercise Period Upon
Death or Disability.  If the
Participant dies or becomes disabled (within the meaning of Section 22(e)(3) of
the Code) prior to the Grant Expiration Date while he or she is an Eligible
Participant and the Company has not terminated such relationship for “cause” as
specified in paragraph (e) below, this option shall be exercisable, within the
period of one year following the date of death or disability of the
Participant, by the Participant (or in the case of death by an authorized
transferee), provided that this option shall be exercisable only to the extent
that this option was exercisable by the Participant on the date of his or her
death or disability, and further provided that this option shall not be
exercisable after the Grant Expiration Date.


 


(e)            Discharge for Cause.  If the Participant, prior to the Grant
Expiration Date, is discharged by the Company for “cause” (as defined below),
the right to exercise this option shall terminate immediately upon the
effective date of such discharge. 
“Cause” shall have the meaning set forth in the Employment Agreement.


 


4.             Withholding.


 


                No
Shares will be issued pursuant to the exercise of this option unless and until
the Participant pays to the Company, or makes provision satisfactory to the
Company for payment of, any federal, state or local withholding taxes required
by law to be withheld in respect of this option.


 


5.             Nontransferability
of Option.


 


                This
option may not be sold, assigned, transferred, pledged or otherwise encumbered
by the Participant, either voluntarily or by operation of law, except by will
or the laws of descent and distribution, and, during the lifetime of the
Participant, this option shall be exercisable only by the Participant.


 


6.             Disqualifying
Disposition.


 


                If
the Participant diposes of Shares acquired upon exercise of this option within
two years from the Grant Date or one year after such Shares were acquired
pursuant to exercise of this option, the Participant shall notify the Company
in writing of such disposition.


 

















 


7.             Provisions
of the Plan.


 


                This
option is subject to the provisions of the Plan, a copy of which is furnished
to the Participant with this option.


 


 


IN WITNESS WHEREOF, the Company has caused this option to be executed
under its corporate seal by its duly authorized officer.  This option shall take effect as a sealed
instrument.


 


	
   

  	
  SEPRACOR INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  



 


PARTICIPANT’S ACCEPTANCE


 


                The
Participant hereby accepts the foregoing option and agrees to the terms and
conditions thereof.  The Participant
hereby acknowledges receipt of a copy of the Company’s 2000 Stock Incentive
Plan. 


	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
   

  



 

















 


SEPRACOR INC.


 


Nonstatutory Stock
Option Agreement

Granted Under 2000 Stock Incentive Plan


1.             Grant of Option.


This agreement evidences
the grant by Sepracor Inc., a Delaware corporation (the “Company”), on the
Grant Date indicated on the preceding Certificate of Stock Option Grant (the
“Certificate”) to  an employee, consultant, or
director of the Company (the “Participant”), of an option to purchase, in whole
or in part, on the terms provided herein and in the Company’s 2000 Stock
Incentive Plan (the “Plan”), the number of shares (the “Shares”) of common
stock, $.10  par value per share,  of the Company (“Common Stock”),indicated on
the certificate at the price per Share indicated on the Certificate. Unless
earlier terminated, this option shall expire on the Grant Expiration Date
indicated on the Certificate (“Grant Expiration Date”).


It is intended that the
option evidenced by this agreement shall not be an incentive stock option as
defined in Section 422 of the Internal Revenue Code of 1986, as amended, and
any regulations promulgated thereunder (the “Code”).  Except as otherwise indicated by the context,
the term “Participant”, as used in this option, shall be deemed to include any
person who acquires the right to exercise this option validly under its terms.


2.             Vesting Schedule.


This option will become
exercisable (“vest”) pursuant to the Vesting Schedule indicated on the
Certificate (“Vesting Schedule”).


The right of exercise
shall be cumulative so that to the extent the option is not exercised in any
period to the maximum extent permissible it shall continue to be exercisable,
in whole or in part, with respect to all shares for which it is vested until
the earlier of the Grant Expiration Date or the termination of this option
under Section 3 hereof or the Plan.


3.             Exercise of Option.


(a)           Form of Exercise.
Each election to exercise this option shall be in writing, signed by the
Participant, and received by the Company at its principal office, accompanied
by this agreement, and payment in full in the manner provided in the Plan. The
Participant may purchase less than the number of shares covered hereby, provided
that no partial exercise of this option may be for any fractional share.


(b)           Continuous
Relationship with the Company Required. 
Except as otherwise provided in this Section 3, this option may not
be exercised unless the Participant, at the time he or she exercises this
option, is, and has been at all times since the Grant Date, an [employee or
officer of], or consultant or advisor to, the Company or any parent or
subsidiary of the Company as defined in Section 424(e) or (f) of the Code (an
“Eligible Participant”).


 

















 


(c)           Termination of
Relationship with the Company. If the Participant ceases to be an Eligible
Participant for any reason, then, except as provided in paragraphs (d) and
(e) below, the right to exercise this option shall terminate  three months after such cessation (but in no event after
the Grant Expiration Date), provided  that this option shall be
exercisable only to the extent that the Participant was entitled to exercise
this option on the date of such cessation. 
Notwithstanding the foregoing, if, following the time the Participant
has ceased to be an Eligible Participant, but prior to the Grant Expiration
Date, the Participant materially breaches Section 6 or 7 of the Employment
Agreement between the Participant and the Company dated March 1, 2007 (the
“Employment Agreement”), the right to exercise this option shall terminate
immediately upon written notice to the Participant from the Company describing  such violation.


(d)           Exercise Period Upon
Death or Disability.  If the
Participant dies or becomes disabled (within the meaning of
Section 22(e)(3) of the Code) prior to the Grant Expiration Date while he
or she is an Eligible Participant and the Company has not terminated such
relationship for “cause” as specified in paragraph (e) below, this option shall
be exercisable, within the period of one year following the date of death or
disability of the Participant, by the Participant (or in the case of death by
an authorized transferee), provided  that this option shall be
exercisable only to the extent that this option was exercisable by the
Participant on the date of his or her death or disability, and further provided
that this option shall not be exercisable after the Grant Expiration Date.


(e)           Discharge for Cause.  If the Participant, prior to the Grant
Expiration Date, is discharged by the Company for “cause” (as defined below),
the right to exercise this option shall terminate immediately upon the
effective date of such discharge. 
“Cause” shall have the meaning set forth in the Employment Agreement.


4.             Withholding.


No Shares will be issued
pursuant to the exercise of this option unless and until the Participant pays
to the Company, or makes provision satisfactory to the Company for payment of,
any federal, state or local withholding taxes required by law to be withheld in
respect of this option.


5.             Nontransferability
of Option.


This option may not be
sold, assigned, transferred, pledged or otherwise encumbered by the
Participant, either voluntarily or by operation of law, except by will or the
laws of descent and distribution, and, during the lifetime of the Participant,
this option shall be exercisable only by the Participant.


6.             Provisions of the
Plan.


This option is subject to the provisions of the Plan,
a copy of which is furnished to the Participant with this option.


 

















 


IN WITNESS WHEREOF, the
Company has caused this option to be executed under its corporate seal by its
duly authorized officer.  This option
shall take effect as a sealed instrument.


	
   

  	
  SEPRACOR INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  



 


PARTICIPANT’S
ACCEPTANCE


The Participant hereby
accepts the foregoing option and agrees to the terms and conditions
thereof.  The Participant hereby
acknowledges receipt of a copy of the Company’s 2000 Stock Incentive Plan.


	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
   

  



 

















 


SCHEDULE
C

VACATION POLICY


 


 


SEE
ATTACHED POLICY


 


21

















 


	
  Sepracor Companies

  	
   

  	
  Human Resource Policy

  



 


	
  Division:

  

  All

  	
   

  	
  Effective Date:

  

  January 1, 2005

  	
   

  	
  Index No.:

  

  3-60

  	
   

  	
  Page No:

  

  1 of 2

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  

  Accrued Vacation Policy

  Director Level and Above

  	
   

  	
  Supersedes:

  

  All

  	
   

  	
  Approved By:

  

  Signature on File

  	
   

  	
   

  



 


1.             Introduction


 


1.1                                      The
purpose of the Accrued Vacation Policy is to provide paid time off for
employees to cover vacations and personal time.


 


2.             Accrual rate for
employees at Director level and above


 


2.1                                 Employees
accrue vacation hours monthly that may be used for paid time off to cover
vacations and personal time. Regular full-time employees, Director level or
above, will accrue vacation time at a rate of ten (10) hours per month
during the first year of employment, for a total of fifteen (15) days per year,
equal to one hundred twenty (120) hours. 
Additional time begins to accrue in the month of the employee’s
anniversary date, up to a maximum of twenty-three (23) days per year, equal to
one hundred eighty-four (184) hours. Please see schedule below for details on
total hours accrued monthly:


 


	
  Years of

  Service

  	
   

  	
  Director

  and Above

  Total Days

  	
   

  	
  Monthly

  Accrual

  (Hours)

  
	
  0-1

  	
   

  	
  15

  	
   

  	
  10.00

  
	
  1-2

  	
   

  	
  16

  	
   

  	
  10.67

  
	
  2-3

  	
   

  	
  17

  	
   

  	
  11.33

  
	
  3-4

  	
   

  	
  18

  	
   

  	
  12.00

  
	
  4-5

  	
   

  	
  19

  	
   

  	
  12.67

  
	
  5-10

  	
   

  	
  20

  	
   

  	
  13.33

  
	
  10-13

  	
   

  	
  20

  	
   

  	
  13.33

  
	
  13-15

  	
   

  	
  20

  	
   

  	
  13.33

  
	
  15-17

  	
   

  	
  20

  	
   

  	
  13.33

  
	
  17-19

  	
   

  	
  21

  	
   

  	
  14.00

  
	
  19-20

  	
   

  	
  22

  	
   

  	
  14.67

  
	
  20+

  	
   

  	
  23

  	
   

  	
  15.33

  



 


3.             Administration


 


3.1           Accrual of vacation
time is pro-rated for employees who are regularly scheduled to work less than
forty (40) hours but work at least twenty (20) hours per week.  For example, an employee with a weekly
schedule of twenty (20) hours will accrue five (5) hours per month, and a
thirty (30) hour employee will accrue seven and a half (7.5) hours of vacation
time per month.


 


22

















 


Accrued Vacation Policy: Director Level and Above


 


3.                                                                                      Administration
(Continued)


 


3.2                                              The
current month’s accrual is accrued on the 15th of every month.  An employee must be employed on the 15th
in order to receive that monthly accrual. 
For example, if an employee is hired on or before the 15th,
they will receive that month’s accrual, and if they are hired after the 15th,
they will not.  Also, if an employee
terminates employment before the 15th they will not be paid for that
month’s accrual, but if they terminate after the 15th they will.


 


3.3                                              Employees
may carry over a maximum of forty (40) accrued vacation hours into the next
calendar year.  The carryover vacation
hours must be used by July 31st of the new calendar year.  Any carried over vacation hours not used by
this date will be forfeited.*


 


3.3.1                        *In accordance with state law,
California residents will not have a limit on carryover time into the next
calendar year.  Once an employee accrues
twenty-three (23) days of vacation, equal to one hundred eighty-four (184)
hours, the employee will cease to accrue any additional vacation time until the
vacation balance falls below that level. 
Please refer to Sepracor Human Resources for more information.


 


3.4                                              It
is your responsibility to request and schedule the use of accrued vacation time
with your manager.  Approval of vacation
time will depend on the business needs of the organization.  It is your responsibility to accurately track
your use of accrued vacation time through the iTime Tracking system.


 


3.5                                              At
the minimum, vacation time for full time employees should be taken in four (4) hour
increments, with the norm being eight (8) hour increments. For those with
schedules of 20-39 hours, increments of time used would be pro-rated according
to hours worked.  For example, if you
were regularly scheduled to work six (6) hours, then you would be paid a
six (6) hour vacation day.


 


3.6                                              Your
manager may approve the borrowing of vacation time, up to a maximum of forty
(40) hours for regular full-time employees and pro-rated accordingly for
regular part-time employees.  Employees
with a negative vacation balance may not borrow additional vacation time until
the existing vacation time balance has been satisfied and then upon approval
from your manager.  Under no
circumstances may an employee borrow vacation time from a future calendar year.


 


3.7                                              If
it has been verified by Payroll and the manager that an employee has a balance
of accrued and unused vacation time left at the end of employment, the balance
will be converted to cash and included in his/her final paycheck.  In the event an employee ends his/her
employment before having enough accrued time to cover any borrowed vacation
time, the employee’s final paycheck will reflect a deduction equal to the cash
value of the borrowed vacation time.


 


23

















 


SCHEDULE
D

FORM OF SEPARATION AGREEMENT AND RELEASE OF CLAIMS


 


 


SEE
ATTACHED FORM


 


24

















 


FORM OF SEPARATION AGREEMENT AND RELEASE OF CLAIMS


In connection with your
employment separation from Sepracor, Inc. (the “Company”) on [INSERT TERMINATION DATE], and in order to receive the
benefits as set forth in Section 5 of the Employment agreement, this agreement
must become binding between you and the Company.  By signing and returning this agreement, you
will be entering into a binding agreement with the Company and will be agreeing
to the terms and conditions set forth in the numbered paragraphs below,
including the release of claims set forth in paragraph 1.  Therefore, you are advised to consult with an
attorney before signing this agreement and you have been given more than twenty-one
(21) days to do so.  If you sign this
agreement, you may change your mind and revoke your agreement during the seven
(7) day period after you have signed it. 
If you do not so revoke, this agreement will become a binding agreement
between you and the Company upon the expiration of the seven (7) day revocation
period.


The following
numbered paragraphs set forth the terms and conditions which will apply if you
timely sign and return this agreement and do not revoke it within the seven (7)
day revocation period:


1.             Mutual Releases - In consideration
of the payment of the severance benefits, which you acknowledge you would not
otherwise be entitled to receive, you hereby fully, forever, irrevocably and
unconditionally release, remise and discharge the Company, its officers,
directors, stockholders, corporate affiliates, subsidiaries, parent companies,
successors and assigns, agents and employees (each in their individual and
corporate capacities) (hereinafter, the “Released Parties”) from any and all
claims, charges, complaints, demands, actions, causes of action, suits, rights,
debts, sums of money, costs, accounts, reckonings, covenants, contracts,
agreements, promises, doings, omissions, damages, executions, obligations,
liabilities, and expenses (including attorneys’ fees and costs), of every kind
and nature which you ever had or now have against the Released Parties,
including, but not limited to, those claims arising out of your employment with
and/or separation from the Company, including, but not limited to, all claims
under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq.,
the Age Discrimination in Employment Act, 29 U.S.C. § 621 et seq., the
Americans With Disabilities Act of 1990, 42 U.S.C. § 12101 et seq., the
Family and Medical Leave Act, 29 U.S.C. § 2601 et seq., the Worker
Adjustment and Retraining Notification Act (“WARN”), 29 U.S.C. § 2101 et seq.,
Section 806 of the Corporate and Criminal Fraud Accountability Act of 2002, 18
U.S.C. § 1514(A), the Rehabilitation Act of 1973, 29 U.S.C. § 701 et seq.,
Executive Order 11246, Executive Order 11141, the Fair Credit Reporting Act, 15
U.S.C. § 1681 et seq., the Employee Retirement Income Security Act of
1974 (“ERISA”), 29 U.S.C. § 1001 et seq., the Massachusetts Fair
Employment Practices Act., M.G.L. c. 151B, § 1 et seq., the
Massachusetts Civil Rights Act, M.G.L. c. 12, §§ 11H and 11I, the Massachusetts
Equal Rights Act, M.G.L. c. 93, § 102 and M.G.L. c. 214, § 1C, the
Massachusetts Labor and Industries Act, M.G.L. c. 149, § 1 et seq., the
Massachusetts Privacy Act, M.G.L. c. 214, § 1B, and the Massachusetts Maternity
Leave Act, M.G.L. c. 149, § 105D, all as amended; all common law claims
including, but not limited to, actions in tort, defamation and breach of
contract; all claims to any non-vested ownership interest in the Company,
contractual or otherwise, including, but not limited to, claims to stock or
stock options; and any claim or damage arising out of your employment with or


 

















 


separation from the
Company (including a claim for retaliation) under any common law theory or any
federal, state or local statute or ordinance not expressly referenced above;
provided, however, that nothing in this Agreement prevents you from filing,
cooperating with, or participating in any proceeding before the EEOC or a state
Fair Employment Practices Agency (except that you acknowledge that you may not
be able to recover any monetary benefits in connection with any such claim,
charge or proceeding).  Notwithstanding
the foregoing, the release set forth in this Section 1 shall not apply to (a)
any claim to severance benefits under the Employment Agreement or your rights
under this agreement or (b) any vested equity interest in the Company,
including vested stock options.


The Company hereby fully, forever, irrevocably and
unconditionally releases, remises and discharges you from any and all claims,
charges, complaints, demands, actions, causes of action, suits, rights, debts,
sums of money, costs, accounts, reckonings, covenants, contracts, agreements,
promises, doings, omissions, damages, executions, obligations, liabilities and
expenses (including attorney’s fees and costs), of every kind and nature that
the Company ever had or now has against you as of the date of this agreement.


2.             Non-Disclosure, Non-Competition and
Non-Solicitation Obligations — You acknowledge and reaffirm your
obligation to keep confidential and not to disclose any and all non-public
information concerning the Company which you acquired during the course of your
employment with the Company, including, but not limited to, any non-public
information concerning the Company’s business affairs, business prospects and
financial condition, as is stated more fully in the [Name of the
Non-Disclosure Agreement] you executed at the inception of your
employment, which remains in full force and effect.  You further acknowledge and reaffirm your
obligations under the [Name of the
Non-Competition and/or Non-Solicitation Agreement(s)] you previously
executed for the benefit of the Company at the inception of your employment,
which also remain(s) in full force and effect.


3.             Return of Company Property - You
confirm that you have returned to the Company all keys, files, records (and
copies thereof), equipment (including, but not limited to, computer hardware,
software and printers, wireless handheld devices, cellular phones, pagers,
etc.), Company identification, Company vehicles and any other Company-owned
property in your possession or control and have left intact all electronic
Company documents, including but not limited to, those that you developed or
helped develop during your employment. 
You further confirm that you have cancelled all accounts for your
benefit, if any, in the Company’s name, including but not limited to, credit
cards, telephone charge cards, cellular phone and/or pager accounts and
computer accounts.


4.             Business
Expenses and Compensation - You acknowledge that you have been
reimbursed by the Company for all business expenses incurred in conjunction
with the performance of your employment and that no other reimbursements are
owed to you.  You further acknowledge
that you have received payment in full for all services rendered in conjunction
with your employment by the Company and that no other compensation is owed to
you except as provided herein.


 

















 


5.             Non-Disparagement - You understand
and agree that, as a condition for payment to you of the consideration herein
described, you shall not make any false, disparaging or derogatory statements
to any media outlet, industry group, financial institution or current or former
employee, consultant, client or customer of the Company regarding the Company
or any of its directors, officers, employees, agents or representatives or
about the Company’s business affairs and financial condition; provided, however,
that nothing herein shall prevent you from making truthful disclosures to any
governmental entity or in any litigation or arbitration.


6.             Amendment - This agreement shall be
binding upon the parties and may not be modified in any manner, except by an
instrument in writing of concurrent or subsequent date signed by duly
authorized representatives of the parties hereto.  This agreement is binding upon and shall
inure to the benefit of the parties and their respective agents, assigns, heirs,
executors, successors and administrators.


7.             Waiver of Rights - No delay or
omission by the Company in exercising any right under this agreement shall
operate as a waiver of that or any other right. 
A waiver or consent given by the Company on any one occasion shall be
effective only in that instance and shall not be construed as a bar or waiver
of any right on any other occasion.


8.             Validity - Should any provision of
this agreement be declared or be determined by any court of competent
jurisdiction to be illegal or invalid, the validity of the remaining parts,
terms or provisions shall not be affected thereby and said illegal or invalid
part, term or provision shall be deemed not to be a part of this agreement.


9.             Cooperation — You agree to
cooperate with the Company in the investigation, defense or prosecution of any
claims or actions now in existence or which may be brought in the future
against or on behalf of the Company. 
Your cooperation in connection with such claims or actions shall
include, but not be limited to, being available to meet with the Company’s
counsel to prepare for discovery or any mediation, arbitration, trial,
administrative hearing or other proceeding or to act as a witness when
reasonably requested by the Company at mutually agreeable times and at
locations mutually convenient to you and the Company.  You also agree to cooperate with the Company
in the transitioning of your work, and will be available to the Company for
this purpose or any other purpose reasonably requested by the Company.


10.           Tax Provision — In connection with
the severance benefits provided to you pursuant to this agreement, the Company
shall withhold and remit to the tax authorities the amounts required under
applicable law, and you shall be responsible for all applicable taxes with
respect to such severance benefits under applicable law.  You acknowledge that you are not relying upon
advice or representation of the Company with respect to the tax treatment of
any of the severance benefits.


11.           Section 409A - No payments that may
be made pursuant to this agreement that constitute “nonqualified deferred
compensation” within the meaning of Section 409A of the Internal Revenue Code
and the guidance issued thereunder (“Section 409A”) may be accelerated or
deferred by the Company or by you. 
Notwithstanding anything else to the


 

















 


contrary in this
agreement, to the extent that any of the payments that may be made hereunder
constitute “nonqualified deferred compensation”, within the meaning of Section
409A and you are a “specified employee” upon your separation (as defined under
Section 409A), any such payment shall be delayed following your separation date
if, absent such delay, such payment would otherwise be subject to penalty under
Section 409A.  In any event, the Company
makes no representation or warranty and shall have no liability to you or to
any other person if any provisions of this agreement are determined to
constitute “nonqualified deferred compensation” subject to Section 409A but do
not satisfy the requirements of that section.


12.           Nature of Agreement - You
understand and agree that this agreement is a severance agreement and does not
constitute an admission of liability or wrongdoing on the part of the Company.


13.           Acknowledgments - You acknowledge
that you have been given at least twenty-one (21) days to consider this
agreement and that the Company advised you to consult with an attorney of your
own choosing prior to signing this agreement. 
You understand that you may revoke this agreement for a period of seven
(7) days after you sign this agreement, and the agreement shall not be
effective or enforceable until the expiration of this seven (7) day revocation
period.  You
understand and agree that by entering into this agreement you are waiving any
and all rights or claims you might have under The Age Discrimination in
Employment Act, as amended by The Older Workers Benefit Protection Act, and
that you have received consideration beyond that to which you were previously
entitled.


14.           Voluntary Assent - You affirm that
no other promises or agreements of any kind have been made to or with you by
any person or entity whatsoever to cause you to sign this agreement, and that
you fully understand the meaning and intent of this agreement.  You state and represent that you have had an
opportunity to fully discuss and review the terms of this agreement with an
attorney.  You further state and
represent that you have carefully read this agreement, understand the contents
herein, freely and voluntarily assent to all of the terms and conditions
hereof, and sign your name of your own free act.


15.           Applicable Law — This agreement
shall be interpreted and construed by the laws of the Commonwealth of
Massachusetts, without regard to conflict of laws provisions.  You hereby irrevocably submit to and
acknowledge and recognize the jurisdiction of the courts of the Commonwealth of
Massachusetts, or if appropriate, a federal court located in Massachusetts
(which courts, for purposes of this agreement, are the only courts of competent
jurisdiction), over any suit, action or other proceeding arising out of, under
or in connection with this agreement or the subject matter hereof.


16.           Entire
Agreement - This agreement contains and constitutes the entire
understanding and agreement between the parties hereto with respect to your
severance benefits and the settlement of claims against the Company and cancels
all previous oral and written negotiations, agreements, commitments and
writings in connection therewith. Nothing in this paragraph, however, shall
modify, cancel or supersede your obligations set forth in paragraph 2 herein.


 

















 


	
   

  	
  SEPRACOR
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  



 


I hereby agree to the
terms and conditions set forth above.  I
have been given at least twenty-one (21) days to consider this agreement and I
have chosen to execute this on the date below. 
I intend that this agreement become a binding agreement between me and
the Company if I do not revoke my acceptance in seven (7) days by notifying
                                              
in writing.


 


	
   

  	
   

  	
  Date

  	
   

  
	
  Employee Name: