Separation of Employment Agreement - Edward F. Kessig



 EXHIBIT 10.37 
 SEPARATION OF EMPLOYMENT AGREEMENT AND GENERAL RELEASE 
 This
Separation of Employment Agreement and General Release (this “Agreement”) is being entered into by and between Auxilium Pharmaceuticals, Inc. (hereinafter “Auxilium” or the “Company”), and Edward F. Kessig (hereinafter
“Mr. Kessig”). 
 WHEREAS, Mr. Kessig and Auxilium are parties to that certain Amended and Restated Employment
Agreement having an effective date of November 1, 2011 (hereinafter, the “Employment Agreement”); 
 WHEREAS,
Mr. Kessig and the Company have mutually agreed that Mr. Kessig will resign from the Company and cease to serve as the Senior Vice President of Sales of the Company; 
 WHEREAS, as a result of such resignation Mr. Kessig’s employment with Auxilium will end on February 3, 2012 (the “Termination Date”); and 

WHEREAS, both Auxilium and Mr. Kessig desire to enter into this Agreement to fully resolve all questions of expenses compensation,
entitlement to benefits, and any and all other claims, whether known or unknown, which Mr. Kessig may have relating to his employment and his resignation of employment with the Company. 

NOW, THEREFORE, in consideration of the mutual promises contained in this Agreement and intending to be legally bound and for good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: 
 1. Effective as of
the Termination Date, Mr. Kessig will cease to serve as the Senior Vice President of Sales of the Company. 
 2. Subject in all respects to
this Agreement becoming effective and enforceable in accordance with paragraph 11 hereof Auxilium shall provide payments described in (a) and (b) below, less appropriate withholdings taxes and deductions, and the benefit described in
(e) below. In addition, regardless of whether this Agreement becomes effective and enforceable in accordance with paragraph 11 hereof, Mr. Kessig shall be entitled to the other benefits described in (c) and (d) below. 

(a) Payment in the gross amount of $412,777.50. This amount will be paid in 12 equal monthly installments commencing within 60 days
following the Termination Date. 
 (b) Payment of an amount equal to $112,065.95, which is a bonus for fiscal year 2011
performance under the Company’s 2011 bonus plan. Such amount, less applicable withholding taxes, shall be paid to Mr. Kessig at the same time as such bonus is paid to other executives of the Company who participate in the 2011 bonus plan.

 (c) Provided Executive timely elects COBRA continuation coverage, reimbursement of the monthly COBRA medical insurance cost
(less any required employee payments calculated as if Executive had continued to be an employee) during the 12 month period following the Termination Date for Mr. Kessig, and his spouse and (if applicable) dependents. The COBRA health care
continuation period shall run concurrently with the foregoing period. 







 (d) Mr. Kessig will also be compensated for two earned, but unused, vacation time
through the Termination Date, in an amount equal to $2,331.84. 
 (e) In accordance with the terms of the applicable grant
agreements pursuant to which they were granted and the Company’s 2004 Equity Compensation Plan, Mr. Kessig has until September 30, 2012, to exercise all outstanding options that have vested as of the Termination Date. Outstanding
options and restricted stock units that have not vested as of the Termination Date will be forfeited. Information regarding the vested options will be provided under separate cover. 
 3. Payment of an amount equal to $25,261.66, which equals 30 days of salary, in lieu of the Company’s obligation to provide notice of termination pursuant to Section 2.1 of the Employment
Agreement, which amount will be reduced by any applicable tax withholdings and normal deductions and will be paid to Mr. Kessig on the Company’s next regular pay cycle date after the Termination Date. 

4. Mr. Kessig agrees to submit final travel and expense reports to Human Resources by February 15, 2012, and to cooperate with the immediate
return of all Company property, as applicable; provided that Mr. Kessig may retain his Company purchased iPhone, iPad and laptop computer so long as Mr. Kessig cooperates with the Company to remove all Company-related information from such
devices. 
 5. MR. KESSIG, FOR HIMSELF AND HIS RESPECTIVE ADMINISTRATORS, EXECUTORS, AGENTS, BENEFICIARIES AND ASSIGNS, HEREBY WAIVES, RELEASES
AND FOREVER DISCHARGES AUXILIUM PHARMACEUTICALS, INC. (AS DEFINED BELOW) OF AND FROM ANY AND ALL CLAIMS (AS DEFINED BELOW). Mr. Kessig further agrees that should any other person, organization or entity file a lawsuit or
arbitration to assert any such Claim, he will not seek any personal relief in such an action. This General Release of Claims provision (hereafter “Release”) covers all Claims arising from the beginning of time up to and including the
effective date of this Agreement. 
 Exclusions: Notwithstanding any other provision of this Release, the following are
not barred by the Release: (a) Claims relating to the validity of this Agreement; (b) Claims by either party to enforce this Agreement; and (c) Claims which legally may not be waived. In addition, this Release does not bar
Mr. Kessig’s right to file an administrative charge with the Equal Employment Opportunity Commission (“EEOC”) and/or to participate in an investigation by the EEOC, although the Release does bar Mr. Kessig’s right to
recover any personal relief if he or any person, organization, or entity asserts a charge on his behalf, including in a subsequent lawsuit or arbitration. 
 The following provisions further explain this Release: 
 (a) Definition of
“Claims”. Except as stated above, “Claims” includes without limitation all actions or demands of any kind that Mr. Kessig now has or may have or claim to have in the future. More specifically, Claims include rights,
causes of action, damages, penalties, losses, attorneys’ fees, costs, expenses, obligations, agreements, judgments and all other liabilities of any kind or description whatsoever, either in law or in equity, whether known or unknown, suspected
or unsuspected. 
 The nature of Claims covered by this Release includes without limitation all actions or demands in any way
based on Mr. Kessig’s employment with the Company, the terms and 

  
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conditions of such employment or Mr. Kessig’s separation from employment. More specifically, all of the following are among the types of Claims which, to the extent permitted by law,
are waived and barred by this Release: 
 •   Contract Claims (whether express or implied); 

•   Tort Claims, such as for tortious interference, defamation or emotional distress; 

•   Claims under federal, state and municipal laws, regulations, ordinance or court decisions of any kind; 

•   Claims of discrimination, harassment or retaliation, whether based on race, color, religion, gender, sex, age, sexual
orientation, handicap and/or disability, national origin, whistleblowing or any other legally protected class; 
 Ÿ   Claims under the AGE DISCRIMINATION IN EMPLOYMENT ACT, Title VII of the Civil Rights Act of 1964, the Americans with
Disabilities Act and similar state and local laws, all as amended; 
 •   Claims under the Employee Retirement
Income Security Act, the Occupational Safety and Health Act, all as amended, and similar state and local laws; 

•   Claims for wrongful discharge; and 
 •   Claims for attorney’s fees, litigation expenses and/or costs. The foregoing list is intended to be illustrative and not exhaustive. 

(b) Definition of “Auxilium Pharmaceuticals, Inc.” “Auxilium Pharmaceuticals, Inc.” includes without
limitation Auxilium Pharmaceuticals, Inc. and its respective past, present and future parents, affiliates, subsidiaries, divisions, predecessors, successors, assigns, employee benefit plans and trusts. It also includes all past, present and future
managers, directors, officers, partners, agents, employees, attorneys, representatives, consultants, associates, fiduciaries, plan sponsors, administrators and trustees of each of the foregoing. 

6. Mr. Kessig expressly acknowledges that: 
 (a) He remains bound by Sections 4, 5, 6, and 7 of the Employment Agreement, which remain in full force and effect and whose remaining in full force and effect is reasonably and properly required for the
protection of the Company’s business; and, in keeping with the foregoing, Mr. Kessig explicitly and specifically acknowledges that among his obligations thereunder, he may not directly or indirectly solicit or recruit any employee of
Auxilium to work for a third party other than Auxilium (excluding newspaper or similar print or electronic solicitations of general circulation); 
 (b) The provisions of Section 8 of the Employment Agreement remain in full force and effect; 

  
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 (c) Auxilium’s obligation to provide him with the benefits set forth in paragraph 2
above are contingent upon his ongoing compliance with Sections 4, 5, 6, and 7 of the Employment Agreement; 
 (d) He will not
disparage the personal or professional reputation of Auxilium, its directors, officers, or employees. Auxilium agrees that its officers and directors will not disparage the personal or professional reputation of Mr. Kessig. Nothing in this
section is intended to prohibit or restrict Mr. Kessig or Auxilium, its officers and directors from making any disclosure of information required by law or participating in an otherwise legally protected activity, such as an investigation or
proceeding by a federal regulatory or law enforcement agency or legislative body; 
 (e) He agrees to cooperate with Auxilium
with respect to any legal issue regarding any matter of which he had knowledge during his employment with Auxilium. His cooperation includes appearance at depositions, assistance in responding to discovery demands, preparation for trials, and
appearance at trial. Auxilium will reimburse Mr. Kessig for all reasonable expenses incurred by him in providing such assistance; and 
 (f) After the Termination Date, Auxilium will not have any obligation to provide Mr. Kessig at any time in the future with any payments, benefits or considerations other than those recited in
subsections (a) through (d) of paragraph 2 above and any vested benefits to which Mr. Kessig may be entitled under the terms of Auxilium’s benefit plans. 
 7. Unless otherwise compelled by law or to the extent that any information contained herein is publicly disclosed by Auxilium in its filings with the Securities and Exchange Commission, Mr. Kessig
further agrees that the existence of this Agreement, the terms of this Agreement and the amount of any payments under this Agreement are all confidential information, and shall not be intentionally disclosed, discussed or otherwise published under
any circumstances, except only that Mr. Kessig may reveal the terms and amount of settlement to his attorney for the purpose of obtaining legal advice and representation, to his accountant for the purpose of filing government tax returns, or
pursuant to subpoena or court order. Mr. Kessig may also reveal the financial and other terms of this Agreement to his spouse, provided, however that Mr. Kessig will remain liable for any disclosure of such information to any third party
by his spouse. Auxilium’s obligation to provide his with the benefits set forth in paragraph 2 above is contingent upon his ongoing compliance with this paragraph 7. 
 8. By entering into this Agreement, the Company does not admit and expressly denies that it has violated any contract, rule or law, including but not limited to, any federal, state and local statute or
law relating to employment or employment discrimination. 
 9. Mr. Kessig understands and acknowledges that by signing this Agreement and
accepting the terms contained herein he is receiving benefits that he would not otherwise be entitled to. Mr. Kessig acknowledges that he is receiving these payments and benefits in exchange for entering into this Agreement and complying with
all the provisions of this Agreement. 
 10. Mr. Kessig acknowledges that he has been advised in writing by Auxilium to consult with an
attorney before signing this Agreement. 

  
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 11. Mr. Kessig acknowledges that he has been provided with a period of at least 21 calendar days to
consider the terms of this offer from the date this Agreement first was presented to him on February 3, 2012. Mr. Kessig agrees that any changes to this offer, whether material or immaterial, will not restart the running of the foregoing
consideration period. 
 Mr. Kessig agrees to notify Auxilium of his acceptance of this Agreement by delivering a signed
copy to the Company, addressed to Jennifer Armstrong. Mr. Kessig understands that he may take the entire 21-day period to consider this Agreement. If Mr. Kessig does not notify Auxilium of his acceptance of this Agreement by delivering a
signed copy to the Company, addressed to Jennifer Armstrong, Mr. Kessig shall have no further right to receive the payments recited in subsections (a) and (b) of paragraph 2 above. 

By signing and returning this Agreement, Mr. Kessig acknowledges that the consideration period afforded him a reasonable period of
time to consider fully each and every term of this Agreement, including the General Release of Claims set forth in paragraph 4 above, and that he has given the terms full and complete consideration. 

12. If Mr. Kessig notifies Auxilium of his acceptance of this Agreement by delivering a signed copy to the Company addressed to Jennifer Armstrong
as described above, Mr. Kessig may revoke this Agreement for a period of seven days. This Agreement shall not become effective or enforceable until the seven day revocation period has ended. For revocation to be effective, it must be delivered
to Jennifer Armstrong, Auxilium Pharmaceuticals, Inc., 40 Valley Stream Parkway, Malvern, PA 19355 within the seven-day revocation period. 

13. Mr. Kessig, intending to be legally bound, certifies and warrants that he has read carefully this Agreement and has executed it voluntarily and
with full knowledge and understanding of its significance, meaning and binding effect. Mr. Kessig further declares he is competent to understand the content and effect of this Agreement and that his decision to enter into this Agreement has not
been influenced in any way by fraud, duress, coercion, mistake or misleading information. 
 14. This Agreement will take effect on the first
business day following the expiration of the revocation period specified in paragraph 11 hereof, provided that Mr. Kessig chooses not to revoke it. 
 15. Mr. Kessig agrees that he may not assign his rights or obligations under this Agreement or the Employment Agreement. Mr. Kessig further agrees that Auxilium may assign this Agreement to a
successor or assignee in connection with a merger, consolidation or sale or transfer of assets. 
 16. If any provision of this Agreement is
held to be illegal, void, or unenforceable, such provision shall be of no force or effect. However, the illegality or unenforceability of such provision shall have no effect upon, and shall not impair the legality or enforceability of, any other
provision of this Agreement; provided, however, that upon any finding by a court of competent jurisdiction that the release provided for by paragraph 4 above is illegal, void or unenforceable, Mr. Kessig shall, at Auxilium’s request,
execute promptly a release and/or promise of comparable scope that is legal and enforceable. If such a release is not executed by Mr. Kessig, he shall promptly return to Auxilium any payments made pursuant to paragraphs 2(a) or (b) above.


  
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 17. The construction, interpretation and performance of this Agreement shall be governed by the laws of the
Commonwealth of Pennsylvania, without regard to conflict of laws principles. 
 18. This Agreement supersedes any and all prior agreements or
understandings between Mr. Kessig and Auxilium, except those provisions of the Employment Agreement identified above. Mr. Kessig represents and acknowledges that in executing this Agreement he has not relied upon any representation or
statement not set forth herein made by the Auxilium Pharmaceuticals, Inc. (as defined in paragraph 4(b) hereof) with regard to the subject matter of this Agreement. Any modification of this Agreement must be made in writing and signed by all
parties. 
 [Signature Page Follows] 

  
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 As evidenced by their signatures below, the parties intend to be legally bound by this
Agreement. 
  

	
	
	/s/ Edward F. Kessig
	 Edward F. Kessig
  

DATE: 2/12/2012



  

			
	Auxilium Pharmaceuticals, Inc.
		
	BY:	 	/s/ Adrian Adams
	NAME:	 	Adrian Adams
	TITLE:	 	CEO and President
	DATE:	 	2/14/2012



  
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