Exhibit
10.15


 


EXECUTION
VERSION


 


AMENDED AND RESTATED
EMPLOYMENT AGREEMENT


 


AMENDED AND RESTATED
EMPLOYMENT AGREEMENT by and between Ikaria Holdings, Inc., a Delaware
corporation (the “Company”“), and Michael Kennedy (the “Executive”),
dated as of the 1st day of June, 2009 (this “Agreement”).


 


WHEREAS, the Executive
possesses skills, experience and knowledge that are of value to the Company;


 


WHEREAS, the Company desires
to continue to employ the Executive as its Senior Vice President, Engineering
and Operations , and the Executive is willing to continue such employment, in
each case on the terms and conditions set forth herein; and


 


WHEREAS, the Executive and
the Company previously entered into an Employment Agreement dated as of October 13th, 2008 (the “Original
Agreement”) and now wish to amend and restate the Original Agreement In its
entirety as set forth in this Agreement.


 


NOW, THEREFORE, in
consideration of the promises and mutual covenants herein contained, the
parties hereto agree as follows:


 


1.             Employment Period.  The Company shall employ the Executive, and
the Executive shall serve the Company, on the terms and conditions set forth in
this Agreement, for the period commencing on June 1, 2009 (the “Effective
Date”), and ending on May 31, 2010 (the “Initial  Term”);
provided, however, that commencing on May 31, 2010 and each
annual anniversary of such date (May 31, 2010, and each annual anniversary
thereof, shall hereinafter be referred to as the “Renewal Date”), unless
previously terminated, the Term shall be automatically extended so as to
terminate one year from the applicable Renewal Date (each such one year
renewal, a “Renewal Term,” and the Initial Term together with all
Renewal Terms(s), the “Term”), unless at least ninety (90) days prior to
such Renewal Date the Company or the Executive shall give written notice to the
other party that the Term shall not be so extended; provided, further, however
(that if a “Sale Transaction” (as defined in the Company’s Senior Executive
Bonus Pool Program) occurs during the Term and prior to June 1, 2010, and
the Term is scheduled to expire prior to the day that is seven (7) months
following the closing of Sale Transaction (the “Sale Extension Date”) as
a result of a notice by the Company that the Term shall not be extended, the
Term, notwithstanding such notice, shall be extended until the Sale Extension
Date.  The Executive’s period of
employment pursuant to this Agreement shall hereinafter be referred to as the “Employment
Period.”


 


2.             Position and Duties.


 


(a)           During the Employment
Period, the Executive shall serve as Senior Vice President, Engineering and
Operations, of the Company, with such duties and responsibilities as are
customarily assigned to such position, and such other duties and
responsibilities not inconsistent therewith as may be assigned to the Executive
from time to time by the Company.  In
such capacity, the Executive shall report to the Company’s Chief Executive
Officer.


 


(b)           During the Employment
Period, and excluding any periods of vacation and sick leave to which the
Executive is entitled, the Executive shall devote his full business


 

















 


time
and efforts to the business and affairs of the Company and use his best efforts
to carry out such responsibilities faithfully and efficiently.  During the Employment Period, the Executive
shall not be engaged in any other business activity without the prior written
consent of the Company except for time spent in managing his personal,
financial and legal affairs, in each case only if, and to the extent that, such
activities do not interfere with the performance of the Executive’s duties and
responsibilities hereunder or otherwise result in a breach of this Agreement.


 


(c)           The Executive’s services
hereunder shall be performed at the Company’s headquarters, subject to such
business travel as may be required from time to time.


 


3.             Compensation.


 


(a)           Base Salary.  During the Employment Period, the Executive
shall receive a base salary (such base salary, as it may be increased from time
to time hereunder, the “Annual Base Salary”) at the annual rate of
$300,000.00.  The Annual Base Salary
shall be payable in accordance with the Company’s payroll practices as in
effect from time to time, subject to applicable taxes and withholding.  During the Employment Period, the Annual Base
Salary shall be reviewed for possible merit increases at least annually but
shall not be reduced during the Employment Period.


 


(b)           Annual Bonus.  For each calendar year ending during the
Employment Period, the Executive shall be eligible to earn an annual cash bonus
payable in accordance with the terms of the Company’s management incentive
program at a target of 50% of Annual Base Salary, or such higher level
established by the Company from time to time (the “Annual Bonus”).


 


(c)           Benefits.  During the Employment Period, the Executive
and/or the Executive’s family, as the case may be, shall be provided with such
employee benefits, and under the same terms, as are provided by the Company
from time to time to its executives.  The
Company reserves the right to modify or terminate its benefits plans generally
for employees.


 


(d)           Vacation.  During each year of the Employment Period,
the Executive shall be entitled to paid vacation consistent with the Company’s
practices, policies and programs for its senior executives; provided
that the Executive shall be entitled to no less than four (4) weeks of
paid vacation during each year of the Employment Period.


 


(e)           Business and Entertainment
Expenses.  During the
Employment Period, the Executive shall be entitled to receive prompt
reimbursement for all reasonable expenses, incurred by the Executive in
carrying out the Executive’s duties under this Agreement; provided that
the Executive complies with the policies, practices and procedures of the
Company for submission of expense reports, receipts, or similar documentation
of such expenses.


 


4.             Termination of Employment.


 


(a)           Death or Disability.  The Executive’s employment hereunder shall
terminate automatically upon the Executive’s death during the Term.  The Company shall, to the full extent
permitted by law, be entitled to terminate the Executive’s employment because
of the


 

















 


Executive’s
“Disability” (as herein defined) during the Term.  “Disability” means the permanent
disability of the Executive in accordance with the long-term disability plan of
the Company applicable to the Executive.


 


(b)           By the Company.  The Company may terminate the Executive’s
employment hereunder during the Term for Cause or without Cause.  For purposes of this Agreement, the term “Cause”
shall be defined as: (A) disloyalty or dishonesty which results or is
intended to result in material personal enrichment to Executive at the material
expense of the Company or any of its subsidiaries (including, without
limitation, fraud, embezzlement or dishonesty or breach of business ethics); (B) fraudulent
conduct in connection with the material business or affairs of the Company or
any of its subsidiaries that materially and adversely affects the Company or
any of its subsidiaries; (C) conviction of a felony or any crime involving
moral turpitude (or entering into a plea of nolo contendere with respect to
such crime); (D) gross misconduct that materially and adversely affects
the Company; (E) any breach or intended breach of any Company policies or
procedures as in effect from time to time, in each case constituting a material
violation of such policies or procedures, and in each case causing material
harm to the Company; or (F) failure by the Executive to provide thirty
(30) days advance written notice of resignation; provided that in the
case of subsection (E) of this Section 4(b), the Company shall give
written notice to the Executive at least ten (10) days prior to such
termination (“Notice of Termination for Cause”) of the Company’s intent
to terminate, which notice shall set out in detail the ways in which Executive
has materially breached or expressed an intent to breach materially a Company
policy or procedure in such a way as to cause the Company material harm, and
Executive shall have failed to cure such breach prior to the expiration often (10) days
following the date on which such notice is provided to him; and provided
further that with respect to the Executive’s violation of Subsection (E) of
this Section 4(b), the Executive shall have only one opportunity to cure
such failure and thereafter may be terminated immediately in connection with
subsequent violations of Subsection (E) of this Section 4(b).


 


(c)           By the Executive for Good
Reason.  The Executive may terminate
the Executive’s employment hereunder during the Term for Good Reason or other
than for Good Reason.  For purposes of
this Agreement, “Good Reason” means that the Company has engaged in any
of the following without the Executive’s consent:


 


A.            any material and adverse
change in the Executive’s position, title or status, any change in the
Executive’s job duties, authority or responsibilities to those of lesser
status, or any obligation that the Executive report other than to the Chief
Executive Officer of the Company;


 


B.            any material and adverse
breach of this Agreement by the Company; provided, that any failure of a
successor to assume and agree to perform under this Agreement required by Section 7(c) shall
be deemed to be a material and adverse breach of this Agreement by the Company;


 


C.            relocation of the Company’s
headquarters more than fifty (50) miles from its present location or transfer
of Executive to any location more than fifty (50) miles from the location of
the current headquarters; or


 

















 


D.            any material and adverse
change in the Executive’s compensation or benefits;


 


provided, that, following a Change
in Control, any change (in the case of clauses (A) and (D)) and any breach
(in the case of clause (B)), in each case whether or not material and adverse,
shall constitute Good Reason hereunder and (in the case of clause (A)) a change
shall be deemed to have occurred if, following a Change in Control in which the
Company becomes controlled by another entity (a “Parent Company”) (i) the
Executive’s position, title, status, job duties, authority or responsibilities
with the Parent Company are not equivalent to his position, title, status, job
duties, authority and responsibilities with the Company immediately prior to
the Change in Control and/or (ii) the Executive is obligated to report
other than to the Chief Executive Officer of the Company.  For purposes of this Agreement, a “Change
in Control” shall have occurred if, after the Effective Date, (A) any “Person”
(as the term person is used for purposes of Section 13(d) or 14(d) of
the Securities Exchange Act of 1934, as amended (the “Exchange Act”))
(other than any Person that includes New Mountain Partners II, L.P., New
Mountain Affiliated Investors II, L.P. or Allegheny New Mountain Partners, L.P.
or any of their affiliates (an “Excluded Person”)), is the “Beneficial
Owner” (within the meaning of Rule 13d-3 promulgated under the Exchange
Act), directly or indirectly, of more than 50% of the voting capital stock of
the Company, (B) any Person other than an Excluded Person has or obtains
the right to elect a majority of the Board or (C) the Company sells in a
single transaction or series of transactions all or substantially all of its
assets; and provided, that, for avoidance of doubt, an initial public offering
of securities of the Company shall not constitute a Change in Control for
purposes of this Agreement.


 


A termination of employment
by the Executive for Good Reason shall be effectuated by giving the Company
written notice (“Notice of Termination for Good Reason”) of the
termination, setting forth the conduct of the Company that constitutes Good
Reason, within the later of (i) ninety (90) days of the first date on
which the Executive has knowledge of such conduct or (ii) if a Sale
Transaction has occurred prior to June 1, 2010, prior to the Sale
Extension Date.  The Executive shall
further provide the Company at least thirty (30) days following the date on
which such notice is provided to cure such conduct.  Failing such cure, a termination of
employment by the Executive for Good Reason shall be effective on the day
following the expiration of such cure period.


 


(d)           No Waiver.  The failure to set forth any fact or
circumstance in a Notice of Termination for Cause or a Notice of Termination
for Good Reason shall not constitute a waiver of the right to assert, and shall
not preclude the party giving notice from asserting, such fact or circumstance
in an attempt to enforce any right under or provision of this Agreement.


 


(e)           Date of Termination.  The “Date of Termination” means the
date of the Executive’s death, the date on which the Executive is designated as
having a Disability, or the date on which the termination of the Executive’s
employment by the Company or by the Executive is effective.


 

















 


5.             Obligations of the Company
upon Termination.


 


(a)           Termination Other Than for
Cause: Termination for Good Reason: Non-Renewal of the Term.  If either (i) during the Term, (A) the
Company terminates the Executive’s employment, for any reason other than for
Cause, death or Disability, or (B) the Executive terminates his employment
for Good Reason, or (ii) the Executive terminates his employment at the
end of the Term and the Company has previously given notice to the Executive
that the Term will not be extended, then the Company shall pay the amounts and
provide the benefits, subject to and in accordance with Section 5(e) hereof,
in each case as set forth in paragraphs A through F below.


 


A.            The Executive’s earned and
accrued but unpaid cash compensation, in the form of a lump-sum payment, to be
paid not later than the regularly scheduled pay period next following the date
on which the Release becomes effective, which shall equal the sum of (i) any
portion of the Executive’s Annual Base Salary earned through the Date of
Termination that has not yet been paid, (ii) any unpaid Annual Bonus that
was earned by the Executive and declared due and owing by the Company, and (iii) any
accrued but unpaid vacation time, in each case subject to applicable taxes and
withholding (the amounts set forth in subclauses (i)-(iii) constitute the “Accrued
Obligations”).  The Company shall
also provide the Executive with any other benefits (other than severance
benefits) to which the Executive is entitled under the Company’s benefit plans
and arrangements as and when due under such plans and arrangements (the “Accrued
Benefits”).


 


B.            A pro rata portion of the
Executive’s Annual Bonus in the form of a lump-sum payment, which shall equal
the sum of the Executive’s Annual Bonus at target, multiplied by the number
equal to the sum of any partial and full months worked by the Executive in the
year of termination, divided by the number twelve (12) (the “Pro Rata Bonus”).


 


C.            Payments, payable in
accordance with the Company’s standard monthly payroll practices and subject to
withholding and taxes, of an amount equal to the sum of (i) the Executive’s
Annual Base Salary and (ii) the greater of the Annual Bonus at the target
level and the actual Annual Bonus most recently paid to the Executive,
determined on a monthly basis, for a period of 12 (twelve) months from the Date
of Termination (the “Salary Continuation Severance Payments”).


 


D.            For twelve (12) months from
the Date of Termination, and subject to the Executive electing COBRA
continuation coverage, the Company shall provide the Executive with medical,
dental and vision benefits at active-employee rates.


 


E.             A lump sum payment of
$18,263 in lieu of the annual financial planning, annual physical and life
insurance benefits (the “Benefit Payment”).


 


F.             The unvested portion of any
equity compensation granted to the Executive shall (whether or not specified in
the grant agreements evidencing such equity compensation) become immediately
vested as to that portion thereof that would become exercisable during the
period beginning on the Date of Termination and ending on the first anniversary
of the Date of Termination, assuming that the Executive’s employment had


 

















 


continued
during the entirety of such period; provided, that if the Date of
Termination is on or after the date on which a Change in Control occurs, then
any equity compensation granted to the Executive shall (whether or not
specified in the grant agreements evidencing such equity compensation) become
fully vested as of the Date of Termination.


 


(b)           Death or Disability.  If the Executive’s employment is terminated
by reason of the Executive’s death or Disability during the Term, the Company
shall pay the Accrued Obligations to the Executive or the Executive’s estate or
legal representative, as applicable, in a lump-sum payment (subject to
applicable taxes and withholding) not later than the next regularly scheduled
pay period following the Date of Termination, and, following the Date of
Termination, the Company shall provide the Executive with the Accrued Benefits as
and when due.


 


(c)           Cause, etc.  If the Executive’s employment is terminated
by the Company for Cause during the Term, or if the Executive terminates his
employment during the Term other than for Good Reason, the Company shall pay
the Executive, in a lump-sum payment (subject to applicable taxes and
withholding) not later than the next regularly scheduled pay period following
the Date of Termination, the Accrued Obligations, and, following the Date of
Termination, the Company shall provide the Executive with the Accrued Benefits
as and when due.


 


(d)           Termination Other Than for
Cause, Termination for Good Reason, or Non-Renewal of the Term following a
Change in Control.  If either (i) within
eighteen (18) months following a Change in Control, (A) the Company
terminates the Executive’s employment for any reason other than for Cause,
death or Disability, or (B) the Executive terminates his employment for
Good Reason, or (ii) the Executive terminates his employment at the end of
the Term and the Company has given notice to the Executive within eighteen (18)
months following a Change in Control that the Term will not be extended, then
the Company shall, in addition to the payment and benefits provided for in
Sections 5(a)(A) through 5(a)(F) and subject to and in accordance
with Section 5(e), pay the amounts and provide the benefits described in
paragraphs (A) through (D) below:


 


A.            A lump sum payment equal to
one-half (.5) times the sum of (i) the Executive’s Annual Base Salary and (ii) the
greater of the Annual Bonus at the target level and the actual Annual Bonus
most recently paid to the Executive (the “CIC Severance Payment”).


 


B.            In addition to the
continuation coverage provided in Section 5(a)(D) hereof, and subject
to the Executive electing COBRA continuation coverage, the Company shall
provide the Executive with medical, dental and vision benefits at active-
employee rates for an additional six (6) months.


 


C.            A lump sum payment equal to
one half (1⁄2) times the Benefit Payment (the “CIC Benefit Payment”).


 


D.            The unvested portion of any
equity compensation granted to the Executive shall (whether or not specified in
the grant agreements evidencing such equity compensation) become immediately
fully vested.


 

















 


If the Executive’s
employment is terminated by the Company for any reason other than for Cause,
death or Disability at any time prior to the date of a Change in Control and
either (i) such termination occurred after the Company entered into a
definitive agreement, the consummation of which would constitute a Change in
Control or (ii) the Executive was terminated at the request of a third
party who has indicated an intention or has taken steps reasonably calculated
to effect a Change in Control, such termination shall be deemed to have
occurred after a Change in Control, notwithstanding that such event or
condition occurred prior to a Change in Control, and the payments and benefits
described above in this Section 5(d) shall apply.


 


For purposes of this Section 5(d),
with respect to the definition of Good Reason, if any event or condition
described in Section 4(c) occurs at any time prior to the date of a
Change in Control and either (i) occurred after the Company entered into a
definitive agreement, the consummation of which would constitute a Change in
Control or (ii) was at the request of a third party who has indicated an
intention or has taken steps reasonably calculated to effect a Change in
Control, any resulting termination by the Executive for Good Reason shall be
deemed to have occurred after a Change in Control, notwithstanding that such
event or condition occurred prior to a Change in Control, and the payments and
benefits described above in this Section 5(d) shall apply.


 


If the Executive terminates
his employment at the end of the Term and the Company has previously given
notice to the Executive that the Term will not be extended at any time prior to
or following the date of a Change in Control and either (i) such notice or
termination occurred after the Company entered into a definitive agreement, the
consummation of which would constitute a Change in Control or (ii) the
Company gave such notice of termination to the Executive that the Term will not
be extended at the request of a third party who has indicated an intention or
has taken steps reasonably calculated to effect a Change in Control, such
termination shall be deemed to have occurred after a Change in Control,
notwithstanding that such event or condition occurred prior to a Change in
Control, and the payments and benefits described above in this Section 5(d) shall
apply.


 


(e)           Timing of Severance Payments
and Benefits.


 


The Company’s obligations to
make the payments, or otherwise perform, as set forth in Sections 5(a)(B), (C),
(D), (E), and (F) and Sections 5(d)(A), (B), (C) and (D), shall be conditioned
upon: (i) the Executive’s continued compliance with his obligations under Section 6
and (ii) the Executive’s execution, delivery and non-revocation of a valid
and enforceable general release of claims against the Company and its
affiliates in the form attached hereto as Exhibit A (the “Release”)
within forty-five (45) days after the Executive’s Date of Termination.


 


The payments and benefits
described in Sections 5(a)(A), (D), and (F) and Sections 5(d)(B) and (D) shall
be made, provided, or commenced, as applicable, promptly after the Date of
Termination, provided that the Executive has executed and delivered the
Release, and the Release has become irrevocable by such date.


 

















 


If no stock of the Company
is publicly traded on an established securities market or otherwise on the Date
of Termination, the payments and benefits described in Sections 5(a)(B), (C),
and (E) and Sections 5(d)(A) and (C) shall be made, provided, or
commenced, as applicable, on the forty-fifth (45th) day after the Date of Termination.  If stock of the Company is publicly traded on
an established securities market or otherwise on the Date of Termination, the
payments and benefits described in Sections 5(a)(B), (C), and (E) and
Sections 5(d)(A) and (C) shall be made, provided, or commenced, as
applicable, upon the day following the day that is six (6) months after
the Date of Termination.


 


Except for any payments made
pursuant to the Company’s Senior Executive Bonus Pool Program, the payments
described in Sections 5(a) through (d) shall constitute the exclusive
payments in the nature of severance or termination pay which shall be due to
the Executive upon a termination of employment and shall be in lieu of any
other such payments under any plan, program, policy or other arrangement of the
Company or any affiliate.  The Executive
shall have no obligation to mitigate any amounts payable or arrangements made
under any provision of this Agreement, whether by seeking employment or
otherwise.


 


If the Executive dies during
the period between the Date of Termination and the date on which the payments
and benefits described in Sections 5(a) and 5(d) are due to be paid,
all such payments and benefits shall be paid to the personal representative of
the Executive’s estate.


 


(f)            Immediate Vesting on Change
in Control.  Without
limitation of Section 5(a)(F), the unvested portion of any equity
compensation granted to the Executive shall (whether or not specified in the
grant agreements evidencing such equity compensation) immediately become fully vested
upon a Change in Control, whether or not a termination of the Executive’s
employment occurs; provided, however, that to the extent equity
compensation is treated as deferred compensation for purposes of the Internal
Revenue Code of 1986 as amended, and the regulations issued thereunder (“Section 409A”),
the vesting of such equity compensation shall only accelerate pursuant to this Section 5(f) upon
a Change in Control which also constitutes a change in control or effective
control of the Company or a change in the ownership of a substantial portion of
its assets, in each case within the meaning of Section 409A.


 


(g)           Separate Payments.  The Pro Rata Bonus, the Salary Continuation
Severance Payments, the Benefit Payment, the CIC Benefit Payment, and the CIC
Severance Payment are each intended to be separate payments for purposes of Section 409A.


 


(h)           Indemnification by the
Company.  The Company shall defend,
indemnify, and hold the Executive harmless from and against any liabilities the
Executive may incur by virtue of the applicability of Section 409A to any
payments made hereunder.


 


(i)            Taxes and Withholding.  All payments and benefits to be made or
otherwise provided to the Executive hereunder shall be subject to applicable
taxes and withholding.


 


6.             Confidential Information;
Noncompetition: Work Product.  The Executive acknowledges that his
employment by the Company will, throughout the Employment Period


 

















 


bring
him into close contact with the confidential affairs of the Company and its
affiliates, including information about their client and customer lists and
information concerning proprietary manufacturing formulations and processes,
costs, profits, real estate, markets, sales, products, key personnel, pricing
policies, operational methods, patents, research and development, technical
processes, and other business affairs and methods, plans for future product
development and other information not readily available to the public.  The Executive further acknowledges that the
services to be performed under this Agreement are of a special, unique,
unusual, extraordinary and intellectual character.  The Executive further acknowledges that the
business of the Company and its subsidiaries is international in scope, that
their products are marketed throughout the world, that the Company and its
subsidiaries competes in nearly all of their business activities with other
entities that are or could be located in nearly any part of the world and that
the nature of the Executive’s services, position and expertise are such that he
is capable of competing with the Company and its subsidiaries from nearly any
location in the world.  In recognition of
the foregoing, the Executive covenants and agrees:


 


(a)           The Executive, at all times
during the Employment Period and thereafter, shall hold in a fiduciary capacity
for the benefit of the Company all secret, trade, proprietary or confidential
information, knowledge or data relating to the Company or any of its affiliated
companies and shareholders, and their respective businesses, that the Executive
obtains during the Executive’s employment by the Company or any of its
affiliated companies and that is not public knowledge (other than as a result
of the Executive’s violation of this Section 6(a)) (“Confidential
Information”).  The Executive shall
not communicate, divulge or disseminate Confidential Information at any time
during or after the Executive’s employment with the Company, except with the
prior written consent of the Company or as otherwise required by law or legal
process.  The Executive shall deliver
promptly to the Company on termination of the Executive’s employment by the
Company, or at any other time the Company may so request, at the Company’s
expense, all memoranda, notes, records, reports and other documents (and all
copies thereof) relating to the Company’s business, which the Executive
obtained while employed by, or otherwise serving or acting on behalf of, the
Company and which the Executive may then posses or have under the Executive’s
control.


 


(b)           During the “Noncompetition
Period,” the Executive shall not, without the prior written consent of the
Board, engage in or become associated with a “Competitive Activity.”  For purposes of this Section 6:  (i) the “Noncompetition Period”
means the period commencing on the Effective Date and ending on the
twelve-month anniversary of the date upon which Executive’s employment with the
Company is terminated for any reason; (ii) a “Competitive Activity”
means any business or other endeavor that engages in clinical or pre- clinical
research or development, manufacturing, marketing, sales, or commercialization
of products or services that directly or indirectly compete with, or are a
therapeutic alternative to, either (x) the products of, or services
engaged in by, the Company or any of its subsidiaries at the Date of
Termination in any geographic location in the United States, or (y) the
products proposed to be developed or commercialized, or services proposed to be
engaged in, by the Company or any of its subsidiaries at the Date of
Termination in any geographic location in the United States (provided that
clause (y) shall apply only to any proposed business activity as to which
the Company or any of its subsidiaries has devoted significant and documented
efforts at the Date of Termination, whether internally or through acquisition,
licensing or other business development activities); provided, however, that
the Executive shall not be engaged in a Competitive Activity


 

















 


if
he is providing services to a division or subsidiary of a multi-division entity
or holding company, so long as no division or subsidiary to which the Executive
provides services is in competition with the Company or its subsidiaries or
affiliates, and the Executive does not otherwise engage in a Competitive
Activity on behalf of the multi-division entity or any competing division or
subsidiary; and (iii) the Executive shall be considered to have become “associated
with a Competitive Activity” if the Executive becomes directly or indirectly
involved as an owner, investor (other than a passive stockholder of less than
five percent (5%) of a corporation the securities of which are traded on a
national securities exchange), employee, officer, director, consultant,
independent contractor, agent, partner, advisor, or in any other capacity
calling for the rendition of the Executive’s personal services, with any
individual, partnership, corporation or other organization that is engaged
directly or indirectly in a Competitive Activity.


 


(c)           During the Noncompetition
Period, the Executive shall not, on his own behalf or on behalf of any other
person, firm or entity (x) directly or indirectly solicit, induce or
attempt to solicit or induce any employee of the Company or any of its
subsidiaries to terminate his employment with the Company or any of its
subsidiaries, or to provide any assistance whatsoever to any person, firm or
entity engaged in a Competitive Activity, or (y) directly or indirectly
induce any business, entity or person with which the Company or any of their
subsidiaries or affiliates has a business relationship to terminate or alter
such business relationship.


 


(d)           In addition to such other
rights and remedies as the Company may have at equity or in law with respect to
any breach of this Agreement, if the Executive commits a material breach of any
of the provisions of Section 6, the Company shall have the right to seek
to have such provisions specifically enforced by any court having equity
jurisdiction (without any obligation to post a bond or other security); it
being acknowledged and agreed that any such breach or threatened breach will
cause irreparable injury to the Company and that money damages alone will not
provide an adequate remedy to the Company.


 


(e)           The Executive acknowledges
that during the Employment Period, the Executive may conceive of, discover,
invent or create inventions, improvements, new contributions, literary
property, computer programs and software material, ideas and discoveries,
whether patentable or copyrightable or not (all of the foregoing being
collectively referred to herein as “Work Product”), and that various
business opportunities shall be presented to the Executive by reason of the
Executive’s employment by the Company. 
The Executive acknowledges that all of the foregoing shall be owned by
and belong exclusively to the Company and that the Executive shall have no
personal interest therein; provided that they are either related in any
manner to the business (commercial or experimental) of the Company or any of
its subsidiaries, or are, in the case of Work Product, conceived or made on the
Company’s time or with the use of the Company’s facilities or materials, or, in
the case of business opportunities, are presented to the Executive for the
possible interest or participation of the Company or any of its
subsidiaries.  The Executive shall (i) promptly
disclose any such Work Product and business opportunities to the Company; (ii) assign
to the Company, upon request and without additional compensation, the entire
rights to such Work Product and business opportunities; (iii) sign all
papers necessary to carry out the foregoing; and (iv) give testimony in
support of the Executive’s inventorship or creation in any appropriate
case.  The Executive agrees that the
Executive will


 

















 


not
assert any rights to any Work Product or business opportunity as having been
made or acquired by the Executive prior to the date of this Agreement except
for Work Product or business opportunities disclosed on Exhibit B to this
Agreement.


 


(f)            The Executive acknowledges
and agrees that the provisions of this Section 6 are necessary to protect
the business operations and affairs of the Company and its subsidiaries.  The Executive understands that the
restrictions set forth in this Agreement may limit his ability to earn a
livelihood in a business similar that of the Company, but he nevertheless
believes that he has received and will receive sufficient consideration and
other benefits as an employee of the Company to justify clearly such
restrictions which, in any event (given his education, skills and ability), the
Executive does not believe would prevent him from earning a livelihood.


 


7.             Successors.


 


(a)           This Agreement is personal
to the Executive and, without the prior written consent of the Company, shall
not be assignable by the Executive otherwise than by will or the laws of
descent and distribution.  This Agreement
shall inure to the benefit of and be enforceable by the Executive’s legal
representatives.


 


(b)           This Agreement shall inure
to the benefit of and be binding upon the Company and its successors and
assigns, and may be assigned by Company in connection with any sale, transfer
or other disposition of all or substantially all of its business and assets.


 


(c)           The Company shall require
any successor (whether direct or indirect, by purchase, merger, consolidation
or otherwise) to all or substantially all of the business and/or assets of the
Company expressly to assume and agree to perform under this Agreement in the
same manner and to the same extent that the Company would have been required to
perform it if no such succession had taken place, except under circumstances in
which such assumption occurs by operation of law.  As used in this Agreement, “Company” shall
mean both the Company as defined above and any such successor that assumes and
agrees to perform this Agreement, by operation of law or otherwise.


 


8.             Indemnification.  The Executive shall be entitled to defense by
and full indemnification from the Company for any claims that a third party brings
against him based on any alleged act or omission related in any way to the
Executive’s employment by the Company to the maximum extent permitted under
applicable law.  In addition, during the
term of the Executive’s employment, the Executive shall be covered under any
directors’ and officers’ insurance policy maintained by the Company.


 


9.             Post-Termination Assistance.  After the termination of the Executive’s
employment for any reason, for so long as the Executive is receiving any
payments pursuant to this Agreement, the Executive shall cooperate, at the
reasonable request of the Company or any of its subsidiaries, (i) in the
transition of any matter for which the Executive had authority or
responsibility during the Employment Period, or (ii) with respect to any
other matter involving the Company or any of its subsidiaries for which the
Executive may be of assistance.  Any such
cooperation required from the Executive shall take into account any
responsibilities to which the Executive is subject to a subsequent employer or
otherwise.


 














 


10.           Miscellaneous.


 


(a)           This Agreement shall be
governed by, and construed in accordance with, the laws of the State of New
Jersey, applicable to agreements made and to be performed entirely within such
state.  The captions of this Agreement
are not part of the provisions hereof and shall have no force or effect.  This Agreement may not be amended or modified
except by a written agreement executed by the parties hereto or their
respective successors and legal representatives.


 


(b)           All notices and other communications
under this Agreement shall be in writing and shall be given by hand delivery to
the other party or by registered or certified mail, return receipt requested,
postage prepaid, addressed as follows:


 


If
to the Executive, to the Executive’s address as

maintained by the Company.


 


If
to the Company:


 


Ikaria
Holdings, Inc.

6 Route 173

Clinton, New Jersey 08809

Telephone: (908) 238-6600

Facsimile: (908) 238-6699

Attention: General Counsel


 


or to such other address as either party furnishes
to the other in writing in accordance with this Section 10.  Notices and communications shall be effective
when actually received by the addressee.


 


(c)           The invalidity or
unenforceability of any provision of this Agreement shall not affect the
validity or enforceability of any other provision of this Agreement.  If any provision of this Agreement shall be
held invalid or unenforceable in part, the remaining portion of such provision,
together with all other provisions of this Agreement, shall remain valid and
enforceable and continue in full force and effect to the fullest extent
consistent with law, and the invalid or unenforceable provision shall be deemed
to have been redrafted as if in the original, so as to be valid and enforceable
to the maximum extent permissible under applicable law.


 


(d)           Notwithstanding any other
provision of this Agreement, the Company may withhold from amounts payable
under this Agreement all federal, state, local and foreign taxes that are
required to be withheld by applicable laws or regulations.


 


(e)           The failure of the Executive
or the Company to insist upon strict compliance with any provision of, or to
assert any right under, this Agreement shall not be deemed to be a waiver of
such provision or right or of any other provision of or right under this
Agreement.


 


(f)            The Executive and the
Company acknowledge that this Agreement represents the complete agreement
between the parties and supersedes any other agreement


 

















 


between
them concerning the subject matter hereof, including the Original Agreement.  This Agreement may not be modified except by
express written agreement between the parties.


 


(g)           This Agreement may be
executed in one or more counterparts, each of which shall be deemed an
original, and which together shall constitute one instrument.


 


(h)           Whenever this Agreement
provides for any payment to the Executive’s estate, such payment may be made
instead to such beneficiary or beneficiaries as the Executive may designate by
written notice to the Company.  The
Executive shall have the right to revoke any such designation and to
redesignate a beneficiary or beneficiaries by written notice to the Company
(and to any applicable insurance company) to such effect.


 


(i)            The Executive represents and
warrants to the Company that this Agreement is legal, valid and binding upon
the Executive and the execution of this Agreement and the performance of the
Executive’s obligations hereunder does not and will not constitute a breach of,
or conflict with the terms or provisions of, any agreement or understanding to
which the Executive is a party (including, without limitation, any other
employment agreement).  The Company
represents and warrants to the Executive that this Agreement is legal, valid
and binding upon the Company and the execution of this Agreement and the
performance of the Company’s obligations hereunder does not and will not
constitute a breach of, or conflict with the terms or provisions of, any
agreement or understanding to which the Company is a party.


 


(j)            Neither the Executive, his
legal representative nor any beneficiary designated by the Executive shall have
any right, without the prior written consent of the Company, to assign,
transfer, pledge, hypothecate, anticipate or commute to any person or entity
any payment due in the future pursuant to any provision of this Agreement, and
any attempt to do so shall be void and shall not be recognized by the Company.


 


(k)           Each party (i) hereby
irrevocably submits itself to and acknowledges and recognizes the jurisdiction
of the courts of the State of New Jersey in the County of Hunterdon (which
court, together with all applicable appellate courts, for purposes of this
Agreement, are the only “courts of competent jurisdiction”), for the purpose of
any suit, action or other proceeding arising out of, under, or in connection
with, relating to, or based upon this Agreement, (ii) agrees that any
service of process in connection with any such suit, action or other proceeding
may be made upon it by means of the United States mail or such other service as
may be authorized by any such court, (iii) agrees that the courts of
competent jurisdiction shall be the sole and exclusive courts and forums for
the purpose of any such suit, action or proceeding and (iv) waives and
agrees not to assert, by way of motion, as a defense, or otherwise, in any such
suit, action or proceeding, any claim that it is not subject to the
jurisdiction of courts of competent jurisdiction, that such suit, action or
proceeding is brought in an inconvenient forum, that the venue of the suit,
action or proceeding is improper or that this Agreement or the subject matter
hereof may not be enforced in or by such court. 
Each party agrees that its submission to jurisdiction and its consent to
service of process by mail is made for the express benefit of the other party.


 


(l)            Each of the parties has been
represented by counsel (or has had the opportunity to be so represented) in the
negotiation and preparation of this Agreement. 
The


 

















 


parties
agree that this Agreement is to be construed as jointly drafted.  Accordingly, this Agreement will be construed
according to the fair meaning of its language, and the rule of
construction that ambiguities are to be resolved against the drafting party
will not be employed in the interpretation of this Agreement.


 


(m)          The Executive acknowledges
and agrees that the Company may satisfy its obligations to make payments to the
Executive under this Agreement by causing one or more of its subsidiaries to
make such payments to the Executive.  The
Executive agrees that any such payment made by any such subsidiary shall fully
satisfy and discharge the Company’s obligation to make such payment to the
Executive hereunder (but only to the extent of such payment).


 


(n)           Notwithstanding the
expiration or termination of this Agreement, the provisions of Sections 6, 7, 9
and 10 of the Agreement shall continue in full force and effect and remain
fully binding upon the parties.


 


11.           Gross-Up Payment.


 


(i)            To the extent that any (a) severance
payment, (b) transaction or other bonus payment, (c) payment under
any transaction or other incentive plan, (d) payment related to equity or
made under an equity incentive program, or (e) other amounts or payments
of any type or kind whatsoever, in the nature of compensation (within the meaning
of Section 280G of the Internal Revenue Code of 1986, as amended, and the
regulations promulgated thereunder (“Section 280G”)) or otherwise
to or for the benefit of the Executive under this Agreement, or any other
agreement or plan, or otherwise (or any part of such amount or other payment)
(collectively, “Payments”), in any case constitutes an “excess parachute
payment” within the meaning of Section 280G and Section 4999 of the
Internal Revenue Code (“Section 4999”), then the Company shall pay
to the Executive an additional sum (“Gross-Up Payment”) such that, after
all taxes applicable to the receipt of such amount have been subtracted
therefrom, the remaining amount will equal the sum of the amount of tax imposed
with respect to the “excess parachute payments,” plus any interest and
penalties thereon (other than those caused solely by Executive’s action or
inaction).  Therefore, the effect shall
be to maintain the Executive in the same financial position that he would have
been in had no tax under Section 4999 been imposed.  All payments and reimbursements to which the
Executive is entitled under this Section 11 shall be made not later than April 15
of the taxable year of the Executive next following the taxable year of the
Executive in which the Executive receives amounts subject to Section 4999.


 


(ii)           Notwithstanding the
immediately preceding paragraph, in the event that a reduction to the Payments
in respect of the Executive of 10% or less, but not more than $250,000, would
cause none of the Payments to be “excess parachute payments,” the Executive
will not be entitled to a Gross-Up Payment and the Payments shall be reduced to
the extent necessary so that none of the Payments shall be “excess parachute
payments.” Unless the Executive shall have given prior written notice to the
Company specifying a different order by which to effectuate the foregoing, the
Company shall reduce or eliminate the Payments (x) by first reducing or
eliminating the portion of the Payments which are not payable in cash (other than
that portion of the Payments subject to clause (z) hereof), (y) then
by reducing or eliminating cash payments (other than that portion of the
Payments subject to clause (z) hereof) and (z) then by reducing or
eliminating the portion of the Payments (whether payable in cash or


 

















 


not
payable in cash) to which Treasury Regulation § 1.280G-1 Q/A 24(c) (or
successor thereto) applies, in each case in reverse order beginning with
payments or benefits which are to be paid the farthest in time from the date of
the Change in Control.  Any notice given
by the Executive pursuant to the preceding sentence shall take precedence over
the provisions of any other plan, arrangement or agreement governing the
Executive’s rights and entitlements to any benefits or compensation.


 


(iii)          The provisions of this Section 11
shall expire, and shall be of no further force or effect, on December 31,
2010.


 


[SIGNATURE PAGE FOLLOWS]


 

















 


IN WITNESS WHEREOF, the
Executive has hereunto set the Executive’s hand and, pursuant to the authorization
of its Board, the Company has caused this Agreement to be executed in its name
on its behalf, all as of the day and year first above written.


 


	
  EXECUTIVE

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ Michael Kennedy

  	
   

  
	
  By:

  	
  Michael Kennedy

  	
   

  
	
  Title:

  	
  Senior Vice President,
  Engineering & Operations

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  IKARIA HOLDINGS, INC.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Daniel Tassé

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  Daniel Tassé

  	
   

  
	
  Title:

  	
  President & Chief
  Executive Officer

  	
   

  



 


 


Exhibits:


A: Form of Waiver and Release of Claims


B: Disclosed Work Product and Business Opportunities


 

















 


Exhibit A


Form of
Waiver and Release of Claims


 


WAIVER AND RELEASE OF
CLAIMS


 


1.             General Release.  In consideration of the payments and benefits
to be made under the Amended and Restated Employment Agreement, dated as of June 1,
2009, to which Ikaria Holdings, Inc. (the “Company”) and Michael
Kennedy (the “Executive”) are parties (the “Employment Agreement”),
the Executive, with the intention of binding the Executive and the Executive’s
heirs, executors, administrators and assigns, does hereby release, remise,
acquit and forever discharge the Company and each of its subsidiaries and
affiliates (the “Company Affiliated Group”), their present and former
officers, directors, executives, agents, shareholders, attorneys, employees and
employee benefits plans (and the fiduciaries thereof), and the successors,
predecessors and assigns of each of the foregoing (collectively, the “Company
Released Parties”), of and from any and all claims, actions, causes of
action, complaints, charges, demands, rights, damages, debts, sums of money,
accounts, financial obligations, suits, expenses, attorneys’ fees and
liabilities of whatever kind or nature in law, equity or otherwise, whether
accrued, absolute, contingent, unliquidated or otherwise and whether now known,
unknown, suspected or unsuspected which the Executive, individually or as a
member of a class, now has, owns or holds, or has at any time heretofore had,
owned or held, against any Company Released Party (an “Action”) arising
out of or in connection with the Executive’s service as an employee, officer
and/or director to any member of the Company Affiliated Group (or the
predecessors thereof), including (i) the termination of such service in
any such capacity, (ii) for severance or vacation benefits, unpaid wages,
salary or incentive payments, (iii) for breach of contract, wrongful
discharge, impairment of economic opportunity, defamation, intentional
infliction of emotional harm or other tort and (iv) for any violation of
applicable state and local labor and employment laws (including, without
limitation, all laws concerning harassment, discrimination, retaliation and
other unlawful or unfair labor and employment practices), any and all Actions
based on the Employee Retirement Income Security Act of 1974 (“ERISA”),
and any and all Actions arising under the civil rights laws of any federal,
state or local jurisdiction, including, without limitation, Title VII of the
Civil Rights Act of 1964 (“Title VII”), the Americans with Disabilities
Act (“ADA”).  Sections 503 and 504
of the Rehabilitation Act, the Family and Medical Leave Act and the Age
Discrimination in Employment Act (“ADEA”), excepting only:


 


(a)                                  rights of the Executive
under this Waiver and Release of Claims and the Employment Agreement;


 


(b)                                 rights of the Executive relating
to equity awards held by the Executive as of his date of termination;


 


(c)                                  the right of the Executive
to receive COBRA continuation coverage in accordance with applicable law and
the Employment Agreement;


 


(d)                                 rights to indemnification
the Executive may have (i) under applicable corporate law, (ii) under
the by-laws or certificate of incorporation of any 


 

















 


Company
Released Party or (iii) as an insured under any director’s and officer’s
liability insurance policy now or previously in force;


 


(e)                                  claims (i) for benefits
under any health, disability, retirement, deferred compensation, life insurance
or other, similar employee benefit plan or arrangement of the Company
Affiliated Group and (ii) for earned but unused vacation pay through the
date of termination in accordance with applicable Company policy; and


 


(f)                                    claims for the reimbursement
of unreimbursed business expenses incurred prior to the date of termination
pursuant to applicable Company policy.


 


2.             No Admissions, Complaints or
Other Claims.  The
Executive acknowledges and agrees that this Waiver and Release of Claims is not
to be construed in any way as an admission of any liability whatsoever by any
Company Released Party, any such liability being expressly denied.  The Executive also acknowledges and agrees
that he has not, with respect to any transaction or state of facts existing
prior to the date hereof, filed any Actions against any Company Released Party
with any governmental agency, court or tribunal.


 


3.             Application to all Forms of
Relief.  This Waiver and Release of
Claims applies to any relief no matter how called, including, without
limitation, wages, back pay, front pay, compensatory damages, liquidated
damages, punitive damages for pain or suffering, costs and attorney’s fees and
expenses.


 


4.             Specific Waiver.  The Executive specifically acknowledges that
his acceptance of the terms of this Waiver and Release of Claims is, among
other things, a specific waiver of any and all Actions under Title VII, ADEA,
ADA and any state or local law or regulation in respect of discrimination of
any kind; provided, however, that nothing herein shall be deemed,
nor does anything herein purport, to be a waiver of any right or Action which
by law the Executive is not permitted to waive.


 


5.             Voluntariness.  The Executive acknowledges and agrees that he
is relying solely upon his own judgment; that the Executive is over eighteen
years of age and is legally competent to sign this Waiver and Release of
Claims; that the Executive is signing this Waiver and Release of Claims of his
own free will; that the Executive has read and understood the Waiver and
Release of Claims before signing it; and that the Executive is signing this
Waiver and Release of Claims in exchange for consideration that he believes is
satisfactory and adequate.  The Executive
also acknowledges and agrees that he has been informed of the right to consult
with legal counsel and has been encouraged to do so.


 


6.             Complete
Agreement/Severability.  This
Waiver and Release of Claims constitutes the complete and final agreement
between the parties and supersedes and replaces all prior or contemporaneous
agreements, negotiations, or discussions relating to the subject matter of this
Waiver and Release of Claims.  All
provisions and portions of this Waiver and Release of Claims are
severable.  If any provision or portion
of this Waiver and Release of Claims or the application of any provision or
portion of the Waiver and Release of Claims shall be determined to be invalid
or unenforceable to any extent or for any reason, all other provisions and
portions of 


 

















 


this
Waiver and Release of Claims shall remain in full force and shall continue to
be enforceable to the fullest and greatest extent permitted by law.


 


7.             Acceptance and Revocability.  The Executive acknowledges that he has been
given a period of 21 days within which to consider this Waiver and Release of
Claims, unless applicable law requires a longer period, in which case the
Executive shall be advised of such longer period and such longer period shall
apply.  The Executive may accept this
Waiver and Release of Claims at any time within this period of time by signing
the Waiver and Release of Claims and returning it to the Company.  This Waiver and Release of Claims shall not
become effective or enforceable until seven calendar days after the Executive
signs it.  The Executive may revoke his
acceptance of this Waiver and Release of Claims at any time within that seven
calendar day period by sending written notice to the Company.  Such notice must be received by the Company
within the seven calendar day period in order to be effective and, if so
received, would void this Waiver and Release of Claims for all purposes.


 


8.             Governing Law.  Except for issues or matters as to which
federal law is applicable, this Waiver and Release of Claims shall be governed
by and construed and enforced in accordance with the laws of the State of New
Jersey without giving effect to the conflicts of law principles thereof.


 


 


	
   

  	
   

  



 

















 


Exhibit B


Disclosed
Work Product and Business Opportunities


 


NONE