Document:

vtae_Ex10_33

		

			Exhibit 10.33

		

		
			Vitae Pharmaceuticals, Inc.

Management Cash Incentive Plan

(As Amended and restated Effective June 28, 2016)
		

		
			 
		

		
			 
		

		
			

		 

		

			 

		

		

			 

		

 

		

			 

		

TABLE OF CONTENTS
		

		
			Page
		

			
					
						 

					
					
						 

					
					
						 

				
	
					
						ARTICLE 1.

					
					
						BACKGROUND AND PURPOSE

					
1 
				
	
					
						1.1

					
					
						Effective Date

					
1 
				
	
					
						1.2

					
					
						Purpose of the Plan

					
1 
				
	
					
						ARTICLE 2.

					
					
						DEFINITIONS

					
1 
				
	
					
						ARTICLE 3.

					
					
						SELECTION OF PARTICIPANTS AND DETERMINATION OF AWARDS

					
3 
				
	
					
						3.1

					
					
						Selection of Participants

					
3 
				
	
					
						3.2

					
					
						Determination of Performance Goals

					
3 
				
	
					
						3.3

					
					
						Determination of Target Awards

					
3 
				
	
					
						3.4

					
					
						Determination of Payout Formula or Formulae

					
3 
				
	
					
						3.5

					
					
						Determination of Actual Awards

					
3 
				
	
					
						3.6

					
					
						Adjustments

					
4 
				
	
					
						ARTICLE 4.

					
					
						PAYMENT OF AWARDS

					
4 
				
	
					
						4.1

					
					
						Right to Receive Payment

					
4 
				
	
					
						4.2

					
					
						Timing of Payment

					
4 
				
	
					
						4.3

					
					
						Form of Payment

					
4 
				
	
					
						4.4

					
					
						Payment in the Event of Death

					
4 
				
	
					
						ARTICLE 5.

					
					
						ADMINISTRATION

					
4 
				
	
					
						5.1

					
					
						Committee Authority

					
4 
				
	
					
						5.2

					
					
						Decisions Binding

					
5 
				
	
					
						5.3

					
					
						Delegation by the Committee

					
5 
				
	
					
						ARTICLE 6.

					
					
						GENERAL PROVISIONS

					
5 
				
	
					
						6.1

					
					
						Tax Withholding

					
5 
				
	
					
						6.2

					
					
						No Effect on Employment

					
5 
				
	
					
						6.3

					
					
						No Effect on Other Benefits

					
5 
				
	
					
						6.4

					
					
						Successors

					
5 
				
	
					
						6.5

					
					
						Nontransferability of Awards

					
5 
				
	
					
						ARTICLE 7.

					
					
						DURATION, AMENDMENT AND TERMINATION

					
5 
				
	
					
						7.1

					
					
						Duration of the Plan

					
5 
				
	
					
						7.2

					
					
						Amendment, Suspension or Termination

					
6 
				
	
					
						ARTICLE 8.

					
					
						LEGAL CONSTRUCTION

					
6 
				
	
					
						8.1

					
					
						Severability

					
6 
				
	
					
						8.2

					
					
						Requirements of Law

					
6 
				
	
					
						8.3

					
					
						Governing Law

					
6 
				
	
					
						8.4

					
					
						Captions

					
6 
				
	
					
						Appendix A  Performance Metrics

					
7 
				

		
			 
		

		
			 
		

		
			

		 

		

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			Vitae Pharmaceuticals, Inc.
Management Cash Incentive Plan
		

		
			ARTICLE 1.BACKGROUND AND PURPOSE 
		

		
			1.1Effective Date.  The Plan was amended and restated by the Committee on the date set forth above, became effective immediately and is not subject to approval by the Company’s stockholders.    
		

		
			1.2Purpose of the Plan.  The Plan is intended to motivate Participants to achieve excellent short- and long-term financial performance for the Company and its business units.  The Plan provides Participants with the opportunity to earn cash incentive awards for the achievement of goals relating to the performance of the Company. 
		

		
			ARTICLE 2.DEFINITIONS 
		

		
			The following words and phrases shall have the following meanings, unless a different meaning is plainly required by the context: 
		

		
			2.1“Actual Award” means, as to any Performance Period, the actual award (if any) payable to a Participant for the Performance Period.  Each Actual Award is determined by the Payout Formula for the Performance Period, subject to the Committee’s authority under Section 3.5 to increase, eliminate or reduce the award otherwise indicated by the Payout Formula. 
		

		
			2.2“Affiliate” means any corporation or other entity (including, without limitation, partnerships and joint ventures) controlled by the Company. 
		

		
			2.3“Base Salary” means, as to any Performance Period, the Participant’s earned salary during the Performance Period.  Base Salary shall be calculated before both (a) deductions for taxes or benefits and (b) deferrals of compensation pursuant to Company-sponsored plans or Affiliate-sponsored plans. 
		

		
			2.4“Board” means the Company’s Board of Directors. 
		

		
			2.5“Committee” means the Compensation Committee of the Board. 
		

		
			2.6“Company” means Vitae Pharmaceuticals, Inc., a Delaware corporation, or any successor thereto. 
		

		
			2.7“Disability” means a permanent disability, as determined for purposes of the principal long-term disability insurance plan maintained by the Company for the benefit of the Participant.  If there is no such plan, Disability shall be determined in accordance with a policy established by the Committee. 
		

		
			
		

		 

		

			 

		

 

		
			2.8“Employee” means any employee of the Company or of an Affiliate, whether such employee is so employed when the Plan is adopted or becomes so employed after the adoption of the Plan. 
		

		
			2.9“Fiscal Quarter” means a fiscal quarter within a Fiscal Year of the Company. 
		

		
			2.10“Fiscal Year” means the fiscal year of the Company. 
		

		
			2.11“Participant” means, as to any Performance Period, an Employee who has been selected for participation in the Plan for that Performance Period pursuant to Section 3.1.  
		

		
			2.12“Payout Formula” means, as to any Performance Period, the formula or payout matrix established by the Committee pursuant to Section 3.4 in order to determine the Actual Awards (if any) to be paid to Participants.  The formula or matrix may differ from Participant to Participant. 
		

		
			2.13“Performance Period” means a Fiscal Year, or any longer or shorter period determined by the Committee. 
		

		
			2.14“Performance Goals” means the goal(s) determined by the Committee to be applicable to a Participant for a Target Award for a Performance Period.  As determined by the Committee, the Performance Goal(s) may provide for a targeted level or levels of achievement using the performance criteria specified by the Committee.  Such criteria shall be based on one or more of the performance metrics set forth in Appendix A attached to the Plan.
		

		
			2.15“Plan” means this Vitae Pharmaceuticals, Inc. Management Cash Incentive Plan, as set forth in this instrument and as hereafter amended from time to time. 
		

		
			2.16“Progress Payment” means a portion of the Target Award or Actual Award determined in accordance with Section 3.5 that has been earned by the Participant as of the end of the Progress Period, based on achievement of the applicable Performance Goals, and that may be paid to the Participant during the Performance Period. 
		

		
			2.17“Progress Period” means a period shorter than and within the Performance Period for which a Progress Payment may be made. 
		

		
			2.18“Retirement” means, with respect to any Participant, a Termination of Employment occurring in accordance with a policy or policies established by the Committee from time to time. 
		

		
			2.19“Target Award” means the target award payable under the Plan to a Participant for the Performance Period or Progress Period, as applicable, expressed as a percentage of his or her Base Salary or a specific dollar amount, as determined by the Committee in accordance with Section 3.3.  
		

		
			
		

		 

		

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			2.20“Termination of Employment” means a cessation of the employee-employer relationship between an Employee and the Company or an Affiliate for any reason, including (without limitation) a termination by resignation, discharge, death, Disability, Retirement or the disaffiliation of an Affiliate, but excluding a transfer from the Company to an Affiliate or between Affiliates. 
		

		
			ARTICLE 3.SELECTION OF PARTICIPANTS AND DETERMINATION OF AWARDS 
		

		
			3.1Selection of Participants.  The Committee shall select the Employees who shall be Participants for any Performance Period.  The Committee also may designate as Participants one or more individuals (by name or position) who are expected to become Employees during a Performance Period.  Participation in the Plan is in the sole discretion of the Committee and shall be determined Performance Period by Performance Period.  Accordingly, an Employee who is a Participant for a given Performance Period is in no way assured of being selected for participation in any subsequent Performance Period. 
		

		
			3.2Determination of Performance Goals.  The Committee shall establish the Performance Goals for each Participant for the Performance Period.  Such Performance Goals shall be set forth in writing and shall be based on one or more of the performance metrics set forth in Appendix A attached to the Plan.  Any criteria used may be measured (a) in absolute terms, (b) in relative terms, including (without limitation) the passage of time and/or against other companies or metrics, (c) on a per-share basis, (d) against the performance of the Company as a whole or against particular segments or products of the Company and/or (e) on a pre-tax or after-tax basis.  Any Performance Goal may be measured on a basis other than generally accepted accounting principles.
		

		
			3.3Determination of Target Awards.  The Committee shall establish a Target Award for each Participant for each Performance Period.  Such Target Award shall be set forth in writing. 
		

		
			3.4Determination of Payout Formula or Formulae.  The Committee shall establish a Payout Formula or Formulae for purposes of determining the Actual Award (if any) payable to each Participant.  Each Payout Formula shall (a) be in writing, (b) be based on a comparison of actual performance to the Performance Goals, (c) provide for the payment of a Participant’s Target Award if the Performance Goals for the Performance Period are achieved at the predetermined level and (d) provide for the payment of an Actual Award greater than or less than the Participant’s Target Award. 
		

		
			3.5Determination of Actual Awards.  After the end of each Performance Period or, to the extent that Progress Payments will be made, after the end of each Progress Period, the Committee shall certify the extent to which the Performance Goals applicable to each Participant for the Performance Period or Progress Period, as applicable, were achieved or exceeded, as determined by the Committee.  The Actual Award for each Participant shall be determined by applying the Payout Formula to the level of actual performance that has been certified by the Committee.  Any contrary provision of the Plan notwithstanding, the Committee may (a)  reduce or eliminate the Actual Award that otherwise would be payable under the Payout 

		 

		

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Formula or (b) determine whether or not any Participant will receive an Actual Award or Progress Payment in the event that the Participant incurs a Termination of Employment before such Actual Award or Progress Payment is to be paid pursuant to Section 4.2.  
		

		
			3.6Adjustments.  The Committee may adjust the results under any Performance Goal to exclude any of the following events that occurs during a Performance Period: (a) asset write-downs, (b) litigation, claims, judgments or settlements, (c) the effect of changes in tax law, accounting principles or other such laws or provisions affecting reported results, (d) accruals for reorganization and restructuring programs, (e) mergers or acquisitions and (f) any other extraordinary, unusual or non-recurring items. 
		

		
			ARTICLE 4.PAYMENT OF AWARDS 
		

		
			4.1Right to Receive Payment.  Each Actual Award or Progress Payment that may become payable under the Plan shall be paid solely from the general assets of the Company or the Affiliate that employs the Participant (as the case may be), as determined by the Company.  No amounts awarded or accrued under the Plan shall be funded, set aside or otherwise segregated prior to payment.  The obligation to pay Actual Awards or Progress Payments under the Plan shall at all times be an unfunded and unsecured obligation of the Company.  Participants shall have the status of general creditors of the Company or the Affiliate that employs the Participant. 
		

		
			4.2Timing of Payment.  Subject to Section 3.5, payment of each Actual Award or Progress Payment shall be made as soon as administratively practicable, but in no event later than two and one-half months after the end of the applicable Performance Period or Progress Period, as the case may be. 
		

		
			4.3Form of Payment.  Each Actual Award or Progress Payment shall be paid in cash (or its equivalent) in a single lump sum. 
		

		
			4.4Payment in the Event of Death.  If a Participant dies before receiving an Actual Award or Progress Payment (determined under Section 3.5) that was scheduled to be paid before his or her death for a prior Performance Period or Progress Period, then the Actual Award or Progress Payment shall be paid to the Participant’s designated beneficiary or, if no beneficiary has been designated, to the administrator or representative of his or her estate.  Any beneficiary designation or revocation of a prior designation shall be effective only if it is in writing, signed by the Participant and received by the Company prior to the Participant’s death.
		

		
			ARTICLE 5.ADMINISTRATION 
		

		
			5.1Committee Authority.  The Plan shall be administered by the Committee, subject to Section 5.3.  The Committee shall have all powers and discretion necessary or appropriate to administer the Plan and to control its operation, including (without limitation) the power to (a) determine which Employees shall be granted awards, (b) prescribe the terms and conditions of the awards, (c) interpret the Plan, (d) adopt such procedures and sub-plans as are necessary or appropriate to permit participation in the Plan by Employees who are foreign nationals or employed outside of the United States, (e) adopt rules for the administration, interpretation and application of the Plan and (f) interpret, amend or revoke any such rules. 
		

		
			
		

		
			

		 

		

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5.2Decisions Binding.  All determinations and decisions made by the Committee, the Board or any delegate of the Committee pursuant to the provisions of the Plan shall be final, conclusive and binding on all persons and shall be given the maximum deference permitted by law. 
		

		
			5.3Delegation by the Committee.  The Committee, on such terms and conditions as it may provide, may delegate all or part of its authority and powers under the Plan to one or more directors and/or employees of the Company. 
		

		
			ARTICLE 6.GENERAL PROVISIONS 
		

		
			6.1Tax Withholding.  The Company or an Affiliate, as applicable, shall withhold all required taxes from an Actual Award or Progress Payment, including any federal, state, local or other taxes. 
		

		
			6.2No Effect on Employment.  Nothing in the Plan shall interfere with or limit in any way the right of the Company or an Affiliate, as applicable, to terminate any Participant’s employment or service at any time, with or without cause.  Employment with the Company and its Affiliates is on an at-will basis only.  The Company expressly reserves the right, which may be exercised at any time and without regard to when during or after a Performance Period such exercise occurs, to terminate any individual’s employment with or without cause, and to treat him or her without regard to the effect that such treatment might have upon him or her as a Participant. 
		

		
			6.3No Effect on Other Benefits.  Except as expressly set forth in a Participant’s employment agreement with the Company, any Actual Awards or Progress Payments under the Plan shall not be considered for the purpose of calculating any other benefits to which such Participant may be entitled, including (a) any termination, severance, redundancy or end-of-service payments, (b) other bonuses or long-service awards, (c) overtime premiums, (d) pension or retirement benefits or (e) future Base Pay or any other payment to be made by the Company to such Participant.
		

		
			6.4Successors.  All obligations of the Company and any Affiliate under the Plan, with respect to awards granted hereunder, shall be binding on any successor to the Company and/or such Affiliate, whether the existence of such successor is the result of a merger, consolidation, direct or indirect purchase of all or substantially all of the business or assets of the Company or such Affiliate, or any similar transaction. 
		

		
			6.5Nontransferability of Awards.  No award granted under the Plan shall be sold, transferred, pledged, assigned or otherwise alienated or hypothecated, other than by will, by the laws of descent and distribution or to the limited extent provided in Section 4.4.  All rights with respect to an award granted to a Participant shall be available during his or her lifetime only to the Participant. 
		

		
			ARTICLE 7.DURATION, AMENDMENT AND TERMINATION 
		

		
			7.1Duration of the Plan.  The Plan shall commence on the date specified herein and shall remain in effect thereafter until terminated pursuant to Section 7.2.  
		

		
			
		

		
			

		 

		

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7.2Amendment, Suspension or Termination.  The Board or the Committee may amend, suspend or terminate the Plan, or any part thereof, at any time and for any reason.  No award may be granted during any period of suspension or after termination of the Plan. 
		

		
			ARTICLE 8.LEGAL CONSTRUCTION 
		

		
			8.1Severability.  In the event any provision of the Plan shall be held illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining parts of the Plan, and the Plan shall be construed and enforced as if the illegal or invalid provision had not been included. 
		

		
			8.2Requirements of Law.  The granting of awards under the Plan shall be subject to all applicable laws, rules and regulations, and to such approvals by any governmental agencies or national securities markets as may be required. 
		

		
			8.3Governing Law.  The Plan and all awards shall be construed in accordance with and governed by the laws of the Commonwealth of Pennsylvania, without regard to their conflict-of-law provisions. 
		

		
			8.4Captions.  Captions are provided herein for convenience only and shall not serve as a basis for interpretation or construction of the Plan.
		

		
			
		

		
			

		 

		

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			Appendix A

Performance Metrics
		

		
			The Committee may establish Performance Goals derived from the following metrics:
		

			
	
			
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			Backlog

			
	
			
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			Bookings (including annual or total contract value bookings)

			
	
			
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			Cash

			
	
			
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			Cash and short-term investments

			
	
			
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			Cash flow return on investment

			
	
			
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			Comparisons with various stock market indices

			
	
			
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			Deferred revenue

			
	
			
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			Earnings or earnings per share (including earnings before taxes, earnings before interest and taxes or earnings before interest, taxes, depreciation and amortization)

			
	
			
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			Expenses or expense reductions

			
	
			
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			Free cash flow or free cash flow per share

			
	
			
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			Gross profits

			
	
			
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			Headcount

			
	
			
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			Implementation, completion or attainment of measurable objectives with respect to research, development, products, regulatory approvals, projects or recruiting and maintaining personnel

			
	
			
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			Market share

			
	
			
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			Net income (before or after taxes)

			
	
			
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			Operating margin or cash margin

			
	
			
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			Operating profit/loss (on a GAAP or non-GAAP basis)

			
	
			
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			Pre- or after-tax income (before or after allocation of corporate overhead and bonus)

			
	
			
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			Reductions in costs

			
	
			
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			Return on equity

			
	
			
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			Revenue

			
	
			
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			Stock price

			
	
			
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			Total expenses

			
	
			
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			Total stockholder return

			
	
			
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			Working capital

			
	
			
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			Increases or growth in any of the foregoing

		 

		

			7vtae_Ex10_34

		
			Exhibit 10.34
		

		
			 
		

		
			EMPLOYMENT AGREEMENT
		

		
			 
		

		
			EMPLOYMENT AGREEMENT (“Agreement”) dated as of August 3, 2016, by and between Vitae Pharmaceuticals, Inc., a Delaware corporation (the “Company”), and Jeffrey Hatfield (the “Executive”).
		

		
			 
		

		
			WHEREAS, the Company wishes to continue to employ the Executive to serve as the Company’s Chief Executive Officer and President, and the Executive is willing to continue to be employed and to serve in such capacity; 
		

		
			 
		

		
			WHEREAS, the Company and Executive previously entered into an offer letter dated February 25, 2004 and subsequently amended on July 21, 2008 and September 4, 2013 (together, the “Offer Letter”), whereby the Executive was employed as the Company’s Chief Executive Officer and President; and 
		

		
			 
		

		
			WHEREAS, the Company and the Executive wish to supersede the Offer Letter and set forth terms of the Executive’s employment by the Company as set forth in this Agreement. 
		

		
			 
		

		
			NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth, the parties hereto, each intending to be legally bound, do hereby agree as follows:
		

		
			 
		

		
			1.Employment, Duties and Acceptance.
		

		
			1.1.Employment; Duties.  The Executive shall serve as Chief Executive Officer and President, and to perform such other duties consistent with such positions (including service as a director or officer of the Company) as may be assigned by the Company’s Board of Directors (the “Board”) from time to time. The Executive’s title shall be Chief Executive Officer and President.  For so long as he is Chief Executive Officer and President of the Company, the Company agrees that it will nominate the Executive for re-election to the Board at the expiration of each term of office and that the Executive shall serve as a member of the Board for each period for which he is so elected or appointed. 
		

		
			1.2.Acceptance.  The Executive hereby accepts such employment and agrees to render the services described above on an exclusive basis to the Company. During the Term, and consistent with Section 1.1, the Executive agrees to serve the Company faithfully and to the best of the Executive’s ability and to use the Executive’s best efforts, skill and ability to promote the interests of the Company in a manner consistent with the Executive’s position. The Executive also agrees to devote the Executive’s entire business time, energy and skill to such employment, except for vacation time, absence for sickness or similar disability, and time spent performing services for any charitable, religious or community organizations, so long as such services do not materially interfere with the performance of the Executive’s duties hereunder or create a conflict of interest other than current board of director positions held by Executive and disclosed in Exhibit A. The Executive may not serve on the board of directors of any other for-profit business or organization without the prior consent of the Board. In consideration for the substantial consideration provided for herein and as a condition to this Agreement, the Executive agrees to 
		

		
			 
		

		 

 

		
			be bound by the terms of the Proprietary Information and Inventions Agreement attached hereto as Exhibit B.
		

		
			1.3.Compliance with Policies.  The Executive shall comply with all duly adopted Company policies and codes of conduct and ethics in the performance of the Executive’s duties, as such policies may be in effect from time to time and which have been previously provided to the Executive in writing or otherwise made available to him. 
		

		
			1.4.Location.  The duties to be performed by the Executive hereunder shall be performed primarily at the Company’s offices in Fort Washington, Pennsylvania, subject to reasonable travel requirements consistent with the nature of the Executive’s duties from time to time on behalf of the Company.  
		

		
			2.Term of Employment.
		

		
			The term of the Executive’s employment under this Agreement (the “Term”) shall commence on the Effective Date, and shall end when terminated in accordance with Section 4.1. 
		

		
			 
		

		
			3.Compensation and Benefits.
		

		
			3.1.Salary.  During the Term, the Company agrees to pay to the Executive a base salary, payable in arrears in accordance with the Company’s standard payroll practices, at the initial annual rate of $489,250 (as adjusted in accordance with this Section 3.1, the “Base Salary”). The Executive’s Base Salary may be increased as determined by the Compensation Committee of the Board (the “Committee”). All payments of Base Salary or other compensation hereunder shall be less such deductions or withholdings as are required by applicable law and regulations.
		

		
			3.2.Annual Bonus.  For each calendar year that ends during the Term, the Executive shall be entitled to participate in the Company’s annual bonus plan as may be adopted by the Company for senior executives of the Company (the “Bonus Program”). The Executive’s annual bonus under the Bonus Program for any year is herein referred to as the “Annual Bonus” and, except for any applicable Company and individual goals, shall otherwise only be conditioned upon the Executive remaining employed by the Company through the last business day of the fiscal year in which the award was earned; provided that nothing contained herein shall be construed to limit the Committee’s authority to adjust the Annual Bonus in accordance with the Bonus Program. 
		

		
			3.3.Business Expenses.  The Company shall pay or reimburse the Executive for all reasonable expenses actually incurred or paid by the Executive in the performance of the Executive’s services to the Company or its Affiliates, subject to and in accordance with applicable expense reimbursement and related policies and procedures as in effect from time to time.  
		

		
			3.4.Vacation.  The Executive shall be entitled to an annual paid vacation in accordance with the applicable vacation policy, as in effect from time to time. Under the Company’s vacation policy in effect as of the Effective Date, the Executive is entitled to take up to twenty (20) days per calendar year. 
		

		
			
		

		 

		

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			3.5.Employee Savings, Health and Welfare Plans; Perquisites.  The Executive (and, to the extent eligible, the Executive’s dependents and beneficiaries) shall be entitled to participate in all employee benefit plans of the Company, including its savings, health and welfare benefit plans and executive perquisites, as in effect from time to time, and on a basis no less favorable than any other senior executive (or the dependents and beneficiaries of other senior executives, as applicable). 
		

		
			3.6.Clawback.  The Executive agrees that any amount payable to him pursuant to annual bonus plan or any of Company equity plan or any other similar performance-based compensation may be subject to repayment in accordance with the Company’s written policy on recoupment of performance-based compensation, as may be adopted and revised by the Board from time to time, and/or subject to recoupment as required by any other provisions of any law (including, without limitation, Section 10D of the Securities Exchange Act of 1934, as amended), governmental regulation or stock exchange listing requirement and that such repayment obligation will apply notwithstanding any contrary provision of this Agreement. 
		

		
			4.Termination.
		

		
			4.1.Employment at Will.  It is expressly acknowledged and agreed by the parties that the Executive’s employment by the Company constitutes employment at will and that, to the maximum extent permitted by law, either the Company or the Executive has the right to terminate the Executive’s employment at any time and for any reason, or without stated reason. Termination of the Executive’s employment, whether by the Company or the Executive, shall not be considered a breach of this Agreement, and the duties of the parties to each other upon and following a termination of employment shall be governed exclusively by this Agreement, or by the terms of any applicable benefit plan.  
		

		
			4.2.Certain Definitions.  For all purposes related to the Executive’s employment by the Company during the Term, the following capitalized terms shall have the meanings set forth below: 
		

		
			4.2.1Cause.  A termination for “Cause” shall mean termination by the Company of the Executive’s employment by reason of the occurrence of any one or more of the following:
		

		
			(i)        an act or acts of personal dishonesty taken by the Executive and intended to result in substantial personal enrichment of the Executive at the expense of the Company;
		

		
			(ii)       repeated violations by the Executive of the Executive’s obligations under Section 1 of this Agreement (other than as a result of incapacity due to physical or mental illness) which are demonstrably willful and deliberate on the Executive’s part, which are committed in bad faith or without reasonable belief that such violations are in the best interests of the Company and which are not remedied in a reasonable period of time after receipt of written notice from the Company;
		

		
			(iii)      indictment or plea of nolo contendere of Executive of a felony involving moral turpitude; or
		

		
			
		

		 

		

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			(iv)      the material breach of the Executive’s Proprietary Information and Inventions Agreement.
		

		
			The Company shall provide the Executive with thirty (30) days written notice of any determination of Cause and provide the Executive, for a period of thirty (30) days following such notice, to cure such alleged event of “Cause” to the extent that it can be cured. The definition of Cause shall govern all equity award agreements by and between Company and Executive, unless otherwise expressly provided in such equity award agreement.
		

		
			 
		

		
			4.2.2Disability. “Disability” shall mean Executive’s inability to satisfactorily perform the essential functions and duties of Executive’s position with the Company, with or without reasonable accommodation, for either sixty (60) consecutive days or ninety (90) days in any 6 month period, as a result of any physical or mental impairment, as determined by the Board upon certification thereof by a qualified physician selected by the Board after such physician examines the Executive.  The Executive agrees, upon request by the Board, to submit to such examination and to provide the Board such medical evidence, records and examination data as is reasonably necessary for the Board to evaluate any potential Disability.  The Board agrees to treat such medical information confidentially as required by law. 
		

		
			4.2.3Good Reason.  “Good Reason” shall mean:
		

		
			(i)A material diminution (30% or more) in the Executive’s base compensation, except in connection with across-the-board salary reductions for all similarly situated senior executives;
		

		
			(ii)A material diminution in the Executive’s authority, duties and responsibilities;
		

		
			(iii)Removal from the position set forth in Section 1.1 of this agreement;
		

		
			(iv)A requirement that the Executive report to a corporate officer or employee instead of reporting directly to the parent company’s board of directors; 
		

		
			(v)A relocation of Executive’s principal workplace by more than 50 miles from where Executive performed services prior to the relocation; or
		

		
			(vi)Any other action or inaction that constitutes a material breach by the Company of this Agreement or any other agreement under which the Executive provides services.
		

		
			provided, however, that Good Reason shall not exist unless the Executive has given written notice to the Company within ninety (90) days of the initial existence of the Good Reason event or condition(s) giving specific details regarding the event or condition; and unless the Company has had at least thirty (30) days to cure such Good Reason event or condition after the delivery of such written notice and has failed to cure such event or condition within such thirty (30) day cure period.
		

		 

		

			-4-

		

 

		
			4.3.Termination Events.  
		

		
			4.3.1Immediate Termination.  Executive’s employment and the Term shall terminate immediately upon the occurrence of any of the following:
		

		
			(i)        the death of the Executive; 
		

		
			(ii)       Disability of the Executive; or
		

		
			(iii)      notice by the Company to the Executive of a termination for Cause. 
		

		
			4.3.2Termination by the Company without Cause.  The Company may terminate the Executive’s employment without Cause upon thirty (30) days prior written notice and, in such event, the Term shall terminate upon expiration of such thirty (30) day period.
		

		
			4.3.3Resignation by the Executive.  The Executive may resign the Executive’s position (i) voluntarily, which shall be effective ninety (90) days following written notice to the Company of the Executive’s intent to so resign or (ii) due to Good Reason, effective upon expiration of the Company’s thirty (30) day cure period and provided that the Company has not cured. The Company may waive all or any portion of the notice period and notify the Executive that his resignation has been accepted as of an earlier date.
		

		
			4.3.4Definition of Termination Date.  The date upon which the Executive’s employment and the Term terminate pursuant to this Section 4 shall be the Executive’s “Termination Date” for purposes of this Agreement. In the event that the termination of the Executive’s employment does not constitute a “separation from service” as defined in section 409A of the Code, the Executive’s rights to the applicable payments and benefits described in this Section 4 shall vest upon the Termination Date, but no payment to the Executive that is subject to section 409A of the Code shall be paid until the Executive incurs such a separation from service (or, if required under Section 8.1, until six months after such separation if the Executive is a “specified employee” as defined in Treasury Regulation 1.409A-1(i)(1)).
		

		
			4.3.5Deemed Resignation.  Upon termination of Executive’s employment for any reason or no reason, including with or without Cause or for Good Reason, whether by the Company or by Executive, and unless the Board otherwise expressly determines, Executive agrees that he automatically shall have been deemed to have resigned from all positions as an officer, director and employee of the Company or any subsidiaries or affiliates thereof without any further action on the part of the Executive or the Company.
		

		
			4.4.Payments Upon a Termination Event.  
		

		
			4.4.1Entitlements Upon Termination for Cause or Resignation without Good Reason.  Following any termination of the Executive’s employment for Cause or without Good Reason, the Company shall pay or provide to the Executive, or the Executive’s estate or beneficiary, as the case may be, the following amounts (the “Accrued Obligations”):  
		

		
			(i)        Base Salary earned through the Termination Date; 
		

		
			(ii)       a payment representing the Executive’s accrued but unused vacation;
		

		 

		

			-5-

		

 

		
			(iii)      reimbursement of all unpaid business expenses properly incurred by the Executive in connection with the performance of services to the Company or its Affiliates prior to the Termination Date; 
		

		
			 (iv)      The Executive’s Annual Bonus for the fiscal year prior to the year in which the Termination Date occurs if not paid prior to the Termination Date, paid when Annual Bonuses are paid to active employees; and
		

		
			(v)       any vested and/or earned, but not forfeited, amounts or benefits on the Termination Date under the Company’s employee benefit plans, programs, policies or practices in accordance with the terms thereof, including any benefit continuation or conversion rights (collectively, the “Company Arrangements”). 
		

		
			4.4.2Payments Upon Termination by Reason of Death or Disability.  In the event that the Executive’s employment is terminated by reason of his death or Disability, the Company shall pay or provide the Accrued Obligations to the Executive or the Executive’s estate.
		

		
			4.4.3Payments Upon Termination without Cause; or Resignation for Good Reason.  In the event that the Executive’s employment is terminated by the Company without Cause or the Executive resigns for Good Reason, then the Company shall pay or provide to the Executive or the Executive’s estate: 
		

		
			(i)        the Accrued Obligations;
		

		
			(ii)       salary continuation during one year severance period beginning on the Termination Date (or such later date as required by Section 4.5) in accordance with the Company’s normal payroll practices; 
		

		
			(iii)      subject to Executive’s election to receive and continuing eligibility for COBRA continuation coverage, the Company shall pay, on an after-tax basis, for up to 12 months of COBRA continuation premiums for group health and dental coverage; and
		

		
			(iv)      payment of an amount equal to the greater of (i) Annual Bonus earned in the prior fiscal year or (ii) the target annual bonus for Executive under the Company’s annual bonus plan. 
		

		
			4.4.4Payments Upon Termination in Connection with a Change in Control.  In the event the Executive’s employment is terminated without Cause or for Good Reason in the three (3) months prior to or in the 12 months following a Change in Control (as defined in the Company’s 2014 Equity Incentive Plan), then the Company shall pay or provide to the Executive or the Executive’s estate:
		

		
			(i)         the Accrued Obligations; 
		

		
			(ii)       a lump sum payment equal to 18 months of Base Salary within  30 days of the  Termination Date (or such later date as required by Section 4.5);  
		

		 

		

			-6-

		

 

		
			(iii)      subject to the Executive’s election to receive  COBRA continuation coverage, the Company shall pay a lump-sum payment, on an after-tax basis, for  18 months of COBRA continuation premiums for group health and dental coverage;
		

		
			(iv)      payment of an amount equal to the greater of (i) Annual Bonus earned in the prior fiscal year or (ii) the target annual bonus for Executive under the Company’s annual bonus plan; and
		

		
			(v)       all outstanding equity awards shall be fully vested and non-forfeitable.
		

		
			4.4.5Sections Mutually Exclusive.  Sections 4.4.1, 4.4.2, 4.4.3 and 4.4.4 are mutually exclusive, and the Executive shall not be entitled to receive payments or benefits upon a termination of employment under more than one such Section.
		

		
			4.5.Payments Conditioned Upon Release.  Anything else contained herein to the contrary notwithstanding, in no event shall the Executive be entitled to any payment or benefit pursuant to this Section 4, or otherwise as a result of any termination of employment except for his death, other than the Accrued Obligations, unless and until the Executive executes and does not revoke within the applicable revocation period an enforceable waiver and release of all claims against the Company and its officers and directors in a form provided by the Company (the “Release”). Such Release shall be executed and returned to the Company within the period of time specified in the Release; provided, however, if the Termination Date occurs in one calendar year and the period for considering such Release under applicable law expires during the following calendar year, then notwithstanding anything herein to the contrary other than Section 8.1 herein, the payments of severance hereunder will be paid by the Company to the Executive beginning on the first regular payroll date of the Company in the second calendar year following expiration of the applicable consideration and revocation period provided for under the Release. Any amounts that otherwise would have been paid to the Executive prior to the date on which the revocation period expires shall be paid at the expiration of the revocation period, without interest. If the Executive fails to execute the Release within the specified period, or revokes the Release after executing it, all payments and benefits provided under this Section 4, other than the Accrued Obligations, shall be forfeited. 
		

		
			4.6.Tax.  The Company may withhold from any amounts payable under this Agreement such Federal, state or local taxes as shall be required to be withheld pursuant to any applicable law or regulation.
		

		
			4.7.No Mitigation.  Upon termination of the Executive’s employment with the Company, the Executive shall be under no obligation to seek other employment or otherwise mitigate the obligations of the Company under this Agreement or any other agreement with the Company. 
		

		
			 
		

		
			5.Indemnification.
		

		
			The Company shall indemnify the Executive for all claims or losses arising from or related to the discharge of his duties under this Agreement to the fullest extent permitted by Delaware general corporate law. 
		

		
			 
		

		 

		

			-7-

		

 

		
			6.Notices.
		

		
			6.1.Form and Address for Notices.  All notices, requests, consents and other communications required or permitted to be given hereunder shall be in writing and shall be deemed to have been duly given if delivered personally, one (1) day after having been sent by overnight courier or three (3) days after having been mailed first class, e-mail, postage prepaid, by registered or certified mail, as follows (or to such other address as either party shall designate by notice in writing to the other in accordance herewith): 
		

		
			If to the Company, to:
		

		
			 
		

		
			Attention:  General Counsel
		

		
			Vitae Pharmaceuticals, Inc.
		

		
			502 West Office Center Drive
		

		
			Fort Washington, PA 19034
		

		
			 
		

		
			If to the Executive, to the Executive’s principal residence as reflected in the records of the Company. 
		

		
			 
		

		
			7.General.
		

		
			7.1.Governing Law; Jurisdiction and Venue. This Agreement shall be governed by and construed and enforced in accordance with the laws of the Commonwealth of Pennsylvania (without regard to conflicts of laws) applicable to agreements made between residents thereof and to be performed entirely in Pennsylvania.  Any action brought by either party with respect to this Agreement, shall be brought and maintained only in the state or federal courts located in the Commonwealth of Pennsylvania. Each party consents to personal jurisdiction and venue in such courts, waives any right to file a motion based on forum non conveniens or any similar doctrine and agrees not to oppose any motion to transfer any such case to such courts. 
		

		
			7.2.Headings.  The section headings contained herein are for reference purposes only and shall not in any way affect the meaning or interpretation of this Agreement. 
		

		
			7.3.Entire Agreement; Amendment.  This Agreement sets forth the entire agreement and understanding of the parties relating to the subject matter hereof, and supersedes all prior agreements, arrangements and understandings, written or oral, relating to the subject matter hereof; provided, however, that the Proprietary Information and Inventions Agreement, and any outstanding option or other equity award agreements by and between the Company and Executive shall be governed in accordance with the terms therein. 
		

		
			7.4.Assignability.  
		

		
			7.4.1Nonassignability by Executive.  This Agreement, and the Executive’s rights and obligations hereunder, may not be assigned by the Executive, nor may the Executive pledge, encumber or anticipate any payments or benefits due hereunder, by operation of law or otherwise.
		

		
			7.4.2Assignability by Company.  The Company may only assign its rights, together with its obligations, hereunder to a third party in connection with any sale, transfer or other disposition of all or substantially all of any business to which the Executive’s services are 

		 

		

			-8-

		

 

then principally devoted; provided, however, that no assignment pursuant to this Section 7.4.2 shall relieve the Company from its obligations hereunder to the extent the same are not timely discharged by such assignee.
		

		
			7.4.3Assumption of Agreement by Successors.  The Company will 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 to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place.  
		

		
			7.5.Survival.  The respective rights and obligations of the parties hereunder, including under Sections 4, 5 and 7, shall survive any termination of this Agreement or the expiration of the Term to the extent necessary to the intended preservation of such rights and obligations. 
		

		
			7.6.Severability.  The provisions of this Agreement are severable and the invalidity of any provision shall not affect the validity of any other provision.  In the event that any arbitrator or court of competent jurisdiction and venue shall determine that any provision of this Agreement or the application thereof is unenforceable, then the parties hereto agree that said arbitrator or court in making such determination shall have the power to reduce the duration and scope of such provision to the extent necessary to make it enforceable, and that the Agreement in its reduced form shall be valid and enforceable to the fullest extent provided by law.
		

		
			7.7.Counterparts.  This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original, and all of which together will constitute one and the same instrument. The parties hereto agree to accept a signed facsimile or “PDF” copy of this Agreement as a fully binding original. 
		

		
			8.Code Section 409A Legal Requirement.
		

		
			8.1.Six Month Delay in Payment.  Notwithstanding anything to the contrary in this Agreement, if the Executive is a “specified employee” as defined and applied in section 409A of the Code as of the Executive’s Termination Date, then, to the extent any payment under this Agreement or any Company Arrangement constitutes deferred compensation (after taking into account any applicable exemptions from section 409A of the Code, including those specified in Section 8.2) and to the extent required by section 409A of the Code, no payments due under this Agreement or any Company Arrangement may be made until the earlier of: (i) the first day 
		

		
			following the sixth month anniversary of the Executive’s Termination Date and (ii) the Executive’s date of death.
		

		
			8.2.Application of Exemptions.  For purposes of section 409A of the Code, each “payment” (as defined by section 409A of the Code) made under this Agreement shall be considered a “separate payment.” In addition, for purposes of section 409A of the Code, each such payment shall be deemed exempt from section 409A of the Code to the fullest extent possible under the “short-term deferral” exemption of Treasury Regulation § 1.409A-1(b)(4), as well as any other applicable exemptions. 
		

		 

		

			-9-

		

 

		
			8.3.Reimbursement and Offset Provisions.  Reimbursement payments shall generally be made in accordance with applicable Company policies; however, in no event will reimbursement payments be made later than the end of the year following the year in which the expense was incurred.  The amounts eligible for reimbursement provided in one taxable year will not affect the amounts eligible for reimbursement provided in any other taxable year, and the right to reimbursement will not be subject to liquidation or exchange for another benefit.  Notwithstanding any other provision of this Agreement to the contrary, in no event shall any payment that constitutes “non-qualified deferred compensation” under section 409A of the Code be subject to offset by any other amount unless otherwise permitted by section 409A.
		

		
			8.4.Interpretation and Administration of Agreement.  To the maximum extent permitted by law, this Agreement shall be interpreted and administered in such a manner that the payments to the Executive are either exempt from, or comply with, the requirements of section 409A of the Code. 
		

		
			[Signature page follows]
		

		
			 
		

		
			 
		

		
			
		

		
			

		 

		

			-10-

		

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written. 
		

		
			 
		

			
					
						 

					
					
						 

				
	
					
						 

					
					
						VITAE PHARMACEUTICALS, INC.

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						By:

					
					
						/s/ Donald Hayden

				
	
					
						 

					
					
						 

					
					
						Donald Hayden

				
	
					
						 

					
					
						 

					
					
						Chairman of its Board of Directors

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						EXECUTIVE

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						/s/ Jeffrey Hatfield

				
	
					
						 

					
					
						 

					
					
						Jeffrey Hatfield

				

		
			
		

		
			

		 

		

			-11-

		

 

Exhibit A
		

		
			Board Seats
		

		
			None.
		

		
			 
		

		
			
		

		
			

		 

		

			-12-

		

 

Exhibit B
		

		
			 
		

		
			PIIA
		

		 

		

			-13-

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