Document:

MPLX-2015.6.30-EX10.2

Exhibit 10.2
EXECUTION VERSION
LOCK-UP AGREEMENT
This LOCK-UP AGREEMENT (this “Agreement”), dated as of July 11, 2015, is entered into by and among MPLX LP, a Delaware limited partnership (“ Parent ”), MPLX GP LLC, a Delaware limited liability company and the general partner of Parent (“ Parent GP ”), Sapphire Holdco LLC, a Delaware limited liability company and a wholly owned subsidiary of Parent (“ Merger Sub ” and, with Parent and Parent GP, the “ Parent Entities ”), MarkWest Energy Partners, L.P., a Delaware limited partnership (the “ Partnership ”), EMG Utica, LLC, a Delaware limited liability company (“ EMG Utica ”), EMG Utica Condensate, LLC, a Delaware limited liability company (“ EMG Condensate ”), and each of the Persons set forth on  Schedule A  hereto (each, a “ Unitholder ”). All terms used but not otherwise defined in this Agreement shall have the respective meanings ascribed to such terms in the Merger Agreement (as defined below).
WHEREAS, as of the date hereof, each Unitholder is the record and beneficial owner (as defined in Rule 13d-3 under the Exchange Act, including all securities as to which such Person has the right to acquire, without regard to the 60-day period set forth in such rule) of the number of Common Units and Class B Units set forth opposite such Unitholder’s name on Schedule A ; and
WHEREAS, concurrently with the execution and delivery hereof, the Parent Entities, Marathon Petroleum Corporation, a Delaware corporation and the ultimate parent of Parent GP, and the Partnership are entering into an Agreement and Plan of Merger (as it may be amended pursuant to the terms thereof, the “ Merger Agreement ”), which provides, among other things, for the merger of Merger Sub with and into the Partnership, upon the terms and subject to the conditions set forth therein (the “ Merger ”) in accordance with the DRULPA, whereby each issued and outstanding Common Unit and Class B Unit will be converted into the right to receive the consideration set forth in the Merger Agreement.
NOW, THEREFORE, in consideration of the foregoing and the respective representations, warranties, covenants and agreements set forth below and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, do hereby agree as follows:
ARTICLE I
CLASS B CONVERSION; COMMON UNIT TRANSFERS; REGISTRATION RIGHTS
1.1.Class B Conversion. Subject to the terms of this Agreement, the Partnership hereby agrees that, in connection with the Merger, it will not make a Partnership Fundamental Change Election (as such term is defined in the Partnership Agreement), and each Unitholder hereby agrees that, in connection with the Merger, it will not make a Class B Fundamental Change Election (as such term is defined in the Partnership Agreement). The parties hereto hereby acknowledge that, subject to the terms and conditions set forth in the Merger Agreement, at the Effective Time each Class B Unit held by the Unitholders as of immediately prior to the Effective Time will be converted into the right to receive one Parent Class B Unit. It is understood and agreed that the Parent Class B Units will be a new class of units of Parent, with each series thereof containing substantially similar rights and obligations, including in respect of transfer restrictions and conversion rights as those of each series of Class B

Units; provided, however, that (i) there shall be no transfer restrictions on (and Section 1.2 shall not apply to) any Parent Units issued upon the conversion of the Parent Class B Units and (ii) each Parent Class B Unit shall be convertible into 1.09 Parent Units plus an amount in cash equal to the Cash Consideration. Each Unitholder agrees that the Parent Class B Units constitute “ Equivalent Securities ” within the meaning of Section 5.7(i) of the Partnership Agreement.
1.2.Parent Unit Transfer Restrictions. Subject to the terms of this Agreement, each Unitholder agrees that, without Parent’s prior written consent, such Unitholder will not Transfer, in the six-month period immediately following the Closing Date, any Parent Units received by it in connection with the Merger;  provided  that such restriction shall not prevent any Unitholder from Transferring any Parent Units in private sales, “block trades” or similar transactions, so long as no such transaction is an open market transaction or directly results in wide distribution of Parent Units. From and after the date that is six months following the Closing Date, there shall be no restrictions on Transfer applicable to the Parent Units held by the Unitholders and Parent shall take such actions as any Unitholder may reasonably request to evidence the fact that such Parent Units are freely transferable. Parent shall promptly direct its transfer agent to remove the notation of a restrictive legend in such Unitholder’s certificates evidencing the Parent Units or the book-entry account maintained by the transfer agent, and the Parent shall bear all costs associated therewith, so long as such Unitholder or its permitted assigns provide to the Parent any information the Parent deems reasonably necessary to determine that the legend is no longer required under the Securities Act or applicable state laws, including (if there is no effective registration statement) a certification that the Unitholder is not an Affiliate of the Parent and regarding the length of time the Parent Units have been held. Parent shall also direct the transfer agent to permit the transfer of the Parent Units to the Unitholder’s brokerage account. For purposes of this Agreement, “ Transfer ” shall mean a transaction by which a Unitholder directly or indirectly assigns a Parent Unit to another Person, and includes (a) a sale, assignment, gift, pledge, encumbrance, hypothecation, mortgage, exchange or any other disposition by operation of Law or otherwise and (b) entry into any swap or other transaction or arrangement that transfers or that is designed to, or that might reasonably be expected to, result in the transfer to another Person, in whole or in part, any of the economic consequences of ownership of such Parent Unit.
1.3.Registration Rights. Parent and the Unitholders hereby agree that, prior to the Closing, Parent and the Unitholders will enter into a registration rights agreement pursuant to which the Unitholders will obtain substantially similar registration rights in respect of the Parent Units received by the Unitholders in connection with the Merger as those applicable to such Unitholders’ Common Units as of the date hereof;  provided ,  however , that the Effectiveness Period (as such term is defined in the Partnership Registration Rights Agreement) shall expire on November 1, 2019, rather than July 1, 2019.

ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE UNITHOLDERS
Each Unitholder represents and warrants, on its own account with respect to the Common Units and Class B Units held by it, to the Parent Entities and the Partnership as to such Unitholder on a several basis, that:
2.1.Authorization; Binding Agreement. Such Unitholder is duly organized and validly existing in good standing under the Laws of the jurisdiction in which it is incorporated or constituted and the consummation of the transactions contemplated hereby are within such Unitholder’s entity powers and have been duly authorized by all necessary entity actions on the part of such Unitholder, and such Unitholder has full power and authority to execute, deliver and perform this Agreement and to consummate the transactions contemplated hereby. This Agreement has been duly and validly executed and delivered by such Unitholder and, assuming the due authorization, execution and delivery by the Partnership and the Parent Entities, constitutes a valid and binding obligation of such Unitholder, enforceable against such Unitholder in accordance with its terms, subject to the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar Laws relating to or affecting creditors’ rights generally and general equitable principles (whether considered in a proceeding in equity or at law).
2.2.Non-Contravention. Neither the execution and delivery of this Agreement by such Unitholder nor the consummation by such Unitholder of the transactions contemplated hereby, nor compliance by such Unitholder with any of the terms or provisions of this Agreement, will (i) conflict with or violate any provision of the certificate of incorporation or bylaws (or other similar governing documents), (ii) (x) violate any Law, judgment, writ or injunction of any Governmental Authority applicable to such Unitholder or any of their respective properties or assets, or (y) violate, conflict with, result in the loss of any benefit under, constitute a default (or an event which, with notice or lapse of time, or both, would constitute a default) under, result in the termination of or a right of termination or cancellation under, accelerate the performance required by, or result in the creation of any Lien upon any of the respective properties or assets of, such Unitholder under, any of the terms, conditions or provisions of any loan or credit agreement, debenture, note, bond, mortgage, indenture, deed of trust, license, lease, contract or other agreement, instrument or obligation, to which such Unitholder is a party, or by which they or any of their respective properties or assets may be bound or affected or (iii) result in the exercisability of any right to purchase or acquire any asset of such Unitholder, except, in the case of clauses (ii)(x), (ii)(y) and (iii), for such violations, conflicts, losses, defaults, terminations, cancellations, accelerations, Liens, purchases or acquisitions as, individually or in the aggregate, would not prevent or materially impair the consummation of the transactions contemplated hereby.
2.3.Ownership of Units; Total Units. Such Unitholder is the record and beneficial owner of all Common Units and Class B Units listed opposite such Unitholder’s name on  Schedule A  and has good and marketable title to all such Common Units and Class B Units free and clear of any Liens, except for any such Lien that may be imposed pursuant to (i) the Partnership Agreement and (ii) any applicable restrictions on transfer under the Securities Act or any state securities law (collectively, “ Permitted Liens ”). The Common Units and Class B Units listed on  Schedule A  opposite such Unitholder’s name constitute all of the Common Units and Class B Units respectively, beneficially owned by such Unitholder as of the date hereof.

ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE PARTNERSHIP
The Partnership represents and warrants to the Unitholders and the Parent Entities that:
3.1.Organization and Qualification. The Partnership is a duly organized and validly existing entity in good standing under the Laws of the jurisdiction of its organization.
3.2.Authority for this Agreement. The Partnership has all requisite entity power and authority to execute, deliver and perform its obligations under this Agreement and to consummate the transactions contemplated hereby. The execution and delivery of this Agreement by the Partnership has been duly and validly authorized by all necessary entity action on the part of the Partnership, and no other entity proceedings on the part of the Partnership are necessary to authorize this Agreement. This Agreement has been duly and validly executed and delivered by the Partnership and, assuming the due authorization, execution and delivery by the Unitholders and the Parent Entities, constitutes a legal, valid and binding obligation of the Partnership, enforceable against the Partnership in accordance with its terms, except as enforceability may be limited by bankruptcy Laws, other similar Laws affecting creditors’ rights and general principles of equity affecting the availability of specific performance and other equitable remedies.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PARENT ENTITIES
The Parent Entities represent and warrant to the Unitholders and the Partnership that:
4.1.Organization and Qualification. Each of the Parent Entities is a duly organized and validly existing entity in good standing under the Laws of the jurisdiction of its organization. All of the issued and outstanding capital stock of Merger Sub is owned directly or indirectly by Parent.
4.2.Authority for this Agreement. Each of the Parent Entities has all requisite entity power and authority to execute, deliver and perform its obligations under this Agreement and to consummate the transactions contemplated hereby. The execution and delivery of this Agreement by the Parent Entities have been duly and validly authorized by all necessary entity action on the part of each of the Parent Entities, and no other entity proceedings on the part of the Parent Entities are necessary to authorize this Agreement. This Agreement has been duly and validly executed and delivered by the Parent Entities and, assuming the due authorization, execution and delivery by the Unitholders and the Partnership, constitutes a legal, valid and binding obligation of each of the Parent Entities, enforceable against each of the Parent Entities in accordance with its terms, except as enforceability may be limited by bankruptcy Laws, other similar Laws affecting creditors’ rights and general principles of equity affecting the availability of specific performance and other equitable remedies.

ARTICLE V
COVENANTS
5.1.Additional Matters. As promptly as reasonably practicable, but in any event prior to the consummation of the Merger, the parties hereto shall take all actions as are necessary and appropriate to effect the matters set forth on  Schedule B  hereto.
ARTICLE VI
MISCELLANEOUS
6.1.Documentation and Information. Such Unitholder shall not make any public announcement regarding this Agreement and the transactions contemplated hereby without the prior written consent of Parent and the Partnership (such consent not to be unreasonably withheld, conditioned or delayed), except as may be required by applicable Law (provided that reasonable notice of any such disclosure will be provided to Parent and the Partnership). Such Unitholder consents to and hereby authorizes the Parent Entities and the Partnership to publish and disclose in all documents and schedules filed with the SEC or other Governmental Authority or applicable securities exchange, to the extent Parent determines such filing is required by applicable Law or regulation, and any press release or other disclosure document that the Parent Entities reasonably determine to be necessary or advisable in connection with the Merger and any other transactions contemplated by the Merger Agreement, such Unitholder’s identity and ownership of the Common Units and Class B Units set forth on  Schedule A  hereto, the existence of this Agreement and the nature of such Unitholder’s commitments and obligations under this Agreement, and such Unitholder acknowledges that the Parent Entities and the Partnership may, in their respective sole discretion, file this Agreement or a form hereof with the SEC or any other Governmental Authority or securities exchange. Such Unitholder agrees to promptly give Parent and the Partnership any information it may reasonably require for the preparation of any such disclosure documents, and such Unitholder agrees to promptly notify Parent and the Partnership, as applicable, of any required corrections with respect to any written information supplied by such Unitholder specifically for use in any such disclosure document, if and to the extent that any such information shall have become false or misleading in any material respect.
6.2.Notices. Any and all notices or other communications or deliveries required or permitted to be provided hereunder will be in writing and sent by facsimile, by electronic mail, by nationally recognized overnight courier service or by registered mail and will be deemed given and effective on the earliest of (a) the date of transmission, if such notice or communication is delivered via electronic mail at the email address specified in  Section 8.9  of the Merger Agreement or facsimile at the facsimile telephone number specified in  Section 8.9  of the Merger Agreement, in either case, prior to 5:00 p.m. (New York City time) on a Business Day and, in each case, a copy is sent on such Business Day by nationally recognized overnight courier service, (b) the Business Day after the date of transmission, if such notice or

communication is delivered via electronic mail at the email address specified in Section 8.9 of the Merger Agreement or facsimile at the facsimile telephone number specified in  Section 8.9  of the Merger Agreement, in each case, later than 5:00 p.m. (New York City time) on any date and earlier than 12 midnight (New York City time) on the following date and a copy is sent no later than such date by nationally recognized overnight courier service, (c) when received, if sent by nationally recognized overnight courier service (other than in the cases of clauses (a) and (b) above), or (d) upon actual receipt by the party to whom such notice is required to be given if sent by registered mail. The address for such notices and communications will be as set forth (i) if to any Parent Entity or the Partnership, to the address or facsimile number set forth in  Section 8.9  of the Merger Agreement and (ii) if to a Unitholder, to such Unitholder’s address or facsimile number set forth on a signature page hereto, or to such other address or facsimile number as such party may hereafter specify for the purpose by notice to each other party hereto.
6.3.Termination. This Agreement shall terminate automatically with respect to a Unitholder, without any notice or other action by any Person, upon the valid termination of the Merger Agreement in accordance with its terms. Upon termination of this Agreement, no party shall have any further obligations or liabilities under this Agreement;  provided ,  however , that (x) nothing set forth in this  Section 6.3  shall relieve any party from liability for any breach of this Agreement prior to termination hereof and (y) the provisions of this  Article VI  shall survive any termination of this Agreement.
6.4.Amendments and Waivers. Any provision of this Agreement may be amended or waived if such amendment or waiver is in writing and is signed, in the case of an amendment, by each party to this Agreement or, in the case of a waiver, by each party against whom the waiver is to be effective. No failure or delay by any party in exercising any right hereunder will operate as a waiver thereof nor will any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right.
6.5.Expenses. All fees and expenses incurred in connection herewith and the transactions contemplated hereby shall be paid by the party incurring such fees and expenses, whether or not the Merger is consummated.
6.6.Assignment. Neither this Agreement nor any of the rights, interests or obligations hereunder may be assigned, in whole or in part, by operation of Law or otherwise, by any of the parties without the prior written consent of the other parties, except that Merger Sub may assign, in its sole discretion, any of or all its rights, interests and obligations under this Agreement to any wholly owned Subsidiary of Parent, but no such assignment will relieve Parent, Parent GP or Merger Sub of any of its obligations hereunder. Subject to the preceding sentence, this Agreement will be binding upon, inure to the benefit of, and be enforceable by, the parties hereto and their respective successors and permitted assigns. Any purported assignment not permitted under this  Section 6.6  will be null and void.
6.7.Counterparts. This Agreement may be executed in counterparts (each of which will be deemed to be an original but all of which taken together will constitute one and the same agreement) and will become effective when one or more counterparts have been signed by each of the parties and delivered to the other parties.

6.8.Entire Agreement; No Third-Party Beneficiaries. This Agreement, together with Schedule A, and the other documents and certificates delivered pursuant hereto, (a) constitute the entire agreement, and supersede all other prior agreements and understandings, both written and oral, among the parties with respect to the subject matter of this Agreement and thereof and (b) will not confer upon any Person other than the parties hereto any rights (including third-party beneficiary rights or otherwise) or remedies hereunder.
6.9. Governing Law; Jurisdiction; Waiver of Jury Trial.
(a) This Agreement will be governed by, and construed in accordance with, the laws of the State of Delaware, applicable to contracts executed in and to be performed entirely within that State.
(b) Each of the parties hereto irrevocably agrees that any legal action or proceeding with respect to this Agreement and the rights and obligations arising hereunder, or for recognition and enforcement of any judgment in respect of this Agreement and the rights and obligations arising hereunder brought by the other party hereto or its successors or assigns, will be brought and determined exclusively in the Delaware Court of Chancery and any state appellate court therefrom within the State of Delaware (or, if the Delaware Court of Chancery declines to accept jurisdiction over a particular matter, any state or federal court within the State of Delaware). Each of the parties hereto hereby irrevocably submits with regard to any such action or proceeding for itself and in respect of its property, generally and unconditionally, to the personal jurisdiction of the aforesaid courts and agrees that it will not bring any action relating to this Agreement or any of the transactions contemplated by this Agreement in any court other than the aforesaid courts. Each of the parties hereto hereby irrevocably waives, and agrees not to assert as a defense, counterclaim or otherwise, in any action or proceeding with respect to this Agreement, (i) any claim that it is not personally subject to the jurisdiction of the above named courts for any reason, (ii) any claim that it or its property is exempt or immune from the jurisdiction of any such court or from any legal process commenced in such courts (whether through service of notice, attachment prior to judgment, attachment in aid of execution of judgment, execution of judgment or otherwise) and (iii) to the fullest extent permitted by the applicable Law, any claim that (x) the suit, action or proceeding in such court is brought in an inconvenient forum, (y) the venue of such suit, action or proceeding is improper or (z) this Agreement, or the subject matter hereof, may not be enforced in or by such courts. The parties hereto further agree that the mailing by certified or registered mail, return receipt requested, (i) if to any Parent Entity or the Partnership, to the address or facsimile number set forth in  Section 8.9 of the Merger Agreement and (ii) if to a Unitholder, to such Unitholder’s address set forth on a signature page hereto, or to such other address as such party may hereafter specify for the purpose by notice to each other party hereto, of any process required by any such court will constitute valid and lawful service of process against them, without necessity for service by any other means provided by statute or rule of court.
(c) EACH PARTY HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THE ACTIONS OF ANY PARTY IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE AND ENFORCEMENT OF THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.

6.10. Specific Enforcement. The parties agree that irreparable damage would occur and that the parties would not have any adequate remedy at law in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached and it is accordingly agreed that the parties will be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement, in each case, in accordance with this  Section 6.10  in the Delaware Court of Chancery or any federal court sitting in the State of Delaware, this being in addition to any other remedy to which they are entitled at law or in equity. Each of the parties agrees that it will not oppose the granting of an injunction, specific performance and other equitable relief as provided herein on the basis that (x) either party has an adequate remedy at law or (y) an award of specific performance is not an appropriate remedy for any reason at law or equity. Each party further agrees that no party will be required to obtain, furnish or post any bond or similar instrument in connection with or as a condition to obtaining any remedy referred to in this  Section 6.10 , and each party irrevocably waives any right it may have to require the obtaining, furnishing or posting of any such bond or similar instrument.
6.11. Severability. If any term or other provision of this Agreement is determined by a court of competent jurisdiction to be invalid, illegal or incapable of being enforced by any rule of Law or public policy, all other terms, provisions and conditions of this Agreement will nevertheless remain in full force and effect. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties hereto will negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible to the fullest extent permitted by applicable Law in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the extent possible.
6.12. Interpretation.
(a) The headings contained in this Agreement are for reference purposes only and will not affect in any way the meaning or interpretation of this Agreement. Whenever the words “include,” “includes” or “including” are used in this Agreement, they will be deemed to be followed by the words “without limitation.” The words “hereof,” “herein” and “hereunder” and words of similar import when used in this Agreement will refer to this Agreement as a whole and not to any particular provision of this Agreement. All terms defined in this Agreement will have the defined meanings when used in any certificate or other document made or delivered pursuant hereto unless otherwise defined therein. The definitions contained in this Agreement are applicable to the singular as well as the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of such term. Any agreement, instrument or statute defined or referred to herein or in any agreement or instrument that is referred to herein means such agreement, instrument or statute as from time to time amended, modified or supplemented, including (in the case of agreements or instruments) by waiver or consent and (in the case of statutes) by succession of comparable successor statutes and references to all attachments thereto and instruments incorporated therein. References to a Person are also to its permitted successors and assigns.
(b) The parties hereto have participated jointly in the negotiation and drafting of this Agreement with the assistance of counsel and other advisors and, in the event an ambiguity or question of intent or interpretation arises, this Agreement will be construed as jointly drafted by the parties hereto and no presumption or burden of proof will arise favoring or disfavoring any party by virtue of the authorship of any provision of this Agreement or interim drafts of this Agreement.

6.13.Further Assurances. Each Unitholder will execute and deliver, or cause to be executed and delivered, all further documents and instruments and use its reasonable best efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things necessary, proper or advisable under applicable Laws and regulations, to perform its obligations under this Agreement.
6.14.Unitholder Obligation Several and Not Joint. The obligations of each Unitholder hereunder shall be several and not joint, and no Unitholder shall be liable for any breach of the terms of this Agreement by any other Unitholder.
[Remainder of Page Intentionally Left Blank. Signature Pages Follow.]

The parties are executing this Agreement on the date set forth in the introductory clause.

	
					
	 
	 
	 
	 
	 

	PARENT:

	 

	MPLX LP

	 
	 

	By:
	 
	MPLX GP LLC,

	 
	 
	its general partner

	 
	 

	 
	 
	By:
	 
	/s/ Gary R. Heminger

	 
	 
	 
	 
	Name: G.R. Heminger

	 
	 
	 
	 
	Title: Chairman and Chief Executive Officer

	 

	PARENT GP:

	 

	MPLX GP LLC

	 
	 

	By:
	 
	/s/ Gary R. Heminger

	 
	 
	Name:
	 
	G.R. Heminger

	 
	 
	Title:
	 
	Chairman and Chief Executive Officer

	 

	MERGER SUB:

	 

	SAPPHIRE HOLDCO LLC

	 
	 

	By:
	 
	/s/ Pamela K.M. Beall

	 
	 
	Name:
	 
	P.K.M. Beall

	 
	 
	Title:
	 
	President

	
					
	 
	 
	 
	 
	 

	PARTNERSHIP:

	 

	MARKWEST ENERGY PARTNERS, L.P.,

	 
	 

	By:
	 
	MARKWEST ENERGY GP, L.L.C.,

	 
	 
	its general partner

	 
	 

	 
	 
	By:
	 
	/s/ Frank M. Semple

	 
	 
	 
	 
	Name: Frank M. Semple

	 
	 
	 
	 
	Title: Chairman, President and Chief Executive Officer

	
					
	 
	 
	 
	 
	 

	EMG UTICA, LLC

	 
	 

	By:
	 
	/s/ John T. Raymond

	 
	 
	Name:
	 
	John T. Raymond

	 
	 
	Title:
	 
	Chief Executive Officer

	 

	EMG UTICA CONDENSATE, LLC

	 
	 

	By:
	 
	/s/ John T. Raymond

	 
	 
	Name:
	 
	John T. Raymond

	 
	 
	Title:
	 
	Chief Executive Officer

	
					
	 
	 
	 
	 
	 

	UNITHOLDER

	 

	M&R MWE LIBERTY, LLC

	 
	 

	By:
	 
	/s/ John T. Raymond

	 
	 
	Name:
	 
	John T. Raymond

	 
	 
	Title:
	 
	Chief Executive Officer and Managing Partnervvus_EX 10-1

		

			Exhibit 10.1

		

		

			 

		

		

			 

		

		

			

		

		

			 

		

		
			April 13, 2015
		

		
			 
		

		
			Guy P. Marsh
		

		
			 
		

		
			Re:Retention Benefits
		

		
			 
		

		
			Dear Guy:
		

		
			We appreciate the many contributions that you have made as a valuable member of VIVUS, Inc. (the “Company” or “VIVUS”).  By this letter agreement (the “Retention Agreement”), the Company is offering certain changes to your compensation, as follows.
		

			
	
			
				 1.
			Retention Benefits.  Subject to Sections 4 and 6 below, if (x) you remain an employee of VIVUS from the date of this Retention Agreement through May 1, 2015 (the “Retention Date”), or (y) prior to the Retention Date, your employment with the Company is terminated by the Company for any reason other than due to Cause (as defined below) and such termination is not as a result of your death or disability, then you will receive the following: 

			
	
			
				 (a)
			Retention Bonus.  A lump sum cash payment in an amount equal to $468,000 which is equal to the sum of 1 year of your base salary ($380,000) and the average of your annual bonus for the past 2 years ($88,000).

			
	
			
				 (b)
			COBRA Benefits.  If you, and any of your spouse and/or dependents (“Family Members”) has coverage on the Retention Date under a group health plan sponsored by the Company, then reimbursement to you of the Company’s portion of the total applicable premium cost for continued group health plan coverage under the Consolidated Omnibus Budget Reconciliation Act of 1986, as amended (“COBRA”) for a period of up to twelve (12) months following your termination of employment or if earlier, the date upon which you and your eligible dependents become covered under similar plans, provided that you validly elect and are eligible to continue coverage under COBRA for you and your Family Members, and, provided further, that if the Company determines in its sole discretion that it cannot provide the COBRA reimbursement benefits without potentially violating applicable laws (including, without limitation, Section 2716 of the Public Health Service Act and the Employee Retirement Income Security Act of 1974, as amended), then in lieu thereof,  the Company will provide to you a taxable lump sum payment in an amount equal to the monthly COBRA premium that you would be required to pay to continue the group health coverage in effect on the Retention Date (which amount will be based on the premium for the first month of COBRA coverage) for a period of twelve (12) months following the Retention Date, which payment will be made regardless of whether you elect COBRA continuation coverage.

			
	
			
				 2.
			At-Will Employment.  The Company and you acknowledge that your employment is and will continue to be at-will, as defined under applicable law, which means

		
			 
		

		
			 
		

		

		

		 

		

			VIVUS, Inc.    351 E. Evelyn Ave., Mountain View, CA  94041    Tel 650-934-5200     www.vivus.com

		

 

		

			 

		

		that either the Company or you may terminate your employment with the Company at any time and for any reason, with or without cause or notice.  If your employment terminates for any reason, you will not be entitled to any separation payments or benefits, other than as provided by this Retention Agreement.
		

			
	
			
				 3.
			Employment Termination.  You and the Company agree that your employment with the Company will terminate on the Retention Date.  

			
	
			
				 4.
			Conditions.  As a condition to receiving the payments and benefits described in Section 1 of this Retention Agreement (the “Retention Benefits”), you will be required to sign and not revoke a separation and release of claims agreement in substantially the form attached hereto as Exhibit A (the “Release”).  The Release must become effective and irrevocable no later than the twenty-eighth (28th) day following the Retention Date (the “Release Deadline Date”).  If the Release does not become effective and irrevocable by the Release Deadline Date, you will forfeit any right to the Retention Benefits.  In no event will the Retention Benefits be paid or provided until the Release becomes effective and irrevocable.  Provided that the Release becomes effective and irrevocable by the Release Deadline Date and subject to Section 6, the Retention Benefits in Section 1(a) will be paid within ten (10) days following the date that the Release becomes effective and irrevocable (such payment date, the “Benefits Start Date”).

			
	
			
				 5.
			Definitions.  For purposes of this Retention Agreement, the following terms will have the following definitions:

			
	
			
				 (a)
			Cause.  “Cause” means (i) gross negligence or willful misconduct in the performance of your duties to the Company where such gross negligence or willful misconduct has resulted or is likely to result in substantial and material damage to the Company or its subsidiaries, (ii) repeated unexcused absences from the Company, (iii) commission of any act of fraud with respect to the Company, or (v) conviction of a felony or a crime involving moral turpitude and causing material harm to the standing and reputation of the Company, in each case as determined in good faith by the Company’s Board of Directors (the “Board”).

			
	
			
				 (b)
			Section 409A.  “Section 409A” means Section 409A of the Code, any final regulations and guidance under that statute, and any applicable state law equivalent, as each may be amended or promulgated from time to time.

			
	
			
				 (c)
			Section 409A Limit.  “Section 409A Limit” means the lesser of two (2) times: (i) your annualized compensation based upon the annual rate of pay paid to you during the Company’s taxable year preceding the Company’s taxable year of your termination of employment as determined under Treasury Regulation 1.409A‐1(b)(9)(iii)(A)(1) and any Internal Revenue Service guidance issued with respect thereto; or (ii) the maximum amount that may be taken into account under a qualified plan pursuant to Section 401(a)(17) of the Code for the year in which your employment is terminated. 

			
	
			
				 (d)
			Severance Agreement.  “Severance Agreement” means the Amended and Restated Change of Control and Severance Agreement dated July 1, 2013, entered into between you and the Company, which amended and restated the Change of Control and Severance Agreement dated April 23, 2009.

		

		

		 

		

			VIVUS, Inc.    351 E. Evelyn Ave., Mountain View, CA  94041    Tel 650-934-5200     www.vivus.com 

		

		

			 

		

		

			2

		

 

		
		

			
	
			
				 6.
			Section 409A.    

			
	
			
				 (a)
			General.  The Retention Benefits are intended to be exempt from or otherwise comply with the requirements of Section 409A so that none of the payments or benefits to be provided under this Agreement will be subject to the additional tax imposed under Section 409A, and any ambiguities or ambiguous terms in this Retention Agreement will be interpreted to be so exempt or otherwise comply with Section 409A.  Each payment and benefit under this Retention Agreement is deemed to be a separate payment for Section 409A purposes.  You and the Company agree to work together in good faith to consider amendments to this Retention Agreement and to take such reasonable actions that are necessary, appropriate or desirable to avoid imposition of any additional tax or income recognition prior to actual payment to you under Section 409A.  Any amount paid under this Retention Agreement that satisfies the requirements of the “short-term deferral” rule set forth in Section 1.409A-1(b)(4) of the Treasury Regulations will not constitute Deferred Payments for purposes of this Section 6.  Any amount paid under this Retention Agreement that qualifies as a payment made as a result of an involuntary separation from service pursuant to Section 1.409A-1(b)(9)(iii) of the Treasury Regulations that does not exceed the Section 409A Limit will not constitute Deferred Payments for purposes of this Section 6.

			
	
			
				 (b)
			Required Delay.  Notwithstanding anything to the contrary in this Retention Agreement, no payments or benefits to be paid or provided to you, if any, under this Retention Agreement that, when considered together with any other severance payments or separation benefits, are considered deferred compensation under Section 409A (together, the “Deferred Payments”) will be paid or provided until you have a “separation from service” within the meaning of Section 409A.  Similarly, no Retention Benefits payable to you, if any, that otherwise would be exempt from Section 409A pursuant to Treasury Regulation Section 1.409A‐1(b)(9) will be payable until you have a “separation from service” within the meaning of Section 409A.  In no event will you have discretion to determine the taxable year of payment of any Deferred Payment.  If and only to the extent it is necessary to avoid subjecting you to an additional tax under Section 409A, payment of all or a portion of the Retention Benefits will be delayed until the date that is six months and one day after the date of your separation from service with the Company.  However, in the event that your death occurs after your separation from service with the Company but prior to the six month anniversary of the date of your separation from service with the Company, any payments and/or benefits due to you but delayed under the prior sentence will be payable to you in a lump sum as soon as administratively practicable after the date of your death and any other separation pay and/or benefits will be payable according to the payment schedule applicable to each payment.

			
	
			
				 7.
			Tax Consequences.  All payments made pursuant to this Retention Agreement will be subject to withholding of applicable income, employment and other taxes.  The Company makes no representations or warranties with respect to the tax consequences of any payments or benefits provided under this Retention Agreement.  You agree and understand that you are responsible for payment, if any, of local, state, and/or federal taxes on the payments and benefits provided under this Retention Agreement or otherwise and any penalties or assessments related to such taxes (including but without limitation, pursuant to Section 409A).  

		

		

		 

		

			VIVUS, Inc.    351 E. Evelyn Ave., Mountain View, CA  94041    Tel 650-934-5200     www.vivus.com

		

		

			 

		

		

			3

		

 

		
		

			
	
			
				 8.
			Confidentiality. The terms of this Retention Agreement, excluding the Retention Date, are considered to be confidential information by the Company and you agree to hold such information in strict confidence and not use, disclose or transfer the information to any third party, other than your spouse and legal and tax advisors, without the express written permission of Company, except to the extent required to be disclosed by law, government agency, court order or valid discovery request in connection with a legal proceeding. The Company agrees to hold such information in strict confidence and not use, disclose or transfer the information to any third party without your express written permission, except to the extent required to be disclosed by law, government agency, court order or valid discovery request in connection with a legal proceeding.

			
	
			
				 9.
			Severability.    If any provision of this Retention Agreement is held to be void, voidable, unlawful or unenforceable, the remaining portions of this Retention Agreement will remain in full force and effect.

			
	
			
				 10.
			Arbitration.    Any dispute or controversy arising under or in connection with this Retention Agreement may be settled at the option of either party by binding arbitration in the County of Santa Clara, California, in accordance with the Employment Arbitration Rules & Procedures of the Judicial Arbitration & Mediation Services then in effect.  Judgment may be entered on the arbitrator’s award in any court having jurisdiction.  

			
	
			
				 11.
			Choice of Law.  The validity, interpretation, construction and performance of this Retention Agreement will be governed by the laws of the State of California without reference to conflict of laws provisions.

			
	
			
				 12.
			Assignment by Company.  The Company may assign its rights under this Retention Agreement to an affiliate, and an affiliate may assign its rights under this Retention Agreement to another affiliate of the Company or to the Company.  In the case of any such assignment, the term “Company” when used in a section of this Retention Agreement will mean the corporation that actually employs you.

			
	
			
				 13.
			Whole Agreement; Modifications.    No agreements, representations or understandings (whether oral or written and whether express or implied) which are not expressly set forth in this Retention Agreement have been made or entered into by either party with respect to the subject matter hereof.  This Retention Agreement supersedes any agreement concerning similar subject matter dated prior to the date of this Retention Agreement, including but not limited to the Severance Agreement, and by execution of this Retention Agreement both parties agree that the Severance Agreement will be deemed null and void.    This Retention Agreement may not be modified or changed in any manner except by a writing executed by you and a duly authorized executive officer of the Company.  No party is relying upon any other agreement, representation, statement, omission, understanding or course of conduct which is not expressly set forth in this Retention Agreement.  Headings used in this Agreement are for convenience only and will not be used to interpret its substantive terms.

		
			To accept this Retention Agreement, please date and sign this letter below where indicated and return it to Sandra Wells.  If you do not accept this Agreement by April 17, 2015, this Retention Agreement will not become effective.
		

		

		

		 

		

			VIVUS, Inc.    351 E. Evelyn Ave., Mountain View, CA  94041    Tel 650-934-5200     www.vivus.com

		

		

			 

		

		

			4

		

 

		
		

		
			We greatly appreciate your many contributions to the Company.
		

			
					
						 

					
					
						Sincerely,

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						/s/ Svai Sanford

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						Svai Sanford

				
	
					
						 

					
					
						Chief Financial Officer

				

		
			 
		

		
			By signing this letter, I acknowledge that I have had the opportunity to review this Retention Agreement carefully with an attorney of my choice; that I have read this Retention Agreement and understand its terms; that I enter into this Retention Agreement knowingly and voluntarily; and that I agree to and accept all of the terms set forth in this Retention Agreement.
		

		
			Agreed and Accepted:
		

		
			 
		

			
					
						 

					
					
						 

				
	
					
						Dated: April 13, 2015

					
					
						GUY P. MARSH

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						/s/ Guy P. Marsh

				

		
			 
		

		
			 
		

		
			
		

		 

		

			VIVUS, Inc.    351 E. Evelyn Ave., Mountain View, CA  94041    Tel 650-934-5200     www.vivus.com

		

		

			 

		

		

			5

		

 

		

			 

		

		EXHIBIT A
		

		
			 
		

		
			SEPARATION AGREEMENT AND RELEASE
		

		
			 
		

		
			 
		

		
			 
		

		

		

		 

		

			 

		

 

		

			 

		

		SEPARATION AGREEMENT AND RELEASE
		

		
			 
		

		
			This Separation Agreement and Release (“Agreement”) is made by and between Guy P. Marsh (“Employee”) and VIVUS, Inc. (the “Company”) (collectively referred to as the “Parties” or individually referred to as a “Party”).
		

		
			 
		

		
			Whereas, in connection with Employee’s termination of employment effective as of May 1, 2015, Employee is eligible to receive the benefits provided in the letter agreement by and between Employee and the Company dated April 13, 2015 (the “Retention Agreement”), subject to the terms and conditions set forth therein including (but not limited to) entering into a release of claims agreement in favor of the Company under Section 4 of the Retention Agreement. 
		

		
			 
		

		
			Whereas, in consideration for such benefits provided under the Retention Agreement and pursuant to Section 4 of the Retention Agreement, the Parties wish to resolve any and all disputes, claims, complaints, grievances, charges, actions, petitions, and demands that Employee may have against the Company and any of the Releasees as defined below, including, but not limited to, any and all claims arising out of or in any way related to Employee’s employment with or separation from the Company.
		

		
			 
		

		
			Now, therefore, Employee covenants and agrees as follows:
		

		
			 
		

			
	
			
				 1.
			Payment of Salary and Receipt of All Benefits.  Employee acknowledges and represents that, other than the consideration set forth in the Retention Agreement, the Company has paid or provided all salary, wages, bonuses, accrued vacation/paid time off, premiums, leaves, housing allowances, relocation costs, interest, severance, outplacement costs, fees, reimbursable expenses, commissions, stock, stock options, vesting, and any and all other benefits and compensation due to Employee.  

		
			 
		

			
	
			
				 2.
			Release of Claims.  Employee agrees that the foregoing consideration represents settlement in full of all outstanding obligations owed to Employee by the Company and its current and former officers, directors, employees, agents, investors, attorneys, shareholders, administrators, affiliates, benefit plans, plan administrators, insurers, trustees, divisions, and subsidiaries, and predecessor and successor corporations and assigns (collectively, the “Releasees”).  Employee, on his/her own behalf and on behalf of his/her respective heirs, family members, executors, agents, and assigns, hereby and forever releases the Releasees from, and agrees not to sue concerning, or in any manner to institute, prosecute, or pursue, any claim, complaint, charge, duty, obligation, demand, or cause of action relating to any matters of any kind, whether presently known or unknown, suspected or unsuspected, that Employee may possess against any of the Releasees arising from any omissions, acts, facts, or damages that have occurred up until and including the Effective Date (as defined below) of this Agreement, including, without limitation:

		
			 
		

			
	
			
				 a.
			any and all claims relating to or arising from Employee’s employment relationship with the Company and the termination of that relationship; 

		

		

		 

		

			-  1  -

		

 

		

			 

		

		
		

			
	
			
				 b.
			any and all claims relating to, or arising from, Employee’s right to purchase, or actual purchase of shares of stock of the Company, including, without limitation, any claims for fraud, misrepresentation, breach of fiduciary duty, breach of duty under applicable state corporate law, and securities fraud under any state or federal law;

		
			 
		

			
	
			
				 c.
			any and all claims for wrongful discharge of employment; termination in violation of public policy; discrimination; harassment; retaliation; breach of contract, both express and implied; breach of covenant of good faith and fair dealing, both express and implied; promissory estoppel; negligent or intentional infliction of emotional distress; fraud; negligent or intentional misrepresentation; negligent or intentional interference with contract or prospective economic advantage; unfair business practices; defamation; libel; slander; negligence; personal injury; assault; battery; invasion of privacy; false imprisonment; conversion; and disability benefits;

		
			 
		

			
	
			
				 d.
			any and all claims for violation of any federal, state, or municipal statute, including, but not limited to, Title VII of the Civil Rights Act of 1964; the Civil Rights Act of 1991; the Rehabilitation Act of 1973; the Americans with Disabilities Act of 1990; the Equal Pay Act; the Fair Labor Standards Act; the Fair Credit Reporting Act; the Age Discrimination in Employment Act of 1967; the Older Workers Benefit Protection Act; the Employee Retirement Income Security Act of 1974; the Worker Adjustment and Retraining Notification Act; the Family and Medical Leave Act; the Sarbanes-Oxley Act of 2002; the California Family Rights Act; the California Labor Code; the California Workers’ Compensation Act; and the California Fair Employment and Housing Act; 

		
			 
		

			
	
			
				 e.
			any and all claims for violation of the federal or any state constitution;

		
			 
		

			
	
			
				 f.
			any and all claims arising out of any other laws and regulations relating to employment or employment discrimination;

		
			 
		

			
	
			
				 g.
			any claim for any loss, cost, damage, or expense arising out of any dispute over the nonwithholding or other tax treatment of any of the proceeds received by Employee as a result of this Agreement; and

		
			 
		

			
	
			
				 h.
			any and all claims for attorneys’ fees and costs.

		
			 
		

		
			Employee agrees that the release set forth in this section shall be and remain in effect in all respects as a complete general release as to the matters released.  This release does not extend to any obligations incurred under this Agreement.  This release does not release claims that cannot be released as a matter of law, including, but not limited to, Employee’s right to file a charge with or participate in a charge by the Equal Employment Opportunity Commission, or any other local, state, or federal administrative body or government agency that is authorized to enforce or administer laws related to employment, against the Company (with the understanding that any such filing or participation does not give Employee the right to recover any monetary damages against the Company; Employee’s release of claims herein bars Employee from recovering such monetary relief from the Company).  Notwithstanding the foregoing, Employee acknowledges that any and all disputed wage claims that are released herein shall be subject to binding arbitration in accordance with Section 9 below, which precludes Employee from filing a claim with the Division of Labor 
		

		

		

		 

		

			-  2  -

		

 

		

			 

		

		
		

		
			Standards Enforcement.  Further, (i) Employee will not be deemed to have waived his/her right to indemnification in accordance with the Company’s certificate of incorporation and bylaws, which indemnifies and holds Employee harmless from and against any and all liability, loss, damages or expenses incurred as a result of, arising out of, or in any way related to, Employee’s service as an officer or director of the Company, to the same extent as with respect to other officers and directors of the Company, or under Labor Code Section 2802, and (ii) Employee will not be deemed to have waived any claims with respect to vested benefits under an ERISA-governed plan.    Employee represents that he/she has made no assignment or transfer of any right, claim, complaint, charge, duty, obligation, demand, cause of action, or other matter waived or released by this Section. 
		

		
			 
		

			
	
			
				 3.
			Acknowledgment of Waiver of Claims under ADEA. Employee acknowledges that he/she is waiving and releasing any rights he/she may have under the Age Discrimination in Employment Act of 1967 (“ADEA”), and that this waiver and release is knowing and voluntary.  Employee agrees that this waiver and release does not apply to any rights or claims that may arise under the ADEA after the Effective Date of this Agreement.  Employee acknowledges that the consideration given for this waiver and release is in addition to anything of value to which Employee was already entitled.  Employee further acknowledges that he/she has been advised by this writing that: (a) he/she should consult with an attorney prior to executing this Agreement; (b) he/she has twenty-one (21) days within which to consider this Agreement; (c) he/she has seven (7) days following his/her execution of this Agreement to revoke this Agreement; (d) this Agreement shall not be effective until after the revocation period has expired; and (e) nothing in this Agreement prevents or precludes Employee from challenging or seeking a determination in good faith of the validity of this waiver under the ADEA, nor does it impose any condition precedent, penalties, or costs for doing so, unless specifically authorized by federal law.  In the event Employee signs this Agreement and returns it to the Company in less than the 21-day period identified above, Employee hereby acknowledges that he/she has freely and voluntarily chosen to waive the time period allotted for considering this Agreement.  Employee acknowledges and understands that revocation must be accomplished by a written notification to the person executing this Agreement on the Company’s behalf that is received prior to the Effective Date.

		
			 
		

			
	
			
				 4.
			California Civil Code Section 1542.  Employee acknowledges that he/she has been advised to consult with legal counsel and is familiar with the provisions of California Civil Code Section 1542, a statute that otherwise prohibits the release of unknown claims, which provides as follows:

		
			 
		

		
			A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.
		

		
			 
		

		
			Employee, being aware of said code section, agrees to expressly waive any rights he/she may have thereunder, as well as under any other statute or common law principles of similar effect.
		

		
			 
		

		

		

		 

		

			-  3  -

		

 

		

			 

		

		
		

			
	
			
				 5.
			No Pending or Future Lawsuits.  Employee represents that he/she has no lawsuits, claims, or actions pending in his/her name, or on behalf of any other person or entity, against the Company or any of the other Releasees. Employee also represents that he/she does not intend to bring any claims on his/her own behalf or on behalf of any other person or entity against the Company or any of the other Releasees.

		
			 
		

			
	
			
				 6.
			Trade Secrets and Confidential Information/Company Property.  Employee reaffirms and agrees to observe and abide by the terms of the Employment, Confidential Information, Invention Assignment, and Arbitration Agreement dated April 29, 1999, specifically including the provisions therein regarding nondisclosure of the Company’s trade secrets and confidential and proprietary information, and nonsolicitation of Company employees.  Employee’s signature below constitutes his/her certification under penalty of perjury that he/she has returned all documents and other items provided to Employee by the Company, developed or obtained by Employee in connection with his/her employment with the Company, or otherwise belonging to the Company.    

		
			 
		

			
	
			
				 7.
			No Admission of Liability.  The Parties understand and acknowledge that this Agreement constitutes a compromise and settlement of any and all actual or potential disputed claims by the Parties.  No action taken by the Company or Employee hereto, either previously or in connection with this Agreement, shall be deemed or construed to be (a) an admission of the truth or falsity of any actual or potential claims or (b) an acknowledgment or admission by the Company or Employee of any fault or liability whatsoever to the other Party or to any third party.

		
			 
		

			
	
			
				 8.
			Costs.  The Parties shall each bear their own costs, attorneys’ fees, and other fees incurred in connection with the preparation of this Agreement.

		
			 
		

			
	
			
				 9.
			ARBITRATION.  THE PARTIES AGREE THAT ANY AND ALL DISPUTES ARISING OUT OF THE TERMS OF THIS AGREEMENT, THEIR INTERPRETATION, AND ANY OF THE MATTERS HEREIN RELEASED, SHALL BE SUBJECT TO ARBITRATION IN SANTA CLARA COUNTY, BEFORE JUDICIAL ARBITRATION & MEDIATION SERVICES (“JAMS”), PURSUANT TO ITS EMPLOYMENT ARBITRATION RULES & PROCEDURES (“JAMS RULES”).  THE ARBITRATOR MAY GRANT INJUNCTIONS AND OTHER RELIEF IN SUCH DISPUTES.  THE ARBITRATOR SHALL ADMINISTER AND CONDUCT ANY ARBITRATION IN ACCORDANCE WITH CALIFORNIA LAW, INCLUDING THE CALIFORNIA CODE OF CIVIL PROCEDURE, AND THE ARBITRATOR SHALL APPLY SUBSTANTIVE AND PROCEDURAL CALIFORNIA LAW TO ANY DISPUTE OR CLAIM, WITHOUT REFERENCE TO ANY CONFLICT-OF-LAW PROVISIONS OF ANY JURISDICTION.  TO THE EXTENT THAT THE JAMS RULES CONFLICT WITH CALIFORNIA LAW, CALIFORNIA LAW SHALL TAKE PRECEDENCE.  THE DECISION OF THE ARBITRATOR SHALL BE FINAL, CONCLUSIVE, AND BINDING ON THE PARTIES TO THE ARBITRATION.  THE PARTIES AGREE THAT THE PREVAILING PARTY IN ANY ARBITRATION SHALL BE ENTITLED TO INJUNCTIVE RELIEF IN ANY COURT OF COMPETENT JURISDICTION TO ENFORCE THE ARBITRATION AWARD.  THE PARTIES TO THE ARBITRATION SHALL EACH PAY AN EQUAL SHARE OF THE COSTS AND EXPENSES OF SUCH ARBITRATION, AND EACH PARTY SHALL SEPARATELY PAY FOR ITS RESPECTIVE COUNSEL FEES AND EXPENSES; PROVIDED, HOWEVER, THAT THE 

		

		

		 

		

			-  4  -

		

 

		

			 

		

		
		

		
			ARBITRATOR SHALL AWARD ATTORNEYS’ FEES AND COSTS TO THE PREVAILING PARTY, EXCEPT AS PROHIBITED BY LAW.  THE PARTIES HEREBY AGREE TO WAIVE THEIR RIGHT TO HAVE ANY DISPUTE BETWEEN THEM RESOLVED IN A COURT OF LAW BY A JUDGE OR JURY.  NOTWITHSTANDING THE FOREGOING, THIS SECTION WILL NOT PREVENT EITHER PARTY FROM SEEKING INJUNCTIVE RELIEF (OR ANY OTHER PROVISIONAL REMEDY) FROM ANY COURT HAVING JURISDICTION OVER THE PARTIES AND THE SUBJECT MATTER OF THEIR DISPUTE RELATING TO THIS AGREEMENT AND THE AGREEMENTS INCORPORATED HEREIN BY REFERENCE.  SHOULD ANY PART OF THE ARBITRATION AGREEMENT CONTAINED IN THIS PARAGRAPH CONFLICT WITH ANY OTHER ARBITRATION AGREEMENT BETWEEN THE PARTIES, THE PARTIES AGREE THAT THIS ARBITRATION AGREEMENT SHALL GOVERN.
		

		
			 
		

			
	
			
				 10.
			Tax Consequences.  The Company makes no representations or warranties with respect to the tax consequences of the payments and any other consideration provided to Employee or made on his/her behalf under the terms of this Agreement.  Employee agrees and understands that he/she is responsible for payment, if any, of local, state, and/or federal taxes on the payments and any other consideration that would normally be Employee’s responsibility and that the Company will be responsible for the employer-related taxes and contributions that would normally be its responsibility.  

		
			 
		

			
	
			
				 11.
			Authority.  The Company represents and warrants that the undersigned has the authority to act on behalf of the Company and to bind the Company and all who may claim through it to the terms and conditions of this Agreement.  Employee represents and warrants that he/she has the capacity to act on his/her own behalf and on behalf of all who might claim through him/her to bind them to the terms and conditions of this Agreement.  Each Party warrants and represents that there are no liens or claims of lien or assignments in law or equity or otherwise of or against any of the claims or causes of action released herein.

		
			 
		

			
	
			
				 12.
			No Representations.  Employee represents that he/she has had an opportunity to consult with an attorney, and has carefully read and understands the scope and effect of the provisions of this Agreement.  Employee has not relied upon any representations or statements made by the Company that are not specifically set forth in this Agreement.

		
			 
		

			
	
			
				 13.
			Severability.  In the event that any provision or any portion of any provision hereof or any surviving agreement made a part hereof becomes or is declared by a court of competent jurisdiction or arbitrator to be illegal, unenforceable, or void, this Agreement shall continue in full force and effect without said provision or portion of provision.

		
			 
		

			
	
			
				 14.
			Attorneys’ Fees.  Except with regard to a legal action challenging or seeking a determination in good faith of the validity of the waiver herein under the ADEA, in the event that either Party brings an action to enforce or effect its rights under this Agreement, the prevailing Party shall be entitled to recover its costs and expenses, including the costs of mediation, arbitration, litigation, court fees, and reasonable attorneys’ fees incurred in connection with such an action.

		
			 
		

		

		

		 

		

			-  5  -

		

 

		

			 

		

		
		

			
	
			
				 15.
			Entire Agreement.  This Agreement represents the entire agreement and understanding between the Company and Employee concerning the subject matter of this Agreement and Employee’s employment with and separation from the Company and the events leading thereto and associated therewith, and supersedes and replaces any and all prior agreements and understandings concerning the subject matter of this Agreement and Employee’s relationship with the Company, with the exception of the Confidentiality Agreement. 

		
			 
		

			
	
			
				 16.
			No Oral Modification.  This Agreement may only be amended in a writing signed by Employee and the Company’s Chief Executive Officer.

		
			 
		

			
	
			
				 17.
			Governing Law.  This Agreement shall be governed by the laws of the State of California, without regard for choice-of-law provisions.  Employee consents to personal and exclusive jurisdiction and venue in the State of California.

		
			 
		

			
	
			
				 18.
			Effective Date.  Employee understands that this Agreement shall be null and void if not executed by him/her within twenty one (21) days.   Employee has seven (7) days after he signs this Agreement to revoke it.  This Agreement will become effective on the eighth (8th) day after Employee signed this Agreement, so long as it has been signed by the Parties and has not been revoked by Employee before that date (the “Effective Date”).  

		
			 
		

			
	
			
				 19.
			Counterparts.  This Agreement may be executed in counterparts and by facsimile, and each counterpart and facsimile shall have the same force and effect as an original and shall constitute an effective, binding agreement on the part of each of the undersigned.

		
			 
		

			
	
			
				 20.
			Voluntary Execution of Agreement.  Employee understands and agrees that he/she executed this Agreement voluntarily, without any duress or undue influence on the part or behalf of the Company or any third party, with the full intent of releasing all of his/her claims against the Company and any of the other Releasees.  Employee acknowledges that:

		
			 
		

			
	
			
				 (a)
			

			
	
			
			he/she has read this Agreement;

		
			 
		

			
	
			
				 (b)
			

			
	
			
			he/she has been represented in the preparation, negotiation, and execution of this Agreement by legal counsel of his/her own choice or has elected not to retain legal counsel;

		
			 
		

			
	
			
				 (c)
			

			
	
			
			he/she understands the terms and consequences of this Agreement and of the releases it contains; and

		
			 
		

			
	
			
				 (d)
			

			
	
			
			he/she is fully aware of the legal and binding effect of this Agreement.

		
			 
		

		

		

		 

		

			-  6  -

		

 

		

			 

		

		
		

		
			IN WITNESS WHEREOF, the Parties have executed this Agreement on the respective dates set forth below.
		

		
			 
		

		
			 
		

			
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						GUY P. MARSH, an individual

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						Dated:  May 1, 2015

					
					
						/s/ Guy P. Marsh

				
	
					
						 

					
					
						Guy P. Marsh

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						VIVUS, INC.

				
	
					
						 

					
					
						 

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						Dated:  May 1, 2015

					
					
						By:

					
					
						/s/ Sandra Wells

				
	
					
						 

					
					
						 

					
					
						 

				
	
					
						 

					
					
						Title:

					
					
						VP, Patents & Assistant General Counsel

				

		
			 
		

		 

		

			-  7  -

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