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Exhibit 10.23    
    

 
 

UNITED ONLINE, INC.    
    
    RESTRICTED STOCK UNIT ISSUANCE AGREEMENT    
    

RECITALS  

        A.    The
Board has adopted the Plan for the purpose of retaining the services of selected Employees and consultants and other independent advisors who provide services to the
Corporation (or any Parent or Subsidiary). 

        B.    Participant
is to render valuable services to the Corporation (or a Parent or Subsidiary), and this Agreement is executed pursuant to, and is intended to carry out the
purposes of, the Plan in connection with the Corporation's issuance of shares of Common Stock to the Participant under the Stock Issuance Program. 

        C.    All
capitalized terms in this Agreement shall have the meaning assigned to them in the attached Appendix A. 

        NOW, THEREFORE, it is hereby agreed as follows: 

        1.    Grant of Restricted Stock Units.    The Corporation hereby awards to the Participant, as
of the Award Date, Restricted Stock Units under the Plan. Each Restricted Stock Unit represents the right to receive one share of Common Stock on the vesting date of that unit. The number of shares of
Common Stock subject to the awarded Restricted Stock Units, the applicable vesting schedule for those shares, the dates on which those vested shares shall become issuable to Participant and the
remaining terms and conditions governing the award (the "Award") shall be as set forth in this Agreement. 

 
 

AWARD SUMMARY    
    

	

Award Date: 	
 	

[                        ].
	

Number of Shares Subject to Award: 	
 	

[                        ] shares of Common Stock (each, a "Share" and collectively, the "Maximum Shares").
	

Vesting Schedule: 	
 	

[If the Corporation's highest 30-day volume-weighted average closing price for any consecutive 30-days between
[                        ] and
[                        ] is (i) less than
[                        ],
[                        ] Shares shall become immediately vested; (ii) equal to or greater than
[                        ], but less than
[                        ],
[                        ] Shares shall become immediately vested; and (iii) equal to or greater than
[                        ], the Maximum Shares shall become immediately vested. Any Shares that have not vested by
[                        ] shall be immediately cancelled with respect to those unvested Shares.]
	

 	
 	

[If, beginning [                        ], the Corporation's closing share price is at least equal to
[                        ], and its volume-weighted average closing price for the immediately following six months (the "Six-Month
Period") is at least equal to [                        ], the Maximum Shares shall become immediately vested as of the last
trading day of the Six-Month Period.]

 

	

Issuance Schedule	
 	

The Shares in which the Participant vests in accordance with the foregoing Vesting Schedule will be issuable immediately upon vesting, and in any event within 21/2 months, after the last day of any calendar quarter in which
any Shares subject to the Award became vested, subject to the Corporation's collection of the applicable Withholding Taxes. The procedures pursuant to which the applicable Withholding Taxes are to be collected are set forth in Paragraph 8 of
this Agreement.

        2.    Limited Transferability.    Prior to actual receipt of the Shares which vest hereunder,
the Participant may not transfer any interest in the Award or the underlying Shares. Any Shares which vest hereunder but which otherwise remain unissued at the time of the Participant's death may be
transferred pursuant to the provisions of the Participant's will or the laws of inheritance or to the Participant's designated beneficiary or beneficiaries of this Award. The Participant may also
direct the Corporation to issue the stock certificates for any Shares which in fact vest and become issuable under the Award during his or her lifetime to one or more designated family members or a
trust established for the Participant and/or his or her family members. The Participant may make such a beneficiary designation or certificate directive at any time by filing the appropriate form with
the Plan Administrator or its designee. 

        3.    Cessation of Service.    Except as otherwise provided in Paragraphs 4 and 6
below, 

        (a)   Should
the Participant's Service be terminated (i) by reason of his resignation from the Company or (ii) by the Company for Cause, in each case prior to
[                        ], then the Award will be immediately cancelled and the Participant shall thereupon cease to have any
right or entitlement to receive any Shares under the
Award. 

        (b)   Should
the Participant's Service terminate by reason of death or permanent disability, then the Maximum Shares shall become immediately vested. 

        (c)   Should
the Participant's Service be terminated without Cause by the Company, then the Maximum Shares shall become immediately vested. 

        4.    Accelerated Vesting.    [Reserved] 

        5.    Stockholder Rights and Dividend Equivalents.    The holder of this Award shall not have
any stockholder rights, including voting or dividend rights, with respect to the Shares subject to the Award until the Participant becomes the record holder of those Shares following their actual
issuance upon the Corporation's collection of the applicable Withholding Taxes. 

Notwithstanding
the foregoing, should any dividend or other distribution, whether regular or extraordinary and whether payable in cash, shares of Common Stock or other property, be declared and paid
on the outstanding Common Stock while one or more Shares remain subject to this Award (i.e., those Shares are not otherwise issued and outstanding for purposes of entitlement to the dividend or
distribution), then a special book account shall be established for the Participant and credited with a phantom dividend equivalent to the actual dividend or distribution which would have been paid on
the Maximum Shares had they been issued and outstanding and entitled to that dividend or distribution. As the Shares subsequently vest hereunder, the phantom dividend equivalents so credited to those
Shares in the book account shall be distributed to the Participant (in the same form the actual dividend or distribution was paid to the holders of the Common Stock entitled to that dividend or
distribution) concurrently with the issuance of the vested Shares to which those phantom dividend equivalents relate, and in any event within 21/2 months after the last day of any
calendar quarter in which any Shares subject to the Award became vested. The phantom dividend equivalents so credited to any Shares that do not vest pursuant to this Agreement shall be forfeited and
the Participant shall cease to have any 

2

 

right
or entitlement to receive any such phantom dividend equivalents. However, each such distribution shall be subject to the Corporation's collection of the Withholding Taxes applicable to that
distribution. 

        6.    Change in Control.    

        (a)   Should
a Change in Control occur, then the Maximum Shares shall become immediately vested. 

        (b)   Should
the accelerated vesting of the Shares pursuant to the provisions of this Paragraph 6 result in a parachute payment under Code Section 280G, then the
Participant shall be entitled to the Code Section 4999 tax gross-up payment provided under his Employment Agreement. 

        (c)   This
Agreement shall not in any way affect the right of the Corporation to adjust, reclassify, reorganize or otherwise change its capital or business structure or to
merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets. 

        7.    Adjustment in Shares.    Should any change be made to the Common Stock by reason of any
stock split, stock dividend, recapitalization, combination of shares, exchange of shares or other change affecting the outstanding Common Stock as a class without the Corporation's receipt of
consideration, appropriate
adjustments shall be made to the total number and/or class of securities issuable pursuant to this Award in order to reflect such change and thereby preclude a dilution or enlargement of benefits
hereunder. 

        8.    Issuance of Shares of Common Stock.    

        (a)   As
soon as administratively practicable following the date the Shares vest in accordance with the provisions of this Agreement, and in any event within
21/2 months after the last day of any calendar quarter in which any Shares subject to the Award became vested, the Corporation shall issue to or on behalf of the Participant a
certificate (which may be in electronic form) for the shares of Common Stock which vest on that date under the Award and shall concurrently distribute to the Participant any phantom dividend
equivalents with respect to those Shares, subject in each instance to the Corporation's collection of the applicable Withholding Taxes. The Corporation shall collect the Withholding Taxes with respect
to the distributed phantom dividend equivalents by withholding a portion of that distribution equal to the amount of the applicable Withholding Taxes, with the cash portion of the distribution to be
the first portion so withheld. The Corporation shall collect the Withholding Taxes with respect to the vested Shares through an automatic Share withholding procedure pursuant to which the Corporation
will withhold, immediately as the Shares vest under the Award, a portion of those vested Shares with a Fair Market Value (measured as of the vesting date) equal to the amount of such Withholding Taxes
(the "Share Withholding Method"); provided, however, that the amount of any Shares so withheld shall not exceed the amount necessary to satisfy the
Corporation's required tax withholding obligations using the minimum statutory withholding rates for federal and state tax purposes, including payroll taxes, that are applicable to supplemental
taxable income. Participant shall be notified in writing in the event such Share Withholding Method is no longer available. 

        (b)   Except
as otherwise provided in Paragraph 8(a), the settlement of all Restricted Stock Units which vest under the Award shall be made solely in shares of Common
Stock. In no event, however, shall any fractional shares be issued. Accordingly, the total number of shares of Common Stock to be issued at the time the Award vests shall, to the extent necessary, be
rounded down to the next whole share in order to avoid the issuance of a fractional share. 

        9.    Compliance with Laws and Regulations.    The issuance of shares of Common Stock pursuant
to the Award shall be subject to compliance by the Corporation and Participant with all applicable requirements of law relating thereto and with all applicable regulations of any stock exchange (or
the 

3

 

Nasdaq
Stock Market, if applicable) on which the Common Stock may be listed for trading at the time of such issuance. 

        10.    Notices.    Any notice required to be given or delivered to the Corporation under the
terms of this Agreement shall be in writing and addressed to the Corporation at its principal corporate offices, and directed to the attention of Stock Plan Administrator. Any notice required to be
given or delivered to Participant shall be in writing and addressed to Participant at the address on record with the Corporation. An email to the email address of Participant on record with the
Corporation shall be deemed to be written notice. All notices shall be deemed effective upon personal delivery, upon sending of an email or upon deposit in the U.S. mail, postage prepaid and properly
addressed to the party to be notified. 

        11.    Governing Law.    The interpretation, performance and enforcement of this Agreement
shall be governed by the laws of the State of California without resort to that State's conflict-of-laws rules. 

        12.    Successors and Assigns.    Except to the extent otherwise provided in this Agreement,
the provisions of this Agreement shall inure to the benefit of, and be binding upon, the Corporation and its successors and assigns and Participant, Participant's assigns, the legal representatives,
heirs and legatees of Participant's estate and any beneficiaries of the Award designated by Participant. 

        13.    Construction.    This Agreement and the Award evidenced hereby are made and granted
pursuant to the Plan and are in all respects limited by and subject to the terms of the Plan. All decisions of the Plan Administrator with respect to any question or issue arising under the Plan or
this Agreement shall be conclusive and binding on all persons having an interest in the Award. 

        14.    Section 409A.    It is intended that this Agreement shall comply with the
provisions of section 409A of the Code and the Treasury Regulations relating thereto so as not to subject Participant to the payment of additional taxes and interest under section 409A
of the Code. In furtherance of this intent, this Agreement shall be interpreted, operated, and administered in a manner consistent with these intentions, and to the extent that any regulations or
other guidance issued under section 409A of the Code would result in Participant being subject to payment of additional income taxes or interest under section 409A of the Code,
Participant and the Company agree to amend this Agreement in order to avoid the application of such taxes or interest under section 409A of the Code. 

        IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year first indicated above. 

	 	 	UNITED ONLINE, INC.
	 	 	 	 	 
	 	 	 	 	 
	 	 	By:	 	 
	 	 	 	 	

	

 	
 	

Title:	
 	

 
	 	 	 	 	

	 	 	 	 	 
	 	 	 	 	 
	 	 	PARTICIPANT
	 	 	 	 	 
	 	 	 	 	 
	 	 	Signature:	 	 
	 	 	 	 	

	

 	
 	

Address:	
 	

 
	 	 	 	 	

	

 	
 	

 	
 	

4

 

 

 
 

APPENDIX A    
    
    DEFINITIONS    
    

        The following definitions shall be in effect under the Agreement: 

        A.    Agreement shall mean this Restricted Stock Unit Issuance Agreement. 

        B.    Award shall mean the award of restricted stock units made to the Participant pursuant to the terms of this Agreement. 

        C.    Award Date shall mean the date the restricted stock units are awarded to Participant pursuant to the Agreement and shall
be the date indicated in Paragraph 1 of the Agreement. 

        D.    Board shall mean the Corporation's Board of Directors. 

        E.    Cause shall have the meaning assigned to such term in the Employment Agreement. 

        F.     Change in Control shall mean a change in ownership or control of the Corporation effected through any of the following
transactions: 

          (i)  a
merger or consolidation approved by the Corporation's stockholders, unless securities possessing more than fifty percent (50%) of the total combined voting power of
the voting securities of the successor corporation are immediately thereafter beneficially owned, directly or indirectly and
substantially in the same proportion, by the persons who beneficially owned the Corporation's outstanding voting securities immediately prior to such transaction, 

         (ii)  the
sale, transfer or other disposition of all or substantially all of the Corporation's assets approved by the Corporation's stockholders, 

        (iii)  the
acquisition, directly or indirectly by any person or related group of persons (other than the Corporation or a person that directly or indirectly controls, is
controlled by, or is under common control with, the Corporation), of beneficial ownership (within the meaning of Rule 13d-3 of the 1934 Act) of securities possessing more than fifty
percent (50%) of the total combined voting power of the Corporation's outstanding securities pursuant to a tender or exchange offer made directly to the Corporation's stockholders, or 

        (iv)  a
change in the composition of the Board over a period of thirty-six (36) consecutive months or less such that a majority of the Board members
ceases, by reason of one or more contested elections for Board membership, to be comprised of individuals who either (A) have been Board members continuously since the beginning of such period
or (B) have been elected or nominated for election as Board members during such period by at least a majority of the Board members described in clause (A) who were still in office at the
time the Board approved such election or nomination. 

        G.    Code shall mean the Internal Revenue Code of 1986, as amended. 

        H.    Common Stock shall mean shares of the Corporation's common stock. 

        I.     Corporation shall mean United Online, Inc., a Delaware corporation, and any successor corporation to all or
substantially all of the assets or voting stock of United Online, Inc. which shall by appropriate action adopt the Plan. 

        J.     Employee shall mean an individual who is in the employ of the Corporation (or any Parent or Subsidiary), subject to the
control and direction of the employer entity as to both the work to be performed and the manner and method of performance. 

A-1

 

        K.    Employment Agreement shall mean the Amended and Restated Employment Agreement between the Participant and the Corporation
dated as of [                        ], and as in effect on the date of the Award. 

        L.    Fair Market Value per share of Common Stock on any relevant date shall be determined in accordance with the following
provisions: 

          (i)  If
the Common Stock is at the time traded on the Nasdaq Stock Market, then the Fair Market Value shall be the closing selling price per share of Common Stock, as such
price is reported by the National Association of Securities Dealers. If there is no closing selling price for the Common Stock on the date in question, then the Fair Market Value shall be the closing
selling price on the last preceding date for which such quotation exists. 

         (ii)  If
the Common Stock is at the time listed on any Stock Exchange, then the Fair Market Value shall be the closing selling price per share of Common Stock on the date in
question on the Stock Exchange determined by the Plan Administrator to be the primary market for the Common Stock, as such price is officially quoted in the composite tape of transactions on such
exchange. If there is no closing selling price for the Common Stock on the date in question, then the Fair Market Value shall be the closing selling price on the last preceding date for which such
quotation exists. 

        M.   Involuntarily Terminated shall have the meaning assigned to that term in the Employment Agreement. 

        N.    1934 Act shall mean the Securities Exchange Act of 1934, as amended from time to time. 

        O.    Participant shall mean the person to whom the Award is made pursuant to the Agreement. 

        P.     Parent shall mean any corporation (other than the Corporation) in an unbroken chain of corporations ending with the
Corporation, provided each corporation in the unbroken chain (other than the Corporation) owns, at the time of the determination, stock possessing fifty percent (50%) or more of the total combined
voting power of all classes of stock in one of the other corporations in such chain. 

        Q.    Plan shall mean the Corporation's 2001 Stock Incentive Plan, as amended and restated. 

        R.    Plan Administrator shall mean either the Board or a committee of the Board acting in its capacity as administrator of the
Plan. 

        S.     Service shall mean the Participant's performance of services for the Corporation (or any Parent or Subsidiary) in the
capacity of an Employee, a non-employee member of the board of directors or a consultant or independent advisor. For purposes of this Agreement, Participant shall be deemed to cease
Service immediately upon the occurrence of the either of the following events: (i) Participant no longer performs services in any of the foregoing capacities for the Corporation (or any Parent
or Subsidiary) or (ii) the entity for which Participant performs such services ceases to remain a Parent or Subsidiary of the Corporation, even though Participant may subsequently continue to
perform services for that entity. Service shall not be deemed to cease during a period of military leave, sick leave or other personal leave approved by the Corporation;  provided, however, that
except to the extent otherwise required by law or expressly authorized by the Plan Administrator, no Service credit shall be
given for vesting purposes for any period the Participant is on a leave of absence. 

        T.     Stock Exchange shall mean the American Stock Exchange or the New York Stock Exchange. 

        U.    Subsidiary shall mean any corporation (other than the Corporation) in an unbroken chain of corporations beginning with the
Corporation, provided each corporation (other than the last corporation) in the unbroken chain owns, at the time of the determination, stock possessing fifty 

A-2

 

percent
(50%) or more of the total combined voting power of all classes of stock in one of the other corporations in such chain. 

        V.     Withholding Taxes shall mean the federal, state and local income taxes and the employee portion of the federal, state and
local employment taxes required to be withheld by the Corporation in connection with the issuance of the shares of Common Stock which vest under of the Award and any phantom dividend equivalents
distributed with respect to those shares. 

A-3

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Exhibit 10.23

UNITED ONLINE, INC. RESTRICTED STOCK UNIT ISSUANCE AGREEMENT

AWARD SUMMARY

APPENDIX A DEFINITIONSQuickLinks
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Exhibit 10.1    
    

 
  EMPLOYMENT AGREEMENT    
    

        AGREEMENT, made and entered into as of February 11, 2008 by and between Vertex Pharmaceuticals Incorporated, a Massachusetts corporation (together with its
successors and assigns, the "Company"), and John Alam (the "Executive"). 

 
 

W I T N E S S E T H    
    

        WHEREAS, the Company is employing the Executive as the Company's Executive Vice President, Medicines Development, and Chief medical Officer; 

        WHEREAS,
the Company and the Executive desire to enter into an employment agreement, which shall set forth the terms of such employment (this
"Agreement"); and 

        WHEREAS,
the Executive desires to enter into this Agreement and to continue such employment, subject to the terms and provisions of this Agreement. 

        NOW,
THEREFORE, in consideration of the premises and mutual covenants contained herein and for other good and valuable consideration, the receipt of which mutually is acknowledged, the
Company and the Executive (each individually a "Party", and together the "Parties") agree as follows: 

	1.
	DEFINITIONS. 

        "Base Salary" shall mean the Executive's base salary in accordance with Section 4 below. 

        "Board" shall mean the Board of Directors of the Company. 

        "Cause" shall mean (i) the Executive is convicted of a crime involving moral turpitude, (ii) the Executive commits a
material breach of any provision of this Agreement not involving the performance or nonperformance of duties, or (iii) the Executive, in carrying out the Executive's duties, acts or fails to
act in a manner that is determined, in the sole discretion of the Board, after written notice of any such act or failure to act and a reasonable opportunity to cure the deficiency has been provided to
the Executive, to be (A) willful gross neglect or (B) willful gross misconduct resulting, in either case, in material harm to the Company unless such act, or failure to act, was believed
by the Executive, in good faith, to be in the best interests of the Company. 

        "Change of Control" shall have the meaning set forth in the Change of Control Agreement. 

        "Change of Control Agreement" shall mean the Change of Control letter agreement between the Company and the Executive dated
March 7, 2003, as amended. 

        "Code" shall mean the Internal Revenue Code of 1986, as amended. 

        "Common Stock" shall mean the common stock of the Company. 

        "Disability" or "Disabled" shall mean a disability as determined under the Company's
long-term disability plan or program in effect at the time the disability first occurs, or if no such plan or program exists at the time of disability, then a "disability" as defined under
Section 22(e)(3) of the Code. 

        "Effective Date" shall mean February 11, 2008. 

        "Good Reason" shall mean that, without the Executive's consent, one or more of the following events occurs, and the Executive, at the
Executive's own initiative provides notice of termination within 30 days after such event: 

	(i)
	the
Executive's Base Salary is decreased unless such reduction is part of an across-the-board proportionate reduction in the salaries of the
Company's senior management team; or

	(ii)
	the
office to which the Executive is assigned is relocated to a place 35 or more miles away and such relocation is not at the Executive's request or with the
Executive's prior agreement (and 

 

other
than, for Executives assigned to the Company's principal executive offices, in connection with a change in location of the Company's principal executive offices). 

        "Severance Payment" shall mean an amount equal to the sum of the Base Salary in effect on the date of termination of Executive's
employment, plus the amount of the Target Bonus for the Executive for the year in which the Executive's employment is terminated; provided, however, that if the Executive terminates the Executive's
employment for Good Reason based on a reduction in Base Salary, then the Base Salary to be used in calculating the Severance Payment shall be the Base Salary in effect immediately prior to such
reduction in Base Salary. 

        "Target Bonus" shall mean the target cash bonus for which the Executive is eligible on an annual basis, at a level consistent with the
Executive's title and responsibilities, under the Company's bonus program then in effect and applicable to the Company's senior executives generally. 

	2.
	TERM
OF EMPLOYMENT. 

        The
Company hereby employs the Executive, and the Executive hereby accepts such employment, continuing until termination in accordance with the terms of this Agreement. The period during
which the Executive is employed hereunder is referred to in this Agreement as the "term of employment." 

	3.
	POSITION. 

        On
the Effective Date, the Executive shall be employed as the Company's Executive, Vice President, Medicines Development and Chief Medical Officer and shall be a member of the Company's
Executive Team, or similar senior leadership group. 

	4.
	BASE
SALARY. 

        The
Executive's annualized Base Salary as of the date of this Agreement is $424,360.00, payable in accordance with the regular payroll practices of the Company. The Base Salary shall be
reviewed no less frequently than annually, and any changes thereto (which shall thereafter be deemed the Executive's Base Salary) shall be solely within the discretion of the Board. 

	5.
	TARGET
BONUS PROGRAM. 

        During
the term of employment, the Executive shall be eligible to participate in the Company's Target Bonus program (and other cash incentive compensation programs) applicable to the
Company's senior executives, as any such programs are established and modified from time to time by the Board in its sole discretion, and in accordance with the terms of such program. 

	6.
	INCENTIVE
COMPENSATION PROGRAMS. 

        During
the term of employment, the Executive shall be eligible to participate in the Company's incentive compensation programs applicable to the Company's senior executives, as such
programs may be established and modified from time to time by the Board in its sole discretion. 

	7.
	EMPLOYEE
BENEFIT PROGRAMS. 

        During
the term of employment, the Executive shall be entitled to participate in all employee welfare and pension benefit plans, programs and/or arrangements offered by the Company to
its senior executives, as such plans, programs and arrangements may be amended from time to time, to the same extent and on the same terms applicable to other senior executives. Nothing in this
section shall preclude the Company from amending or terminating any of its employee benefit plans, programs or arrangements. 

	8.
	VACATION.

        During
the term of employment, the Executive shall be entitled to paid vacation days each calendar year in accordance with the Company's vacation policy then in effect. 

2

 
	9.
	TERMINATION
OF EMPLOYMENT. 

        (a)   Termination in Connection with a Change of Control.    To the extent the Executive is entitled, in connection
with the Executive's termination of employment, to severance or other benefits under the Change of Control Agreement, the Executive shall not be entitled to corresponding benefits under this
Section 9. 

        (b)   Termination by the Company for Cause; or Termination by the Executive without Good Reason. If the Company terminates the
Executive's employment for Cause, or if the Executive voluntarily terminates the Executive's employment, other than for Good Reason, death or Disability, the term of employment shall end as of the
date specified below, and the Executive shall be entitled to the following: 

	(i)
	Base
Salary earned by Executive but not paid through the date of termination of Executive's employment under this Section 9(b); and

	(ii)
	any
amounts earned, accrued or owing to the Executive but not yet paid under Sections 5, 6, or 7 above. 

        Termination
by Company for Cause shall be effective as of the date noticed by the Company. Voluntary termination by Executive other than for Good Reason, death or Disability shall be
effective upon 90 days' prior written notice to the Company and shall not be deemed a breach of this Agreement. 

        If
the Executive voluntarily terminates his or her employment without Good Reason, the Company may elect to waive the period of notice, or any portion thereof, and, if the Company so
elects, the Company will pay the Executive at the rate of the Executive's Base Salary for the notice period or for any remaining portion thereof. 

        (c)   Termination by the Company Without Cause; or Termination by the Executive for Good Reason. If the Executive's employment
is terminated by the Company without Cause (other than due to death or Disability), or is terminated by the Executive for Good Reason, the Executive shall be entitled to the following (provided that,
with respect to (iii) and (v) such amounts shall be subject to and in exchange for a general release by Executive of all claims against the Company, its subsidiaries, and their officers,
directors, agents and representatives): 

	(i)
	Base
Salary earned by Executive but not paid through the date of termination of Executive's employment under this Section 9(c);

	(ii)
	all
incentive compensation awards earned by Executive but not paid prior to the date of termination of Executive's employment under this Section 9(c);

	(iii)
	a
cash payment to the Executive in an amount equal to the Severance Payment, payable within ten days after the execution of a general release and expiration without
revocation of any applicable revocation periods under the general release;

	(iv)
	any
amounts earned, accrued or owing to the Executive but not yet paid under Sections 5, 6 or 7 above;

	(v)
	if
COBRA coverage is elected by the Executive, the Company shall pay the cost of COBRA continuation premiums on the Executive's behalf to continue standard medical,
dental and life insurance coverage for the Executive (or the cash equivalent of same in the event the Executive is ineligible for continued coverage) until the earlier of:

	(A)
	the
date 12 months after the date the Executive's employment is terminated; or 

3

 

	(B)
	the
date, or dates, on which the Executive receives equivalent coverage and benefits under the plans, programs and/or arrangements of a subsequent employer (such coverage and benefits
to be determined on a coverage-by-coverage or benefit-by-benefit basis). 

        If
Executive is a "specified employee" under Section 409A(a)(2)(B)(i) of the Code, any payment of "nonqualified deferred compensation" (as defined under Section 409A of the
Code and related guidance) attributable to a "separation from service" (as defined under Section 409A of the Code and related guidance) shall not commence until the first full business day that
is more than 6 months after the applicable separation from service ("Deferred Payment Date"). 

        Any
payments that would otherwise have been made between the separation from service and the Deferred Payment Date, but for this paragraph, shall be made in a lump sum on the Deferred
Payment Date. Payments that, in any case, are scheduled to be made after the Deferred Payment Date shall continue according to the applicable payment schedule. To the extent that the termination of
the Executive's employment does not constitute a separation of service under Section 409A(a)(2)(A)(i) of the Code (as the result of further services that reasonably are anticipated to be
provided by the Executive to the Company at the time the Executive's employment is terminated), the payment of any nonqualified deferred compensation will be further delayed until the date that is the
first full business day that is more than 6 months after the date of a subsequent event constituting a separation of service under Section 409A(a)(2)(A)(i) of the Code. 

	10.
	ASSIGNABILITY;
BINDING NATURE. 

        This
Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors, heirs (in the case of the Executive) and assigns. No rights or obligations
of the Company under this Agreement may be assigned or transferred by the Company except that such rights or obligations may be assigned or transferred pursuant to a merger or consolidation in which
the Company is not the continuing entity, or the sale or liquidation of all or substantially all of the assets of the Company; provided,  however, that the
assignee or transferee is the successor to all or substantially all of the assets of the Company and such assignee or transferee
assumes the liabilities, obligations and duties of the Company, as contained in this Agreement, either contractually or as a matter of law. 

	11.
	REPRESENTATIONS.

        The
Company represents and warrants that it is fully authorized and empowered to enter into this Agreement, and that the performance of its obligations under this Agreement will not
violate any agreement between it and any other person, firm or organization. The Executive represents and warrants that no agreement exists between him and any other person, firm or organization that
would be violated by the performance of the Executive's obligations under this Agreement. 

	12.
	INDEMNIFICATION;
INSURANCE. 

        The
Executive shall at all times be indemnified and eligible for advancement of expenses on the same basis as is provided for the Company's other executive officers and in accordance
with the provisions of the Company's charter and by-laws then in effect. The Executive shall also be covered under all of the Company's policies of liability insurance maintained for the
benefit of its directors and officers on the same basis as is provided for its other executive officers. 

	13.
	ENTIRE
AGREEMENT; TERMINATION. 

        This
Agreement, Change of Control Agreement, and the Employee Non-Disclosure, Non-Competition & Inventions Agreement between the Executive and the Company,
contain the entire understanding and agreement between the Parties concerning the subject matter hereof and supersedes all prior agreements, understandings, discussions, negotiations and undertakings,
whether written or oral, between the Parties with respect thereto. Subject to the terms of this Agreement, the Company 

4

 

shall
be entitled to terminate the Executive's employment at any time, and the Executive may terminate the Executive's employment by the Company, at any time, in each case by written notice provided
in accordance with Section 20 of this Agreement. 

	14.
	AMENDMENT
OR WAIVER. 

        No
provision in this Agreement may be amended unless such amendment is agreed to in writing and signed by the Executive and an authorized officer of the Company. No waiver by either
Party of any breach by the other Party of any condition or provision contained in this Agreement to be performed by such other Party shall be deemed a waiver of a similar or dissimilar condition or
provision at the same or any prior or subsequent time. Any waiver must be in writing and signed by the Executive or an authorized officer of the Company, as the case may be. 

	15.
	SEVERABILITY.

        If
any provision or portion of this Agreement shall be determined to be invalid or unenforceable for any reason, in whole or in part, the remaining provisions of this Agreement shall be
unaffected thereby and shall remain in full force and effect to the fullest extent permitted by law. 

	16.
	SURVIVORSHIP.

        The
respective rights and obligations of the Parties hereunder shall survive any termination of the Executive's employment to the extent necessary to the intended preservation of such
rights and obligations. 

	17.
	BENEFICIARIES/REFERENCES.

        The
Executive shall be entitled, to the extent permitted under any applicable law, to select and change a beneficiary or beneficiaries to receive any compensation or benefit payable
hereunder following the Executive's death by giving the Company written notice thereof. In the event of the Executive's death or a judicial determination of the Executive's incompetence, reference in
this Agreement to the Executive shall be deemed, where appropriate, to refer to the Executive's beneficiary, estate or other legal representative. 

	18.
	GOVERNING
LAW/JURISDICTION. 

        This
Agreement shall be governed by and construed and interpreted in accordance with the laws of The Commonwealth of Massachusetts without reference to principles of conflict of laws. 

	19.
	RESOLUTION
OF DISPUTES. 

        Any
disputes arising under or in connection with this Agreement may, at the election of the Executive or the Company, be resolved by binding arbitration, to be held in Massachusetts in
accordance with the Rules and Procedures of the American Arbitration Association. If arbitration is elected, the Executive and the Company shall mutually select the arbitrator. If the Executive and
the Company cannot agree on the selection of an arbitrator, each Party shall select an arbitrator and the two arbitrators shall select a third arbitrator, and the three arbitrators shall form an
arbitration panel that shall resolve the dispute by majority vote. Judgment upon the award rendered by the arbitrator or arbitrators may be entered in any court having jurisdiction thereof. Costs of
the arbitrator or arbitrators and other similar costs in connection with an arbitration shall be shared equally by the Parties; all other costs, such as attorneys' fees incurred by each Party, shall
be borne by the Party incurring such costs. 

	20.
	NOTICES. 

        All
notices that are required or permitted hereunder shall be in writing and sufficient if delivered personally, sent by facsimile (and promptly confirmed by personal delivery,
registered or certified mail 

5

 

or
overnight courier), sent by nationally-recognized overnight courier or sent by registered or certified mail, postage prepaid, addressed as follows: 

	 	 	If to the Company:	 	Vertex Pharmaceuticals Incorporated

130 Waverly Street

Cambridge, MA 02139-4242

Attn: Chief Executive Officer

with copies to:

the General Counsel
	

 	
 	

If to the Executive:	
 	

at the Executive's home address listed in the Company records.

        Any
such notice shall be deemed to have been given: (a) when delivered if personally delivered or sent by facsimile on a business day; (b) on the business day after
dispatch if sent by nationally-recognized overnight courier; and/or (c) on the fifth business day following the date of mailing if sent by mail. 

	21.
	HEADINGS.

        The
headings of the sections contained in this Agreement are for convenience only and shall not be deemed to control or affect the meaning or construction of any provision of this
Agreement. 

	22.
	COUNTERPARTS. 

        This
Agreement may be executed in two or more counterparts. 

	23.
	SECTION 409A
COMPLIANCE. 

        It
is the intention of the Company and the Executive that this Agreement and the payments provided for herein meet the requirements of Section 409A of the Code, to the extent
applicable to this
Agreement and such payments. The Company and the Executive agree to cooperate in good faith in preparing and executing, at such time as sufficient guidance is available under Section 409A and
from time to time thereafter, such amendments to this Agreement, if any, as the Executive may reasonably request solely for the purpose of assuring that this Agreement and the payments provided
hereunder meet the requirements of Section 409A. Nothing in this Section 23 shall require the Company to increase the Executive's compensation or make the Executive whole for any
requested changes. 

	24.
	TAX
WITHHOLDING; NO GUARANTEE OF ANY TAX CONSEQUENCES. 

        All
payments hereunder shall be subject to all applicable withholding for any federal, state or local income taxes including any excise taxes under the Code. Notwithstanding any other
provision of this Agreement to the contrary or other representation, the Company does not in any way guarantee the tax consequences of any payment or compensation under this Agreement including,
without limitation, under Section 409A of the Code. 

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

	 	 	Vertex Pharmaceuticals Incorporated
	

 	
 	

/s/  JOSHUA S. BOGER      
 Joshua S. Boger

President & Chief Executive Officer
	

 	
 	
Executive
	

 	
 	

/s/  JOHN ALAM      
 John Alam

6

QuickLinks

Exhibit 10.1

EMPLOYMENT AGREEMENT

W I T N E S S E T H

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