Document:

Exhibit 10.2

 

Robert
Forrester

Name
of Employee

COMBINATORX,
INCORPORATED

2004
Incentive Plan

 

Restricted
Stock Award Agreement

 

CombinatoRx, Incorporated

650 Albany St.

Boston, MA 02118

 

Attn:  Alexis Borisy

 

Ladies and Gentlemen:

 

The undersigned (i) acknowledges
that he has received an award (the “Award”) of restricted stock from CombinatoRx,
Incorporated (the “Company”) under the 2004 Incentive Plan (the “Plan”),
subject to the terms set forth below and in the Plan; (ii) further acknowledges
receipt of a copy of the Plan as in effect on the date hereof; and (iii) agrees
with the Company as follows:

 

1.               Effective
Date.  This
Agreement shall take effect as of January 26, 2006, which is the date of grant
of the Award.

 

2.               Shares
Subject to Award.  The Award
consists of 25,000 shares (the “Shares”) of common stock of the Company (“Stock”).  The undersigned’s rights to the Shares are
subject to the restrictions described in this Agreement and the Plan (which is
incorporated herein by reference with the same effect as if set forth herein in
full) in addition to such other restrictions, if any, as may be imposed by law.

 

3.               Meaning
of Certain Terms.  Except as
otherwise expressly provided, all terms used herein shall have the same meaning
as in the Plan.  The term “vest” as used
herein with respect to any Share means the lapsing of the restrictions described
herein with respect to such Share.

 

4.               Nontransferability
of Shares.  The Shares
acquired by the undersigned pursuant to this Agreement shall not be sold, transferred,
pledged, assigned or otherwise encumbered or disposed of except as provided
below and in the Plan.

 

5.               Accelerated
Vesting of Unvested Shares Upon Termination Without Cause or for Good Reason.  If the undersigned is terminated by the
Company without Cause (as defined below) or if the undersigned terminates his
employment for Good Reason, to the extent there are any unvested Shares, the
twenty five (25%) percent of the then unvested Shares shall vest for each year
of employment of the undersigned with the Company.  For example, if there is a termination
without Cause at the end of the second year of employment, then fifty (50%)
percent of Shares would be unvested and automatically an additional twenty five
(25%) percent of the initial amount shall be vested (50% of the remaining 50%),
and thereafter no additional Shares shall vest and such Shares shall be
forfeited.

 

 

For the purposes of this
Agreement, the term “Cause”
shall mean (a) the conviction of the undersigned of any felony; (b) the willful
or gross neglect or dereliction by the undersigned of his duties and
responsibilities under the terms or requirements of his employment, which
neglect or dereliction of duties and responsibilities continues 30 days after
written notice given to the undersigned by the Company’s Board of Directors;
(c) material breach by the undersigned
of any terms or requirements of his employment in any material respect, which
breach continues or remains uncured after thirty (30) days’ notice to the
undersigned; or (d) engaging in material fraudulent conduct toward the
Company. A determination that there is for Cause termination of the undersigned’s
employment shall be made by the Board in good faith, and only after notice to
undersigned and providing the undersigned an opportunity to be heard, and such
determination shall require that the Board find that there has occurred an
event of the kind described in (a), (b), (c) or (d) above.

 

For the purposes of this
Agreement, the term “Good Reason”
shall mean, without the express written consent of the undersigned: (i) any
material breach by the Company of the terms or requirements of the undersigned’s
employment, including a reduction in the compensation, or in the position,
duties, responsibilities or authority of the undersigned; or (ii) a relocation
of the place of employment for the undersigned beyond a 35-mile radius of the
Company’s current office.

 

6.               Accelerated
Vesting of Unvested Shares Upon a Change of Control.  Upon the consummation of a Change of Control
(as defined below), all unvested Shares will immediately become vested.  For purposes of this Agreement, the term “Change
of Control” shall mean: (a) a sale, merger or consolidation after which
securities possessing more than fifty (50%) percent of the total combined
voting power of the Company’s outstanding securities have been transferred to
or acquired by a person or persons different from the persons who held such
percentage of the total combined voting power immediately prior to such
transaction; or (b) the sale, transfer or other disposition of all or
substantially all of the Company’s assets to one or more persons (other than a
wholly owned subsidiary of the Company or a parent company whose stock
ownership after the transaction is the same as the Company’s ownership before
the transaction); or (c) an acquisition, merger or similar transaction or a
divestiture of a substantial portion of the Company’s business after which the
role of the undersigned is not substantially the same as such role prior to the
transaction.

 

7.               Forfeiture
Risk.  If the
undersigned ceases to be employed by the Company and its subsidiaries because
of death or Disability (as defined below), the then unvested Shares shall
continue to vest for an additional 179 days and be forfeited as of the 180th
day after death or Disability of the undersigned.  If the undersigned ceases to be employed by
the Company for any reason other than because of death or Disability or as
provided in Section 5 above, then any outstanding and unvested Shares acquired by
the undersigned hereunder shall be automatically and immediately
forfeited.  With respect to any Shares
that are forfeited under this Section 7 or Section 5 above, the undersigned
hereby (i) appoints the Company as the attorney-in-fact of the undersigned to
take such actions as may be necessary or appropriate to effectuate a transfer
of the record ownership of any such shares that are unvested and forfeited
hereunder, (ii) agrees to deliver to the Company, as a precondition to the
issuance of any certificate or certificates with respect to unvested Shares
hereunder, one or more stock powers, endorsed in blank, with respect to such
Shares, and (iii) agrees to sign such other powers and take such other actions
as the Company may reasonably request to accomplish the transfer or forfeiture
of any unvested Shares that are forfeited hereunder.

 

2

 

For purposes of this
Agreement, the term “Disability” shall mean the physical or mental illness or
disability of the undersigned such that, in the good faith and reasonable
judgment of a reputable physician mutually selected by the undersigned and the
Board, he shall be materially unable to perform his duties of employment, with
reasonable accommodation, and such inability may reasonably be expected to be
permanent or to continue for a period of at least one hundred twenty (120)
business days during any period of twelve (12) consecutive months.

 

8.               Retention
of Certificates.  Any
certificates representing unvested Shares shall be held by the Company.  If unvested Shares are held in book entry
form, the undersigned agrees that the Company may give stop transfer
instructions to the depository to ensure compliance with the provisions hereof.

 

9.               Vesting
of Shares.  The shares
acquired hereunder shall vest in accordance with the provisions of this Section
9 and applicable provisions of the Plan, as follows: 25% percent of the Shares
on January 26, 2007 and an additional 6.25% on each three months anniversary
thereafter until January 26, 2010.

 

Notwithstanding
the foregoing, no shares shall vest on any vesting date specified above unless
the undersigned is then, and since the date of grant has continuously been,
employed by the Company or its subsidiaries.

 

10.         Legends.  Any certificates representing unvested Shares
shall be held by the Company, and any such certificate shall contain legends substantially
in the following form:

 

THE TRANSFERABILITY OF THIS
CERTIFICATE AND THE SHARES OF STOCK REPRESENTED HEREBY ARE SUBJECT TO THE TERMS
AND CONDITIONS (INCLUDING FORFEITURE) OF THE 2004 INCENTIVE PLAN AND A
RESTRICTED STOCK AWARD AGREEMENT ENTERED INTO BETWEEN THE REGISTERED OWNER AND COMBINATORX,
INCORPORATED.  COPIES OF SUCH PLAN AND
AGREEMENT ARE ON FILE IN THE OFFICES OF COMBINATORX, INCORPORATED.

 

THESE SECURITIES HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.  THEY MAY NOT BE SOLD, OFFERED FOR SALE,
PLEDGED, OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
AS TO THE SECURITIES UNDER SAID ACT OR AN OPINION OF COUNSEL SATISFACTORY TO
THE COMPANY, THAT SUCH REGISTRATION IS NOT REQUIRED.

 

As soon as practicable following the vesting of any
such Shares the Company shall cause a certificate or certificates covering such
vested Shares to be issued and delivered to the undersigned without the first
legend set forth above referencing the Restricted Stock Award Agreement.  If any Shares are held in
book-entry form, the Company may take such steps as it deems necessary or
appropriate to record and manifest the restrictions applicable to such Shares.

 

11.         Dividends, etc..  The undersigned shall be entitled to (i)
receive any and all dividends or other distributions paid with respect to those
Shares of which he is the record owner on the record date for such dividend or
other distribution, and (ii) vote any Shares of which he is the record owner on
the record date for such vote; provided, however,
that any property (other than 

 

3

 

cash)
distributed with respect to a share of Stock (the “associated share”) acquired
hereunder, including without limitation a distribution of Stock by reason of a
stock dividend, stock split or otherwise, or a distribution of other securities
with respect to an associated share, shall be subject to the restrictions of
this Agreement in the same manner and for so long as the associated share
remains subject to such restrictions, and shall be promptly forfeited if and
when the associated share is so forfeited;  and further provided, that the
Administrator may require that any cash distribution with respect to the Shares
other than a normal cash dividend be placed in escrow or otherwise made subject
to such restrictions as the Administrator deems appropriate to carry out the
intent of the Plan.  References in this
Agreement to the Shares shall refer, mutatis mutandis,
to any such restricted amounts.

 

12.         Sale of Vested Shares.  The undersigned understands
that he will be free to sell any Share once it has vested, subject to (i) satisfaction
of any applicable tax withholding requirements with respect to the vesting or
transfer of such Share; (ii) the completion of any administrative steps
(for example, but without limitation, the transfer of certificates) that the
Company may reasonably impose; and (iii) applicable requirements of federal and
state securities laws.

 

13.         Certain Tax Matters.  The undersigned expressly acknowledges the
following:

 

a.               The undersigned has been
advised to confer promptly with a professional tax advisor to consider whether
the undersigned should make a so-called “83(b) election” with respect to the
Shares.  Any such election, to be
effective, must be made in accordance with applicable regulations and within
thirty (30) days following the date of this Award.  The Company has made no recommendation to the
undersigned with respect to the advisability of making such an election.

 

b.              The award or vesting of the
Shares acquired hereunder, and the payment of dividends with respect to such Shares,
may give rise to “wages” subject to withholding.  The undersigned expressly acknowledges and
agrees that his rights hereunder are subject to his promptly paying to the
Company in cash (or by such other means as may be acceptable to the Company in
its discretion, including, if the Administrator so determines, by the delivery
of previously acquired Stock or shares of Stock acquired hereunder or by the
withholding of amounts from any payment hereunder) all taxes required to be
withheld in connection with such award, vesting or payment.

 

	
   

  	
  Very truly yours,

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  /s/ Robert Forrester

  	
   

  
	
   

  	
  (Signature of Employee)

  	
   

  

Dated:

 

The foregoing Restricted Stock

Award Agreement is hereby accepted:

 

COMBINATORX, INCORPORATED

 

 

	
  By

  	
  /s/ Alexis Borisy

  	
   

  

 

4Exhibit 10.3

 

Dr. Jan Lessem

Name of Employee

COMBINATORX, INCORPORATED

2004 Incentive Plan

 

Restricted Stock Award
Agreement

 

CombinatoRx, Incorporated

650 Albany St.

Boston, MA 02118

 

Attn:  Alexis
Borisy

 

Ladies and Gentlemen:

 

The undersigned (i) acknowledges that he has received
an award (the “Award”) of restricted stock from CombinatoRx, Incorporated (the “Company”)
under the 2004 Incentive Plan (the “Plan”), subject to the terms set forth
below and in the Plan; (ii) further acknowledges receipt of a copy of the Plan
as in effect on the date hereof; and (iii) agrees with the Company as follows:

 

1.               Effective Date. 
This Agreement shall take effect as of January 26, 2006, which is the
date of grant of the Award.

 

2.               Shares Subject to Award. 
The Award consists of 15,000 shares (the “Shares”) of common stock of
the Company (“Stock”).  The undersigned’s
rights to the Shares are subject to the restrictions described in this
Agreement and the Plan (which is incorporated herein by reference with the same
effect as if set forth herein in full) in addition to such other restrictions,
if any, as may be imposed by law.

 

3.               Meaning of Certain Terms. 
Except as otherwise expressly provided, all terms used herein shall have
the same meaning as in the Plan.  The
term “vest” as used herein with respect to any Share means the lapsing of the
restrictions described herein with respect to such Share.

 

4.               Nontransferability of Shares. 
The Shares acquired by the undersigned pursuant to this Agreement shall
not be sold, transferred, pledged, assigned or otherwise encumbered or disposed
of except as provided below and in the Plan.

 

5.               Accelerated Vesting of Unvested
Shares Upon Termination Without Cause.  If the
undersigned is terminated by the Company without Cause (as defined below), to
the extent there are any unvested Shares, the twenty five (25%) percent of the
then unvested Shares shall vest for each year of employment of the undersigned
with the Company.  For example, if there
is a termination without Cause at the end of the second year of employment,
then fifty (50%) percent of Shares would be unvested and automatically an
additional twenty five (25%) percent of the initial amount shall be vested (50%
of the remaining 50%), and thereafter no additional Shares shall vest and such
Shares shall be forfeited.

 

For the purposes of this Agreement, the term “Cause” shall mean the determination,
in good faith, by the Board, that any one of the following events has
occurred:  (a) the conviction of the
undersigned of any felony; (b) the neglect or dereliction by the undersigned of
his duties and responsibilities in accordance with the terms or requirements of
his employment, which neglect or dereliction of duties and responsibilities
continues, in the reasonable judgment of the Board, after written notice given
to the undersigned by the Board; (c) breach
by the undersigned in any material respect of any terms or requirements of his
employment; or (d) engaging in any fraudulent conduct toward the
Company. A determination that there is for Cause termination of the undersigned’s
employment shall be made by the Board, after notice to undersigned and
providing the undersigned an opportunity to be heard, and such determination
shall require that the Board find that there has occurred an event of the kind
described in (a), (b), (c) or (d) above.

 

6.               Accelerated Vesting of Unvested
Shares Upon a Change of Control.  Upon the
consummation of a Change of Control (the “Change of Control Effective Date”), all unvested Shares will
immediately become vested.  For purposes
of this Agreement, the term “Change of Control” shall mean: (a) a sale, merger
or consolidation in which securities possessing more than fifty (50%) percent
of the total combined voting power of the Company’s outstanding securities are
transferred to a person or persons different from the persons who held such
securities immediately prior to such transaction, but excluding any merger with
the subsidiary or parent company of the Company; or (b) the sale, transfer or
other disposition of all or substantially all of the Company’s assets to one or
more persons (other than a wholly owned subsidiary of the Company in a single
transaction or series of related transactions).

 

7.               Forfeiture Risk. 
If the undersigned ceases to be employed by the Company and its
subsidiaries because of death or disability or for any reason other than as
specified in Section 5 above, any then outstanding and unvested Shares acquired
by the undersigned hereunder shall be automatically and immediately forfeited.
With respect to any Shares that are forfeited under this Section 7 or Section 5
above, the undersigned hereby (i) appoints the Company as the attorney-in-fact
of the undersigned to take such actions as may be necessary or appropriate to
effectuate a transfer of the record ownership of any such shares that are
unvested and forfeited hereunder, (ii) agrees to deliver to the Company, as a
precondition to the issuance of any certificate or certificates with respect to
unvested Shares hereunder, one or more stock powers, endorsed in blank, with
respect to such Shares, and (iii) agrees to sign such other powers and take
such other actions as the Company may reasonably request to accomplish the
transfer or forfeiture of any unvested Shares that are forfeited hereunder.

 

8.               Retention of Certificates. 
Any certificates representing unvested Shares shall be held by the
Company.  If unvested Shares are held in
book entry form, the undersigned agrees that the Company may give stop transfer
instructions to the depository to ensure compliance with the provisions hereof.

 

9.               Vesting of Shares. 
The shares acquired hereunder shall vest in accordance with the
provisions of this Section 9 and applicable provisions of the Plan, as follows:
25% percent of the Shares on January 26, 2007 and an additional 6.25% on each
three months anniversary thereafter until January 26, 2010.

 

Notwithstanding the foregoing, no shares shall vest on
any vesting date specified above unless the undersigned is then, and since the
date of grant has continuously been, employed by the Company or its
subsidiaries.

 

2

 

10.         Legends. 
Any certificates representing unvested Shares shall be held by the
Company, and any such certificate shall contain legends substantially in the
following form:

 

THE TRANSFERABILITY OF THIS CERTIFICATE AND THE SHARES
OF STOCK REPRESENTED HEREBY ARE SUBJECT TO THE TERMS AND CONDITIONS (INCLUDING
FORFEITURE) OF THE 2004 INCENTIVE PLAN AND A RESTRICTED STOCK AWARD AGREEMENT
ENTERED INTO BETWEEN THE REGISTERED OWNER AND COMBINATORX, INCORPORATED.  COPIES OF SUCH PLAN AND AGREEMENT ARE ON FILE
IN THE OFFICES OF COMBINATORX, INCORPORATED.

 

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED.  THEY
MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED, OR HYPOTHECATED IN THE ABSENCE OF
AN EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER SAID ACT OR AN
OPINION OF COUNSEL SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS NOT
REQUIRED.

 

As soon as practicable
following the vesting of any such Shares the Company shall cause a certificate
or certificates covering such vested Shares to be issued and delivered to the
undersigned without the first legend set forth above referencing the Restricted
Stock Award Agreement.  If any Shares are held in book-entry
form, the Company may take such steps as it deems necessary or appropriate to
record and manifest the restrictions applicable to such Shares.

 

11.         Dividends, etc.. 
The undersigned shall be entitled to (i) receive any and all dividends
or other distributions paid with respect to those Shares of which he is the
record owner on the record date for such dividend or other distribution, and
(ii) vote any Shares of which he is the record owner on the record date for such
vote; provided, however, that any property
(other than cash) distributed with respect to a share of Stock (the “associated
share”) acquired hereunder, including without limitation a distribution of
Stock by reason of a stock dividend, stock split or otherwise, or a
distribution of other securities with respect to an associated share, shall be
subject to the restrictions of this Agreement in the same manner and for so
long as the associated share remains subject to such restrictions, and shall be
promptly forfeited if and when the associated share is so forfeited;  and further provided,
that the Administrator may require that any cash distribution with respect to
the Shares other than a normal cash dividend be placed in escrow or otherwise
made subject to such restrictions as the Administrator deems appropriate to
carry out the intent of the Plan. 
References in this Agreement to the Shares shall  refer, mutatis mutandis,
to any such restricted amounts.

 

12.         Sale of Vested Shares. 
The
undersigned understands that he will be free to sell any Share once it has
vested, subject to (i) satisfaction of any applicable tax withholding
requirements with respect to the vesting or transfer of such Share;
(ii) the completion of any administrative steps (for example, but without
limitation, the transfer of certificates) that the Company may reasonably
impose; and (iii) applicable requirements of federal and state securities laws.

 

13.         Certain Tax Matters. 
The undersigned expressly acknowledges the following:

 

a.               The undersigned has been advised to
confer promptly with a professional tax advisor to consider whether the
undersigned should make a so-called “83(b) election” with respect to the
Shares.  Any such election, to be
effective, must be made in accordance 

 

3

 

with applicable
regulations and within thirty (30) days following the date of this Award.  The Company has made no recommendation to the
undersigned with respect to the advisability of making such an election.

 

b.              The award or vesting of the Shares
acquired hereunder, and the payment of dividends with respect to such Shares,
may give rise to “wages” subject to withholding.  The undersigned expressly acknowledges and
agrees that his rights hereunder are subject to his promptly paying to the
Company in cash (or by such other means as may be acceptable to the Company in
its discretion, including, if the Administrator so determines, by the delivery
of previously acquired Stock or shares of Stock acquired hereunder or by the
withholding of amounts from any payment hereunder) all taxes required to be
withheld in connection with such award, vesting or payment.

 

	
   

  	
  Very truly yours,

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  /s/ Jan Lessem

  	
   

  
	
   

  	
  (Signature of Employee)

  	
   

  
	
   

  	
   

  	
   

  

Dated:

 

The foregoing Restricted Stock

Award Agreement is hereby accepted:

 

COMBINATORX, INCORPORATED

 

 

	
  By

  	
  /s/ Alexis Borisy

  	
   

  

 

4

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