Document:

Exhibit 10.2

 

SUBLEASE AGREEMENT

 

THIS
SUBLEASE AGREEMENT (this “Sublease”)
is made this 29th day of May, 2008, by and between CUBIST PHARMACEUTICALS, INC., a Delaware
corporation, having an office at 65 Hayden Avenue, Lexington, Massachusetts
02421 (the “Sublandlord”), and NITROMED,
INC., a Delaware corporation,
having an address at 45 Hayden Avenue, Lexington, Massachusetts 02421 (the “Subtenant”).

 

WITNESSETH

 

WHEREAS, by that
certain Prime Lease dated February 23, 2007 (the “Prime Lease”),
Subtenant, as Tenant, leased certain premises as described therein (the “Prime
Lease Premises”) from The Realty Associates Fund VI, L.P., a Delaware
limited partnership, having an office c/o Jones Lang LaSalle Americas, Inc.,
at 55 Hayden Avenue, Lexington, Massachusetts 02421 (the “Prime Lessor”);

 

WHEREAS, by that
certain Assignment of Lease and Assumption Agreement dated as of May 29,
2008 (the “Assignment”), Subtenant, as Assignor, assigned its interest
in and to the Prime Lease and the Prime Lease Premises to Sublandlord, as
Assignee;

 

WHEREAS, the Prime
Lessor consented to the Assignment to Assignee upon and subject to the terms of
that certain Consent to Assignment of Lease dated as of May 29, 2008 (the “Consent
to Assignment”; the Prime Lease, as affected by the Assignment and the
Consent to Assignment is collectively referred to herein as (the “Prime
Lease”); and

 

WHEREAS, Subtenant
desires to sublease a portion of the Prime Lease Premises from Sublandlord and
Sublandlord is willing to sublease such portion of the Prime Lease Premises to
Subtenant pursuant to the hereinafter contained terms and conditions.

 

NOW, THEREFORE, for and in
consideration of the rents hereinafter reserved and the covenants and
agreements hereinafter contained on the part of Subtenant to be kept, performed
and fulfilled, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto hereby agree as
follows:

 

1.             Premises.  Sublandlord does hereby demise and lease unto
Subtenant and Subtenant does hereby agree to lease those certain premises
consisting of  approximately 4,000
rentable square feet (the “Sublease Premises”) within the Prime Lease
Premises.

 

2.             Term/Renewals.

 

a.             The initial
term of this Sublease shall commence on June 1, 2008 (the “Sublease
Commencement Date”), and expire on 11:59 p.m., local time, on the day
immediately preceding the third (3rd) monthly anniversary of the Sublease
Commencement Date, or if the Sublease Commencement Date is not the first day of
a calendar month, then the last day of the third (3rd) full calendar month 

 

 

following the calendar month in which the Sublease Commencement Date
occurs (together with all renewals and extensions thereof and any holdover, the
“Term”).

 

b.             Provided that, at the time of such exercise, (i) there
exists no Event of Default on the part of Subtenant under this Sublease (nor
any failure by Subtenant to make any required payment or perform any
obligation, of which failure Subtenant has received notice and which, with the
passage of time, would constitute an Event of Default), (ii) Subtenant
then occupies the Sublease Premises, and (iii) this Sublease is still in
full force and effect, Subtenant shall have the automatic right to extend the
Term of this Sublease, without the need for any notice or the execution of an
instrument of renewal, on a month-to-month basis (each such monthly term being
an “Extended Term”).  The initial
Extension Term shall commence on the day immediately following the last day of
the initial Term and, except as otherwise set forth below, shall end at 11:59 p.m.
on the last day of the applicable calendar month.  During any Extended Term, either Sublandlord
or Subtenant may terminate this Sublease upon at least thirty (30) days’
written notice to the other of its intent to terminate.    Each Extended Term shall be on all the
terms and conditions of this Sublease. 
Notwithstanding anything to the contrary herein, the parties hereby
acknowledge and agree that the final Extended Term of this Sublease, to the
extent applicable, shall expire one (1) day prior to the “Expiration Date”
under the Prime Lease.

 

3.             Uses.      The Premises shall be used and occupied by
Subtenant only for the purposes allowed under the Prime Lease and for no other
use or purpose.

 

4.             Rent and Security Deposit.

 

a.             Subtenant shall pay Sublandlord without demand or
offset a monthly rental payable in advance on the first day of each month
throughout the Term of this Sublease in the amount of Nine Thousand One Hundred
Sixty Six Dollars and 67/100 ($9,166.67; $27.50 per rentable square foot x
4,000 rentable square feet, divided by twelve (12) months) (the “Rent”).  Any partial month of occupancy shall be
prorated accordingly.  All Rent to be
paid by Subtenant to Sublandlord under the terms of this Sublease shall be paid
at such place as Sublandlord may from time to time designate, and in lieu of
such designation, then at the place designated in Section 10
of this Sublease for the giving of notices.  Subtenant
shall have no obligation to pay for all or any portion of either utility
payments or other pass-throughs, including, without limitation, any operating
expenses, taxes or insurance premiums, due to the Prime Lessor under the Prime
Lease.

 

b.             Sublandlord and Subtenant hereby acknowledge and
agree that any Security Deposit held by the Prime Lessor under the Prime Lease
will be returned by the Prime Lessor to Subtenant in accordance with the terms
of the Consent to Assignment. 
Sublandlord shall be solely responsible for providing Prime Lessor with
a substitute Security Deposit or any other collateral or security that may be
required under the Prime Lease. 
Subtenant shall not be required to provide Sublandlord with a Security
Deposit under this Sublease.

 

2

 

5.             Preparation for Occupancy.  At the commencement of the Term, Subtenant
shall accept the Sublease Premises in its then “as is” “where is”
condition.  The parties hereby
acknowledge and agree that Subtenant will maintain in the Premises certain
items of personal property in place as of the Sublease Commencement Date.

 

6.             Incorporation
of Prime Lease.

 

a.             Except as otherwise provided herein, this Sublease
is subject to all the terms and conditions of the Prime Lease with the same
force and effect as if they were incorporated herein.  Defined terms in the Prime Lease are hereby
incorporated in this Sublease.  Except as
otherwise specifically provided herein, Subtenant hereby agrees to assume, be
liable and responsible for and perform all acts and all of the terms and
provisions to be observed by Sublandlord, as Tenant under the Prime Lease.

 

b.             Sublandlord represents to Subtenant that the Prime
Lease attached hereto as Exhibit A
is a complete and accurate copy of the Prime Lease, is in full force and effect
and that no notices of default have been sent or received by Sublandlord with
respect to the Prime Lease, nor has any event or condition occurred which, with
the passing of time and/or the giving of notice, would result in a default by
Sublandlord under the Prime Lease.  If
Sublandlord receives any notice or demand from Prime Lessor under the Prime
Lease with respect to the Prime Lease Premises, Sublandlord shall promptly
deliver a true and correct copy of same to Subtenant.

 

c.             The provisions of the Prime Lease which are so
incorporated into this Sublease pursuant to this Section 6
shall, coincident with their incorporation, be amended so that references in
the Prime Lease to “Landlord” and “Tenant” shall be deemed to refer in this
Sublease to Sublandlord and Subtenant, respectively, and references to “Premises”
shall be deemed to refer in this Sublease to the Sublease Premises, unless the
context indicates that such amendment should not be made or such amendment
would have an illogical effect on the provision being so amended.  All uses of the term “Sublease” in this
Sublease shall be regarded as referring to this Sublease, into which the Prime
Lease has been so incorporated.

 

d.             Notwithstanding any of the foregoing provisions of
this Section 6 to the contrary, the
following provisions of the Prime Lease are not incorporated into or made a
part of this Sublease:

 

Section 3.1 (Term, Commencement Date,
Rent Commencement Date and Expiration Date), solely to the extent conflicting
with Section 2 of this Sublease;

 

Section 3.2 (Preparation of the
Premises);

 

Section 3.3 (Condition; Prime Lessor’s
Performance);

 

Section 3.4 (Tenant’s Delays);

 

3

 

Section 3.5 (Early Access);

 

Section 4 (Rent), solely to the extent
conflicting with Section 4 of this
Sublease;

 

Section 5 (Security Deposit), solely to
the extent conflicting with Section 4(b) of this
Sublease;

 

Section 8.1 (Insurance - Tenant), solely
to the extent conflicting with Section 13 of this
Sublease;

 

Article 10 (Real and Personal Property
Taxes), solely to the extent conflicting with Section 4(a) of this
Sublease;

 

Article 12 (Assignment and Subletting),
solely to the extent conflicting with Section 11 of this
Sublease;

 

Section 13.1 (Default by Tenant) solely
to the extent conflicting with Section 9 of this
Sublease;

 

Article 16 (Parking), solely to the
extent conflicting with Section 13 of this
Sublease;

 

Article 27 (Option to Extend), solely to
the extent conflicting with Section 2 of this
Sublease; and

 

Article 41 (Notices), solely to the
extent conflicting with Section 10 of this
Sublease.

 

7.             Prime Lessor’s
Responsibilities.

 

a.                                       Subtenant
acknowledges, understands and agrees that Sublandlord is not obligated under
this Sublease (i) to furnish certain services set forth in Prime Lease to
be furnished by Prime Lessor, (ii) to obtain an agreement of
non-disturbance, or (iii) to perform certain other obligations which are
not within the control of Sublandlord under the Prime Lease.  Notwithstanding anything in this Sublease to
the contrary, Subtenant agrees to look to Prime Lessor to furnish and perform
all obligations furnished and to be performed by Prime Lessor under the Prime
Lease.  Sublandlord shall not be liable
to Subtenant or be deemed in default hereunder for failure of Prime Lessor to
furnish or perform the same.  However,
whenever Prime Lessor shall fail to perform any of its obligations pertaining
to the Premises, Sublandlord shall promptly take such action as may reasonable
under the circumstances to secure such performance upon Subtenant’s request to
Sublandlord to do so and shall thereafter diligently prosecute such performance
on the part of Prime Lessor.  If
Sublandlord fails, after using reasonable efforts, to cause Prime Lessor to
observe and/or perform any of its obligations under the Prime Lease with
respect to the Sublease Premises, Subtenant shall have the right, upon notice
to Sublandlord, and at Subtenant’s sole cost and expense, to bring an action in
Sublandlord’s name to accomplish such purpose and Sublandlord agrees 

 

4

 

to cooperate with Subtenant in any such action.  Any monetary recovery in such action shall
inure to the benefit of Subtenant.

 

b.                                      Sublandlord
covenants and agrees with Subtenant that Sublandlord (i) will pay all Base
Rent, Tenant’s Share of all Operating Expenses and Tenant’s Share of Taxes (as
those terms are defined in the Prime Lease) and all other additional rent
payable by Sublandlord pursuant to the Prime Lease and will perform all of its
other obligations under the Prime Lease to the extent that such obligations are
not dependent upon possession of the Premises (i.e., Sublandlord will not fail
to provide estoppel certificates and SNDAs to the Prime Lessor as required
under the Prime Lease and Sublandlord will supply financial statements to Prime
Lessor as required under the Prime Lease), and (ii) will not terminate
(except as otherwise expressly permitted under the Prime Lease), modify or
amend the Prime Lease or take any other action that would adversely affect
Subtenant’s use or occupancy of the Sublease Premises (unless consented to by
Subtenant).

 

8.             Quiet
Enjoyment / Indemnities.

 

a.                                       Sublandlord
covenants and agrees with Subtenant that upon Subtenant’s paying the Rent
reserved in this Sublease and observing and performing all of the other
obligations, terms, covenants and conditions of this Sublease, Subtenant may
peaceably and quietly enjoy the Premises during the Term; provided, however,
that this Sublease shall automatically terminate upon termination of the Prime
Lease for any reason whatsoever and Subtenant shall have no claim against
Sublandlord unless such termination was (i) caused by the default of
Sublandlord in the performance of any of Sublandlord’s obligations under the
Prime Lease which have not been assumed by Subtenant hereunder or (ii) made
voluntarily by Sublandlord without Subtenant’s consent.

 

b.                                      Sublandlord
shall indemnify, defend and hold harmless Subtenant, its parents, subsidiaries
and affiliates and their respective officers, directors, employees, agents,
successors and assigns (“Subtenant’s Indemnitees”) from and against all losses,
costs, damages, expenses and liabilities, including, without limitation,
reasonable attorneys’ fees and disbursements, which Subtenant may incur or pay
out by reason of (i) the intentional wrongful acts or negligence of
Sublandlord or its contractors, licensees, agents, servants, or invitees, or (ii) any
breach or default by Sublandlord of its obligations under this Sublease or the
Prime Lease.  Sublandlord’s obligations
under this paragraph shall survive the expiration or earlier termination of
this Sublease.

 

c.                                       Subtenant
hereby agrees that it shall not do, suffer or permit anything to be done which
would constitute a default by Sublandlord under the Prime Lease or would cause
the Prime Lease to be canceled, terminated or forfeited by Prime Lessor under
the Prime Lease.  Subtenant shall
indemnify, defend and hold Sublandlord harmless from and against any and all
claims, judgments, suits, causes of action, proceedings, penalties,
liabilities, losses, injuries, damages, costs and expenses (including, but not
limited to, attorneys’ fees and expenses), occurring during the 

 

5

 

Term of this Sublease in or about the Sublease Premises and/or the
Building and arising out of the intentional wrongful acts or negligence of
Subtenant or its contractors, licensees, agents, servants, or invitees, except
special and consequential damages.

 

9.             Default and Remedies.

 

a.                                       It shall be an
event of default hereunder (“Event of Default”) if Subtenant shall fail to (i) pay
the Rent as and when due, where such failure shall continue for a period of ten
(10) business days after Sublandlord notifies Subtenant in writing of such
failure, (ii) perform any provision, term or condition of the Prime Lease
within the timeframes set forth in Prime Lease, or (iii) perform any
provision, term or condition of this Sublease (other than as specified in (i) above)
within fifteen (15) days after Subtenant’s receipt of written notice from
Sublandlord specifying such failure or, if it reasonably would require more
than fifteen (15) days to cure such failure, within a time reasonably necessary
to cure such failure after Subtenant’s receipt of such written notice.

 

b.                                      Upon the
occurrence of an Event of Default, Sublandlord shall have the right, at its
option, in addition to all other rights and remedies in this Sublease or those
of Prime Lessor in the Prime Lease, at law or in equity, to give Subtenant
notice of Sublandlord’s termination of this Sublease as of a date specified
therein.  Upon the giving of such notice,
the Term and the estate hereby granted shall expire and terminate as if such
date were the date fixed for the expiration of the Term.

 

c.                                       If Sublandlord
should be in default in the performance of any of its obligations under this
Sublease, which default continues for a period of more than fifteen (15) days
after receipt of written notice from Subtenant specifying such default, or if
such default is of a nature to require more than fifteen (15) days for remedy
and continues beyond the time reasonably necessary to cure (provided
Sublandlord must have undertaken procedures to cure the default within such fifteen
(15) day period and diligently pursue such efforts to cure to completion),
Subtenant may, in addition to availing itself of any other remedies available
at law and in equity, at its option, incur any reasonable expense necessary to
perform the obligation of Sublandlord specified in such notice and deduct such
expense from Rent and other charges next coming due under this Sublease.

 

10.           Notices.  All notices required or contemplated
hereunder shall be in writing and shall be deemed to have been properly given
when (i) delivered by hand or messenger against a receipt, in which case
notice shall be deemed given on the date received; (ii) sent prepaid by a
reputable overnight delivery service, in which case notice shall be deemed
given on the next business day after the date sent; or (iii) sent by
United States mail, certified or registered, return receipt requested, postage
prepaid, in which case notice shall be deemed given two (2) business days
after the date sent, at the following addresses:

 

6

 

SUBLANDLORD:

 

Cubist Pharmaceuticals, Inc.

65 Hayden Avenue

Lexington, MA  02421

Attn: Chief Financial Officer

 

SUBTENANT:

 

NitroMed, Inc.

45 Hayden Avenue, Suite 3000

Lexington, MA  02421

Facsimile: 781-274-8080

Attn: Chief Financial Officer

 

with a copy to:

 

McCarter & English, LLP

265 Franklin Street 

Boston, MA  02110

Facsimile: 617-326-3113

Attn: Jason M. Sweatt

 

or such other persons and
addresses as Sublandlord or Subtenant may specify by notice as provided above.

 

11.           Assignment and Subletting.  Subtenant shall not, without prior written
consent of Sublandlord, which consent shall not be unreasonably withheld,
conditioned or delayed, (a) assign or encumber this Sublease or any
interest under it, in whole or in part; (b) sublet the Sublease Premises or any
part thereof; (c) allow any transfer of Subtenant’s interest herein or any
lien upon Subtenant’s interest by operation of law or otherwise; or (d) permit
the use or occupancy of the Sublease Premises or any part thereof by anyone
other than Subtenant.  Sublandlord’s
consent to any assignment or sublease shall not be deemed to constitute a
waiver by Sublandlord of its required consent to any subsequent assignment or
sublease.

 

12.           Signage.  Subtenant shall be responsible for the cost
and coordination of Subtenant’s signage, which shall be in compliance with
requirements of the Prime Lease and all applicable laws, ordinances and codes.

 

13.           Parking.  Subtenant shall be entitled to use twelve
(12) parking spaces (3 parking spaces per 1,000 square feet of rentable area),
which spaces shall be used in common and on an unassigned basis.

 

14.           Insurance
/ Waiver of Subrogation.

 

a.                                       During the Term, Subtenant
shall, with respect to the Sublease Premises, obtain and maintain at all times
the insurance required to be maintained by “Tenant” under the Prime Lease at
Subtenant’s sole expense.  Such policy
shall name 

 

7

 

Sublandlord and Prime Lessor as additional insureds and shall be
endorsed to provide that the insurer shall endeavor to provide at least thirty
(30) days’ written notice (ten (10) days in the event of non-payment of
premiums) to Sublandlord prior to any material modification or
cancellation.  At Sublandlord’s request, Subtenant
will provide evidence of insurance to Sublandlord before the Sublease
Commencement Date of the Term of this Sublease and annually thereafter (to the
extent applicable); provided, however, in no event shall
Subtenant be required to provide copies of such insurance policy or any
original insurance documents.  In no
event shall Subtenant be required to provide insurance for any portion of the
Prime Lease Premises, except for the Sublease Premises.

 

b.             Each party hereby waives every right or cause of
action for the events which occur or accrue during the Term for any and all
loss of, or damage to, any of its property (whether or not such loss or damage
is caused by the fault or negligence of the other party or anyone for whom said
other party may be responsible), which loss or damage is covered (or would have
been covered if such party had maintained the coverage required under the Prime
Lease or this Sublease) by valid and collectible fire, extended coverage, “special
form” or similar policies covering real property, personal property or business
interruption insurance policies, to the extent that such loss or damage is
recovered (or would have been recovered if such coverage were in effect as may
be required under the Prime Lease or this Sublease) under said insurance
policies.  Said waivers are in addition
to, and not in limitation or derogation of, any other waiver or release
contained in the Prime Lease or this Sublease with respect to any loss or
damage to property of the parties hereto. 
Each party will give its insurance carrier written notice of the terms
of such mutual waiver, and the insurance policies will be properly endorsed, if
necessary, to prevent the invalidation of coverage by reason of said
waiver.  In the event of a conflict between
this paragraph and any other provision of the Prime Lease or this Sublease, the
terms of this paragraph shall control.

 

15.           Binding and Entire Agreement.  This Sublease shall be binding on and inure
to the benefit of Subtenant, Sublandlord and their respective heirs, executors,
administrators, legal representatives, successors and assigns.  This Sublease contains the entire agreement
of the parties with respect to the subject matter herein contained and may not
be modified except by instrument in writing which is signed by both parties.

 

16.           Hold-Over.  Upon the expiration date of this Sublease,
Subtenant shall surrender and deliver the Sublease Premises to Sublandlord in
good repair and condition, excepting ordinary wear and tear and damage by
casualty.  All tenant improvements shall
become Sublandlord’s property and remain in the Sublease Premises at the
expiration or earlier termination of this Sublease.  Subtenant’s failure to immediately surrender
the Sublease Premises at the end of the Term shall not operate to renew or
extend this Sublease.  If Subtenant holds
over, Subtenant shall become a tenant at sufferance, subject to all of the
conditions and covenants of this Sublease. 
During the holdover period, each party hereto shall give to the other at
least thirty (30) days’ written notice to terminate this Prime Lease, except in
the event of nonpayment of any installment of Rent or the breach of any other
provision hereof, in which event the defaulting party shall not be entitled to
any notice, such notice being hereby expressly waived.

 

8

 

17.           Services and Utilities.  Sublandlord shall be responsible, at its sole
cost and expense and without contribution from Subtenant, for all utilities to
the Sublease Premises, landscaping, maintenance of the HVAC, bulb replacement,
plumbing, janitorial service, snow removal, water and sewer and real estate
taxes.  Sublandlord will, at it sole cost
and expense and without contribution from Subtenant, maintain the roof and
perform any structural repairs as required.

 

18.           Applicable Law.  This Sublease shall be governed by and
construed in accordance with the laws of the Commonwealth of
Massachusetts.  If any provision of this
Sublease or the application thereof to person or circumstances shall, to any
extent, be invalid or unenforceable, the remainder of this Sublease shall not
be affected thereby and each provision of the Sublease shall be valid and
enforceable to the fullest extent permitted by law.

 

19.           Prime Lessor Consent.  Notwithstanding anything to the contrary
herein, this Sublease shall not be effective until the Prime Lessor has
consented to this Sublease in accordance the Prime Lease, which consent shall
be evidenced by that certain Consent to Sublease dated as of even date herewith.

 

20.           Titles.  The titles contained in this Sublease are
inserted only for convenience and are not to be construed as a part of this
Sublease or as a limitation upon the scope of the particular provisions to
which they refer.

 

[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

 

9

 

IN
WITNESS WHEREOF, duly authorized representatives of the parties hereto have
executed this Sublease as of the day and year first above written.

 

	
   

  	
  SUBLANDLORD

  
	
   

  	
   

  
	
   

  	
  CUBIST PHARMACEUTICALS,
  INC., a

  
	
   

  	
  Delaware corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Tamara L. Joseph

  
	
   

  	
  Name:

  	
  Tamara L. Joseph

  
	
   

  	
  Title:

  	
  SVP, General
  Counsel & Secretary

  
	
   

  	
  thereto duly authorized

  
	
   

  	
   

  
	
   

  	
  SUBTENANT

  
	
   

  	
   

  
	
   

  	
  NITROMED, INC., a Delaware
  corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kenneth M. Bate

  
	
   

  	
  Name:

  	
  Kenneth M. Bate

  
	
   

  	
  Title:

  	
  President and Chief
  Executive Officer

  
	
   

  	
  thereto duly authorized

  
							

 

10

 

EXHIBIT A

 

Prime
Lease

 

Please see Exhibit 10.31 to NitroMed, Inc.’s Annual Report on
Form 10-K for the year ended December 31, 2006, filed with the
Securities and Exchange Commission on March 8, 2007, for a copy of the
Prime Lease.

 

11Exhibit 10.50

 

AMENDED
AND RESTATED EMPLOYMENT AGREEMENT

 

This Amended and Restated
Employment Agreement (the “Agreement”) is made and entered into effective as of
June 2, 2008 by and between Aart de Geus (the “Employee”) and Synopsys, Inc.,
a Delaware corporation (the “Company”), and amends and restates the Employment
Agreement between the parties dated October 1, 1997 as amended by the
First Amendment to the Employment Agreement dated March 23, 2006.

 

R E C I T A L S

 

A.                                   The Employee is and has been employed by
the Company and is currently the Company’s 
Chief Executive Officer.

 

B.                                     The Company and the Employee desire to
enter into this Agreement to provide additional financial security and benefits
to the Employee and to encourage the Employee to continue his employment with
the Company.

 

C.                                     Certain capitalized terms used in the
Agreement are  defined in Section 7
below.

 

A G R E E M E N T

 

In consideration of the
mutual covenants herein contained, and in consideration of the continuing
employment of the Employee by the Company, the parties agree as follows:

 

1.                                       Duties and Scope of Employment.

 

(a)                                  Position.  The Company
shall employ the Employee in the position of Chief Executive Officer, as such
position has been defined in terms of responsibilities and compensation as of
the effective date of this Agreement; provided, however, that the Board of
Directors (the “Board”) shall have the right, at any time prior to the
occurrence of a Change of Control, to revise such responsibilities and
compensation as the Board in its discretion may deem necessary or
appropriate.  The Employee shall comply
with and be bound by the Company’s operating policies, procedures and practices
from time to time in effect during his employment.  During the term of the Employee’s employment
with the Company, the Employee shall continue to devote his full time, skill
and attention to his duties and responsibilities, and shall perform them
faithfully, diligently and competently, and the Employee shall use his best
efforts to further the business of the Company and its affiliated entities.

 

2.                                       Base Compensation.  The Company
shall pay the Employee as compensation for his services a base salary at an
annualized rate in an amount to be determined from time to time by the Board or
the Compensation Committee of the Board. 
Such salary shall be paid periodically in accordance with normal Company
payroll practices.  The annualized
compensation specified in

 

 

this Section 2, as
such compensation may be increased or decreased by the Board or the Compensation
Committee, is referred to in this Agreement as “Base Compensation.”

 

3.                                       Annual Incentive.  Beginning
with the Company’s current fiscal year and for each fiscal year thereafter
during the term of this Agreement, the Employee shall be eligible to receive
additional cash compensation under the Company’s annual incentive plan (the
“Annual Incentive”) based upon specific financial and/or other targets approved
by the compensation committee of the Board (the “Target Incentive”).  The Annual Incentive payable hereunder shall
be payable in accordance with the Company’s normal practices and policies
pursuant to the terms of the annual incentive plan.

 

4.                                       Employee Benefits.  The Employee
shall be eligible to participate in the employee benefit plans and executive
compensation programs maintained by the Company applicable to other key
executives of the Company, including (without limitation) retirement plans,
savings or profit-sharing plans, stock option, incentive or other bonus plans,
life, disability, health, accident and other insurance programs, paid
vacations, and similar plans or programs, subject in each case to the generally
applicable terms and conditions of the applicable plan or program in question
and to the sole determination of the Board or any committee administering such
plan or program.

 

5.                                       Employment Relationship.  The Company
and the Employee acknowledge that the Employee’s employment is and shall
continue to be at-will, as defined under applicable law.  If the Employee’s employment terminates for
any reason, the Employee shall not be entitled to any payments, benefits,
damages, awards or compensation other than as provided by this Agreement, or as
may otherwise be available in accordance with the Company’s established
employee plans and policies at the time of termination.

 

6.                                       Severance Benefits.

 

(a)                                  Termination Following A Change of Control. 
If the Employee’s employment with the Company terminates at any time
within twenty-four (24) months after a Change of Control, then the Employee
shall be entitled to receive severance benefits as follows:

 

(i)                                     Involuntary Termination. 
If the Employee’s employment terminates as a result of Involuntary
Termination other than for Cause, the Employee shall be entitled to receive a
severance payment equal to the sum of (x) two times the Employee’s Base
Compensation for the Company’s fiscal year then in effect or if greater, two
times the Employee’s Base Compensation for the Company’s fiscal year
immediately preceding the Termination Date, plus (y) two times the
Employee’s Target Incentive for the fiscal year then in effect (or, if no
Target Incentive is in effect for such year, the highest Target Incentive in
the three (3) preceding fiscal years). 
Any severance payments to which the Employee is entitled pursuant to
this Section 6(a)(i) shall be paid to the Employee (or to the
Employee’s estate or beneficiary in the event of the Employee’s death) in a
lump sum not later than fifteen (15) days following the Employee’s
Involuntary Termination, but in no event later than the 15th day of
the third month following the end of the fiscal year in which the Employee’s
Involuntary Termination occurs.

 

 

(ii)                                  Voluntary Resignation; Termination For
Cause.  If the Employee voluntarily resigns from the
Company without Good Reason, or if the Company terminates the Employee’s
employment for Cause, then the Employee shall not be entitled to receive
severance or other benefits except for those (if any) to which he may be
entitled under the Company’s then existing severance and benefits plans and
policies at the time of such resignation or termination.

 

(iii)                               Disability; Death. 
If the Company terminates the Employee’s employment as a result of the
Employee’s Disability, or if the Employee’s employment terminates due to the
death of the Employee, then the Employee shall not be entitled to receive
severance or other benefits except for those (if any) to which he may be
entitled under the Company’s then existing severance and benefits plans and
policies at the time of such Disability or death.

 

(b)                                 Equity Awards. 
In the event the Employee is entitled to severance benefits pursuant to Section 6(a)(i),
then in addition to such severance benefits, the unvested portion of any stock
option(s) or other equity awards held by the Employee under the Company’s
stock option plans and other equity compensation plans or instruments shall
vest and become exercisable in full, and the Employee shall have the right to
exercise such additional vested portion of such stock option(s) or other
equity awards at the time the Employee becomes entitled to the benefits under Section 6(a)(i).  Any equity award that vests pursuant to this Section 6(b) shall
be paid not later than the 15th day of the third month following the
fiscal year in which the Employee’s Involuntary Termination occurs.

 

(c)                                  Termination Apart from a Change of
Control.  If the Employee’s employment with the Company
terminates either prior to the occurrence of a Change of Control or after the
twenty-four (24) month period following a Change of Control, then the Employee
shall be entitled to receive severance benefits as follows:

 

(i)                                     Involuntary Termination. 
If the Employee’s employment terminates as a result of Involuntary
Termination other than for Cause, the Employee shall be entitled to receive a
severance payment in an amount equal to the Employee’s Base Compensation for
the Company’s fiscal year then in effect or if greater, the Employee’s Base
Compensation for the Company’s fiscal year immediately preceding the
Termination Date.  Such severance payment
shall be paid to the Employee (or to the Employee’s estate or beneficiary in
the event of the Employee’s death) in a lump sum within fifteen (15) days
following the Employee’s Involuntary Termination, but in no event later than
the 15th day of the third month following the end of the fiscal year
in which the Employee’s Involuntary Termination occurs.  In addition, provided the Employee does not
engage in Misconduct during the period beginning on the Employee’s Termination
Date and ending on the date six (6) months after the Employee’s
Termination of Employment, the Employee shall be entitled to receive an
additional payment from the Company in an amount equal to the Employee’s Target
Incentive for the Company’s fiscal year then in effect (or, if no Target
Incentive is in effect for such year, the highest Target Incentive in the three
(3) preceding fiscal years).  Any
such additional payment shall be paid to the Employee in a lump sum on the date
that is six (6) months after the Employee’s Termination of Employment.

 

3

 

(ii)                                  Voluntary Resignation; Termination for
Cause.  If the Employee voluntarily resigns from the
Company (other than a resignation that is an Involuntary Termination), or if
the Company terminates the Employee’s employment for Cause, then the Employee
shall not be entitled to receive severance or other benefits except for those,
if any, as may then be established under the Company’s then-existing severance
and benefits plans and policies at the time of such resignation or termination.

 

(iii)                               Disability; Death. 
If the Company terminates the Employee’s employment as a result of the
Employee’s Disability, or if the Employee’s employment terminates due to the
death of the Employee, then the Employee shall not be entitled to receive
severance or other benefits except for those (if any) as may then be
established under the Company’s then-existing severance and benefit plans and
policies at the time of such Disability or death.

 

(d)                                 Medical Benefits. 
In the event the Employee is entitled to severance benefits pursuant to Section 6(a)(i) or
Section 6(c)(i), then in addition to such severance benefits the Company
shall pay the Employee a lump sum payment in an amount equivalent to the reasonably
estimated cost the Employee may incur to extend for a period of eighteen (18)
months (twelve (12) months in the case of a termination pursuant to Section 6(c)(i))
under the COBRA continuation laws the Employee’s group health and dental plan
coverage in effect on the Termination Date. 
The Employee may use this payment, as well as any other payment made
under this Section 6, for such continuation coverage or for any other
purpose. Such payment will be made on the date that is six (6) months
after the Employee’s Termination of Employment.

 

(e)                                  Release. Notwithstanding any other provision of this Section 6,
no amounts shall be payable pursuant to this Section 6 unless (i) the
Employee has delivered to the Company a waiver and release of claims in favor
of the Company, in form and substance satisfactory to the Company, and (ii) such
release has become effective not later than the 15th day of the
third month following the end of the fiscal year in which the Employee’s
Involuntary Termination occurs.

 

(f)                                    No Participation
In The Synopsys, Inc. Executive Change of Control Severance Benefit Plan,
established effective March 23, 2006.    It is agreed that the severance benefits
described in this Agreement are in lieu of the severance benefits described in
The Synopsys, Inc. Executive Change of Control Severance Benefit Plan, as
effective March 24, 2006 (the “Plan”), and that Employee will not be
eligible to participate in the Plan.

 

(g)                                 Application of Section 409A.   If (i) any severance
benefits provided under this Agreement fail to satisfy the distribution
requirement of Section 409A(a)(2)(A) of the Internal Revenue Code of
1986, as amended (the “Code”) as a result of the application of Section 409A(a)(2)(B)(i) of
the Code, the payment of such benefits shall be delayed to the minimum extent
necessary so that such benefits are not subject to the provisions of Section 409A(a)(1) of
the Code.  The Company may attach
conditions to or adjust the amounts paid pursuant to this Section 6(g) to
preserve, as closely as possible, the economic consequences that would have
applied in the

 

4

 

absence
of this Section 6(g); provided, however, that no such condition shall
result in the payments being subject to Section 409A(a)(1) of the
Code.

 

(h)                                 Parachute
Payments.  Except as
otherwise provided in an agreement between Employee and the Company, if any
payment or benefit the Employee would receive in connection with a Change of
Control from the Company or otherwise (“Payment”) would (i) constitute a
“parachute payment” within the meaning of Section 280G of the Code, and (ii) but
for this sentence, be subject to the excise tax imposed by Section 4999 of
the Code (the “Excise  Tax”), then such Payment shall be equal to the
“Reduced Amount.” 
The Reduced Amount shall be either (x) the largest portion of the
Payment that would result in no portion of the Payment being subject to the
Excise Tax, or (y) the largest portion, up to and including the total, of
the Payment, whichever amount, after taking into account all applicable
federal, state and local employment taxes, income taxes, and the Excise Tax
(all computed at the highest applicable marginal rate), results in the
Employee’s receipt, on an after-tax basis, of the greater amount of the Payment
notwithstanding that all or some portion of the Payment may be subject to the
Excise Tax. If a reduction or elimination in payments or benefits constituting
“parachute payments” is necessary so that the Payment equals the Reduced
Amount, reduction shall occur in the following order unless the Employee elects
in writing a different order (provided, however, that such election shall be
subject to Company approval if made on or after the date on which the event
that triggers the Payment occurs): (1) reduction of cash payments; (2) cancellation
of accelerated vesting of equity awards other than stock options; (3) cancellation
of accelerated vesting of stock options; and (4) reduction of other
benefits paid to Employee. If acceleration of vesting of compensation from
Employee’s equity awards is to be reduced, such acceleration of vesting shall
be cancelled by first canceling such acceleration for the vesting installment
that will vest last and continuing by canceling as a first priority such
acceleration for vesting installment with the latest vesting unless the
Employee elects in writing a different order for cancellation prior to any
Change of Control.

 

7.                                       Definition of Terms.  The following
terms referred to in this Agreement shall have the following meanings:

 

(a)                                  Cause.  “Cause” shall
mean (i) any act of personal dishonesty taken by the Employee in
connection with his responsibilities as an employee and intended to result in
substantial personal enrichment of the Employee, (ii) conviction of a
felony that is injurious to the Company, (iii) a willful act by the
Employee which constitutes gross misconduct and which is injurious to the
Company, or (iv) continued violations by the Employee of the Employee’s
obligations under Section 1 of this Agreement that are demonstrably
willful and deliberate on the Employee’s part after there has been delivered to
the Employee a written demand for performance from the Company which describes
the basis for the Company’s belief that the Employee has not substantially
performed his duties.

 

(b)                                 Change of Control. 
“Change of Control” shall mean the occurrence of any of the following
events:

 

5

 

(i)                                     The acquisition by any “person” (as such
term is used in Sections 13(d) and 14(d) of the Exchange Act)
(other than the Company or a person that directly or indirectly controls, is
controlled by, or is under common control with, the Company) of the “beneficial
ownership” (as defined in Rule 13d-3 under said Act), directly or
indirectly, of securities of the Company representing fifty percent (50%) or
more of the total voting power represented by the Company’s then outstanding
voting securities; or

 

(ii)                                  A change in the composition of the Board
of Directors of the Company occurring within a two-year period, as a result of
which fewer than  a majority of the
directors are Incumbent Directors. 
“Incumbent Directors” shall mean directors who either (A) are
directors of the Company as of the date hereof, or (B) are elected, or
nominated for election, to the Board of Directors of the Company with the
affirmative votes of at least a majority of the Incumbent Directors at the time
of such election or nomination (but shall not include an individual not
otherwise an Incumbent Director whose election or nomination is in connection
with an actual or threatened proxy contest relating to the election of
directors to the Company); or

 

(iii)                               A merger or consolidation of the Company
with any other corporation, other than a merger or consolidation which would
result in the voting securities of the Company outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity) at least fifty
percent (50%) of the total voting power represented by the voting securities of
the Company or such surviving entity outstanding immediately after such merger
or consolidation, or the approval by the stockholders of the Company of a plan
of complete liquidation of the Company or of an agreement for the sale or
disposition by the Company of all or substantially all the Company’s assets.

 

                                                (c)                                  Disability.  “Disability”
shall mean that the Employee has been unable to substantially perform his
duties under this Agreement as the result of his incapacity due to physical or
mental illness, and such inability, at least 26 weeks after its commencement,
is determined to be total and permanent by a physician selected by the Company
or its insurers and acceptable to the Employee or the Employee’s legal
representative (such Agreement as to acceptability not to be unreasonably
withheld).

 

                                                (d)                                 Exchange Act.  “Exchange
Act” shall mean the Securities Exchange Act of 1934, as amended.

 

                                                (e)                                  Good Reason.  “Good Reason”
shall mean any of the following actions undertaken without the Employee’s
consent: (i) a significant reduction of the Employee’s duties, authority
or responsibilities relative to his duties, authority or responsibilities
immediately prior to such reduction,  (ii) a
requirement that the Employee report to another employee or officer of the
Company rather than to its Board of Directors; (iii) a reduction by at
least five (5)% in the Employee’s Base Compensation; (iv) a relocation of
the Employee’s primary place of business to

6

 

a location more
than fifty (50) miles from the Employee’s primary place of business immediately
prior to such relocation; or (v) a material breach of this agreement by
the Company or any successor.

 

(f)                                      Involuntary Termination. 
“Involuntary Termination” shall mean (i) any Termination of
Employment of the Employee by the Company which is not effected for Disability
or for Cause, or for which the grounds relied upon are not valid; (ii) the
failure of the Company to obtain the assumption of this agreement by any
successors contemplated in Section 8 below or (iii) the Employee’s
resignation for Good Reason, provided that the Employee’s Termination of
Employment occurs not later than two (2) years from the initial occurrence
of such Good Reason, the Employee has provided notice to the Company of the
event constituting Good Reason within ninety (90) days of its initial
occurrence and the Company has had at least thirty (30) days to cure the Good
Reason event and has failed to do so.

 

(g)                                   Misconduct.  “Misconduct”
shall mean conduct on the part of the Employee that is inimical, contrary or
harmful to the interests of the Company, including, but not limited to:  (i) conduct related to the Employee’s
employment for which criminal or civil penalties against the Employee may be
sought, (ii) willful violation of the Company’s written policies, (iii) unauthorized
disclosure of confidential information or trade secrets of the Company, (iv) engaging
(directly or indirectly) in any business activity that is directly competitive
with the Company’s business; or (v) disparagement, defamation or slander
of the Company.

 

(h)                                   Termination Date. 
“Termination Date” shall mean (i) if the Employee’s employment is
terminated by the Company for Disability, thirty (30) days after notice of
termination is given to the Employee (provided that the Employee shall not have
returned to the performance of the Employee’s duties on a full-time basis
during such thirty (30)-day period), (ii) if the Employee’s employment is
terminated by the Company for any other reason, the date on which the Company
delivers notice of termination to the Company or such later date, not to exceed
ninety (90) days, specified in the notice of termination, or (iii) if the
Agreement is terminated by the Employee, the date on which the Employee
delivers notice of termination to the Company.

 

(i)                                       Termination of Employment. 
“Termination of Employment” shall mean “separation from service” within
the meaning of Section 409A of the Code and Section 1.409A-1(h) of
the regulations promulgated under the Code or any successor regulations.

 

8.                                       Successors.

 

(a)                                    Company’s Successors.  Any successor
to the Company (whether direct or indirect and whether by purchase, lease,
merger, consolidation, liquidation or otherwise) to all or substantially all of
the Company’s business and assets shall assume the obligations under this
Agreement and agree expressly to perform the obligations under this Agreement
in the same manner and to the same extent as the Company would be required to
perform such obligations in the absence of a succession.  For all purposes under this Agreement, the
term “Company” shall

7

 

include any
successor to the Company’s business and assets which executes and delivers the assumption
agreement described in this Section 9(a) or which becomes bound by
the terms of this Agreement by operation of law.

 

(b)                                   Employee’s Successors.  The terms of
this Agreement and all rights of the Employee hereunder shall inure to the
benefit of, and be enforceable by, the Employee’s personal or legal
representatives, executors, administrators, successors, heirs, devisees and
legatees.

 

9.                                         Notice.

 

(a)                                    General.  Notices and
all other communications contemplated by this Agreement shall be in writing and
shall be deemed to have been duly given when personally delivered or when
mailed by U.S. registered or certified mail, return receipt requested and
postage prepaid.  In the case of the
Employee, mailed notices shall be addressed to him at the home address which he
most recently communicated to the Company in writing.  In the case of the Company, mailed notices
shall be addressed to its corporate headquarters, and all notices shall be
directed to the attention of its Secretary.

 

(b)                                   Notice of Termination.  Any
termination by the Company for Cause or by the Employee as a result of an
Involuntary Termination shall be communicated by a notice of termination to the
other party hereto given in accordance with Section 10(a) of this
Agreement.  Such notice shall indicate
the specific termination provision in this Agreement relied upon, shall set
forth in reasonable detail the facts and circumstances claimed to provide a
basis for termination under the provision so indicated, and shall specify the
Termination Date (which shall be not more than ninety (90) days after the
giving of such notice).  The failure by
the Employee to include in the notice any fact or circumstance which
contributes to a showing of Involuntary Termination shall not waive any right
of the Employee hereunder or preclude the Employee from asserting such fact or
circumstance in enforcing his rights hereunder.

 

10.                                 Miscellaneous Provisions.

 

(a)                                    No Duty to Mitigate.  The Employee
shall not be required to mitigate the amount of any payment contemplated by
this Agreement (whether by seeking new employment or in any other manner), nor
shall any such payment be reduced by any earnings that the Employee may receive
from any other source.

 

(b)                                   Waiver.  No provision
of this Agreement shall be modified, waived or discharged unless the
modification, waiver or discharge is agreed to in writing and signed by the
Employee and by an authorized officer of the Company (other than the
Employee).  No waiver by either party of
any breach of, or of compliance with, any condition or provision of this
Agreement by the other party shall be considered a waiver of any other
condition or provision or of the same condition or provision at another time.

 

8

 

(c)                                    Whole Agreement.  No
agreements, representations or understandings (whether oral or written and
whether express or implied) which are not expressly set forth in this Agreement
have been made or entered into by either party with respect to the subject
matter hereof.

 

(d)                                   Choice of Law.  The validity,
interpretation, construction and performance of this Agreement shall be
governed by the laws of the State of California.

 

(e)                                    Severability.  The
invalidity or unenforceability of any provision or provisions of this Agreement
shall not affect the validity or enforceability of any other provision hereof,
which shall remain in full force and effect.

 

(f)                                      Arbitration.  Any dispute or
controversy arising out of, relating to or in connection with this Agreement
shall be resolved to the fullest extent permitted by law by final, binding and
confidential arbitration in San Jose, California, in accordance with the
National Rules for the Resolution of Employment Disputes of the American
Arbitration Association (“AAA”) then in effect, as consistent with applicable
law.  By agreeing to this arbitration
procedure, Employee and the Company both agree 
to waive the right to resolve any such dispute through a trial by jury,
judge or administrative proceeding.  The
arbitrator shall: (a) have the authority to compel adequate discovery for
the resolution of the dispute and to award such relief as would otherwise be
permitted by law; and (b) issue a written arbitration decision, to include
the arbitrator’s essential findings and conclusions and a statement of the
award.  The arbitrator shall be
authorized to award any or all remedies that Employee or the Company would be
entitled to seek in a court of law.  The
Company shall pay all AAA arbitration fees in excess of the amount of court
fees that would be required if the dispute were decided in a court of law.
Judgment may be entered on the arbitrator’s award in any court having
jurisdiction.

 

(g)                                   No Assignment of Benefits. 
The rights of any person to payments or benefits under this Agreement
shall not be made subject to option or assignment, either by voluntary or
involuntary assignment or by operation of law, including (without limitation)
bankruptcy, garnishment, attachment or other creditor’s process, and any action
in violation of this Section 11(g) shall be void.

 

(h)                                   Employment Taxes.  All payments
made pursuant to this Agreement will be subject to withholding of applicable
income and employment taxes.

 

(i)                                       Assignment by Company.  The Company
may assign its rights under this Agreement to an affiliate, and an affiliate
may assign its rights under this Agreement to another affiliate of the Company
or to the Company; provided, however, that no assignment shall be made if the
net worth of the assignee is less than the net worth of the Company at the time
of assignment.  In the case of any such
assignment, the term “Company” when used in a section of this Agreement shall
mean the corporation that actually employs the Employee.

 

9

 

(j)                                       Counterparts.  This
Agreement may be executed in counterparts, each of which shall be deemed an
original, but all of which together will constitute one and the same
instrument.

 

IN WITNESS
WHEREOF, each of the parties has executed this Agreement, in the case of the
Company by its duly authorized officer, as of the day and year first above
written.

 

 

	
  COMPANY:

  	
    SYNOPSYS,
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jan Collinson

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Senior Vice President,
  Human Resources and Facilities

  
	
   

  	
   

  
	
   

  	
   

  
	
  EMPLOYEE:

  	
  /s/ Aart de Geus

  
				

 

10

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