Document:

Exhibit 10.8

 

SYROS PHARMACEUTICALS, INC.

 

2016 EMPLOYEE STOCK PURCHASE PLAN

 

The purpose of this 2016 Employee Stock Purchase Plan (this “Plan”) is to provide eligible employees of Syros Pharmaceuticals, Inc. (the “Company”) and certain of its subsidiaries with opportunities to purchase shares of the Company’s common stock, $0.001 par value per share (the “Common Stock”), commencing at such time and on such dates as the Board of Directors of the Company (the “Board”) shall determine.  Subject to adjustment under Section 15 hereof, the number of shares of Common Stock that have been approved for this purpose is the sum of:

 

(a)         2,200,000 shares of Common Stock; plus

 

(b)         an annual increase to be added on the first day of each fiscal year, beginning with the fiscal year ended December 31, 2017 and ending on December 31, 2025, equal to the lowest of (i) 4,400,000 shares of Common Stock, (ii) 1.0% of the outstanding shares on such date or (iii) an amount determined by the Board.

 

This Plan is intended to qualify as an “employee stock purchase plan” as defined in Section 423 of the Internal Revenue Code of 1986, as amended (the “Code”), and the regulations issued thereunder, and shall be interpreted consistent therewith.

 

1.                                      Administration.  The Plan will be administered by the Board or by a Committee appointed by the Board (the “Committee”).  The Board or the Committee has authority to make rules and regulations for the administration of the Plan and its interpretation and decisions with regard thereto shall be final and conclusive.

 

2.                                      Eligibility.  All employees of the Company and all employees of any subsidiary of the Company (as defined in Section 424(f) of the Code) designated by the Board or the Committee from time to time (a “Designated Subsidiary”), are eligible to participate in any one or more of the offerings of Options (as defined in Section 9) to purchase Common Stock under the Plan provided that:

 

(a)                                 they are customarily employed by the Company or a Designated Subsidiary for more than twenty (20) hours a week and for more than six months in a calendar year;

 

(b)                                 they have been employed by the Company or a Designated Subsidiary for at least three (3) months prior to enrolling in the Plan; and

 

(c)                                  they are employees of the Company or a Designated Subsidiary on the first day of the applicable Plan Period (as defined below).

 

No employee may be granted an Option hereunder if such employee, immediately after the Option is granted, owns 5% or more of the total combined voting power or value of the stock

 

 

of the Company or any subsidiary.  For purposes of the preceding sentence, the attribution rules of Section 424(d) of the Code shall apply in determining the stock ownership of an employee, and all stock that the employee has a contractual right to purchase shall be treated as stock owned by the employee.

 

The Company retains the discretion to determine which eligible employees may participate in an offering pursuant to and consistent with Treasury Regulation Sections 1.423-2(e) and (f).

 

3.                                      Offerings.  The Company will make one or more offerings (“Offerings”) to employees to purchase stock under this Plan.  Offerings will begin at such time and on such dates as the Board shall determine, or the first business day thereafter (such dates, the “Offering Commencement Dates”).  Each Offering Commencement Date will begin a six (6) month period (a “Plan Period”) during which payroll deductions will be made and held for the purchase of Common Stock at the end of the Plan Period.  The Board or the Committee may, at its discretion, choose a different Plan Period of not more than twelve (12) months for Offerings.

 

4.                                      Participation.  An employee eligible on the Offering Commencement Date of any Offering may participate in such Offering by completing and forwarding either a written or electronic payroll deduction authorization form to the employee’s appropriate payroll office at least fifteen (15) days prior to the applicable Offering Commencement Date.  The form will authorize a regular payroll deduction from the Compensation received by the employee during the Plan Period.  Unless an employee files a new form or withdraws from the Plan, his or her deductions and purchases will continue at the same rate for future Offerings under the Plan as long as the Plan remains in effect.  The term “Compensation” means the amount of money reportable on the employee’s Federal Income Tax Withholding Statement, excluding overtime, shift premium, incentive or bonus awards, allowances and reimbursements for expenses such as relocation allowances for travel expenses, income or gains associated with the grant or vesting of restricted stock, income or gains on the exercise of Company stock options or stock appreciation rights, and similar items, whether or not shown or separately identified on the employee’s Federal Income Tax Withholding Statement, but including, in the case of salespersons, sales commissions to the extent determined by the Board or the Committee.

 

5.                                      Deductions.  The Company will maintain payroll deduction accounts for all participating employees.  With respect to any Offering made under this Plan, an employee may authorize a payroll deduction in any percentage amount (in whole percentages) up to a maximum of fifteen percent (15%) of the Compensation he or she receives during the Plan Period or such shorter period during which deductions from payroll are made.  The Board or the Committee may, at its discretion, designate a lower maximum contribution rate.  The minimum payroll deduction is such percentage of Compensation as may be established from time to time by the Board or the Committee.

 

6.                                      Deduction Changes.  An employee may decrease or discontinue his or her payroll deduction once during any Plan Period, by filing either a written or electronic new payroll deduction authorization form.  However, an employee may not increase his or her payroll deduction during a Plan Period.  If an employee elects to discontinue his or her payroll deductions during a Plan Period, but does not elect to withdraw his or her funds pursuant to

 

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Section 8 hereof, funds deducted prior to his or her election to discontinue will be applied to the purchase of Common Stock on the Exercise Date (as defined below).

 

7.                                      Interest.  Interest will not be paid on any employee accounts, except to the extent that the Board or the Committee, in its sole discretion, elects to credit employee accounts with interest at such rate as it may from time to time determine.

 

8.                                      Withdrawal of Funds.  An employee may at any time prior to the close of business on the fifteenth business day prior to the end of a Plan Period and for any reason permanently draw out the balance accumulated in the employee’s account and thereby withdraw from participation in an Offering.  Partial withdrawals are not permitted.  The employee may not begin participation again during the remainder of the Plan Period during which the employee withdrew his or her balance.  The employee may participate in any subsequent Offering in accordance with terms and conditions established by the Board or the Committee.

 

9.                                      Purchase of Shares.

 

(a)                                 Number of Shares.                                           On the Offering Commencement Date, the Company will grant to each eligible employee who is then a participant in the Plan an option (an “Option”) to purchase on the last business day of such Plan Period (the “Exercise Date”) at the applicable purchase price (the “Option Price”) up to that number of shares of Common Stock determined by multiplying $2,083 by the number of full months in the Plan Period and dividing the result by the closing price (as determined below) on the Offering Commencement Date; provided, however, that no employee may be granted an Option which permits his or her rights to purchase Common Stock under this Plan and any other employee stock purchase plan (as defined in Section 423(b) of the Code) of the Company and its subsidiaries, to accrue at a rate which exceeds $25,000 of the fair market value of such Common Stock (determined at the date such Option is granted) for each calendar year in which the Option is outstanding at any time; and, provided, further, however, that the Committee may, in its discretion, set a fixed maximum number of shares of Common Stock that each eligible employee may purchase per Plan Period which number may not be greater than the number of shares of Common Stock determined by using the formula in the first clause of this Section 9(a) and which number shall be subject to the second clause of this Section 9(a).

 

(b)                                 Option Price.                           The Board or the Committee shall determine the Option Price for each Plan Period, including whether such Option Price shall be determined based on the lesser of the closing price of the Common Stock on (i) the first business day of the Plan Period or (ii) the Exercise Date, or shall be based solely on the closing price of the Common Stock on the Exercise Date; provided, however, that such Option Price shall be at least 85% of the applicable closing price.  In the absence of a determination by the Board or the Committee, the Option Price will be 85% of the lesser of the closing price of the Common Stock on (i) the first business day of the Plan Period or (ii) the Exercise Date.  The closing price shall be (a) the closing price (for the primary trading session) on any national securities exchange on which the Common Stock is listed or (b) the average of the closing bid and asked prices in the over-the-counter-market, whichever is applicable, as published in The Wall Street Journal or another source selected by the Board or the Committee.  If no sales of Common Stock were made on such a day, the price of

 

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the Common Stock shall be the reported price for the next preceding day on which sales were made.

 

(c)                                  Exercise of Option.                                         Each employee who continues to be a participant in the Plan on the Exercise Date shall be deemed to have exercised his or her Option at the Option Price on such date and shall be deemed to have purchased from the Company the number of whole shares of Common Stock reserved for the purpose of the Plan that his or her accumulated payroll deductions on such date will pay for, but not in excess of the maximum numbers determined in the manner set forth above.

 

(d)                                 Return of Unused Payroll Deductions.  Any balance remaining in an employee’s payroll deduction account at the end of a Plan Period will be automatically refunded to the employee, except that any balance that is less than the purchase price of one share of Common Stock will be carried forward into the employee’s payroll deduction account for the following Offering, unless the employee elects not to participate in the following Offering under the Plan, in which case the balance in the employee’s account shall be refunded.

 

10.                               Issuance of Certificates.  Certificates representing shares of Common Stock purchased under the Plan may be issued only in the name of the employee, in the name of the employee and another person of legal age as joint tenants with rights of survivorship, or (in the Company’s sole discretion) in the name of a brokerage firm, bank, or other nominee holder designated by the employee.  The Company may, in its sole discretion and in compliance with applicable laws, authorize the use of book entry registration of shares in lieu of issuing stock certificates.

 

11.                               Rights on Retirement, Death or Termination of Employment.  If a participating employee’s employment ends before the last business day of a Plan Period, no payroll deduction shall be taken from any pay then due and owing to the employee and the balance in the employee’s account shall be paid to the employee.  In the event of the employee’s death before the last business day of a Plan Period, the Company shall, upon notification of such death, pay the balance of the employee’s account (a) to the executor or administrator of the employee’s estate or (b) if no such executor or administrator has been appointed to the knowledge of the Company, to such other person(s) as the Company may, in its discretion, designate.  If, before the last business day of the Plan Period, the Designated Subsidiary by which an employee is employed ceases to be a subsidiary of the Company, or if the employee is transferred to a subsidiary of the Company that is not a Designated Subsidiary, the employee shall be deemed to have terminated employment for the purposes of this Plan.

 

12.                               Optionees Not Stockholders.  Neither the granting of an Option to an employee nor the deductions from his or her pay shall make such employee a stockholder of the shares of Common Stock covered by an Option under this Plan until he or she has purchased and received such shares.

 

13.                               Options Not Transferable.  Options under this Plan are not transferable by a participating employee other than by will or the laws of descent and distribution, and are exercisable during the employee’s lifetime only by the employee.

 

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14.                               Application of Funds.  All funds received or held by the Company under this Plan may be combined with other corporate funds and may be used for any corporate purpose.

 

15.                               Adjustment for Changes in Common Stock and Certain Other Events.

 

(a)                                 Changes in Capitalization.  In the event of any stock split, reverse stock split, stock dividend, recapitalization, combination of shares, reclassification of shares, spin-off or other similar change in capitalization or event, or any dividend or distribution to holders of Common Stock other than an ordinary cash dividend, (i) the number and class of securities available under this Plan, (ii) the share limitations set forth in Section 9, and (iii) the Option Price shall be equitably adjusted to the extent determined by the Board or the Committee.

 

(b)                                 Reorganization Events.

 

(1)                                 Definition.  A “Reorganization Event” shall mean:  (a) any merger or consolidation of the Company with or into another entity as a result of which all of the Common Stock of the Company is converted into or exchanged for the right to receive cash, securities or other property or is cancelled, (b) any transfer or disposition of all of the Common Stock of the Company for cash, securities or other property pursuant to a share exchange or other transaction or (c) any liquidation or dissolution of the Company.

 

(2)                                 Consequences of a Reorganization Event on Options.  In connection with a Reorganization Event, the Board or the Committee may take any one or more of the following actions as to outstanding Options on such terms as the Board or the Committee determines:  (i) provide that Options shall be assumed, or substantially equivalent Options shall be substituted, by the acquiring or succeeding corporation (or an affiliate thereof), (ii) upon written notice to employees, provide that all outstanding Options will be terminated immediately prior to the consummation of such Reorganization Event and that all such outstanding Options will become exercisable to the extent of accumulated payroll deductions as of a date specified by the Board or the Committee in such notice, which date shall not be less than ten (10) days preceding the effective date of the Reorganization Event, (iii) upon written notice to employees, provide that all outstanding Options will be cancelled as of a date prior to the effective date of the Reorganization Event and that all accumulated payroll deductions will be returned to participating employees on such date, (iv) in the event of a Reorganization Event under the terms of which holders of Common Stock will receive upon consummation thereof a cash payment for each share surrendered in the Reorganization Event (the “Acquisition Price”), change the last day of the Plan Period to be the date of the consummation of the Reorganization Event and make or provide for a cash payment to each employee equal to (A) (1) the Acquisition Price times (2) the number of shares of Common Stock that the employee’s accumulated payroll deductions as of immediately prior to the Reorganization Event could purchase at the Option Price, where the Acquisition Price is treated as the fair market value of the Common Stock on the last day of the applicable Plan Period for purposes of determining the Option Price under Section 9(b) hereof, and where the number of shares that could be purchased is subject to the limitations set forth in Section 9(a), minus (B) the result of multiplying such number of shares by such Option Price, (v) provide that, in connection with a liquidation or dissolution of the Company, Options shall convert into the right to receive liquidation proceeds (net of the Option Price thereof) and (vi) any combination of the foregoing.

 

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For purposes of clause (i) above, an Option shall be considered assumed if, following consummation of the Reorganization Event, the Option confers the right to purchase, for each share of Common Stock subject to the Option immediately prior to the consummation of the Reorganization Event, the consideration (whether cash, securities or other property) received as a result of the Reorganization Event by holders of Common Stock for each share of Common Stock held immediately prior to the consummation of the Reorganization Event (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding shares of Common Stock); provided, however, that if the consideration received as a result of the Reorganization Event is not solely common stock of the acquiring or succeeding corporation (or an affiliate thereof), the Company may, with the consent of the acquiring or succeeding corporation, provide for the consideration to be received upon the exercise of Options to consist solely of such number of shares of common stock of the acquiring or succeeding corporation (or an affiliate thereof) that the Board determines to be equivalent in value (as of the date of such determination or another date specified by the Board) to the per share consideration received by holders of outstanding shares of Common Stock as a result of the Reorganization Event.

 

16.                               Amendment of the Plan.  The Board may at any time, and from time to time, amend or suspend this Plan or any portion thereof, except that (a) if the approval of any such amendment by the shareholders of the Company is required by Section 423 of the Code, such amendment shall not be effected without such approval, and (b) in no event may any amendment be made that would cause the Plan to fail to comply with Section 423 of the Code.

 

17.                               Insufficient Shares.  If the total number of shares of Common Stock specified in elections to be purchased under any Offering plus the number of shares purchased under previous Offerings under this Plan exceeds the maximum number of shares issuable under this Plan, the Board or the Committee will allot the shares then available on a pro-rata basis.

 

18.                               Termination of the Plan.  This Plan may be terminated at any time by the Board.  Upon termination of this Plan all amounts in the accounts of participating employees shall be promptly refunded.

 

19.                               Governmental Regulations.  The Company’s obligation to sell and deliver Common Stock under this Plan is subject to listing on a national stock exchange (to the extent the Common Stock is then so listed or quoted) and the approval of all governmental authorities required in connection with the authorization, issuance or sale of such stock.

 

20.                               Governing Law.  The Plan shall be governed by Delaware law except to the extent that such law is preempted by federal law.

 

21.                               Issuance of Shares.  Shares may be issued upon exercise of an Option from authorized but unissued Common Stock, from shares held in the treasury of the Company, or from any other proper source.

 

22.                               Notification upon Sale of Shares.  Each employee agrees, by entering the Plan, to promptly give the Company notice of any disposition of shares purchased under the Plan where

 

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such disposition occurs within two years after the date of grant of the Option pursuant to which such shares were purchased.

 

23.                               Grants to Employees in Foreign Jurisdictions.  The Company may, to comply with the laws of a foreign jurisdiction, grant Options to employees of the Company or a Designated Subsidiary who are citizens or residents of such foreign jurisdiction (without regard to whether they are also citizens of the United States or resident aliens (within the meaning of Section 7701(b)(1)(A) of the Code)) with terms that are less favorable (but not more favorable) than the terms of Options granted under the Plan to employees of the Company or a Designated Subsidiary who are resident in the United States.  Notwithstanding the preceding provisions of this Plan, employees of the Company or a Designated Subsidiary who are citizens or residents of a foreign jurisdiction (without regard to whether they are also citizens of the United States or resident aliens (within the meaning of Section 7701(b)(1)(A) of the Code)) may be excluded from eligibility under the Plan if (a) the grant of an Option under the Plan to a citizen or resident of the foreign jurisdiction is prohibited under the laws of such jurisdiction or (b) compliance with the laws of the foreign jurisdiction would cause the Plan to violate the requirements of Section 423 of the Code.  The Company may add one or more appendices to this Plan describing the operation of the Plan in those foreign jurisdictions in which employees are excluded from participation or granted less favorable Options.

 

24.                               Authorization of Sub-Plans.  The Board may from time to time establish one or more sub-plans under the Plan with respect to one or more Designated Subsidiaries, provided that such sub-plan complies with Section 423 of the Code.

 

25.                               Withholding.  If applicable tax laws impose a tax withholding obligation, each affected employee shall, no later than the date of the event creating the tax liability, make provision satisfactory to the Board for payment of any taxes required by law to be withheld in connection with any transaction related to Options granted to or shares acquired by such employee pursuant to the Plan.  The Company may, to the extent permitted by law, deduct any such taxes from any payment of any kind otherwise due to an employee.

 

26.                               Effective Date and Approval of Shareholders.  The Plan shall take effect as of the closing of the Company’s initial public offering, subject to approval by the shareholders of the Company as required by Section 423 of the Code, which approval must occur within twelve months of the adoption of the Plan by the Board.

 

	
 
    	
Adopted by the Board of   Directors on
    
	
 
    	
December 15, 2015
    
	
 
    	
 
    
	
 
    	
Approved by the   stockholders on
    
	
 
    	
                   , 201
    

 

7Exhibit 10.9

 

SYROS PHARMACEUTICALS, INC. 
 One Memorial Drive 
 7th Floor 
 Cambridge, MA 02142

 

November 13, 2012 (and effective as of July 2, 2012)

 

Nancy Simonian, M.D. 

Dear Nancy:

 

I am pleased to offer you the position of Chief Executive Officer with Syros Pharmaceuticals, Inc. (the “Company”) working out of the Company’s headquarters in Cambridge, Massachusetts. Outlined below are the terms of this Offer Letter for your review.

 

Effective as of July 2, 2012, you will be employed by the Company, on a full-time basis, as its Chief Executive Officer and shall have all authority commensurate with such position, subject to the supervision of, and any conditions or restrictions on such authority as determined from time to time by, the Board of Directors (the “Board”).

 

You agree to perform the duties and responsibilities inherent in such position, and such other duties and responsibilities as shall from time to time be mutually agreed upon between you and the Board, including, but not limited to, (i) leadership regarding efforts to create value for the Company, (ii) guiding the Company’s effort to identify and diligence business development opportunities that are consistent with the strategic goals of the Company, and to negotiate such opportunities as are approved by the Board, (iii) leading the effort to develop and achieve the annual financial and business plan goals for the Company, and (iv) development and ongoing maintenance of the Company’s values and positive culture, reinforcing the Company’s mission to be a highly productive organization that aspires to become one of the leading companies in the industry. You also agree that, while employed by the Company, you will devote your full business time and your best efforts, business judgment, skill and knowledge exclusively to the advancement of the business and interests of the Company and to the discharge of your duties and responsibilities for it. Provided, however, it is agreed that you may serve on outside boards and participate in charitable and civic organizations to the extent such activities do not interfere with your duties and responsibilities to the Company. You agree to abide by the rules, regulations, instructions, personnel practices and policies of the Company, as adopted and amended from time to time by the Company, from and after the date that they are disclosed to you.

 

You will receive a semi-monthly salary of $17,708.34 which, if annualized, is equivalent to $425,000.00. All payments will be payable in accordance with the normal payroll practices of the Company, and will be subject to legally required and otherwise authorized withholdings.

 

Your performance will be reviewed by the Compensation Committee of the Board on an annual basis in conjunction with an annual salary review, with your salary subject to increase but not decrease at such times.

 

 

You will be eligible to receive an annual incentive bonus commencing in calendar year 2012, equal to up to 50% of your then-current base salary. Your 2012 award, which will be prorated based upon your start date, and future bonuses, will be subject to the terms of the applicable bonus plan developed under your leadership and approved by the Board. Additional details will be determined by mutual agreement between you and the Board.   Any bonus awarded will be paid, subject to required withholdings and deductions, on or before March 15 of the calendar year immediately following the year for which the bonus was awarded.

 

On or about the first date on which the Company receives aggregate gross proceeds equal to or exceeding $12,500,000 from the sale to one or more third parties of shares of its capital stock, or notes or other indebtedness that is convertible into or exercisable for shares of its capital stock, in a venture capital financing (the “Qualified Financing Date”), you will, subject to approval by the Board, be awarded a stock option (the “Initial Option”) to purchase that number of shares of the Company’s Common Stock, $0.001 par value per share (“Common Stock”) representing 5% of the fully diluted shares of Common Stock of the Company calculated immediately following the Qualified Financing Date. The exercise price of the Initial Option will be equal to the fair market value of the Company’s Common Stock on the date of grant, and will be subject to the standard terms and conditions of the Company’s 2012 Stock Plan and the stock incentive agreement evidencing such award. The Initial Option will vest and become exercisable over four years at the rate of 25% of the shares underlying the award on the first anniversary of the date of your July 2, 2012 commencement of employment, and then at the rate of l/36th of the remaining shares of Common Stock underlying the award at the end of each additional month after the first anniversary of the date of your commencement of employment until the option is fully vested and exercisable, subject to your continued service to the Company. The Initial Option shall be an incentive stock option to the extent permitted by law, and shall be subject to a right of early exercise (in which case there shall be a Company right of repurchase on any unvested shares of Common Stock issued upon such early exercise that shall lapse in accordance with the same schedule as the vesting described above).

 

In addition to your Initial Option, on or about the Qualified Financing Date you shall also, subject to approval by the Board, be awarded an additional stock option (the “Milestone Option”) to purchase the number of shares of the Company’s Common Stock representing 2% of the fully diluted shares of Common Stock of the Company calculated immediately following the Qualified Financing Date. The exercise price of the Milestone Option will be equal to the fair market value of the Company’s Common Stock on the date of grant, and will be subject to the standard terms and conditions of the Company’s 2012 Stock Plan and the stock incentive agreement evidencing such award. The Milestone Option will vest and become exercisable on the earlier of (1) the date on which the Performance Objective (as defined below) is achieved, and (2) six years from your July 2, 2012 commencement of employment, subject to your continued service to the Company.   The Milestone Option shall be an incentive stock option to the extent permitted by law, and shall be subject to a right of early exercise (in which case there shall be a Company right of repurchase on any unvested shares of Common Stock issued upon such early exercise that shall lapse in accordance with the same schedule as the vesting described above).  The Performance Objective shall be a corporate objective that will be mutually agreed upon by you and the Company, acting in good faith, and approved by the Board, on or before the date that the Milestone Option is granted.

 

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This Offer Letter shall not be construed as an agreement, either express or implied, to employ you for any stated term, and shall in no way alter the Company’s policy of employment at-will, under which both the Company and you remain free to end the employment relationship for any reason, at any time, with or without cause or notice.   Although your job duties, title, compensation and benefits, as well as the Company’s personnel policies and procedures, may change from time to time, the “at-will” nature of your employment may only be changed by a written agreement signed by you and a member of the Board which expressly states the intention to modify the at-will nature of your employment.   Similarly, nothing in this offer letter shall be construed as an agreement, either express or implied, to pay you any compensation or grant you any benefit beyond the end of your employment with the Company, except as otherwise explicitly set forth herein.   This offer letter supersedes all prior understandings, whether written or oral, relating to the terms of your employment.   Your employment and this letter will be governed by the laws of Massachusetts.

 

Without otherwise limiting the “at-will” nature of your employment, in the event your employment is terminated at any time by the Company without Cause or by you for Good Reason, then: (i) you shall receive your base salary accrued through the last day of your employment with the Company, (ii) you shall continue to receive your base salary at the then-current rate per semi-monthly pay period, reduced by all applicable taxes and withholdings, for a period of twelve (12) months in accordance with the Company’s then-current payroll policies and practices, and (iii) you shall receive an incentive bonus (which assumes the achievement of annual targets) pro-rated for the portion of the then-current calendar year during which you were employed by the Company.   In the event of a Change in Control, 100% of all unvested stock options then held by you shall become fully vested and exercisable on the earlier to occur of (a) the date your employment is terminated by the Company without Cause or by you for Good Reason (either in contemplation of, pursuant to or following a Change in Control) or (b) the date that is twelve (12) months following the effective date of the Change in Control. Notwithstanding the foregoing, you will not be entitled to receive any severance payments unless, within sixty (60) days following the date of termination, you (i) have executed a general release in a form prescribed by the Company of all known and unknown claims that you may then have against the Company or persons affiliated with the Company, and (ii) have agreed not to prosecute any legal action or other proceeding based on those claims. The severance payments shall be paid or commence on the first payroll period following the date the release becomes effective (the “Payment Date”). Notwithstanding the foregoing, if the 60th day following the date of termination occurs in the calendar year following the calendar year of the termination, then the Payment Date shall be no earlier than January 1 of such subsequent calendar year.

 

For purposes of this Agreement, “Change of Control” means any transaction or series of related transactions (i) the result of which is a change in the ownership of the Company, such that more than 50% of the equity securities of the Company are acquired by any person or group (as such terms are defined for purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended) that does not own capital stock of the Company on the effective date of such change in control, (ii) that results in the sale of all or substantially all of the assets of the Company, or (iii) that results in the consolidation or merger of the Company with or into another corporation or corporations or other entity in which the Company is not the survivor (except any such corporation or entity controlled, directly or indirectly, by the Company).

 

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“Cause” means: (i) your conviction of, or plea of guilty or nolo contendere to, any crime involving dishonesty or moral turpitude or any felony; or (ii) you have (A) engaged in material dishonesty, willful misconduct or gross negligence, (B) breached or threatened to breach either or both of the Ancillary Agreements (as defined below), (C) materially violated a Company policy or procedure causing or threatening to cause substantial injury to the Company, and/or (D) willfully refused to perform your assigned duties to the Company, following written notice of such refusal by the Company and a period of fifteen (15) days to cure the same.

 

“Good Reason” means the occurrence of one or more of the following without your written consent: (i) a change in your principal work location resulting in a new one-way commute that is more than thirty-five (35) miles greater than your one-way commute prior to the change in your principal work location, regardless of whether you receive an offer of relocation benefits, (ii) a material reduction in your authority, duties and/or responsibilities as compared to your authority, duties and/or responsibilities in effect immediately prior to the occurrence of the event (for example, but not by way of limitation, this determination will include an analysis of whether you maintain at least the same level, scope and type of duties and responsibilities with respect to the management, strategy, operations and business of the Company), or (iii) a material reduction in your base compensation as compared to your base compensation in effect immediately prior to the occurrence of the event; provided, however, that no such occurrence shall constitute Good Reason unless (A) you give the Company a written notice of termination for Good Reason not more than ninety (90) days after the initial existence of the condition, (B) the grounds for termination (if susceptible to correction) are not corrected by the Company within fifteen (15) days of its receipt of such notice, and (C) your termination of employment occurs within one year following the Company’s receipt of such notice.

 

Any severance payments to you under this Offer Letter shall begin only after the date of your “separation from service” (determined as set forth below), which occurs on or after date of the termination of your employment, and shall be subject to the following provisions:

 

(i)            It is intended that each installment of the severance payments under this Offer Letter shall be treated as a separate “payment” for purposes of Section 409A of the Internal Revenue Code of 1986, as amended, and the guidance issued thereunder (“Section 409A”).

 

Neither the Company nor you shall have the right to accelerate or defer the delivery of any such payments except to the extent specifically permitted or required by Section 409A.

 

(ii)           If, as of the date of your “separation from service” from the Company, you are not a “specified employee” (within the meaning of Section 409A), then each installment of the severance payments shall be made on the dates and terms set forth in this Offer Letter.

 

(iii)          If, as of the date of your “separation from service” from the Company, you are a “specified employee” (within the meaning of Section 409A), then:

 

A.            Each installment of the severance payments that, in accordance with the dates and terms set forth in this Offer Letter, will in all circumstances, regardless of when the “separation from service” occurs, be paid within the short-term deferral period (as defined in Section 409A) shall be treated as a “short-term deferral” within the meaning of Treasury

 

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Regulation Section 1.409A-l(b)(4) to the maximum extent permissible under Section 409A and shall be paid on the dates and terms set forth in this Offer Letter; and

 

B.            Each installment of the severance payments that is not described in clause (iii)(A) above and that would, absent this clause (B), be paid within the six-month period following your “separation from service” from the Company shall not be paid until the date that is six (6) months and one (1) day after such “separation from service” (or, if earlier, your death), with any such installments that are required to be delayed being accumulated during the six-month period and paid in a lump sum on the date that is six (6) months and one (1) day following your “separation from service” and any subsequent installments, if any, being paid in accordance with the dates and terms set forth in this Offer Letter; provided, however, that the preceding provisions of this clause (B) shall not apply to any installment of severance payments if and to the maximum extent that that such installment is deemed to be paid under a separation pay plan that does not provide for a deferral of compensation by reason of the application of Treasury Regulation 1.409A-l(b)(9)(iii) (relating to separation pay upon an involuntary separation from service).   Any installments that qualify for the exception under Treasury Regulation Section 1.409A- 1(b)(9)(iii) must be paid no later than the last day of your second taxable year following the taxable year in which the “separation from service” occurs.

 

(iv)          The determination of whether and when your “separation from service” from the Company has occurred shall be made in a manner consistent with, and based on the presumptions set forth in, Treasury Regulation Section 1.409A-1(h).   Solely for purposes of this paragraph (iv), “Company” shall include all persons with whom the Company would be considered a single employer under Section 414(b) and 414(c) of the Code.

 

(v)           All reimbursements and in-kind benefits provided under the Offer Letter shall be made or provided in accordance with the requirements of Section 409A to the extent that such reimbursements or in-kind benefits are subject to Section 409A, including, where applicable, the requirements that (i) any reimbursement is for expenses incurred during your lifetime (or during a shorter period of time specified in this Offer Letter), (ii) the amount of expenses eligible for reimbursement during a calendar year may not affect the expenses eligible for reimbursement in any other calendar year, (iii) the reimbursement of any eligible expense will be made on or before the last day of the calendar year following the year in which the expense is incurred, and (iv) the right to reimbursement is not subject to set off or liquidation or exchange for any other benefit.

 

(vi)          Notwithstanding any other provision of this Offer Letter, the Company makes no representation or warranty and shall have no liability to you or to any other person if any provisions of this Offer Letter are determined to constitute deferred compensation subject to Section 409A but do not satisfy an exemption from, or the conditions of, that section.

 

You will be eligible to participate in any and all benefit programs that the Company establishes and makes available to its employees from time to time, provided that you are eligible under (and subject to all provisions of) the plan documents that govern those programs. Benefits are subject to change at any time in the Company’s sole discretion.

 

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You represent that you are not bound by any employment contract, restrictive covenant or other restriction preventing you from entering into employment with or carrying out your responsibilities for the Company, or which is in any way inconsistent with the terms of this offer letter.

 

This offer of employment is contingent upon satisfactory reference checks, and upon your execution of the Company’s (i) Invention and Non-Disclosure Agreement and (ii) Non-Competition and Non-Solicitation Agreement (collectively, the “Ancillary Agreements”), which are attached hereto as Exhibit A and Exhibit B. You will be required to submit documentation that establishes identity and employment eligibility in accordance with the US Immigration and Naturalization requirements.

 

[Remainder of page intentionally left blank.]

 

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I am very excited about having you join our team and I anticipate that you will make many important contributions to our Company and strategic mission. Please acknowledge your acceptance of this offer by returning a signed copy of this letter.

 

	
 
    	
Very truly yours,
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
SYROS PHARMACEUTICALS, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Robert Nelsen
    
	
 
    	
Robert Nelsen
    
	
 
    	
Member, Board of Directors
    
	
 
    	
 
    
	
 
    	
Agreed and acknowledged as of the date first   written above.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/ Nancy Simonian
    
	
 
    	
Nancy Simonian
    

 

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Syros Pharmaceuticals, Inc.

 

January 29, 2016

 

Nancy Simonian, M.D.

 

Re:                             Amendment to Employment Offer Letter

 

Dear Nancy:

 

Reference is made to that certain Employment Offer Letter dated November 13, 2012 (and effective as of July 2, 2012) between Syros Pharmaceuticals, Inc., a Delaware corporation (the “Company”), and you regarding the terms of your employment with the Company (the “Offer Letter”).  This letter (the “Amendment”) confirms the agreement between the Company and you regarding an amendment to the Offer Letter.

 

1.                                      The portion of the Offer Letter beginning with the second full paragraph on Page 3 (beginning with the clause, “Without otherwise limiting the ‘at-will’ nature of your employment”) through the end of Page 5 (ending with subsection (vi)) is hereby deleted in its entirety and the following inserted in lieu thereof:

 

“Without otherwise limiting the “at-will” nature of your employment, in the event your employment is terminated by the Company without Cause or by you for Good Reason (each as defined below), you shall be entitled to the base salary that has accrued and to which you are entitled as of the effective date of such termination, and further, subject to the conditions set forth in the next paragraph, the Company shall: (a) for a period of twelve (12) months following your termination date: (i) continue to pay you, in accordance with the Company’s regularly established payroll procedure, your base salary as severance; and (ii) provided you are eligible for and timely elect to continue receiving group medical insurance pursuant to the “COBRA” law, continue to pay the share of the premium for health coverage that is paid by the Company for active and similarly-situated employees who receive the same type of coverage, unless the Company’s provision of such COBRA payments will violate the nondiscrimination requirements of applicable law, in which case this benefit will not apply; and (b) pay you a lump sum pro-rata target annual bonus in respect of the year of your termination from employment, which such bonus shall be calculated as a pro-rata portion of the current calendar year bonus based on the number of full months worked in the calendar year in which termination occurs through the date of termination.  If, within the three months prior to a Change in Control or in the twelve months following a Change in Control, the Company terminates your employment without Cause or you resign for Good Reason, the Company, subject to the conditions set forth in the next paragraph, will: (a) extend the severance benefits described in (i) and (ii) above for an additional six (6) months, such that the total severance benefit period shall be eighteen (18) months; (b) in lieu of paying you a lump sum pro rata target bonus as described in (b) above, pay you a lump sum amount equal to 150% of your target bonus in effect for the fiscal year

 

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in which your separation from employment occurs; and (c) accelerate the vesting of all unvested stock options held by you as of the date your employment is terminated such that 100% of such options shall become fully vested and exercisable effective as of such date.

 

Notwithstanding the foregoing, you will not be entitled to receive any severance benefits unless, within sixty (60) days following the date of termination, you (i) have executed a severance and release of claims agreement in a form prescribed by the Company or persons affiliated with the Company (which will include, at a minimum, a release of all releasable claims and non-disparagement and cooperation obligations).  Any severance payments shall be paid, or commence on the first payroll period following the date the release becomes effective (the “Payment Date”). Notwithstanding the foregoing, if the 60th day following the date of termination occurs in the calendar year following the calendar year of the termination, then the Payment Date shall be no earlier than January 1st of such subsequent calendar year.  The severance payments are subject to the terms and conditions set forth on Attachment A.

 

For purposes of this Agreement, “Change in Control” means any transaction or series of related transactions (a) the result of which is a change in the ownership of the Company, such that more than 50% of the equity securities of the Company are acquired by any person or group (as such terms are defined for purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended) that does not own capital stock of the Company of the effective date of such change in control, (b) that results in the sale of all or substantially all of the assets of the Company, or (c) that results in the consolidation or merger of the Company with or into another corporation or corporations or other entity in which the Company is not the survivor (except any such corporation or entity controlled, directly or indirectly, by the Company).

 

“Cause” means: (a) your conviction of, or plea of guilty or nolo contendere to, any crime involving dishonesty or moral turpitude or any felony; or (b) you have (i) engaged in material dishonesty, willful misconduct or gross negligence, (ii) breached or threatened to breach either or both of the Ancillary Agreements (as defined below), (iii) materially violated a Company policy or procedure causing or threatening to cause substantial injury to the Company, and/or (iv) willfully refused to perform your assigned duties to the Company, following written notice of such refusal by the Company and a period of thirty (30) days to cure the same.

 

“Good Reason” means the occurrence of one or more of the following without your written consent: (a) a material reduction in your authority, duties and/or responsibilities as compared to your authority, duties and/or responsibilities in effect immediately prior to the occurrence of the event (for example, but not by way of limitation, this determination will include an analysis of whether you maintain at least the same level, scope and type of duties and responsibilities with respect to the management, strategy, operations and business of the Company), or (b) a material reduction in your base compensation as compared to your base compensation in effect immediately prior to the occurrence of the event; provided, however, that no such occurrence shall constitute Good Reason unless: (i) you

 

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give the Company a written notice of termination for Good Reason not more than ninety (90) days after the initial existence of the condition, (ii) the grounds for termination (if susceptible to correction) are not corrected by the Company within thirty (30) days of its receipt of such notice, and (iii) your termination of employment occurs within one (1) year following the Company’s receipt of such notice.”

 

2.                                      The following language shall be inserted as a new paragraph subsequent to the portion referenced in Section 1 of this Amendment:

 

“This letter is intended to provide payments that are exempt from or compliant with 409A, and should be interpreted consistent with that intent.”

 

3.                                      The attached exhibit entitled “Payments Subject to Section 409A” is hereby appended to the Offer Letter as Attachment A and, if applicable, replaces any previous such attachment concerning the same subject matter.

 

4.                                      Except as specifically provided herein, the Offer Letter remains in full force and effect and is not modified or amended hereby.

 

5.                                      This Amendment will be construed and interpreted in accordance with the laws of the Commonwealth of Massachusetts (other than choice-of-law provisions).

 

6.                                      This Amendment may be executed in counterparts, each of which will be considered an original, but all of which together will constitute one agreement.  Execution of a facsimile or “pdf” copy will have the same force and effect as execution of an original, and a facsimile or “pdf” signature will be deemed an original and valid signature. From and after the date of this Amendment, all references in the Offer Letter to “this agreement” or “this Agreement” or similar terms shall be deemed to be references to the Offer Letter as amended hereby.

 

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Please indicate your agreement with the above terms by signing below.

 

	
 
    	
Very truly yours,
    
	
 
    	
 
    
	
 
    	
SYROS   PHARMACEUTICALS, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Kyle D. Kuvalanka
    
	
 
    	
 
    	
Name:
    	
Kyle D. Kuvalanka
    
	
 
    	
 
    	
Title:
    	
C.O.O
    

 

 

Accepted and Agreed as of January 29, 2016

 

 

	
/s/ Nancy   Simonian
    	
 
    
	
Nancy Simonian
    	
 
    

 

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Attachment A

 

Payments Subject to Section 409A

 

1.                                      Subject to this Attachment A, any severance payments that may be due under the letter agreement shall begin only upon the date of your “separation from service” (determined as set forth below) which occurs on or after the termination of your employment.  The following rules shall apply with respect to distribution of the severance payments, if any, to be provided to you under the letter agreement, as applicable:

 

a.              It is intended that each installment of the severance payments under the letter agreement provided under shall be treated as a separate “payment” for purposes of Section 409A of the Internal Revenue Code of 1986, as amended (“Section 409A”).  Neither the Company nor you shall have the right to accelerate or defer the delivery of any such payments except to the extent specifically permitted or required by Section 409A.

 

b.              If, as of the date of your “separation from service” from the Company, you are not a “specified employee” (within the meaning of Section 409A), then each installment of the severance payments shall be made on the dates and terms set forth in the letter agreement.

 

c.               If, as of the date of your “separation from service” from the Company, you are a “specified employee” (within the meaning of Section 409A), then:

 

i.                  Each installment of the severance payments due under the letter agreement that, in accordance with the dates and terms set forth herein, will in all circumstances, regardless of when your separation from service occurs, be paid within the short-term deferral period (as defined under Section 409A) shall be treated as a short-term deferral within the meaning of Treasury Regulation Section 1.409A-1(b)(4) to the maximum extent permissible under Section 409A and shall be paid on the dates and terms set forth in the letter agreement; and

 

ii.               Each installment of the severance payments due under the letter agreement that is not described in this Attachment A, Section 1(c)(i) and that would, absent this subsection, be paid within the six-month period following your “separation from service” from the Company shall not be paid until the date that is six months and one day after such separation from service (or, if earlier, your death), with any such installments that are required to be delayed being accumulated during the six-month period and paid in a lump sum on the date that is six months and one day following your separation from service and any subsequent installments, if any, being paid in accordance with the dates and terms set forth herein; provided, however, that the preceding provisions of this sentence shall not apply to any installment of payments if and to the maximum extent that that such installment is deemed to be paid under a separation pay plan that does not provide for a deferral of compensation by reason of

 

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                        the application of Treasury Regulation 1.409A-1(b)(9)(iii) (relating to separation pay upon an involuntary separation from service).  Any installments that qualify for the exception under Treasury Regulation Section 1.409A-1(b)(9)(iii) must be paid no later than the last day of your second taxable year following the taxable year in which the separation from service occurs.

 

2.                                      The determination of whether and when your separation from service from the Company has occurred shall be made and in a manner consistent with, and based on the presumptions set forth in, Treasury Regulation Section 1.409A-1(h).  Solely for purposes of this Attachment A, Section 2, “Company” shall include all persons with whom the Company would be considered a single employer under Section 414(b) and 414(c) of the Internal Revenue Code of 1986, as amended.

 

3.                                      The Company makes no representation or warranty and shall have no liability to you or to any other person if any of the provisions of the letter agreement (including this Attachment) are determined to constitute deferred compensation subject to Section 409A but that do not satisfy an exemption from, or the conditions of, that section.

 

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