Document:

ims-ex102_520.htm

 

Exhibit 10.2

Name of Participant: Ari Bousbib  

IMS HEALTH HOLDINGS, INC.

2014 INCENTIVE AND STOCK AWARD PLAN

Performance Share Award Agreement

Pursuant to the IMS Health Holdings, Inc. 2014 Incentive and Stock Award Plan  (as amended from time to time, the “Plan”), IMS Health Holdings, Inc. (the “Company”) has granted to the Participant named above, on the grant date listed on Exhibit A attached hereto (the “Grant Date”), an award (the “Award”) of performance shares (the “Performance Shares”) providing an opportunity to earn 108,412 shares of Stock if designated performance goals are achieved at target levels, an opportunity to earn 50% of such target number of shares if designated performance goals are achieved at threshold levels and an opportunity to earn 200% of the target number of shares if designated performance goals are achieved at or above the maximum levels, subject in all cases to vesting and other terms and conditions set forth in this Performance Share Agreement (the “Agreement”). For the avoidance of doubt, the total number of Performance Shares subject to the Award and the performance goals set forth herein are subject to adjustment pursuant to Section 10 of the Plan. For purposes of this Agreement, “Employer” shall mean the affiliate or subsidiary that employs the Participant (to the extent the Participant is not directly employed by the Company).

1. Earning and Vesting.  Subject to the terms and conditions set forth in this Agreement and the Plan, and unless earlier terminated or forfeited, the Performance Shares will be earned and vest in accordance with the terms of Exhibit A.  

2. Use of Certain Defined Terms.  Capitalized terms used in this Agreement shall have the meaning specified in the Plan, unless a different meaning is specified herein (including in Exhibit A).  In the event of a conflict between the terms and conditions of this Agreement and the Plan, the Plan shall control.

3. Settlement.  

(a) Not later than thirty (30) days following the Determination Date (as defined in Exhibit A), but in no event later than March 15th of the year following the end of the Performance Period, the Company shall deliver to the Participant the number of shares of Stock that become earned and that vest on the Determination Date, determined in accordance with Exhibit A.  Payment may be made by issuance of shares in the name of the Participant and delivery of such shares to the Participant or, in the discretion of the Company, by issuance and delivery of such shares to a financial institution for the account of the Participant, or in any other commercially reasonable manner as may be determined by the Company.

(b) The Participant’s sales or other dispositions of shares of Stock acquired upon settlement of the Performance Shares will be subject to applicable restrictions under Company policies applicable to the Participant, including those covering insider trading by employees.

(c) Notwithstanding any provision in this Agreement to the contrary, the Company may, in its sole discretion, settle the Participant’s Performance Shares in the form of (1) a cash payment to the extent settlement in shares of Stock (i) is prohibited under local law, (ii) would require the Participant, the Company and/or the Employer to obtain the approval of any governmental and/or regulatory body in the Participant’s country of residence (and/or country of employment, if different), or (iii) is administratively burdensome; or (2) shares of Stock, but require the Participant to immediately sell such shares of Stock (in which case, as a condition to the grant of this Award, the Participant hereby expressly authorizes the Company to issue sales instructions on the Participant’s behalf).

4. Termination of the Award.

(a) If the Participant’s employment by, or other service to, the Company or any of its subsidiaries (“Employment”) ceases for any reason prior to the end of the Performance Period, the Performance Shares will be forfeited immediately, unless otherwise determined by the Committee and subject to Section 4(d) below.

(b) Any outstanding Performance Shares that do not vest in accordance with the terms set forth in Exhibit A will terminate on the Determination Date, without any consideration due to the Participant, subject to earlier termination as provided for above and subject to Section 4(d) below.

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(c) Other provisions of the Plan and this Agreement, including Sections 7 and 8, may result in the termination of the Award prior to the end of the Performance Period or the Determination Date, as applicable.

(d) In the event there occurs a Covered Transaction or Change in Control during the Performance Period in which there is no assumption, continuation, substitution or cash-out of all or a portion of the Performance Shares, such Performance Shares will vest and the designated performance goals will be deemed to have been achieved at target levels immediately before the consummation of the Covered Transaction or other event relating to the Change in Control that would cause the Common Stock to cease to be outstanding.  In the case of a Covered Transaction or a Change in Control which occurs during the Performance Period in which the Performance Shares will be assumed, continued, or substituted for, in the event that, at or within 24 months after such Covered Transaction or Change in Control, (i) the Company terminates the Participant’s employment without Cause, (ii) the Participant terminates his employment for Good Reason, or (iii) an Expiration Termination occurs, such Performance Shares will become fully vested and the designated performance goals will be deemed to have been achieved at target levels immediately before such termination. For this purpose, the terms “Cause,” “Expiration Termination” and “Good Reason” have the meanings as defined in the Employment Agreement between the Participant and the Company, as in effect at the Grant Date

5. Income Tax and Social Insurance Withholding. Regardless of any action the Company and/or the Employer takes with respect to any or all income tax (including U.S. federal, state and local taxes or non-U.S. taxes), social insurance, payroll tax, fringe benefit, payment on account or other tax-related withholding (“Tax-Related Items”), the Participant acknowledges that the ultimate liability for all Tax-Related Items legally due by the Participant is and remains the Participant’s responsibility and that the Company and the Employer (a) make no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the Award, including the grant of the Performance Shares, the vesting of the Performance Shares, the subsequent issuance or sale of any shares of Stock acquired pursuant to the Performance Shares and the receipt of any dividends, and (b) do not commit to structure the terms of the grant or any aspect of the Performance Shares to reduce or eliminate the Participant’s liability for Tax-Related Items.  Prior to the delivery of shares of Stock upon the vesting of the Participant’s Performance Shares, if the Participant’s country of residence (and/or the country of employment, if different) requires withholding of Tax-Related Items, the Company shall withhold a sufficient number of whole shares of Stock otherwise issuable upon the vesting of the Performance Shares that have an aggregate fair market value sufficient to pay the minimum Tax-Related Items required to be withheld with respect to the shares of Stock delivered upon such vesting of the Performance Shares.  The cash equivalent of the shares of Stock withheld will be used to settle the obligation to withhold the Tax-Related Items.  Alternatively, the Company or the Employer may withhold the minimum Tax-Related Items required to be withheld with respect to the shares of Stocks in cash from the Participant’s regular salary and/or wages or any other amounts payable to the Participant.  In the event the withholding requirements are not satisfied through the withholding of shares of Stock by the Company or through the Participant’s regular salary and/or wages or other amounts payable to the Participant, no shares of Stock will be issued to the Participant (or the Participant’s estate) upon vesting of the Performance Shares unless and until satisfactory arrangements (as determined by the Committee) have been made by the Participant with respect to the payment of any Tax-Related Items that the Company or the Employer determines, in its sole discretion, must be withheld or collected with respect to such Performance Shares.  By accepting this grant of Performance Shares, the Participant expressly consents and agrees to the withholding of shares of Stock and/or withholding from the Participant’s regular salary and/or wages or other amounts payable to the Participant as provided for hereunder.  All other Tax-Related Items related to the Performance Shares and any shares of Stock delivered in payment thereof are the Participant’s sole responsibility.

6. Transferability. The Performance Shares and this Agreement are personal to the Participant, are non-assignable and are not transferable in any manner, by operation of law or otherwise, other than by will or the laws of descent and distribution or as permitted by the Committee.  Any attempted transfer, assignment, pledge or other disposition of the Award, the Performance Shares, or of any rights granted under this Agreement that is contrary to the provisions of the Plan or this Section 6 shall be null and void.  Except as permitted by the Plan, the Stock to be issued pursuant to this Agreement shall be issued, during the Participant’s lifetime, only to the Participant.   A permitted transferee will have the rights of the Participant with regard to any transferred Award, subject to any limitations imposed by the Company as a condition of permitting the transfer or otherwise.

7. Forfeiture; Recovery of Compensation.  

(a) The Committee may cancel, rescind, withhold or otherwise limit or restrict the Performance Shares or delivery of shares in settlement of the Performance Shares at any time if the Participant is not in compliance with all applicable provisions of this Agreement and the Plan (including, but not limited to, Section 2(e), Section 6 and Section 9). 

(b) By accepting the Performance Shares, the Participant expressly acknowledges and agrees that his or her rights, and those of any permitted transferee of the Performance Shares, with respect to the Performance Shares, including to any Stock acquired upon settlement of the Performance Shares or proceeds from the disposition thereof, are subject to Section 9 of the Plan (including any successor provision). Nothing in the preceding sentence shall be construed as limiting the general application of Section 10(e) of this Agreement.

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8. Other Undertakings.  To protect the interests of the Company and its direct and indirect affiliates and subsidiaries (individually, an “IMS Company” and collectively, the “IMS Companies”), including the confidential information of the IMS Companies and the confidential information of their respective customers, data suppliers, prospective customers and other companies with which the IMS Companies have a business relationship, and in consideration of the covenants and promises and other valuable consideration described in this Agreement, the Company and the Participant agree as follows. 

(a) The Participant acknowledges and agrees that he is bound by the confidentiality and other covenants contained in one or more restrictive covenant and confidentiality agreements that he has executed with an IMS Company, which covenants and agreements are incorporated herein by reference and shall survive any exercise, expiration, forfeiture or other termination of this Agreement or the Performance Shares issuable hereunder. The Participant also acknowledges and agrees that the Company shall be an affiliate for purposes of such restrictive covenant and confidentiality agreements. 

(b) The Participant acknowledges that the opportunity to participate in the Plan and the financial benefits that may accrue from such participation is good, valuable and sufficient consideration for the following:

(i) The Participant acknowledges and agrees that he is and will remain bound by the non-competition, non-solicitation and other covenants contained in the restrictive covenant and confidentiality agreement(s) that he has executed with any of the IMS Companies to the fullest extent permitted by law.   

(ii) The Participant further acknowledges and agrees that the period during which the non-competition and non-solicitation covenants in such agreement(s) will apply following a termination of Employment shall be extended from twelve (12) months to eighteen (18) months; provided, however, that the remedies available for breach of any non-competition or non-solicitation covenants during such extended six-month period shall be limited to the following:  (x) to the extent then outstanding, the forfeiture of the Performance Shares for no consideration, and (y) to the extent the Performance Shares have been settled on or after the date that is eighteen (18) months before the Participant’s cessation of Employment, with respect to the shares of Stock issued upon such settlement (including shares of Stock withheld for taxes), the Participant shall pay to the Company an amount equal to (A) the aggregate fair market value of such shares of Stock as of the date of settlement, plus (B) the excess, if any, of the aggregate proceeds of all sales of such shares of Stock over the amount described under subsection (A) above.  (For this purpose, the Participant’s earliest sales of shares following such settlement will be deemed sales of the shares acquired upon such settlement.)  The Company shall also be entitled to the foregoing remedies in the event of a material breach of any confidentiality, non-disclosure or other similar covenant contained in the restrictive covenant and confidentiality agreement(s) that the Participant has executed with an IMS Company.

(iii) The Participant further acknowledges and agrees to the Company’s application, implementation and enforcement of (a) such policy set forth in Section 10(b)(ii) of this Agreement and (b) any provision of applicable law or Company policy relating to cancellation, recoupment, rescission or payback of compensation and expressly agrees that the Company may take such actions as are necessary to effectuate such policy (as applicable to the Participant) or applicable law without further consent or action being required by the Participant.  For purposes of the foregoing, the Participant expressly and explicitly authorizes the Company to issue instructions, on the Participant’s behalf, to any brokerage firm and/or third party administrator engaged by the Company to hold Participant’s shares of Stock and other amounts acquired under the Plan to re-convey, transfer or otherwise return such shares of Stock and/or other amounts to the Company.  To the extent that the terms of this Agreement and such policy conflict, the terms of such policy shall prevail.  

(iv) By accepting the Performance Shares, the Participant consents to one or more deductions from any amounts any IMS Company owes the Participant from time to time in an aggregate amount equal to all amounts described in subsection (ii) above, to the extent such deductions are permitted by applicable law.  Any such deduction from an amount that constitutes a deferral of compensation under Code Section 409A may only take place at the time the amount would otherwise be payable to the Participant, except to the extent permitted by Code Section 409A.

9. Governing Law and Venue. 

(a) This Agreement and all claims arising out of or based upon this Agreement or relating to the subject matter hereof shall be governed by and construed in accordance with the domestic substantive laws of the State of Delaware without giving effect to any choice or conflict of laws provision or rule that would cause the application of the domestic substantive laws of any other jurisdiction.

(b) Any legal proceeding arising out of this Plan or this Agreement shall be brought exclusively in the Federal or State courts located in the State of Delaware.  The Participant agrees to submit to personal jurisdiction and to venue in those courts.  The Participant further agrees to waive all legal challenges and defenses to the appropriateness of Delaware as the site of any such legal proceeding and to the application of the laws of the State of Delaware and any applicable Federal laws.

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10. Miscellaneous.

(a) Notice hereunder shall be given to the Company at its principal place of business, and shall be given to the Participant at the last address shown in the Company’s records, or in either case at such other address as one party may subsequently furnish to the other party in writing.

(b) Notwithstanding any provisions of Agreement to the contrary, the Award shall be subject to any special terms and conditions for the Participant’s country of residence (and/or country of employment, if different) set forth in the addendum to this Agreement (the “Addendum”).  Further, if the Participant transfers residency and/or employment to another country reflected in the Addendum, at the time of transfer, the special terms and conditions for such country will apply to the Participant to the extent the Company determines, in its sole discretion, that the application of such terms and conditions is necessary or advisable in order to comply with local law, rules and regulations or to facilitate the operation and administration of the Award and the Plan (or the Company may establish alternative terms and conditions as may be necessary or advisable to accommodate the Participant’s transfer).  In all circumstances, any applicable Addendum shall constitute part of the Agreement.

(c) The Company reserves the right to impose other requirements on the Award, any shares of Stock acquired pursuant to the Performance Shares and the Participant’s participation in the Plan to the extent the Company determines, in its sole discretion, that such other requirements are necessary or advisable in order to comply with local law, rules and regulations or to facilitate the operation and administration of the Award and the Plan.  Such requirements may include (but are not limited to) requiring the Participant to sign any agreements or undertakings that may be necessary to accomplish the foregoing.

(d) The issuance of Stock upon settlement of the Performance Shares will be contingent upon the Company’s receipt of any agreement, statement or other evidence that the Company and/or the Committee may require to satisfy itself that the issuance of Stock pursuant to the settlement of the Performance Shares and any subsequent resale of the shares of Stock will be in compliance with all applicable laws and regulations and with the requirements hereof and of the Plan.  The determination of the Committee as to such compliance shall be final and binding on the Participant.  The Participant shall not be deemed to be the holder of, or to have any rights with respect to dividends  or other rights of a holder with respect to, any shares of Stock underlying the Performance Shares unless and until the Company shall have issued and delivered the shares of Stock to the Participant in accordance with Section 3 and Exhibit A of this Agreement, and the Participant’s name shall have been entered as the stockholder of record on the books of the Company (if an alternative method of delivery is elected by the Company under Section 3, Participant will be required to take appropriate steps to cause any nominee to transfer shares into the name of the Participant in order for Participant to become a record holder of the shares).  Thereupon, the Participant shall have full voting, dividend and other ownership rights with respect to such shares of Stock.

(e) This Agreement is subject in its entirety to the provisions of the Plan, which are incorporated herein by reference.  A copy of the Plan as in effect on the Grant Date has been furnished to the Participant. Accepting the Award, the Participant agrees to be bound by the terms of the Plan and this Agreement.  

(f) The Agreement, the Exhibit, the Addendum (if applicable) and the Plan constitute the entire understanding between the Participant and the Company regarding the Performance Shares, and any prior agreements, commitments or negotiations concerning the Performance Shares are superseded.

(g) Any provision of this Agreement, the Exhibit or the Addendum that is deemed invalid, illegal or unenforceable in any jurisdiction shall, as to that jurisdiction and subject to this Section, be ineffective to the extent of such invalidity, illegality or unenforceability, without affecting in any way the remaining provisions thereof in such jurisdiction or rendering that or any other provisions of this Agreement, the Exhibit and the Addendum invalid, illegal, or unenforceable in any other jurisdiction.  If any covenant should be deemed invalid, illegal or unenforceable because its scope is considered excessive, such covenant shall be modified so that the scope of the covenant is reduced only to the minimum extent necessary to render the modified covenant valid, legal and enforceable.  No waiver of any provision or violation of this Agreement or the Addendum by the Company shall be implied by the Company’s forbearance or failure to take action.

(h) The Performance Shares are intended to be exempt from the requirements of Code Section 409A. The Plan and this Agreement shall be administered and interpreted in a manner consistent with this intent. If the Company determines that this Agreement is subject to Code Section 409A and that it has failed to comply with the requirements of that Section, the Company may, at the Company’s sole discretion and without Participant consent, amend the Agreement to cause the terms and conditions of the Agreement to comply with Code Section 409A or be exempt from Code Section 409A. 

11. Data Privacy.  The Company and the Employer hereby notify the Participant of the following in relation to the Participant’s personal data and the collection, processing and transfer of such data in relation to the award of the Performance Shares and the Participant’s participation in the Plan pursuant to applicable personal data protection laws.  The collection, processing and transfer of the Participant’s personal data is necessary for the Company’s administration of the Plan and the Participant’s participation in the Plan, and the Participant’s denial and/or objection to the collection, processing and transfer of personal data may affect the Participant’s ability to participate in the Plan.  As such, the Participant voluntarily acknowledges, consents and agrees (where required under applicable law) to the collection, use, processing and transfer of personal data as described herein.  The Company and the 

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Employer hold certain personal information about the Participant, including (but not limited to) the Participant’s name, home address and telephone number, date of birth, social security number or other employee identification number, salary, nationality, job title, any shares of Stock or directorships held in the Company, details of all Awards or any other entitlement to shares of Stock awarded, canceled, purchased, vested, unvested or outstanding in the Participant’s favor for the purpose of managing and administering the Plan (“Data”).  The Data may be provided by the Participant or collected, where lawful, from third parties, and the Company and the Employer will process the Data for the exclusive purpose of implementing, administering and managing the Participant’s participation in the Plan.  The data processing will take place through electronic and non-electronic means according to logics and procedures strictly correlated to the purposes for which the Data is collected and with confidentiality and security provisions as set forth by applicable laws and regulations in the Participant’s country of residence.  Data processing operations will be performed in a manner that minimizes the use of personal and identification data when such operations are unnecessary for the processing purposes sought.  The Data will be accessible within the Company’s organization only by those persons requiring access for purposes of the implementation, administration and operation of the Plan and for the Participant’s participation in the Plan.  The Company and the Employer will transfer Data as necessary for the purpose of implementation, administration and management of the Participant’s participation in the Plan, and the Company and/or the Employer may each further transfer Data to any third parties assisting the Company in the implementation, administration and management of the Plan.  These recipients may be located in the European Economic Area, the United States or elsewhere throughout the world.  The Participant hereby authorizes (where required under applicable law) the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for purposes of implementing, administering and managing the Participant’s participation in the Plan, including any requisite transfer of such Data as may be required for the administration of the Plan and/or the subsequent holding of shares of Stock on the Participant’s behalf to a broker or other third party with whom the Participant may elect to deposit any shares of Stock acquired pursuant to the Plan.  The Participant may, at any time, exercise the Participant’s rights provided under applicable personal data protection laws, which may include the right to (a) obtain confirmation as to the existence of the Data, (b) verify the content, origin and accuracy of the Data, (c) request the integration, update, amendment, deletion, or blockage (for breach of applicable laws) of the Data, and (d) oppose, for legal reasons, the collection, processing or transfer of the Data that is not necessary or required for the implementation, administration and/or operation of the Plan and the Participant’s participation in the Plan.  The Participant may seek to exercise these rights by contacting the Participant’s local human resources manager.

12. Acknowledgements and Acceptance. 

In accepting the Performance Shares, the Participant acknowledges and agrees that:

(a) The Participant will have no claim or entitlement (1) to compensation or damages in consequence of the termination of Employment for any reason whatsoever and whether or not in breach of contract, insofar as such claim or entitlement arises or may arise from his or her ceasing to have any rights under the Plan or this Agreement, (2) to settlement of the Performance Shares as a result of such termination of Employment, except as expressly provided in this Agreement, or (3) from the loss or diminution in value of the Performance Shares or shares of Stock deliverable or delivered in settlement of the Performance Shares (including due to any delay in delivery of shares in settlement); and, upon the grant of the Performance Shares and in partial consideration for his or her participation in the Plan and this Agreement, the Participant shall be deemed irrevocably to have waived any such claim or entitlement.

(b) Reserved. 

(c) All questions arising under this Agreement, Exhibit A, the Addendum (if applicable) and the Plan shall be decided by the Committee in its sole discretion.

(d) Neither the grant of the Performance Shares, nor the issuance of Stock in settlement of the Performance Shares, will give the Participant any right to be retained in the employ or service of the Company or any of its subsidiaries, affect the right of the Company or any of its subsidiaries, to discharge (as may otherwise be permitted under local law) or discipline the Participant at any time, or affect any right of the Participant to terminate his or her Employment at any time. 

(e) The Participant acknowledges and agrees that the Plan is discretionary in nature and limited in duration, and may be amended, cancelled, or terminated by the Company, in its sole discretion, at any time.  

(f) The grant of the Performance Shares under the Plan is a one-time benefit and does not create any contractual or other right to receive Performance Shares or benefits in lieu of Performance Shares in the future.  The terms of future Performance Shares, if any, will be determined by the Company in its sole discretion, including, but not limited to, the form and timing of such Award, the number of shares of Stock subject to the Performance Shares, and the vesting provisions applicable to the Performance Shares.

(g) The headings preceding the text of the sections hereof are inserted solely for convenience of reference, and shall not constitute a part of this Agreement, nor shall they affect its meaning, construction or effect.

(h) The grant of Performance Shares is not intended to be a public offering of securities in the Participant’s country of residence (and country of employment, if different).  The Company has not submitted any registration statement, prospectus or other 

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filings with the local securities authorities (unless otherwise required under local law), and the grant of the Performance Shares is not subject to the supervision of the local securities authorities.

(i) It is the Participant’s express intent that the Agreement, the Exhibit, the Addendum and the Plan and all other documents, notices and legal proceedings entered into, given or instituted pursuant to the Award, be drawn up in English.  If the Participant has received the Agreement, the Exhibit, the Addendum, the Plan or any other documents related to the Award translated into a language other than English, and if the meaning of the translated version is different than the English version, the English version shall control.

(j) As a condition to the Performance Shares, the Participant agrees to repatriate all payments attributable to the shares of Stock and/or cash acquired under the Plan in accordance with local foreign exchange rules and regulations in the Participant’s country of residence (and country of employment, if different).  In addition, the Participant also agrees to take any and all actions, and consents to any and all actions taken by the Company and any subsidiary or affiliate, as may be required to allow the Company and any subsidiaries or affiliates to comply with local laws, rules and regulations in the Participant’s country of residence (and country of employment, if different).  Finally, the Participant agrees to take any and all actions as may be required to comply with the Participant’s personal obligations under local laws, rules and regulations in the Participant’s country of residence (and country of employment, if different).  

[Remainder of the page intentionally left blank.]

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The Company, by its duly authorized officer, and the Participant have executed this Agreement as of the date first set forth above.

 

 

 

	
IMS HEALTH HOLDINGS, INC.

	
 

	
/s/ Harvey A. Ashman

	
Harvey A. Ashman

Senior Vice President, General Counsel & External Affairs and Corporate Secretary

 

 

 

 

 

Agreed and Accepted:

 

	
/s/ Ari Bousbib

	
Ari Bousbib

	
Participant

 

7ctmx-ex102_450.htm

 

Exhibit 10.2

Severance and Change of Control Agreement

 

This Severance and Change of Control Agreement (the “Agreement”) is made and entered into, effective as of March 23, 2016 (the “Effective Date”), by and between CytomX Therapeutics, Inc. a Delaware corporation (the “Company”), and Rachel Humphrey, Senior Vice President, Chief Medical Officer (“Employee”).  

 

Upon acceptance of this Agreement, the following terms and conditions shall apply to your employment:

 

	
 
	
1.
	
Term of Employment and Severance Benefits. It is important for you to understand that California is an "at will" employment state. This means that you will have the right to terminate your employment relationship with the Company at any time for any reason. Similarly, the Company will have the right to terminate its employment relationship with you at any time for any reason. Your employment and this Agreement will be governed by the laws of California. Notwithstanding the foregoing, in the event that the Company terminates your employment at any time without Cause (as defined below), or if you terminate your employment for Good Reason (as defined below), then the Company shall pay a lump sum amount equal to your then current base salary for a period of nine (9) months, which will be payable within thirty (30) days following your termination of employment.  In addition, the Company will provide and pay the premium cost for you and your dependents, for a period of nine (9) months after termination of your employment, of medical and dental insurance benefits to the extent you were receiving such benefits immediately prior to your termination date and provided that either (a) the Company is able to provide you with such benefits at a cost that is not in excess of the cost that the Company was paying for such benefits for you immediately prior to your termination, or (b) you timely elect "COBRA" coverage under the Company group health insurance plan under which coverage was being provided to you at the time when your employment terminates. If the Company is unable to provide such medical and dental insurance benefits and "COBRA" coverage is not available to you as of the time when your employment is terminated, then the Company will pay to you a lump sum equal to the premium cost of the benefits provided for the six months prior to your termination, payable within thirty (30) days following your termination of employment.  

 

	
 
	
2.
	
Change of Control. In the event that a Change of Control (as defined below) occurs during your employment relationship and within twelve (12) months following such Change of Control, the Company, or any successor thereto terminates your employment without Cause (as defined below) or you terminate your employment for Good Reason (as defined below), then the Company shall (i) pay a lump sum amount equal to your then current base salary for a period of nine (9) months, which will be payable within thirty (30) days following your termination of employment, (ii) pay a lump sum amount equal to three fourths (3/4) of the Annual Bonus you are eligible to receive for the current Calendar year, which will be payable within thirty (30) days following your termination of employment, and (iii) accelerate in full your vesting in all Company options and other equity that you then hold and such options and other equity shall immediately become exercisable in full. In addition, the Company will provide and pay the premium cost for you and your dependents, for a 

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period of nine (9) months after termination of your employment, of medical and dental insurance benefits to the extent you were receiving such benefits immediately prior to your termination date and provided that either (a) the Company is able to provide you with such benefits at a cost that is not in excess of the cost that the Company was paying for such benefits for you immediately prior to your termination, or (b) you timely elect "COBRA" coverage under the Company group health insurance plan under which coverage was being provided to you at the time when your employment terminates. If the Company is unable to provide such medical and dental insurance benefits and "COBRA" coverage is not available to you as of the time when your employment is terminated, then the Company will pay to you a lump sum equal to the premium cost of the benefits provided for the nine months prior to your termination, payable within thirty (30) days following your termination of employment. 

 

	
 
	
3.
	
Release. The Company's obligations to make such payments and provide such benefits shall be contingent upon your execution of a release in a form reasonably acceptable to the Company (the "Release") which Release must be signed and any applicable revocation period with respect thereto must have expired by the 30th day following your termination of employment.  If the Release has been signed and any applicable revocation period has expired prior to the 30th day following your termination of employment, then the severance payments above may be made on such earlier date; provided, however, that if the 30th day following your termination of employment occurs in the calendar year following the year of your termination date, then the payments shall not be made earlier than January 1 of such subsequent calendar year.

 

For purposes of this Agreement, a "Change of Control" shall mean the occurrence of any of the following events, provided that such event or occurrence constitutes a change in the ownership or effective control of the Company, or a change in the ownership of a substantial portion of the assets of the Company, as defined in Treasury Regulation §§ 1.409A-3(i)(5)(v), (vi), and (vii): (i) any merger or consolidation that results in the voting securities of the Company outstanding immediately prior thereto representing (either by remaining outstanding or by being converted into voting securities of the surviving or acquiring entity) less than 50% of the combined voting power of the voting securities of the Company or such surviving or acquiring entity outstanding immediately after such merger or consolidation; (ii) any sale of all or substantially all of the assets of the Company; (iii) the complete liquidation or dissolution of the Company; or (iv) the acquisition of "beneficial ownership" (as defined in Rule 13d-3 under the Exchange Act) of securities of the Company representing 50% or more of the combined voting power of the Company's then outstanding securities (other than through a merger or consolidation or an acquisition of securities directly from The Company) by any "person," as such term is used in Sections 13(d) and 14(d) of the Exchange Act, other than the Company, any trustee or other fiduciary holding securities under an employee benefit plan of the Company or any corporation owned directly or indirectly by the stockholders of the Company in substantially the same proportion as their ownership of stock of the Company.

 

For purposes of this Agreement, "Cause" shall mean a termination of your employment based upon a finding by the Company or its successor, acting in good faith and based on its reasonable belief at the time, that you (a) have been negligent in the discharge of your duties to the Company or its successor, have refused to perform stated or assigned duties or are incompetent in or (other than by reason of a disability or analogous condition) incapable of performing those duties; (b) have been dishonest or committed or engaged in an act of theft, embezzlement or fraud, a breach of confidentiality, an unauthorized disclosure or use of inside information, customer lists, trade secrets or other confidential information; (c) have breached a fiduciary duty, or willfully and materially violated any other duty, law, rule, regulation or policy of the Company or its successor; or have been convicted of, or pled guilty or nolo contendere to, a felony or misdemeanor (other than minor traffic violations or similar offenses); (d) have materially breached any of the provisions of any agreement with the Company or its successor; (e) have engaged in unfair competition with, or otherwise 

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acted intentionally in a manner injurious to the reputation, business or assets of, the Company or its successor; or (f) have improperly induced a vendor or customer to break or terminate any contract with the Company or its successor or induced a principal for whom the Company or its successor acts as agent to terminate such agency relationship.

 

For purposes of this Agreement, "Good Reason" shall mean the occurrence of any of the following events or circumstances (i) a reduction in the amount of your base salary of more than ten (10) percent (except where such reduction applies to all vice presidents and officers of the Company); (ii) the relocation of the Company's headquarters to a place outside of a 50-mile radius from the company's headquarters in South San Francisco, California; or (iii) the assignment, without your consent, to a position, responsibilities, or duties of a materially lesser status or degree than your position, responsibilities or duties as Senior Vice President, Chief Medical Officer, as of the commencement of your  employment. 

 

In order to establish a "Good Reason" for terminating employment, you must provide written notice to the Company of the existence of the condition giving rise to the Good Reason, which notice must be provided within 15 days of the initial existence of such condition, the Company must fail to cure the condition within 30 days thereafter, and your termination of employment must occur no later than seven (7) days following the expiration of that 30-day cure period.

 

All severance or change of control payments shall be made in full compliance with Section 409A and shall begin only upon the date of your "separation from service" (as defined below), which occurs on or after the date of termination of the employment relationship, and shall be subject to the rules set forth below.

 

(a) It is intended that each installment of the severance or change of control payments and benefits provided under the offer letter shall be treated as a separate "payment" for purposes of Section 409 A of the Internal Revenue Code and the guidance issued thereunder ("Section 409A"). Neither you nor the Company shall have the right to accelerate or defer the delivery of any such payments or benefits 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 or change of control payments and benefits shall be made on the dates and terms set forth in this offer letter.

 

(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 or change of control payments and benefits due under this Agreement that, in accordance with the dates and terms set forth herein, will in all circumstances, regardless of when the 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-l(b)(4) to the maximum extent permissible under Section 409A; and

 

(ii) Each installment of the severance or change of control payments and benefits due under this Agreement that is not described in paragraph (i) above 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, upon 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 

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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 severance or change of control payments and benefits 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 Section 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-l(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.

 

(d) 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-l(h). Solely for purposes of this paragraph (d), "the Company" shall include all persons with whom the Company would be considered a single employer under Sections 414(b) and 414(c) of the Code.

 

(e) All reimbursements and in-kind benefits provided under this Agreement 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 requirement that (i) any  reimbursement is for expenses incurred during your lifetime (or during a shorter period of time specified in this Agreement), (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 an 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.

 

This Agreement shall be governed by and construed in accordance with California law.

 

If any provision of this Agreement is determined to be illegal or unenforceable, then the remainder of this Agreement nonetheless shall be fully enforceable and binding upon the parties hereto, and it is the intent of the parties that a court or arbitrator shall enforce the remainder of this Agreement to the maximum extent permitted by law.  

 

This Agreement (a) represents our entire understanding regarding the subject matter hereof, and supersedes and replaces all prior and contemporaneous understandings regarding such subject matter, whether oral or written, and (b) may not be modified or amended, except by a written instrument executed by you and by the Company’s Chief Executive Officer.  

 

ACCEPTANCE

 

The undersigned agrees to and accepts the terms and conditions set forth above.

 

 

 

____03/31/16_________________________/s/ Rachel Humphrey______________

	
Date
	
Rachel Humphrey, S.V.P., Chief Medical Officer

 

 

 

____03/31/16_________________________/s/ Cynthia J. Ladd     ______________

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DateCynthia J. Ladd, S.V.P. and General Counsel 

 

 

 

First Amendment to Severance and Change of Control Agreement

 

This First Amendment to Severance and Change of Control Agreement (the “Amendment”) is made and entered into, effective as of March 23, 2016 (the “Effective Date”), by and between CytomX Therapeutics, Inc., a Delaware Corporation (the “Company”) and Rachel Humphrey (“Employee”), with reference to the following facts. Capitalized terms not defined herein shall have the meanings specified in the Severance and Change of Control Agreement dated March 23, 2016 (the “Severance Agreement”), between the Company and Employee.

 

Recitals:

 

A. The parties previously executed the Severance Agreement, pursuant to which the Company provides Employee severance and change of control benefits following certain terminations of Employee’s employment with the Company.

 

B. The parties have agreed to execute this Amendment to address the treatment of “excess parachute payments” within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”).

 

Agreements: 

 

Now, Therefore, in accordance with the foregoing recitals, the parties hereto, intending to be legally bound, do hereby agree as follows:

 

1. Amendment of Severance Agreement. The Severance Agreement is hereby amended by adding the following new Section 4 directly after the last sentence of Section 3(e):

 

“4.Section 280G of the Code. 

 

(a) Notwithstanding anything in this Agreement to the contrary, if any payment, distribution, or other benefit provided by the Company to or for the benefit of Employee, whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise (collectively, the “Payments”), (x) constitute a “parachute payment” within the meaning of Section 280G of the Code, and (y) but for this Section 4 would be subject to the excise tax imposed by Section 4999 of the Code or any similar or successor provision thereto (the “Excise Tax”), then the Payments shall be either: (i) delivered in full pursuant to the terms of this Agreement, or (ii) delivered to such lesser extent as would result in no portion of the payment being subject to the Excise Tax, as determined in accordance with Section 4(c).

 

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(b) The determination of whether Section 4(a)(i) or Section 4(a)(ii) shall be given effect shall be made by the Company on the basis of which of such clauses results in the receipt by Employee of the greater Net After-Tax Receipt (as defined herein) of the aggregate Payments. The term “Net After-Tax Receipt” shall mean the present value (as determined in accordance with Section 280G of the Code) of the payments net of all applicable federal, state and local income, employment, and other applicable taxes and the Excise Tax. 

 

(c)If Section 4(a)(ii) is given effect, the reduction shall be accomplished in accordance with Section 409A of the Code and the following: first by reducing, on a pro rata basis, cash Payments that are exempt from Section 409A of the Code; second by reducing, on a pro rata basis, other cash Payments; and third by forfeiting any equity-based awards that vest and become payable, starting with the most recent equity-based awards that vest, to the extent necessary to accomplish such reduction.1

 

(d)Unless the Company and Employee otherwise agree in writing, any determination required under this Section 4 shall be made by the Company’s independent accountants or compensation consultants (the “Third Party”), and all such determinations shall be conclusive, final and binding on the parties hereto. The Company and Employee shall furnish to the Third Party such information and documents as the Third Party may reasonably request in order to make a determination under this Section 4. The Company shall bear all fees and costs of the Third Party with respect to all determinations under or contemplated by this Section 4.”

 

2. Miscellaneous. Except as expressly modified by Section 1, above, the Severance Agreement is hereby ratified and confirmed and shall remain in full force and effect. This Agreement may be executed in counterparts, each of which shall be deemed an original and both of which, taken together, shall constitute one and the same instrument, binding on each signatory thereto. A copy of this Amendment that is executed by a party and transmitted by that party to the other party by facsimile or as an attachment (e.g., in “.tif” or “.pdf” format) to an email shall be binding upon the signatory to the same extent as a copy hereof containing that party’s original signature.

 

[Signatures appear on the following page.]

 

	
	 

	
1 
	
 Confirm the ordering of the reductions with the Company, particularly with respect to the ordering of the equity awards and whether last vesting or first vesting are eliminated first. 

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In Witness Whereof, the undersigned have executed this Amendment, effective as of the Effective Date set forth above.

 

		
	
“Company”

 
	
“Employee”

	
CytomX Therapeutics, Inc., a Delaware corporation

 
	
 

 

 

	
By: __/s/ Cynthia J. Ladd______________
	
 

___/s/ Rachel Humphrey__________________

	
Cynthia J. Ladd, S.V.P and General Counsel 
	
Rachel Humphrey, S.V.P., Chief Medical Officer

 

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