Document:

Exhibit 10.11

 

CUBIST PHARMACEUTICALS, INC.

2012 EQUITY INCENTIVE PLAN

STOCK OPTION AGREEMENT

FOR NON-U.S. PARTICIPANTS

 

This Stock Option Agreement (the “Agreement”) governs the Award of stock options (“Options”) to employees (“Optionees”) of Cubist Pharmaceuticals, Inc. (the “Company”). The details of any Option awarded to an Optionee will be set forth in a letter from the Optionee’s manager or other written communication from the Company (a “Notice”).

 

In consideration of the premises and the mutual covenants contained in this Agreement and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Optionee agree as follows:

 

1.             Relationship to the Plan.  Optionee specifically understands and agrees that the Option is being granted under the Company’s 2012 Equity Incentive Plan (the “Plan”), a copy of which the Optionee acknowledges he or she has read and understands and agrees to be bound.  The provisions of the Plan are incorporated into this Agreement by reference.  Any terms used and not defined in this Agreement have the meanings ascribed to such terms in the Plan.

 

2.             Grant of Award.  Optionees will be notified of their Award through a Notice.  The Notice will contain, among other things, the number of Options granted, the Grant Date of the Options and the Exercise Price. An Option represents a contingent entitlement of the Optionee to purchase one share of the Company’s common stock, par value $.001 per share (“Share”) at the Exercise Price stated in the Notice of Grant.

 

3.             Nature of the Option.  This Option is intended to be a nonstatutory stock option and is not intended to be an incentive stock option within the meaning of Section 422 of the United States Internal Revenue Code of 1986, as amended (the “Code”).

 

4.             Option Period.  No Option may be exercised on or after the earlier of (a) the Option expiration date, as specified in Section 8, or (b) the tenth anniversary of the Grant Date.  In the event that the last date to exercise an Option by its terms falls on a date when the primary stock exchange or national market on which the Company’s common stock is listed (the “Primary Stock Exchange”) is closed, then the expiration date and time for the Option shall be the closing time of the regular market hours for the Primary Stock Exchange on the last date prior to the expiration date that the Primary Stock Exchange is open.

 

5.             Vesting .  Subject to the terms and conditions set forth in this Agreement and the Plan, including the potential impact of a Change in Corporate Control upon the vesting of the Award, the Award will vest according to the vesting schedule set forth in the Notice of Grant, provided that the Optionee remains continuously employed by the Company or a Subsidiary through the applicable vesting date.  As the Option vests and becomes exercisable, unexercised vested Options shall accumulate and shall remain exercisable until the last business day prior to the last day of the Option Period. Except as otherwise set forth in this Agreement or the Plan, if the Optionee ceases to be employed for any reason by the Company or a Subsidiary prior to a vesting date, then as of the date on which the Optionee’s employment terminates, all unvested Options shall immediately be forfeited to the Company.

 

6.             Delivery of Shares.  Within thirty (30) days after Option exercise, but subject to the remaining provisions of the Plan, the Company shall deliver or cause to be delivered to the Optionee or his agent a certificate or certificates for the number of Shares then being purchased, or shall cause its transfer agent to register such shares in book entry form in the name of the Optionee.  Such Shares shall

 

 

be fully paid and nonassessable.  Shares shall thereafter be delivered by the Company to the Optionee in accordance with this Agreement and the Plan and as required to comply with Section 409A of the Code.  Notwithstanding the foregoing, if the Optionee is as of the vesting date a “specified employee” (as defined under Section 409A of the Code) then such delivery of Shares of common stock, if required by Section 409A of the Code, will be made six months after the date of a Separation from Service (as defined in Section 409A of the Code).

 

7.             Acknowledgement of the Award.  Optionee is required to acknowledge and accept the terms of this Agreement and the Plan in the manner set forth in Section 26 within the time period specified by the Company and/or its designated broker.

 

8.             Termination of Employment

 

(a)       Unless the Committee shall provide otherwise with respect to any Award, and except as otherwise provided in this Section 8, if the Optionee’s active employment with the Company and its Affiliates ends for any reason other than Retirement or death of such Optionee, including because of the Optionee’s employer ceasing to be an Affiliate, (a) any outstanding Option of the Optionee shall cease to be exercisable ninety (90) days following that event and, for the period it remains exercisable following that event, shall be exercisable only to the extent exercisable at the date of that event, and (b) any other unvested Option of the Optionee shall be forfeited or otherwise subject to return to or repurchase by the Company.  In no event, however, shall an Option remain exercisable after the tenth anniversary of the Date of Grant.  Military or sick leave or other bona fide leave shall not be deemed a termination of employment or other association for purposes of the Plan, provided that it does not exceed the longer of ninety (90) days or the period during which the absent Optionee’s reemployment rights, if any, are guaranteed by statute or by contract.

 

(b)       If an Optionee’s active employment terminates due to death or Retirement, any Option held by Optionee or his or her legal representative, as applicable, may be exercised by the Optionee or such Optionee’s legal representative at any time within the shorter of the Option Period or 12 months after the date of the Optionee’s Retirement or death, whichever is applicable, but only to the extent exercisable at the time of such Optionee’s Retirement or death.

 

(c)       Notwithstanding anything to the contrary in this Section 8, if a Optionee’s employment or other association with the Company and its Affiliates is terminated For Cause, or his or her termination occurs under circumstances that in the sole determination of the Committee would have constituted grounds for the Optionee’s employment to be terminated for Cause, the Committee may in its sole discretion cause any Option held by the Optionee or the Optionee’s legal representative (whether or not vested or exercisable) to terminate without any consideration therefor.

 

9.   Method of Exercise.

 

An Option may be exercised by the Optionee giving written notice to the third party broker designated by the Company to administer the Company’s equity incentive programs (as of the initial effective date of the Plan, Merrill Lynch), specifying the number of Shares with respect to which the Option is then being exercised.  The notice shall be accompanied by payment in the form of cash or check payable to the order of the Company in an amount equal to the Exercise Price of the Shares to be purchased or, subject in each instance to the Committee’s prior approval, acting in its sole discretion, and to such conditions, if any, as the Committee may deem necessary to avoid adverse accounting effects to the Company:

 

(a)  by cash or check made payable to the Company;

 

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(b)  having the Company withhold from the Shares that would otherwise be delivered upon exercise of the Option that number of Shares having an aggregate Market Value equal to the aggregate exercise price under the Option for the surrendered portion of the Option, or

 

( c)  if the Shares are traded on an established market, payment through and under the terms and conditions of a formal cashless exercise program, if any, authorized by the Company involving the sale of the Shares subject to an Option in a brokered transaction (other than to the Company); or

 

(d)  Optionees in the U.S. may exercise their Options by delivery to the Company of Shares having a Market Value equal to the exercise price of the Shares to be purchased.

 

Receipt by the Company or its designated broker of such notice and payment in any authorized or combination of authorized means shall constitute the exercise of the Option.

 

10.          Prohibitions on Transfer and Sale.  Except as permitted by the Plan, Options shall not be assigned, pledged or transferred in any way (whether by operation of law or otherwise) and shall not be subject to execution, attachment or similar process.  Any attempted transfer, assignment, pledge or other disposition of an Option or of any rights granted under this Agreement that is contrary to the provisions of the Plan or this Section 10, or the levy of any attachment or similar process upon an Option shall be null and void.  Except as permitted by the Plan, the Shares shall be issued, during the Optionee’s lifetime, only to the Optionee (or, in the event of legal incapacity or incompetence, to the Optionee’s guardian or representative).

 

11.          Restrictions on Exercise.  This Option may not be exercised if the issuance of Shares upon Optionee’s exercise or the method of payment of consideration for such Shares would constitute a violation of any applicable federal or state securities law or other applicable law or regulation.  As a condition to the exercise of this Option, the Company may require the Optionee to make any representation and warranty to the Company as may be required by any applicable law or regulation.

 

12.          Rights as a Stockholder.  Optionee shall have no right as a stockholder, including voting and dividend rights, until the Options are exercised in accordance with the Notice and Section 9 of this Agreement.

 

13.          Responsibility for Taxes.  Optionee acknowledges that, regardless of any action taken by the Company or, if different, the Employer, the ultimate liability for all income tax, social insurance, payroll tax, fringe benefits tax, payment on account or other tax-related items related to Optionee’s participation in the Plan and legally applicable to Optionee (“Tax-Related Items”) is and remains Optionee’s responsibility and may exceed the amount actually withheld by the Company or the Employer.  Optionee further acknowledges that the Company and/or the Employer (i) make no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of this Option, including, but not limited to, the grant, vesting or exercise of the Option, the subsequent sale of Shares acquired pursuant to the exercise of this Option and the receipt of any dividends; and (ii) do not commit to and are under no obligation to structure the terms of the grant or any aspect of the Option to reduce or eliminate Optionee’s liability for Tax-Related Items or achieve any particular tax result.  Further, if Optionee is subject to Tax-Related Items in more than one jurisdiction between the Grant Date and the date of any relevant taxable or tax withholding event, as applicable, Optionee acknowledges that the Company and/or the Employer (or former employer, as applicable) may be required to withhold or account for Tax-Related Items in more than one jurisdiction.

 

Prior to the relevant taxable or tax withholding event, as applicable, Optionee agrees to make adequate arrangements satisfactory to the Company and/or the Employer to satisfy all Tax-Related Items.  In this regard, Optionee authorizes the Company and/or the Employer, or their respective agents, at their discretion, to satisfy the obligations with regard to all Tax-Related Items by (i) withholding from

 

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Optionee’s wages or other cash compensation paid to Optionee by the Company and/or the Employer, and/or (ii) withholding from proceeds of the sale of Shares acquired upon exercise of the Option either through a voluntary sale or through a mandatory sale arranged by the Company (on Optionee’s behalf pursuant to this authorization without further consent).

 

Finally, Optionee agrees to pay to the Company and/or the Employer any amount of Tax-Related Items that the Company and/or the Employer may be required to withhold or account for as a result of Optionee’s participation in the Plan that cannot be satisfied by the means previously described.  The Company may refuse to honor the exercise of the Option, or may refuse to issue or deliver the Shares or the proceeds of the sale of Shares acquired upon exercise, if Optionee fails to comply with his or her obligations in connection with the Tax-Related Items.

 

14.          Optionee Acknowledgements and Authorizations.  Optionee acknowledges the following:

 

(a)  the Plan is established voluntarily by the Company, it is discretionary in nature and it may be modified, amended, suspended or terminated by the Company at any time;

 

(b)  the grant of the Options is voluntary and occasional and does not create any contractual or other right to receive future grants of Options, or benefits in lieu of Options, even if Options have been granted repeatedly in the past;

 

( c) all decisions with respect to future grants, if any, will be at the sole discretion of Company;

 

(d)  the value of an Award is an extraordinary item of compensation outside of the scope of the Optionee’s employment.  As such, an Award is not part of normal or expected compensation for purposes of calculating any severance, resignation, redundancy, end of service payments, bonuses, long-term service awards, pension or retirement benefits or similar payments.  The future value of the Shares underlying the Award is unknown and cannot be predicted with certainty.

 

(e)  the future value of the underlying Shares is unknown and cannot be predicted with certainty;

 

(f)  if the underlying Shares do not increase in value, the Option will have no value;

 

(g)  if Optionee exercises the Option and acquires Shares, the value of those Shares may increase or decrease in value, even below the purchase price;

 

(h)  no claim or entitlement to compensation or damages shall arise from forfeiture of the Options resulting from termination of Optionee’s employment with the Company or the Employer (for any reason whatsoever and whether or not in breach of local labor laws) and Optionee irrevocably releases the Company and the Employer from any such claim that may arise; if, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen, Optionee will be deemed irrevocably to have waived his or her entitlement to pursue such claim;

 

(i)  in the event of termination of Optionee’s employment (whether or not in breach of local labor laws), Optionee’s right to vest in the Options under the Plan, if any, will terminate effective as of the date that Optionee is no longer actively employed and will not be extended by any notice period mandated under local law (e.g., active employment would not include a period of “garden leave” or similar period pursuant to local law); the Committee shall have the exclusive discretion to determine when Optionee is no longer actively employed for purposes of his or her Option; and

 

(j)  unless otherwise provided in the Plan or by the Company in its discretion, the Options and the benefits evidenced by this Agreement do not create any entitlement to have the Options or any such

 

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benefits transferred to, or assumed by, another company nor to be exchanged, cashed out or substituted for, in connection with any corporate transaction affecting the Shares.

 

15.          Notices.  Notices required or permitted by the terms of this Agreement or the Plan shall be given by the Company and the Optionee as set forth in the Plan.

 

16.          Benefit of Agreement.  Subject to the provisions of the Plan and the other provisions hereof, this Agreement shall be for the benefit of and shall be binding upon the heirs, executors, administrators, successors and assigns of the parties hereto.

 

17.          Governing Law and Forum.  This Agreement shall be construed and enforced in accordance with the laws of the State of Delaware, without giving effect to the conflict of law principles thereof.  For the purpose of litigating any dispute that arises under this Agreement, whether at law or in equity, the parties hereby consent to exclusive jurisdiction in the Commonwealth of Massachusetts  and agree that such litigation shall be conducted in the state courts of Massachusetts or the federal courts of the United States for the District of Massachusetts.

 

18.          Severability.  If any provision of this Agreement is held to be invalid or unenforceable by a court of competent jurisdiction, then such provision or provisions shall be modified to the extent necessary to make such provision valid and enforceable, and to the extent that this is impossible, then such provision shall be deemed to be excised from this Agreement, and the validity, legality and enforceability of the rest of this Agreement shall not be affected thereby.

 

19.          Entire Agreement.  This Agreement, together with the Plan and the Notice, constitutes the entire agreement and understanding between the parties hereto with respect to the subject matter hereof and supersedes all prior oral or written agreements and understandings relating to the subject matter hereof.  No statement, representation, warranty, covenant or agreement not expressly set forth in this Agreement shall affect or be used to interpret, change or restrict the express terms and provisions of this Agreement provided, however, in any event, this Agreement shall be subject to and governed by the Plan.

 

20.          Modifications and Amendments; Waivers and Consents.  The terms and provisions of this Agreement may be modified or amended as provided in the Plan.  Except as provided in the Plan, the terms and provisions of this Agreement may be waived, or consent for the departure therefrom granted, only by written document executed by the party entitled to the benefits of such terms or provisions.  No such waiver or consent shall be deemed to be or shall constitute a waiver or consent with respect to any other terms or provisions of this Agreement, whether or not similar.  Each such waiver or consent shall be effective only in the specific instance and for the purpose for which it was given, and shall not constitute a continuing waiver or consent.

 

21.          Miscellaneous.

 

(a)           Successors and Assigns.  This Agreement shall bind and inure only to the benefit of the parties hereto (the “Parties”) and their respective successors and assigns.

 

(b)           No Third-Party Beneficiaries.  Nothing in this Agreement is intended to confer any rights or remedies on any persons other than the Parties and their respective successors or assigns.  Nothing in this Agreement is intended to relieve or discharge the obligation or liability of third persons to either Party.  No provision of this Agreement shall give any third person any right of subrogation or action over or against either Party.

 

22.          Termination or Amendment of Outstanding Awards. The Committee may amend the terms of any Award theretofore granted, prospectively or retroactively, provided that the Award as amended is consistent with the terms of the Plan.  Also within the limitations of the Plan, the Committee

 

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may modify, extend or assume outstanding Awards or may accept the cancellation of outstanding Awards or of outstanding stock options or other equity-based compensation awards granted by another issuer in return for the grant of new Awards for the same or a different number of Shares and on the same or different terms and conditions (including but not limited to the exercise price of any Option).  Furthermore, subject to the terms of this Plan, including, without limitation Section 13.3 thereof, the Committee may at any time (a) offer to buy out for a payment in cash or cash equivalents an Award previously granted, or (b) authorize the recipient of an Award to elect to cash out an Award previously granted, in either case at such time and based upon such terms and conditions as the Committee shall establish.

 

23.          Data Privacy.

 

Optionee hereby explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of Optionee’s Data (as defined below) by and among, as necessary and applicable, the employer, the Company, its subsidiaries and affiliates for the exclusive purpose of implementing, administering and managing Optionee’s participation in the Plan.

 

Optionee understands that the Company and the employer may hold certain personal information about, including, but not limited to, Optionee’s name, home address and telephone number, date of birth, social security or insurance number or other identification number, salary, nationality, and job title, any share ownership or directorships held in the Company, and details of the Options or other entitlement to Shares awarded, canceled, vested, unvested or outstanding in Optionee’s favor, for the purpose of implementing, administering and managing the Plan (“Data”).  Optionee understands that Data may be transferred to any third parties assisting in the implementation, administration and management of the Plan, that these recipients may be located in Optionee’s country or elsewhere, including outside the European Economic Area, and that the recipients’ country may have different data privacy laws and protections than Optionee’s country.  Optionee authorizes the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing Optionee’s participation in the Plan, including any requisite transfer of such Data as may be required to a broker or other third party with whom Optionee may elect to deposit any Shares acquired upon Option exercise or other entitlement to Shares.

 

Optionee understands that Optionee may request a list with the names and addresses of any potential recipients of the Data by contacting Optionee’s local human resources representative. Optionee understands that Optionee is providing the consent herein on a voluntary basis and that refusing to give Optionee’s consent or revoking Optionee’s consent will not adversely affect Optionee’s employment status, service or career with the employer. Optionee understands, however, refusing or withdrawing Optionee’s consent may result in the Company refraining from granting Optionee Options in the future.  Further, Optionee understands that refusing or withdrawing such consent may affect Optionee’s ability to participate in the Plan.  In addition, Optionee understands that the Company, its subsidiaries and its affiliates have separately implemented procedures for the handling of Data, which permits the Company to use the Data in the manner set forth above notwithstanding Optionee’s withdrawal of such consent.  Optionee understands that Data shall be held as long as is reasonably necessary to implement, administer and manage Optionee’s participation in the Plan, and Optionee may, at any time, view Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing Optionee’s local human resources representative.  Optionee understands, however, that refusing or withdrawing such consent may affect Optionee’s ability to participate in the Plan.  For more information on the consequences of refusal to consent or withdrawal of consent, Optionee understands that Optionee may contact Optionee’s local human resources representative.

 

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24.          Imposition of Other Requirements.  The Company reserves the right to impose other requirements on Optionee’s participation in the Plan, on the Option and on any Shares acquired under the Plan, to the extent the Company determines it is necessary or advisable for legal or administrative reasons, and to require Optionee to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.

 

25.          Addendum for Non-U.S. Countries.  Notwithstanding any provisions in this Agreement, the Award shall be subject to any special terms and conditions set forth in any Addendum to this Agreement for Optionee’s country (the “Addendum”).  Moreover, if Optionee relocates to one of the countries included in the Addendum, the special terms and conditions for such country will apply to Optionee, to the extent the Committee determines that the application of such terms and conditions is necessary or advisable in order to comply with local law or facilitate the administration of the Plan.  The Addendum constitutes part of this Agreement.

 

26.          Company Signature; Optionee Electronic Acknowledgment.  An authorized representative of the Company has signed the Agreement below.  Optionee hereby consents to receive such documents by electronic delivery and agree to participate in the Plan through the current on-line system, or any other on-line system or electronic means that the Company may decide, in its sole discretion, to use in the future.

 

By acknowledging acceptance of the terms of this Agreement through an electronic acknowledgment system established by the Company or its designated broker, Optionee agrees to be bound by all of the terms of this Agreement and the Plan.  The Optionee will not be permitted to exercise his or her Options, until Optionee acknowledges his or her acceptance of the terms of this Agreement in the manner required by the Company.

 

 

	
 
    	
CUBIST PHARMACEUTICALS, INC.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    
				

 

7Exhibit 10.15

 

 

STRICTLY CONFIDENTIAL

 

October 3, 2012

 

Tamara Joseph

c/o Cubist Pharmaceuticals, Inc.

65 Hayden Avenue

Lexington, MA 02421

 

Re:          Separation Agreement and Release

 

Dear Tamara:

 

As we have discussed, your employment with Cubist Pharmaceuticals, Inc. (alternatively, “Cubist” or the “Company”) has ended as of October 3, 2012 (the “Departure Date”).

 

1.   Effect of Departure.  On your Departure Date, you were paid all wages and other compensation due, including payment for the 18 hours of vacation you earned, but did not use, through the Departure Date as determined from the books of the Company. Except as set forth below, your participation in all of the Company’s employee benefit plans will end as of your Departure Date, in accordance with the terms of those plans.

 

2.   Severance Pay and Other Benefits

 

(a)           Consistent with section 2 of your Retention Letter dated as of October 12, 2010, and upon the effective date of this Separation Agreement and Release (this “Agreement”) following the seven (7) day revocation date specified below, the Company will provide you with severance pay in the amount of eighteen (18) months’ salary (“Separation Pay”).  Consistent with your Retention Letter, the Separation Pay will be payable as follows:  (i) in the first payroll cycle following December 3, 2012, you will receive the first eight (8) weeks of Separation Pay in a lump sum payment, and (ii) thereafter you will receive the remainder of the Separation Pay in accordance with our normal payroll cycles in eleven (11) equal semi-monthly installments.  You will not be

 

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able to make any salary deferrals for contribution to the Cubist 401(k) plan from the Separation Pay.

 

(b)           The “qualifying event” under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”) shall be deemed to have occurred on the Departure Date.  Consistent with your Retention Letter, upon, and subject to, completion of the appropriate COBRA election forms, and subject to all the requirements of COBRA, for the eighteen (18) month period following the Departure Date (the “Continuation Period”), you will remain eligible to participate in the Company’s health and dental insurance plans under the same terms and conditions applicable to active, full-time employees.  Provided that you elect to continue such participation in these plans in a timely manner, Cubist will continue to contribute to the premium cost of your participation and that of your eligible dependents until (A) the expiration of the Continuation Period, (B) the date you become eligible for coverage under the health and/or dental plans of another employer, or (C) the date you otherwise cease to be eligible to continue participation in Cubist’s plans under COBRA, whichever occurs first, provided that you pay the remainder of the premium cost of such participation on a timely basis when billed and provided further that you notify Cubist promptly if you become eligible for participation in the health and/or dental plans of another employer or otherwise cease to be eligible to continue participation in Cubist’s plans under COBRA (e.g., upon becoming eligible for Medicare) prior to the expiration of the Continuation Period.  After the Continuation Period, you will have the right to continue your medical and dental insurance for the remainder of the COBRA period, if any, subject to the requirements of COBRA, at your own cost (as described in the COBRA qualifying notice to be provided to you under separate cover).

 

(c)           Cubist will provide you with an Executive “Career Transition” program offered by Essex Partners to begin on a mutually agreeable date; provided, that you must commence such program not later than December 31, 2012.

 

(d)           Pursuant to the Company’s Amended and Restated 2000 Equity Incentive Plan (the “2000 Plan”) and the 2010 Equity Incentive Plan (the “2010 Plan”) and equity incentive award notices that you have received, vesting of all stock options and restricted stock units granted to you during your employment with the Company will cease as of the Departure Date and you will have 90 days from the Departure Date to exercise the vested portion of any stock options that were exercisable as of the Departure Date.  All of your stock options and restricted stock unit awards will continue to be governed by, as applicable, the 2000 Plan or the 2010 Plan, and equity incentive award notices between you and the Company.

 

(e)           You will receive an additional cash payment during 2013 but not later than March 15, of $157,125, payable in a lump sum.

 

(f)            All payments set forth in this Section 2 shall be subject to all applicable federal, state and/or local withholding and/or payroll taxes, and Cubist may withhold from any amounts payable to you (including any amounts payable pursuant to this Agreement) in order to comply with such withholding obligations. You further authorize Cubist to deduct any health insurance premiums that you are required to pay under Section 2(b) from your Severance Pay.

 

 

3.   Reference Requests.  Cubist will respond to any reference requests from potential employers that are directed to Human Resources by confirming your title and dates of employment at Cubist.  To the extent that requests for references are directed to Chief Executive Officer Michael Bonney, Mr. Bonney will respond, if in writing, by utilizing the letter of reference attached to this Agreement as Attachment A; if orally, Mr. Bonney will provide a reference for you that is consistent with the statements set forth in Attachment A.

 

4.   Accord and Satisfaction.  You agree that the Separation Pay and other benefits described in this Agreement shall be in full and complete payment and satisfaction of any and all monetary sums and other obligations which are now, or might hereafter have become, owing to you for services rendered by you during your employment or in connection with your termination of employment including, without limitation, all claims for back wages, salary, commissions, vacation pay, sick pay, draws, incentive pay, bonuses, commissions, intellectual property rights, equity incentives, stock options, severance pay, any and all other forms of compensation or benefits, attorney’s fees, or other costs or sums of any kind or nature.  You agree that your separation from the Company is final and that the Company has no obligation to consider you for rehire or reinstatement.

 

5.   Your Continuing Obligations.  You acknowledge and agree that, as Cubist General Counsel and Secretary, you remain bound by your obligations to maintain attorney/client confidences, and you further acknowledge that the Company does not hereby waive any attorney/client privilege. You acknowledge you have had access to information concerning the Company, its clients, and its affiliates which is confidential or proprietary in nature (the “Confidential Information”), and you hereby acknowledge and agree that you will continue to protect the Confidential Information in accordance with the provisions of the employee confidentiality agreement that you signed when you commenced employment with the Company (the “Employee Confidentiality Agreement”).  By executing this Agreement, you reaffirm all of your continuing obligations under the Employee Confidentiality Agreement.

 

6.   Confidentiality of Agreement.  You agree that the terms of this Agreement shall remain strictly confidential, except for those terms which are required by law to be disclosed.  It shall not be considered a violation of this Section 6 of the Agreement for you to disclose the terms of this Agreement to your spouse or to obtain legal or financial advice, provided that your spouse and/or your legal or financial advisors agree not to further disclose the terms of this Agreement to others.

 

7.   Non-Disparagement.  You agree that you will not intentionally disparage the Company or those people or organizations whom or which you know are currently associated with it and that you will not otherwise do or say anything that is intended to harm its business or reputation.  The Company agrees that its current Chief Executive Officer, President and Chief Operating Officer and Executive Vice President, Research & Development, and Chief Scientific Officer, will not intentionally disparage you or otherwise do or say anything that is intended to harm your reputation.

 

 

8.   Return of Documents and Equipment.  In signing this Agreement, you agree that you will return to the Company any and all documents, materials and information related to the business (including all electronic versions), whether present or otherwise, of the Company and its affiliates, and all copies, and all keys, credit cards, computers, phones, handheld devices and other tangible property of the Company and its affiliates, in your possession or control.  This shall not apply to Company documents that pertain to your compensation or performance of your duties, or any other documents that would be included in your personnel file.

 

9.   Cooperation

 

(a)           In signing this Agreement, you agree that you will cooperate fully with Cubist’s employees and business partners in smoothly, effectively, and completely transitioning your work as the Company may designate; the parties agree that any such transition assistance shall conclude by October 31, 2012. You further agree that you will make yourself available to the Company for reasonable periods of time (at mutually convenient times, taking into account your personal and/or professional commitments), either by telephone or, if you and the Company believes necessary, in person upon reasonable notice, to assist the Company in connection with any matter relating to services performed by you on behalf of the Company that is in connection with the defense or prosecution of any claims or actions now in existence or which may be brought or threatened in the future against or on behalf of the Company, its directors, shareholders, officers, or employees.  The Company shall reimburse you for reasonable documented travel expenses incurred should your presence be required in person.  You further agree that should you be contacted (directly or indirectly) by any individual or any person representing an individual or entity that, to your knowledge, is or may be legally or competitively adverse to the Company in connection with any actual or potential claims or legal or regulatory proceedings, you will promptly notify the Company’s General Counsel of that fact in writing (a “Notification of Adverse Action”), but in no event later than the fifth business day after you are contacted, and you hereby represent and warrant that you have not been so contacted as of the date you signed this Agreement (the “Execution Date”).  Such Notification of Adverse Action shall include a reasonable description of the content of the communication with the representative of the legally or competitively adverse individual or entity.  Your obligation to provide a Notification of Adverse Action shall cease as of April 3, 2014.

 

(b)           Nothing herein shall prohibit or bar you from providing truthful testimony in any legal proceeding or in communicating with any governmental agency or representative or from making any truthful disclosure required, authorized or permitted under law; provided however, that in providing such testimony or making such disclosures or communications, you will use your best efforts to ensure that this Section 9 is complied with to the maximum extent possible.

 

(c)           Indemnification.  The Company agrees to abide by the indemnification and hold harmless provisions of the Company’s Restated Certificate of Incorporation and Amended and Restated By-Laws as they pertain to you.  To the extent you were a covered insured by any Company insurance policy, nothing herein negates such coverage or indemnity provided by such policy (including under any applicable directors and officers liability policy or employment practices liability policy).  Any

 

 

reasonable expense incurred by you while cooperating in the investigation, preparation, defense or prosecution of any complaint, lawsuit, charge, claim or any other judicial or investigative proceeding in which you have been identified as a material witness or are deemed by the Company to have relevant knowledge shall, subject to the receipt of appropriate documentation by the Company, be fully reimbursed to you by the Company.  To the extent that it is necessary for you to retain counsel other than the Company’s counsel with respect to any such proceeding, and if, under the provisions of the Company’s insurance policy, the Company will pay for the services of that counsel, then such counsel shall be selected by the Company and you, with neither party unreasonably withholding their approval, and paid directly by the Company.

 

10.   Release of Claims

 

The Company wants to be certain that this Agreement will resolve any and all concerns that you might have and therefore requests that you carefully consider the terms of this Agreement, including the release of claims set forth below, which is a specific condition to your receipt of the Severance Pay and other benefits set forth in this Agreement.  As a result, the Company encourages you to seek the advice of an attorney before you sign this Agreement.

 

(a)           In exchange for the Separation Pay and other benefits to be provided you under this Agreement, you and your respective agents, heirs, legatees, successors and assigns (collectively hereinafter “you”), except as set forth below, hereby unconditionally and irrevocably release, remise, and forever discharge Cubist, (1) and all persons acting by, through, under or in concert with Cubist, of and from any and all actions, causes of actions, suits, debts, charges, complaints, claims, liabilities, obligations, promises, agreements, controversies, damages, and expenses (including attorney fees and costs actually incurred), of any nature whatsoever, in law or equity (collectively “Claims”), which you had, now have, or hereafter may have against the Company from the beginning of time through the Execution Date.  Without limiting the generality of the foregoing waiver and release of claims, you specifically waive and release Cubist from any Claim including, without limitation:

 

(1)        Claims under any federal, state (including, without limitation, Massachusetts) or local discrimination, fair employment practices or other employment related statute, regulation or executive order (as they may have been amended through the Execution Date) prohibiting discrimination or harassment based upon any status protected by law,  including, without limitation, those laws and regulations that prohibit discrimination or harassment based on age, race, national origin, gender, marital status, disability, veteran status or sexual orientation.  Without limitation, specifically included in this paragraph are any Claims arising under the Title VII, the Age Discrimination in Employment Act, the Older Workers Benefit Protection Act, the Civil Rights Acts of 1866 and 1871, Title VII of the Civil

 

(1)           For purposes of this Section, “Cubist” includes Cubist Pharmaceuticals, Inc., and any of its divisions, affiliates (which means all persons and entities directly or indirectly controlling, controlled by or under common control with Cubist Pharmaceuticals, Inc.), subsidiaries and all other related entities, and its and their directors, officers, employees, trustees, attorneys, agents, representatives successors and assigns.

 

 

Rights Act of 1964, the Civil Rights Act of 1991, the Equal Pay Act, the Americans with Disabilities Act, and Massachusetts General Laws Chapter 151B;

 

(2)           Claims under any other federal, state (including, without limitation, Massachusetts) or local employment-related statute, regulation or executive order (as they may have been amended through the Execution Date) relating to wages, hours or any other terms and conditions of employment (including, without limitation, the Fair Labor Standards Act, the National Labor Relations Act, the Employee Retirement Income Security Act of 1974, the Consolidated Omnibus Budget Reconciliation Act of 1985 and any similar statute the Worker Adjustment and Retraining Notification Act and any similar federal, state or local statute, regulation, or executive order);

 

(3)          Claims under any federal, state (including, without limitation, Massachusetts) or local common law theory including, without limitation, wrongful discharge, breach of express or implied contract, promissory estoppel, unjust enrichment, breach of a covenant of good faith and fair dealing, violation of public policy, torts, defamation, interference with contractual relations, intentional or negligent infliction of emotional distress, invasion of privacy, misrepresentation, deceit, fraud or negligence;

 

(4)           Claims under any federal, state (including, without limitation, Massachusetts and Delaware) or local securities law, including, without limitation, the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, and any similar statute;

 

(5)           Claims under the Federal False Claims Act, any state or local false claims act or any federal, state or local qui tam provisions of false claims or false statements statutes; and

 

(6)           All other claims of any kind or nature.

 

Notwithstanding the foregoing, this paragraph shall not release Cubist from any obligation expressly set forth in this Agreement, shall not act as a waiver or release of any Claims that you cannot by law waive or release, including, without limitation, workers’ compensation claims and claims to vested ERISA benefits, and shall not act as a waiver or release of any indemnifications rights.  You acknowledge and agree that, but for providing this waiver and release of Claims, you would not be receiving the Separation Pay or other benefits being provided to you under the terms of this Agreement.

 

(b)           You further agree, to the fullest extent permitted by law, that you will not sue or commence any proceeding (judicial or administrative), or participate in any action, suit or proceeding (unless compelled by legal process or court order), against Cubist with respect to any Claim you have released the Company from under this Agreement.  You also warrant and represent that as of the Execution Date, you have not taken or engaged in any of the acts described in the foregoing sentences.  If, notwithstanding the foregoing promises, you violate this provision, you shall be required, to the maximum extent permitted by law, to indemnify and hold harmless Cubist from and against any and all

 

 

demands, assessments, judgments, costs, damages, losses and liabilities, and attorneys’ fees and other expenses which result from, or are incident to, such violation.

 

(c)           It is the Company’s desire and intent to make certain that you fully understand the provisions and effects of this Agreement.  To that end, you have been encouraged and given the opportunity to consult with legal counsel for the purpose of reviewing the terms of this Agreement.  Also, because you are over the age of 40, and consistent with the provisions of the Age Discrimination in Employment Act (“ADEA”), which prohibits discrimination on the basis of age, the Company is providing you with at least twenty-one (21) days in which to consider and accept the terms of this Agreement by signing below and returning it to Maureen Powers at Cubist, 65 Hayden Avenue, Lexington, MA 02421.  You understand that you do not waive any rights or claims under the ADEA that may arise after the Execution Date.  In addition, you may rescind your assent to this Agreement if, within seven (7) days after the Execution Date, you deliver by hand or send by mail (certified, return receipt and postmarked within such 7-day period) a notice of rescission to Maureen Powers at the above-referenced address.

 

(d)           Consistent with the federal discrimination laws, nothing in this release shall be deemed to prohibit you from challenging the validity of this release under the federal discrimination laws or from filing a charge or complaint of employment related discrimination with the Equal Employment Opportunity Commission (“EEOC”) or from participating in any investigation or proceeding conducted by the EEOC.  Further, nothing in this release or Agreement shall be deemed to limit the Company’s right to seek immediate dismissal of such charge or complaint on the basis that your signing of this Agreement constitutes a full release of any individual rights under the federal discrimination laws, or to seek restitution to the extent permitted by law of the economic benefits provided to you under this Agreement in the event you successfully challenge the validity of this release and prevail in any claim under the federal discrimination laws.

 

(e)           You acknowledge and agree that: (i) you have not been subject to any undue or improper influence interfering with the exercise of your free will in deciding whether to execute this Agreement; (ii) you have carefully read and fully understand all of the provisions of this Agreement; (iii) you knowingly and voluntarily agree to all of the terms set forth in this Agreement; and (iv) in entering into this Agreement, you are not relying on any representation, promise or inducement made by Cubist with the exception of those promises contained in this Agreement.

 

(f)            In exchange for the agreements and promises set forth herein, Cubist hereby unconditionally and irrevocably releases, remises, and forever discharge you and all persons acting by, through, under or in concert with you, of and from any and all Claims which Cubist had, now has, or hereafter may have against you from the beginning of time through the Execution Date.

 

Notwithstanding the foregoing, this paragraph shall not release you from any obligation expressly set forth in this Agreement, and shall not act as a waiver or release of any Claims that arise out of your criminal or fraudulent acts or omissions or that Cubist cannot by law waive or release.

 

 

11.   Representations and Governing Law

 

(a)           This Agreement sets forth the complete and sole agreement between the parties and supersedes any and all other agreements or understandings, whether oral or written, except the Employee Confidentiality Agreement and any applicable restricted stock unit and stock option agreements (as well as the applicable equity incentive plan(s)), which shall remain in full force and effect in accordance with their terms.  This Agreement may not be changed, amended, modified, altered or rescinded except upon the express written consent of both you and an authorized Cubist officer.  Any waiver of any provision of this Agreement shall not constitute a waiver of any other provision of this Agreement unless expressly so indicated otherwise.  The language of all parts of this Agreement shall in all cases be construed as a whole according to its fair meaning and not strictly for or against any of the parties.

 

(b)           This Agreement shall be deemed to be made and entered into in the Commonwealth of Massachusetts.  This Agreement and any claims arising out of this Agreement (or any other claims arising out of the relationship between the parties) shall be governed by and construed in accordance with the laws of the Commonwealth of Massachusetts and shall in all respects be interpreted, enforced and governed under the internal and domestic laws of such Commonwealth, without giving effect to the principles of conflicts of laws of such Commonwealth.  Any claims or legal actions by one party against the other shall be commenced and maintained in any state or federal court located in such Commonwealth, and you hereby submit to the jurisdiction and venue of any such court. In any such proceeding you agree to waive trial by jury and consent to have all legal and factual matters decided by a judge.

 

12.   Remedies Upon Breach

 

If you commit a material breach, or threaten to commit a material breach, of any of the provisions of this Agreement that impose obligations upon you, including, without limitation, Sections 5, 6, 7, 8, 9, 10(a) and 10(b), the Company shall have the following rights and remedies (provided that, prior to seeking the relief described below, the Company provides written notice to you of the specific nature of the breach and a reasonable (i.e., no less than ten business days) opportunity to cure, to the extent that the matter is curable):

 

(a)           The right and remedy to have the provisions of this Agreement specifically enforced by any court having equity jurisdiction, it being acknowledged and agreed that any such breach or threatened breach shall cause irreparable injury to the Company and that money damages shall not provide an adequate remedy to the Company;

 

(b)           The right and remedy to require you to account for and pay over to the Company all Separation Pay that you have been paid, provided that a court of competent jurisdiction has so ordered; and

 

(c)           The right and remedy to immediately stop the Company’s payment of all Severance Pay and/or benefits described in this Agreement.

 

 

Each of the rights and remedies set forth above shall be independent of the other, and shall be severally enforceable, and all of such rights and remedies shall be in addition to, and not in lieu of, any other rights and remedies available to the Company under law or in equity.

 

Similarly, if the Company commits a material breach, or threatens to commit a material breach, of any of the provisions of this Agreement that impose obligations upon it, then you shall have the same rights as the Company does under section 12(a) above, and shall be released from your obligations under this Agreement (and any agreement referenced herein) entirely (provided that, prior to seeking the relief described below, you provide written notice to the Company of the specific nature of the breach and a reasonable (i.e., no less than ten business days) opportunity to cure, to the extent that the matter is curable).

 

13.          Effective Date.  For a period of seven (7) days following the Execution Date, you may revoke this Agreement and this Agreement shall not become effective or enforceable until this revocation period has expired.

 

14.          Severability of Agreement Provisions.  The provisions of this Agreement, including, without limitation, Section 5 of the Agreement, are severable.  In the event that any one or more of the provisions, or the application thereof in any circumstances is held invalid, illegal, or unenforceable in any respect for any reason, the validity and enforceability of any such provision in every other respect and of the remaining provisions of this Agreement shall not be in any way impaired or affected, it being intended that all of the rights and privileges contained in this Agreement shall be enforceable to the fullest extent permitted by law, it is expressly agreed that the Company shall then be entitled to the maximum relief allowable by law as to geography, duration and scope of relief.

 

15.          Return Date.  If the terms of this Agreement are acceptable to you, please sign both copies of this Agreement and return one copy to me no later than  twenty-one (21) days from the date hereof.  If you wish to waive the 21 day period to consider this offer, an appropriate waiver form is attached for your use.

 

 

	
Very truly yours,
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
/s/ Maureen H. Powers
    	
 
    
	
Maureen H. Powers
    	
 
    
	
Senior Vice President, Human Resources
    	
 
    

 

I, TAMARA JOSEPH, REPRESENT THAT I HAVE READ THE FOREGOING AGREEMENT, THAT I FULLY UNDERSTAND THE TERMS AND CONDITIONS OF SUCH AGREEMENT AND THAT I AM VOLUNTARILY EXECUTING THE SAME.  IN ENTERING INTO THIS AGREEMENT, I DO NOT RELY ON ANY REPRESENTATION, PROMISE OR INDUCEMENT MADE BY THE RELEASEES WITH THE

 

 

EXCEPTION OF THE CONSIDERATION DESCRIBED IN THIS DOCUMENT.

 

 

	
/s/ Tamara Joseph
    	
 
    
	
Tamara Joseph
    	
 
    
	
Dated: 11/7/2012

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