Document:

Exhibit
10.34

 

August 16, 2002

VIA HAND DELIVERY

 

John Wehrli

Pharsight Corporation

Dear John:

As we have discussed, Pharsight Corporation (“Pharsight” or the
“Company”) is offering you continued employment through December 31, 2002 and
severance benefits under the terms and conditions set forth below (the
“Agreement”).

1.             CONTINUED
EMPLOYMENT.  Provided that you continue to satisfactorily perform your job duties,
and comply with Company policies and procedures, subject to Paragraph 4 below,
the Company may continue to employ you in the position of Vice President,
General Counsel and Secretary through December 31, 2002 (the “Separation Date”)
and you will continue to be paid your regular base salary in effect as of the
date of this Agreement during the period of such continued employment.

2.             ACCRUED
SALARY AND PAID TIME OFF. 
On the Separation Date, the Company will pay you all accrued and unpaid
salary, and all accrued and unused vacation, earned through the Separation
Date, less required payroll deductions and withholdings.  You are entitled to these payments
regardless of whether you sign this Agreement.

3.             SEVERANCE
BENEFITS. 
If you fully comply with all conditions of this Agreement (including
continuing to work through the Separation Date), and sign and return the
Supplemental Release (attached hereto as Exhibit A) on or after the Separation
Date, the Company will provide you with the following severance benefits (the
“Severance Benefits”):

(a)           A severance payment
equal to six (6) months of your base salary in effect as of the Separation
Date, subject to required payroll deductions and required withholdings (the
“Severance Payment”).  In addition, you
agree to provide the Company with the appropriate withholding rates for federal
and state taxes prior to the Separation Date, but in any event the Company
agrees to apply a federal income tax withholding rate no greater than
twenty-eight percent (28%) and a California income tax withholding rate no
greater than six percent (6%) to your Severance Payment.  The Severance Payment will be provided
within ten (10) business days after you sign and return the Supplemental
Release to the Company; and

 

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(b)           If you timely elect to
continue your health insurance coverage under the federal COBRA law following
the Separation Date pursuant to Section 5, the Company will reimburse your
out-of-pocket costs to continue your COBRA coverage for you and your dependent
children at the same level of coverage in effect as of the Separation Date for
either six (6) months following the Separation Date or the date that you become
eligible for health insurance coverage through a new employer, whichever is
shorter.

4.             TERMINATION OF EMPLOYMENT PRIOR TO SEPARATION
DATE.  The Company can terminate your employment prior to the Separation
Date with or without Cause (as defined below), upon notice to you.  In addition, you can terminate your
employment prior to the Separation Date with or without Good Reason (defined
below), upon notice to the Company. 
If,    prior to the Separation
Date, the Company terminates your employment without Cause or you resign for
Good Reason, you will be entitled to receive the Severance Benefits, provided that you must first sign and
return the Supplemental Release to the Company.  You will not be entitled to receive the Severance Benefits if
your employment is terminated for Cause or you resign for any reason that does
not constitute Good Reason.  For the
purposes of this Agreement, Cause for termination of your employment by the
Company shall mean:  (a) your conviction
(including a guilty or no contest plea) of any felony or any other crime
involving dishonesty; (b) your participation in any fraud against the Company;
(c) your breach of any obligation under this Agreement; (d) your damage to any
Company property; or (e) conduct by you which in the good faith and reasonable
determination of the Company’s Board of Directors (“Board”) demonstrates gross
unfitness to serve.  For the purposes of
this Agreement, your resignation will qualify as a resignation for Good Reason
if it results from requests by the Company’s Chief Executive Officer (“CEO”) or
the Board that you engage in conduct that would violate the ethical rules
applicable to licensed attorneys in California, provided that such requests must continue to be made after
you provide written notice of your objection to the requests to the CEO or
Board, as applicable.

5.             HEALTH
INSURANCE. 
To the extent provided by the federal COBRA law or, if applicable, state
insurance laws, and by the Company’s current group health insurance policies,
you will be eligible to continue your group health insurance benefits at your
own expense after the Separation Date. 
Later, you may be able to convert to an individual policy through the
provider of the Company’s health insurance, if you wish.  You will be provided a separate notice
describing your rights and obligations under COBRA on or after the Separation
Date.

6.             OTHER
COMPENSATION OR BENEFITS. 
You acknowledge that, except as expressly provided in this Agreement,
you will not receive any additional compensation, severance, stock option
vesting, or benefits before or after the Separation Date.  By way of example, but not limitation, you acknowledge
and agree that you are not eligible for any bonus or other incentive
compensation.

7.             EXPENSE
REIMBURSEMENTS. 
Within ten (10) business days following the Separation Date (or any
earlier termination date), you must submit your final documented expense
reimbursement statement reflecting all business expenses you incurred through
the Separation Date, if any, for which you seek reimbursement.  The Company will reimburse you for these
expenses pursuant to its regular business practices.

 

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8.             RETURN
OF COMPANY PROPERTY. 
You agree to return to the Company, no later than the Separation Date or
at the Company’s earlier request, all Company documents (and all copies
thereof) and other Company property that you have in your possession or
control, including, but not limited to, Company files, notes, drawings,
records, business plans and forecasts, financial information, specifications,
computer-recorded information, tangible property (including, but not limited
to, computers), credit cards, entry cards, identification badges and keys; and,
any materials of any kind that contain or embody any proprietary or
confidential information of the Company (and all reproductions thereof).  The timely return of such property is a
condition precedent to the Company providing you with the Severance Payment.

9.             PROPRIETARY
INFORMATION OBLIGATIONS. 
You hereby acknowledge and reaffirm your continuing obligations under
your Proprietary Information and
Inventions Agreement, which apply both during and after your employment.  A copy of your Proprietary Information and Inventions
Agreement is attached hereto as Exhibit B.

10.          CONFIDENTIALITY.  The
provisions of this Agreement will be held in strictest confidence by you and
the Company and will not be publicized or disclosed in any manner whatsoever; provided,
however, that:  (a) you may
disclose this Agreement in confidence to your immediate family; (b) the parties
may disclose this Agreement in confidence to their respective attorneys,
accountants, auditors, tax preparers, and financial advisors; (c) the Company
may disclose this Agreement to investors or potential investors and to fulfill
standard or legally required corporate reporting or disclosure requirements;
and (d) the parties may disclose this Agreement insofar as such disclosure may
be necessary to enforce its terms or as otherwise required by law.  In particular, and without limitation, you
agree not to disclose the terms of this Agreement to any current or former
employee, consultant or independent contractor of the Company.

11.          NONDISPARAGEMENT. 
You agree
that you will not at any time disparage the Company or its directors, officers,
shareholders, agents, or employees in any manner likely to be harmful to the
personal or business reputation of it or them, and the Company (through its
officers and directors) agrees that it will not disparage you in any manner
likely to be harmful to your personal or business reputation, provided that
both you and the Company shall respond accurately and fully to any question, inquiry,
or request for information when required by legal process.

12.          NONSOLICITATION OF COMPANY EMPLOYEES. 
You
hereby agree that during your continued employment and for six (6) months after
the termination of your employment for any reason, you will not, either
directly or indirectly, solicit, attempt to solicit, induce or otherwise cause
any employee of the Company to terminate his or her employment with the
Company.

13.          RELEASE
OF CLAIMS.  In consideration for, and as a condition of, your
continued employment and other consideration provided to you by the Company
under this Agreement, to which you are not otherwise entitled, you hereby
generally and completely release the Company and its directors, officers,
employees, shareholders, partners, agents, attorneys, predecessors, successors,
parent and subsidiary entities, insurers, affiliates, and assigns from any and
all claims, liabilities and obligations, both known and unknown, that arise out
of or are in any way 

 

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related to events, acts,
conduct, or omissions occurring at any time prior to and including the date you
sign this Agreement.  This general
release includes, but is not limited to: (1) all claims arising out of or in
any way related to your employment with the Company or the termination of that
employment; (2) all claims related to your compensation or benefits from the
Company, including salary, bonuses, commissions, vacation pay, expense
reimbursements, severance pay, fringe benefits, stock, stock options, or any
other ownership interests in the Company; (3) all claims for breach of
contract, wrongful termination, and breach of the implied covenant of good
faith and fair dealing; (4) all tort claims, including claims for fraud,
defamation, emotional distress, and discharge in violation of public policy;
and (5) all federal, state, and local statutory claims, including claims for
discrimination, harassment, retaliation, attorneys’ fees, or other claims
arising under the federal Civil Rights Act of 1964 (as amended), the federal
Americans with Disabilities Act of 1990, and the California Fair Employment and
Housing Act (as amended).

14.          RELEASE
OF UNKNOWN CLAIMS.  You acknowledge that you have read and understand
Section 1542 of the California Civil Code: 
“A
general release does not extend to claims which the creditor does not know or
suspect to exist in his favor at the time of executing the release, which if
known by him must have materially affected his settlement with the debtor.”  You hereby expressly waive and relinquish all
rights and benefits under that section and any law of any jurisdiction of
similar effect with respect to your release of any unknown or unsuspected
claims.

15.          ARBITRATION.  To
ensure rapid and economical resolution of any disputes which may arise under
this Agreement, you and the Company agree that any and all disputes or
controversies of any nature whatsoever arising from or regarding the
interpretation, performance, enforcement or breach of this Agreement shall be
resolved, to the fullest extent allowed by law, by confidential, final and
binding arbitration conducted before a single arbitrator with Judicial
Arbitration and Mediation Services, Inc. (“JAMS”) in San Francisco, California,
under the then-existing JAMS employment rules. 
The
parties  acknowledge that by agreeing to this arbitration
procedure, they each waive the right to resolve any such dispute through a
trial by jury, judge or administrative proceeding.  The arbitrator shall:  (a) have the authority to compel
adequate discovery for the resolution of the dispute and to award such relief
as would otherwise be permitted by law; and (b) issue a written arbitration
decision including the arbitrator’s essential findings and conclusions and a
statement of the award.  The Company
shall pay all JAMS’ arbitration fees in excess of those which would be required
if the dispute were decided in a court of law. 
Nothing in this Agreement is intended to prevent either you or the
Company from obtaining injunctive relief in court to prevent irreparable harm
pending the conclusion of any such arbitration.  Notwithstanding the foregoing, you and the Company each have the
right to resolve any issue or dispute involving Company trade secrets or
invention rights by court action instead of arbitration.

16.          MISCELLANEOUS.  This
Agreement, including Exhibits A and B, constitutes the complete, final and
exclusive embodiment of the entire agreement between you and the Company with
regard to its subject matters.  It is
entered into without reliance on any promise or representation, written or
oral, other than those expressly contained herein, and it supersedes any other
such promises, warranties or representations. 
This Agreement may not be modified or amended except in a writing signed
by both you and a duly authorized officer of the Company.  

 

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This Agreement will bind
the heirs, personal representatives, successors and assigns of both you and the
Company, and inure to the benefit of both you and the Company, their heirs,
successors and assigns.  If any
provision of this Agreement is determined to be invalid or unenforceable, in
whole or in part, this determination will not affect any other provision of
this Agreement and the provision in question will be modified by the court so
as to be rendered enforceable.  This
Agreement will be deemed to have been entered into and will be construed and
enforced in accordance with the laws of the State of California as applied to
contracts made and to be performed entirely within California.

We hope the foregoing terms are acceptable to you.  If you agree to the terms set forth in this
Agreement, please sign below and return the original to me.  You have up to fourteen (14) calendar days to decide whether you want to
accept the Company’s offer contained herein. 
If you have any questions regarding these matters, feel free to contact
me.

We wish you good luck in your future endeavors.

Sincerely,

	
  PHARSIGHT CORPORATION

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/  Stacy Murphy

  	
   

  
	
   

  	
  Stacy Murphy

  	
   

  
	
   

  	
  Vice President, Human Resources

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Exhibit A —
  Supplemental Release

  	
   

  
	
   

  	
   

  	
   

  
	
  Exhibit B — Proprietary Information and Inventions
  Agreement

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  AGREED:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/  John Wehrli

  	
   

  
	
  John Wehrli

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:  August 16, 2002

  	
   

  

 

 

 

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EXHIBIT
A

SUPPLEMENTAL RELEASE

(to be signed on or after the Separation Date)

In consideration for the Severance Payment and other
consideration provided to me by Pharsight Corporation (the “Company”), and as
required by the Agreement between the Company and me dated August 16, 2002, I
hereby give the following Supplemental Release.

I hereby generally and completely release the Company
and its directors, officers, employees, shareholders, partners, agents,
attorneys, predecessors, successors, parent and subsidiary entities, insurers,
affiliates, and assigns from any and all claims, liabilities and obligations,
both known and unknown, that arise out of or are in any way related to events,
acts, conduct, or omissions occurring at any time prior to and including the
date I sign this Supplemental Release. 
This general release includes, but is not limited to: (1) all claims
arising out of or in any way related to my employment with the Company or the
termination of that employment; (2) all claims related to my compensation or
benefits from the Company, including salary, bonuses, commissions, vacation
pay, expense reimbursements, severance pay, fringe benefits, stock, stock
options, or any other ownership interests in the Company; (3) all claims
for breach of contract, wrongful termination, and breach of the implied
covenant of good faith and fair dealing; (4) all tort claims, including
claims for fraud, defamation, emotional distress, and discharge in violation of
public policy; and (5) all federal, state, and local statutory claims,
including claims for discrimination, harassment, retaliation, attorneys’ fees,
or other claims arising under the federal Civil Rights Act of 1964 (as
amended), the federal Americans with Disabilities Act of 1990, and the
California Fair Employment and Housing Act (as amended).

 I UNDERSTAND
THAT THIS AGREEMENT INCLUDES A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS.  I acknowledge that I have read and
understand Section 1542 of the California Civil Code which reads as
follows:  “A general release does not extend to
claims which the creditor does not know or suspect to exist in his favor at the
time of executing the release, which if known by him must have materially
affected his settlement with the debtor.”  I hereby expressly waive and relinquish all rights and benefits
under that section and any law of any jurisdiction of similar effect with
respect to my release of any claims I may have.

	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  John Wehrli

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
   

  

 

 

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EXHIBIT
B

PHARSIGHT CORPORATION

 

Proprietary Information and
Inventions Agreement

 

In consideration
of, and as a condition of, my employment with PHARSIGHT CORPORATION, a Delaware
corporation (the “Company”), I hereby represent to and agree with the Company
as follows:

 

1.             Purpose of Agreement; Effective
Date.  I understand that the
Company is engaged in a continuous program of research, development,
production, and marketing in connection with its business and that it is
critical for the Company to preserve and protect its Proprietary Information
(as defined below) and its rights in Inventions (as defined below) and all
related intellectual property rights. 
Accordingly, whether or not I am expected to create inventions of value
for the Company, I am entering into this Proprietary Information and Inventions
Agreement (this “Agreement”) as a condition of my employment with the
Company.  This Agreement shall be
effective as of the first day of my employment with the Company.

 

2.             Definition of Proprietary
Information.  Proprietary
Information is any information of a confidential nature (i.e., not generally
known or publicly available) that may be disclosed to me that relates to the
business of the Company or to the business of any parent, subsidiary,
affiliate, customer, or supplier of the Company or to the business of any other
party with whom the Company agrees to hold the information disclosed by such
party in confidence.   Proprietary
Information includes but is not limited to Inventions, marketing plans, product
plans, business strategies, financial information, forecasts, personnel
information, customer lists, and product sales and pricing information.

 

3.             Confidentiality.  I  understand that my
employment by the Company creates a relationship of confidence and trust with
respect to Proprietary Information.  At
all times, both during my employment with the Company and after the termination
of such employment, I will keep and hold all Proprietary Information in
confidence and trust, and I will not use or disclose any Proprietary
Information without the prior written consent of the Company, except as may be
necessary to perform my duties as an employee of the Company for the benefit of
the Company.  Upon termination of my
employment with the Company, I will promptly deliver to the Company all
documents and materials of any nature pertaining to my work with the Company,
and I will not take with me any documents or materials or copies thereof
containing any Proprietary Information.

 

4.             Work for Hire.  I acknowledge and agree that any copyrightable works
prepared by me within the scope of my employment are “works for hire” under the
Copyright Act and that the Company will be considered the author and owner of
such copyrightable works.

 

5.             Definition of Invention.  The term Invention includes all inventions,
improvements, designs, original works of authorship, formulas, processes,
compositions of matter, algorithms, computer software programs, databases, mask
works, and trade secrets that either (a) are developed using equipment,
supplies, facilities or trade secrets of the Company, (b) result from work
performed by me for the Company, or (c) relate to the Company’s business or to
its current or anticipated research or development.

 

6.             Disclosure and Assignment of
Inventions.   I will promptly disclose in confidence to the
Company all Inventions that I make or conceive or create or first reduce to
practice, either alone or jointly with others, during the period of my
employment, whether or not in the course of my employment and 

 

 

 

whether or not
such Inventions are patentable, copyrightable, or protectable as trade
secrets.  I agree that all Inventions
that (a) are developed using equipment, supplies, facilities or trade secrets
of the Company, (b) result from work performed by me for the Company, or (c)
relate to the Company’s business or to its current or anticipated research or
development will be the sole and exclusive property of the Company and are
hereby irrevocably assigned by me to the Company.

 

7.             Assignment of Other Rights.  In addition to the foregoing
assignment of Inventions to the Company, I hereby irrevocably transfer and
assign to the Company: (a) all worldwide patents, patent applications,
copyrights, mask works, trade secrets, and any other intellectual property
rights in any and all Inventions, and (b) any and all Other Rights (as defined
below) that I may have in or with respect to any Invention.  I also hereby forever waive and agree never
to assert any Other Rights I may have in or with respect to any Invention, even
after termination of my employment with the Company.  “Other Rights” means any right to claim author’s rights with
respect to an Invention, to object to or prevent the modification of any
Invention, and any similar right, existing under judicial or statutory law of
any country in the world, or under any treaty, regardless of whether such right
is denominated or generally referred to as a “moral right” or otherwise.

 

8.             Labor Code Notice.  I  have been notified and
understand that the provisions of paragraphs 6 and 7 of this Agreement do not
apply to any Invention that qualifies fully under the provisions of Section
2870 of the California Labor Code, which states as follows:

 

ANY PROVISION IN
AN EMPLOYMENT AGREEMENT WHICH PROVIDES THAT AN EMPLOYEE SHALL ASSIGN OR OFFER
TO ASSIGN ANY OF HIS OR HER RIGHTS IN AN INVENTION TO HIS OR HER EMPLOYER SHALL
NOT APPLY TO AN INVENTION THAT THE EMPLOYEE DEVELOPED ENTIRELY ON HIS OR HER
OWN TIME WITHOUT USING THE EMPLOYER’S EQUIPMENT, SUPPLIES, FACILITIES, OR TRADE
SECRET INFORMATION EXCEPT FOR THOSE INVENTIONS THAT EITHER: (1) RELATE AT THE
TIME OF CONCEPTION OR REDUCTION TO PRACTICE OF THE INVENTION TO THE EMPLOYER’S
BUSINESS, OR ACTUAL OR DEMONSTRABLY ANTICIPATED RESEARCH OR DEVELOPMENT OF THE
EMPLOYER, OR (2) RESULT FROM ANY WORK PERFORMED BY THE EMPLOYEE FOR THE
EMPLOYER.  TO THE EXTENT A PROVISION IN
AN EMPLOYEE AGREEMENT PURPORTS TO REQUIRE AN EMPLOYEE TO ASSIGN AN INVENTION
OTHERWISE EXCLUDED FROM BEING REQUIRED TO BE ASSIGNED UNDER CALIFORNIA LABOR
CODE SECTION 2870 (A), THE PROVISION IS AGAINST THE PUBLIC POLICY OF THIS STATE
AND IS UNENFORCEABLE.

 

9.             Assistance.  I  agree to assist the Company in every
proper way to obtain for the Company and to enforce patents, copyrights, mask
work rights, trade secret rights, and other legal protections for the Company’s
Inventions in any and all countries.  I
will execute any documents that the Company may reasonably request for use in
obtaining or enforcing such patents, copyrights, mask work rights, trade secret
rights and other legal protections.  My
obligations under this paragraph will continue beyond the termination of my
employment with the Company, provided that the Company will compensate me at a
reasonable rate after such termination for time and expenses actually spent by
me at the Company’s request on such assistance.

 

10.           No Breach of Prior Agreement.  I  represent that my
performance of all the terms of this Agreement and my duties as an employee of
the Company will not breach any invention assignment, proprietary information,
or similar agreement with any former employer or other party.  I represent that I will not bring with me to
the Company or use in the performance of my duties for the Company any
documents or materials of a former employer unless such items have been legally
transferred to the Company or are generally available to the public.

 

 

 

11.         Prior Inventions.  If, in the course of my employment with the Company, I
incorporate a prior invention made by me into a Company product, process or
machine, the Company is hereby granted and shall have a nonexclusive,
royalty-free, irrevocable, perpetual, worldwide license (with rights to
sublicense through multiple tiers of sublicensees) to make, have made, modify,
use and sell such prior invention. 
Notwithstanding the foregoing, I agree that I will not incorporate, or
permit to be incorporated, prior inventions in any Company Inventions without
the Company’s prior written consent.

 

12.           Notification. I  hereby authorize the Company
to notify my future employers of the terms of this Agreement and my
responsibilities hereunder.

 

13.           Injunctive Relief. 
I  understand that in the event of a breach
or threatened breach of this Agreement by me, the Company may suffer
irreparable harm and will therefore be entitled to injunctive relief to enforce
this Agreement.

 

14.           Governing Law; Severability.  This Agreement will be governed and interpreted in
accordance with the laws of the State of California, without regard to
application of choice of law rules or principles.  In the event that any provision of this Agreement is found by a
court, arbitrator, or other tribunal to be illegal, invalid, or unenforceable,
then such provision shall not be voided but shall be enforced to the maximum
extent permissible under applicable law, and the remainder of this Agreement
shall remain in full force and effect.

 

15.           No Duty to Employ. 
I  understand that this Agreement does not
constitute a contract of employment or obligate the Company to employ me for
any stated period of time.

 

16.           FDA Debarrment.  I represent that I have never been debarred under Section 306(a)
or (b) of the Federal Food Drug or Cosmetic Act and that I will immediately
notify the Company in the event that any debarrment proceedings are commenced
against me.

 

 

	
  PHARSIGHT CORPORATION

  	
   

  	
  [JOHN WEHRLI]

  
	
   

  	
   

  	
   

  	
   

  
	
  By

  	
  /s/  Stacy Murphy

  	
   

  	
  /s/  John Wehrli

  
	
   

  	
   

  	
   

  	
   

  
	
  Stacy Murphy

  Vice President, Human Resources

  	
   

  	
  Date:  November 18, 2000Exhibit
10.35

 

August 16, 2002

VIA HAND DELIVERY

 

Charles Faas

Pharsight Corporation

Dear Charlie:

As we have discussed, Pharsight Corporation (“Pharsight” or the
“Company”) is offering you continued employment through March 31, 2003 and
severance benefits under the terms and conditions set forth below (the
“Agreement”).

1.             CONTINUED
EMPLOYMENT.  Provided that you continue to satisfactorily perform your job duties,
and comply with Company policies and procedures, subject to Paragraph 4 below,
the Company may continue to employ you through March 31, 2003 (the “Separation
Date”) and you will continue to be paid your regular base salary in effect as
of the date of this Agreement during the period of such continued employment.

2.             ACCRUED
SALARY, AND PAID TIME OFF. 
On the Separation Date, the Company will pay you all accrued and unpaid
salary, and all accrued and unused vacation, earned through the Separation
Date, less required payroll deductions and withholdings.  You are entitled to these payments
regardless of whether you sign this Agreement.

3.             BONUS PAYMENT.  If your
employment continues through March 31, 2003, the Company agrees that you will
be eligible to receive an annual targeted bonus of thirty-five percent (35%) of
your then-current base salary in accordance with the terms and conditions of
the Company’s Management Incentive Bonus Program for its Executive
Officers.  If such a bonus is owed, the
Company will pay you this bonus on the same date as it pays its other
executives, regardless of whether you are employed by the Company on such
date.  You and the Company agree that
you will be eligible to receive an annual targeted bonus under the Management
Incentive Bonus Program for its Executive Officers if your employment ends for
any reason prior to March 31, 2003, regardless of whether your employment is
terminated by the Company without Cause (as defined below)

4.             SEVERANCE
PAYMENT. 
If you fully comply with all conditions of this Agreement (including
continuing to work through the Separation Date), and sign and return the
Supplemental Release (attached hereto as Exhibit A) on or after the Separation
Date, the Company will provide you with a severance payment equal to four (4)
months of your base salary in effect as of the Separation Date, subject to required
payroll deductions and required 

 

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withholdings (the
“Severance Payment”).  The Severance
Payment will be provided within ten (10) business days after the Effective Date
of the Supplemental Release (as defined therein).

5.             TERMINATION OF EMPLOYMENT PRIOR TO SEPARATION
DATE.  The Company can terminate your employment prior to the Separation
Date with or without Cause, upon notice to you.  In addition, you can terminate your employment prior to the Separation
Date for any reason upon notice to the Company.  If, prior to the Separation Date, the Company terminates your
employment without Cause, and provided that
you must first sign and return the Supplemental Release to the Company, you
will be entitled to receive, as your sole severance compensation, a payment,
subject to required payroll deductions and required withholdings, equal to the
lesser of the following:  (a) the sum of
the Severance Payment and the amount of additional salary you would have received
if your employment had continued from the employment termination date through
the Separation Date; or (b) an amount equal to seven (7) months of your base
salary in effect as of the employment termination date.  You will not be entitled to receive the
payment referenced in the immediately preceding sentence if your employment is
terminated for Cause or you resign for any reason prior to the Separation
Date.  For the purposes of this
Agreement, Cause for termination of your employment by the Company shall
mean:  (a) your conviction
(including a guilty or no contest plea) of any felony or any other crime
involving dishonesty; (b) your participation in any fraud against the Company;
(c) your breach of any obligation under this Agreement; (d) your damage to any
Company property; or (e) conduct by you which in the good faith and reasonable
determination of the Company’s Board of Directors demonstrates gross unfitness
to serve.

6.             HEALTH
INSURANCE. 
To the extent provided by the federal COBRA law or, if applicable, state
insurance laws, and by the Company’s current group health insurance policies,
you will be eligible to continue your group health insurance benefits at your
own expense after the Separation Date. 
Later, you may be able to convert to an individual policy through the
provider of the Company’s health insurance, if you wish.  You will be provided a separate notice
describing your rights and obligations under COBRA on or after the Separation
Date.

7.             OTHER
COMPENSATION OR BENEFITS. 
You acknowledge that, except as expressly provided in this Agreement,
you will not receive any additional compensation, severance, stock option
vesting, or benefits before or after the Separation Date.  By way of example, but not limitation, you
acknowledge and agree that you are not eligible for any bonus or other
incentive compensation.

8.             EXPENSE
REIMBURSEMENTS. 
Within ten (10) business days following the Separation Date (or any
earlier termination date), you must submit your final documented expense
reimbursement statement reflecting all business expenses you incurred through
the Separation Date, if any, for which you seek reimbursement.  The Company will reimburse you for these
expenses pursuant to its regular business practices.

9.             RETURN
OF COMPANY PROPERTY. 
You agree to return to the Company, no later than the Separation Date or
at the Company’s earlier request, all Company documents (and all copies
thereof) and other Company property that you have in your possession or
control, including, but not limited to, Company files, notes, drawings,
records, business plans and forecasts, financial information, specifications,
computer-recorded information, tangible property 

 

2

 

(including, but not
limited to, computers), credit cards, entry cards, identification badges and
keys; and, any materials of any kind that contain or embody any proprietary or
confidential information of the Company (and all reproductions thereof).  The timely return of such property is a
condition precedent to the Company providing you with the Severance Payment.

10.          PROPRIETARY
INFORMATION OBLIGATIONS. 
You hereby acknowledge and reaffirm your continuing obligations under
your Proprietary Information and
Inventions Agreement, which apply both during and after your employment.  A copy of your Proprietary Information and Inventions
Agreement is attached hereto as Exhibit B.

11.          CONFIDENTIALITY. 
The provisions of this Agreement will be held in strictest confidence by
you and the Company and will not be publicized or disclosed in any manner
whatsoever; provided,
however, that:  (a) you may
disclose this Agreement in confidence to your immediate family; (b) the parties
may disclose this Agreement in confidence to their respective attorneys,
accountants, auditors, tax preparers, and financial advisors; (c) the Company
may disclose this Agreement to investors or potential investors and to fulfill
standard or legally required corporate reporting or disclosure requirements;
and (d) the parties may disclose this Agreement insofar as such disclosure may
be necessary to enforce its terms or as otherwise required by law.  In particular, and without limitation, you
agree not to disclose the terms of this Agreement to any current or former
employee, consultant or independent contractor of the Company.

12.          NONDISPARAGEMENT. 
You agree
that you will not at any time disparage the Company or its directors, officers,
shareholders, agents, or employees in any manner likely to be harmful to the
personal or business reputation of it or them, and the Company (through its
officers and directors) agrees that it will not disparage you in any manner
likely to be harmful to your personal or business reputation, provided that
both you and the Company shall respond accurately and fully to any question,
inquiry, or request for information when required by legal process.

13.          COOPERATION.  You agree to cooperate with the Company in
responding to the Company’s requests in connection with any existing or future
litigation, arbitrations, mediations or investigations brought by or against
the Company or any of its affiliates, agents, officers, directors or employees,
whether administrative, civil or criminal in nature, in which the Company
reasonably deems your cooperation necessary or desirable.  In such matters, you agree to provide the
Company with reasonable advice, assistance and information, including offering
and explaining evidence, providing sworn statements, and participating in
discovery and trial preparation and testimony. 
You also agree to promptly send the Company copies of all correspondence
(for example, but not limited to, subpoenas) received by you in connection with
any such legal proceedings, unless you are expressly prohibited by law from so
doing.  You will act in good faith to
furnish the information and cooperation required by this paragraph and the
Company will act in good faith so that the requirement to furnish such
information and cooperation does not create an undue hardship for you.  The Company will reimburse you for reasonable out-of-pocket expenses
incurred by you as a result of your cooperation, with the exception of lost
compensation, within ten (10) days of the presentation of appropriate
documentation thereof, in accordance with the Company’s standard reimbursement
policies and procedures.

 

3

 

14.          NONSOLICITATION OF COMPANY EMPLOYEES. 
You
hereby agree that during your continued employment and for six (6) months after
the termination of your employment for any reason, you will not, either
directly or indirectly, solicit, attempt to solicit, induce or otherwise cause
any employee of the Company to terminate his or her employment with the
Company.

15.          RELEASE
OF CLAIMS.  In consideration for, and as a condition of, your
continued employment and other consideration provided to you by the Company
under this Agreement, to which you are not otherwise entitled, you hereby
generally and completely release the Company and its directors, officers,
employees, shareholders, partners, agents, attorneys, predecessors, successors,
parent and subsidiary entities, insurers, affiliates, and assigns from any and
all claims, liabilities and obligations, both known and unknown, that arise out
of or are in any way related to events, acts, conduct, or omissions occurring
at any time prior to and including the date you sign this Agreement.  This general release includes, but is not
limited to: (1) all claims arising out of or in any way related to your
employment with the Company or the termination of that employment; (2) all
claims related to your compensation or benefits from the Company, including
salary, bonuses, commissions, vacation pay, expense reimbursements, severance
pay, fringe benefits, stock, stock options, or any other ownership interests in
the Company; (3) all claims for breach of contract, wrongful termination,
and breach of the implied covenant of good faith and fair dealing; (4) all
tort claims, including claims for fraud, defamation, emotional distress, and
discharge in violation of public policy; and (5) all federal, state, and local
statutory claims, including claims for discrimination, harassment, retaliation,
attorneys’ fees, or other claims arising under the federal Civil Rights Act of
1964 (as amended), the federal Americans with Disabilities Act of 1990, the
federal Age Discrimination in Employment Act (as amended) (“ADEA”), and the
California Fair Employment and Housing Act (as amended).

16.          ADEA
WAIVER.   You acknowledge that you are knowingly and voluntarily waiving and
releasing any rights you may have under the ADEA, and that the consideration
given for the waiver and release in the preceding paragraph is in addition to
anything of value to which you were already entitled.  You further acknowledge that you have been advised by this
writing that:  (a)
your waiver and release do not apply to any rights or claims that may arise
after the date you sign this Agreement; (b) you
should consult with an attorney prior to signing this Agreement; (c) you have twenty-one (21) days to consider this
Agreement (although you may choose to voluntarily sign this Agreement earlier); (d) you have seven (7) days following the date you sign
this Agreement to revoke the Agreement; and (e) this
Agreement will not be effective until the date upon which the revocation period
has expired, which will be the eighth calendar day after the date you sign this
Agreement.

17.          RELEASE
OF UNKNOWN CLAIMS.   You acknowledge that you have read and understand
Section 1542 of the California Civil Code: 
“A
general release does not extend to claims which the creditor does not know or
suspect to exist in his favor at the time of executing the release, which if
known by him must have materially affected his settlement with the debtor.”  You hereby expressly waive and relinquish all
rights and benefits under that section and any law of any jurisdiction of
similar effect with respect to your release of any unknown or unsuspected
claims.

 

4

 

18.          ARBITRATION.  To
ensure rapid and economical resolution of any disputes which may arise under
this Agreement, you and the Company agree that any and all disputes or
controversies of any nature whatsoever arising from or regarding the
interpretation, performance, enforcement or breach of this Agreement shall be
resolved, to the fullest extent allowed by law, by confidential, final and
binding arbitration conducted before a single arbitrator with Judicial
Arbitration and Mediation Services, Inc. (“JAMS”) in San Francisco, California,
under the then-existing JAMS employment rules. 
The
parties  acknowledge that by agreeing to this arbitration
procedure, they each waive the right to resolve any such dispute through a
trial by jury, judge or administrative proceeding.  The arbitrator shall:  (a) have the authority to compel
adequate discovery for the resolution of the dispute and to award such relief
as would otherwise be permitted by law; and (b) issue a written arbitration
decision including the arbitrator’s essential findings and conclusions and a
statement of the award.  The Company
shall pay all JAMS’ arbitration fees in excess of those which would be required
if the dispute were decided in a court of law. 
Nothing in this Agreement is intended to prevent either you or the
Company from obtaining injunctive relief in court to prevent irreparable harm
pending the conclusion of any such arbitration.  Notwithstanding the foregoing, you and the Company each have the
right to resolve any issue or dispute involving Company trade secrets or invention
rights by court action instead of arbitration.

19.          MISCELLANEOUS.  This
Agreement, including Exhibits A and B, constitutes the complete, final and
exclusive embodiment of the entire agreement between you and the Company with
regard to its subject matters.  It is
entered into without reliance on any promise or representation, written or
oral, other than those expressly contained herein, and it supersedes any other
such promises, warranties or representations. 
This Agreement may not be modified or amended except in a writing signed
by both you and a duly authorized officer of the Company.  This Agreement will bind the heirs, personal
representatives, successors and assigns of both you and the Company, and inure to
the benefit of both you and the Company, their heirs, successors and
assigns.  If any provision of this
Agreement is determined to be invalid or unenforceable, in whole or in part,
this determination will not affect any other provision of this Agreement and
the provision in question will be modified by the court so as to be rendered
enforceable.  This Agreement will be
deemed to have been entered into and will be construed and enforced in
accordance with the laws of the State of California as applied to contracts
made and to be performed entirely within California.

We hope the foregoing terms are acceptable to you.  If you agree to the terms set forth in this
Agreement, please sign below and return the original to me.  You have up to twenty-one (21) calendar days
to decide whether you want to accept the Company’s offer contained herein.  If you have any questions regarding these
matters, feel free to contact me.

 

5

 

We wish you good luck in your future endeavors.

Sincerely,

	
  PHARSIGHT CORPORATION

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/  Stacy Murphy

  	
   

  
	
   

  	
  Stacy Murphy

  	
   

  
	
   

  	
  Vice President, Human Resources

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Exhibit A —
  Supplemental Release

  	
   

  
	
   

  	
   

  	
   

  
	
  Exhibit B — Proprietary Information and Inventions
  Agreement

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  AGREED:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/  Charles Faas

  	
   

  
	
  Charles Faas

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:  August 19, 2002

  	
   

  

 

 

6

 

EXHIBIT
A

SUPPLEMENTAL RELEASE

(to be signed on or after the Separation Date)

In consideration for the severance payment and other
consideration provided to me by Pharsight Corporation (the “Company”), and as
required by the Agreement between the Company and me dated August 16, 2002, I
hereby give the following Supplemental Release.

I hereby generally and completely release the Company
and its directors, officers, employees, shareholders, partners, agents,
attorneys, predecessors, successors, parent and subsidiary entities, insurers,
affiliates, and assigns from any and all claims, liabilities and obligations,
both known and unknown, that arise out of or are in any way related to events,
acts, conduct, or omissions occurring at any time prior to and including the
date I sign this Supplemental Release. 
This general release includes, but is not limited to: (1) all claims
arising out of or in any way related to my employment with the Company or the
termination of that employment; (2) all claims related to my compensation or
benefits from the Company, including salary, bonuses, commissions, vacation
pay, expense reimbursements, severance pay, fringe benefits, stock, stock
options, or any other ownership interests in the Company; (3) all claims
for breach of contract, wrongful termination, and breach of the implied
covenant of good faith and fair dealing; (4) all tort claims, including
claims for fraud, defamation, emotional distress, and discharge in violation of
public policy; and (5) all federal, state, and local statutory claims,
including claims for discrimination, harassment, retaliation, attorneys’ fees,
or other claims arising under the federal Civil Rights Act of 1964 (as amended),
the federal Americans with Disabilities Act of 1990, the federal Age
Discrimination in Employment Act (as amended) (“ADEA”), and the California Fair
Employment and Housing Act (as amended).

I acknowledge that I am knowingly and
voluntarily waiving and releasing any rights I may have under the ADEA, and
that the consideration given for the waiver and release in the preceding
paragraph is in addition to anything of value to which I am already
entitled.  I further acknowledge that I
have been advised by this writing that:  (a) my waiver and release do not
apply to any rights or claims that may arise after the date I sign this
Supplemental Release; (b) I should consult with an
attorney prior to signing this Supplemental Release (although I may choose not
to do so); (c) I have twenty-one (21) days to
consider this Supplemental Release (although I may choose to voluntarily sign
it earlier); (d) I have seven (7) days following the
date I sign this Supplemental Release to revoke it; and (e) this
Supplemental Release will not be effective until the date upon which the
revocation period has expired, which will be the eighth calendar day after the
date I sign it (the “Effective Date”).

 

7

 

I UNDERSTAND THAT THIS AGREEMENT INCLUDES A RELEASE OF
ALL KNOWN AND UNKNOWN CLAIMS.  I
acknowledge that I have read and understand Section 1542 of the California
Civil Code which reads as follows:  “A general
release does not extend to claims which the creditor does not know or suspect
to exist in his favor at the time of executing the release, which if known by
him must have materially affected his settlement with the debtor.”  I hereby expressly waive and relinquish all
rights and benefits under that section and any law of any jurisdiction of
similar effect with respect to my release of any claims I may have.

	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Charles Faas

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
   

  

 

 

8

 

EXHIBIT
B

PHARSIGHT CORPORATION

 

Proprietary Information and
Inventions Agreement

 

In consideration
of, and as a condition of, my employment with Pharsight
Corporation, a Delaware corporation (the “Company”), I hereby represent
to and agree with the Company as follows:

 

1.             Purpose of Agreement; Effective
Date.  I understand that the
Company is engaged in a continuous program of research, development,
production, and marketing in connection with its business and that it is
critical for the Company to preserve and protect its Proprietary Information
(as defined below) and its rights in Inventions (as defined below) and all
related intellectual property rights. 
Accordingly, whether or not I am expected to create inventions of value
for the Company, I am entering into this Proprietary Information and Inventions
Agreement (this “Agreement”) as a condition of my employment with the
Company.  This Agreement shall be
effective as of the first day of my employment with the Company.

 

2.             Definition of Proprietary
Information.  Proprietary
Information is any information of a confidential nature (i.e., not generally
known or publicly available) that may be disclosed to me that relates to the
business of the Company or to the business of any parent, subsidiary,
affiliate, customer, or supplier of the Company or to the business of any other
party with whom the Company agrees to hold the information disclosed by such
party in confidence.   Proprietary
Information includes but is not limited to Inventions, marketing plans, product
plans, business strategies, financial information, forecasts, personnel
information, customer lists, and product sales and pricing information.

 

3.             Confidentiality.  I  understand that my
employment by the Company creates a relationship of confidence and trust with
respect to Proprietary Information.  At
all times, both during my employment with the Company and after the termination
of such employment, I will keep and hold all Proprietary Information in
confidence and trust, and I will not use or disclose any Proprietary
Information without the prior written consent of the Company, except as may be
necessary to perform my duties as an employee of the Company for the benefit of
the Company.  Upon termination of my
employment with the Company, I will promptly deliver to the Company all
documents and materials of any nature pertaining to my work with the Company,
and I will not take with me any documents or materials or copies thereof
containing any Proprietary Information.

 

4.             Work for Hire.  I acknowledge and agree that any copyrightable works
prepared by me within the scope of my employment are “works for hire” under the
Copyright Act and that the Company will be considered the author and owner of
such copyrightable works.

 

5.             Definition of Invention.  The term Invention includes all inventions,
improvements, designs, original works of authorship, formulas, processes,
compositions of matter, algorithms, computer software programs, databases, mask
works, and trade secrets that either (a) are developed using equipment,
supplies, facilities or trade secrets of the Company, (b) result from work performed
by me for the Company, or (c) relate to the Company’s business or to its
current or anticipated research or development.

 

6.             Disclosure and Assignment of
Inventions.   I will promptly disclose in confidence to the
Company all Inventions that I make or conceive or create or first reduce to
practice, either alone or jointly with others, during the period of my
employment, whether or not in the course of my employment and 

 

 

whether or not
such Inventions are patentable, copyrightable, or protectable as trade
secrets.  I agree that all Inventions
that (a) are developed using equipment, supplies, facilities or trade secrets
of the Company, (b) result from work performed by me for the Company, or (c)
relate to the Company’s business or to its current or anticipated research or
development will be the sole and exclusive property of the Company and are
hereby irrevocably assigned by me to the Company.

 

7.             Assignment of Other Rights.  In addition to the foregoing
assignment of Inventions to the Company, I hereby irrevocably transfer and
assign to the Company: (a) all worldwide patents, patent applications,
copyrights, mask works, trade secrets, and any other intellectual property
rights in any and all Inventions, and (b) any and all Other Rights (as defined
below) that I may have in or with respect to any Invention.  I also hereby forever waive and agree never
to assert any Other Rights I may have in or with respect to any Invention, even
after termination of my employment with the Company.  “Other Rights” means any right to claim author’s rights with
respect to an Invention, to object to or prevent the modification of any
Invention, and any similar right, existing under judicial or statutory law of
any country in the world, or under any treaty, regardless of whether such right
is denominated or generally referred to as a “moral right” or otherwise.

 

8.             Labor Code Notice.  I  have been notified and
understand that the provisions of paragraphs 6 and 7 of this Agreement do not
apply to any Invention that qualifies fully under the provisions of Section
2870 of the California Labor Code, which states as follows:

 

ANY PROVISION IN
AN EMPLOYMENT AGREEMENT WHICH PROVIDES THAT AN EMPLOYEE SHALL ASSIGN OR OFFER
TO ASSIGN ANY OF HIS OR HER RIGHTS IN AN INVENTION TO HIS OR HER EMPLOYER SHALL
NOT APPLY TO AN INVENTION THAT THE EMPLOYEE DEVELOPED ENTIRELY ON HIS OR HER
OWN TIME WITHOUT USING THE EMPLOYER’S EQUIPMENT, SUPPLIES, FACILITIES, OR TRADE
SECRET INFORMATION EXCEPT FOR THOSE INVENTIONS THAT EITHER: (1) RELATE AT
THE TIME OF CONCEPTION OR REDUCTION TO PRACTICE OF THE INVENTION TO THE
EMPLOYER’S BUSINESS, OR ACTUAL OR DEMONSTRABLY ANTICIPATED RESEARCH OR
DEVELOPMENT OF THE EMPLOYER, OR (2) RESULT FROM ANY WORK PERFORMED BY THE
EMPLOYEE FOR THE EMPLOYER.  TO THE
EXTENT A PROVISION IN AN EMPLOYEE AGREEMENT PURPORTS TO REQUIRE AN EMPLOYEE TO
ASSIGN AN INVENTION OTHERWISE EXCLUDED FROM BEING REQUIRED TO BE ASSIGNED UNDER
CALIFORNIA LABOR CODE SECTION 2870 (A), THE PROVISION IS AGAINST THE
PUBLIC POLICY OF THIS STATE AND IS UNENFORCEABLE.

 

9.             Assistance.  I  agree to assist the Company in every
proper way to obtain for the Company and to enforce patents, copyrights, mask
work rights, trade secret rights, and other legal protections for the Company’s
Inventions in any and all countries.  I
will execute any documents that the Company may reasonably request for use in
obtaining or enforcing such patents, copyrights, mask work rights, trade secret
rights and other legal protections.  My
obligations under this paragraph will continue beyond the termination of my
employment with the Company, provided that the Company will compensate me at a
reasonable rate after such termination for time and expenses actually spent by
me at the Company’s request on such assistance.

 

10.           No Breach of Prior Agreement.  I  represent that my
performance of all the terms of this Agreement and my duties as an employee of
the Company will not breach any invention assignment, proprietary information,
or similar agreement with any former employer or other party.  I represent that I will not bring with me to
the Company or use in the performance of my duties for the Company any
documents or materials of a former employer unless such items have been legally
transferred to the Company or are generally available to the public.

 

 

11.         Prior Inventions.  If, in the course of my employment with the Company, I
incorporate a prior invention made by me into a Company product, process or
machine, the Company is hereby granted and shall have a nonexclusive,
royalty-free, irrevocable, perpetual, worldwide license (with rights to
sublicense through multiple tiers of sublicensees) to make, have made, modify,
use and sell such prior invention. 
Notwithstanding the foregoing, I agree that I will not incorporate, or
permit to be incorporated, prior inventions in any Company Inventions without
the Company’s prior written consent.

 

12.           Notification. I  hereby authorize the Company
to notify my future employers of the terms of this Agreement and my
responsibilities hereunder.

 

13.           Injunctive Relief. 
I  understand that in the event of a breach
or threatened breach of this Agreement by me, the Company may suffer
irreparable harm and will therefore be entitled to injunctive relief to enforce
this Agreement.

 

14.           Governing Law; Severability.  This Agreement will be governed and interpreted in
accordance with the laws of the State of California, without regard to
application of choice of law rules or principles.  In the event that any provision of this Agreement is found by a
court, arbitrator, or other tribunal to be illegal, invalid, or unenforceable,
then such provision shall not be voided but shall be enforced to the maximum
extent permissible under applicable law, and the remainder of this Agreement
shall remain in full force and effect.

 

15.           No Duty to Employ. 
I  understand that this Agreement does not
constitute a contract of employment or obligate the Company to employ me for
any stated period of time.

 

16.           FDA Debarrment.  I represent that I have never been debarred under Section 306(a)
or (b) of the Federal Food Drug or Cosmetic Act and that I will immediately
notify the Company in the event that any debarrment proceedings are commenced
against me.

 

 

	
  PHARSIGHT CORPORATION

  	
   

  	
  [EMPLOYEE’S
  NAME]

  
	
   

  	
   

  	
   

  	
   

  
	
  By

  	
  /s/  Stacy Murphy

  	
   

  	
  /s/  Charles Faas

  
	
   

  	
   

  	
   

  	
   

  
	
  Stacy Murphy

  	
   

  	
  Date:  July 31, 2000

  
	
  Vice President, Human Resources

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