Execution
Copy
Exhibit 10.20.1
Executive Employment
Agreement
EMPLOYMENT AGREEMENT (the "Agreement") made as of November 4, 2008,
2008 between ARIAD Pharmaceuticals, Inc. (the "Company") a Delaware
corporation, and Daniel M. Bollag, Ph.D. (the
"Employee").
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Employment,
Duties and Acceptance .
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1.1 The
Company hereby employs the Employee, for the Term (as hereinafter
defined), to render full-time services to the Company, and to
perform such duties as the Chief Executive Officer of the Company
shall reasonably direct the Employee to perform. The
Employee's title shall be designated by the Chief Executive Officer
and initially shall be Senior Vice President, Regulatory Affairs
and Quality.
1.2
The Employee hereby accepts such employment and agrees to render
the services described above.
1.3 The
principal place of employment of the Employee hereunder shall be in
the greater Boston, Massachusetts area, or other locations
reasonably acceptable to the Employee. The Employee
acknowledges that for limited periods of time the Employee may be
required to provide services to the Company outside of the Boston,
Massachusetts area.
1.4 Notwithstanding
anything to the contrary herein, although the Employee shall
provide services as a full-time employee, it is understood that the
Employee may (a) have an academic appointment and (b) participate
in professional activities (collectively, "Permitted Activities');
provided , however , that such Permitted Activities
do not interfere with the Employee's duties to the
Company.
1.5 The
Employee represents and affirms that the Employee does not have any
other contractual obligations to any other person or entity that
would prohibit or limit Employee’s employment with the
Company, except for the duty not to use or disclose another
entity’s confidential information without
authorization. Employee further acknowledges that the
Company instructs the Employee not to bring to the Company, use or
disclose in the course of Employee’s employment any
confidential information belonging to another person or entity,
without that person or entity’s express
authorization.
The term of the Employee's employment under this
Agreement (the "Term") shall commence on January 2, 2009 (the
"Effective Date"), or such other date mutually agreed upon by the
parties, and shall end on December 31, 2010, unless sooner
terminated pursuant to Section 4 or 5 of this Agreement;
provided , however , that this Agreement shall
automatically be renewed for successive one-year terms (the Term
and, if the period of employment is so renewed, such additional
period(s) of employment are collectively referred to herein as the
"Term") unless terminated by written notice given by either party
to the other at least ninety (90) days prior to the end of the
applicable Term.
3.1
As full compensation for all services to be rendered pursuant to
this Agreement, the Company agrees to pay the Employee, during the
Term, a salary at the fixed rate of $325,000 per annum during the
first year of the Term and increased each year, by amounts, if any,
to be determined by the Board of Directors of the Company (the
"Board"), in its sole discretion, payable in equal biweekly
installments, less such deductions or amounts to be withheld as
shall be required by applicable law and regulations.
3.2
Each year, Employee shall be eligible to receive a discretionary
bonus. The target for such discretionary bonus shall be
30% of base salary, but the Company may elect to pay a greater or
lesser bonus, in its sole discretion, which shall be determined
annually by the Board. Factors that may be considered by
the Board in determining bonus eligibility and the size of a bonus
awarded, if any, include the Employee’s level of performance,
the Company’s achievement of its business goals, and special
contributions of the Employee. The bonus, if any, may be
paid in the form of stock options, restricted stock awards or
units, deferred compensation or cash, as determined by the
Board. Further details on bonuses are provided in the
Company’s incentive compensation plans; in the event of any
conflict between the plans and this Agreement, the terms of this
Agreement shall control.
Execution Copy
3.3
The Company shall pay or reimburse the Employee for all reasonable
and documented expenses actually incurred or paid by the Employee
during the Term in the performance of Employee’s services
under this Agreement, upon presentation of expense statements or
vouchers or such other supporting information as it may
require.
3.4
The Employee shall be eligible under any incentive plan, stock
award plan, bonus, deferred or extra compensation plan, pension,
group health, disability, long-term care, and life insurance or
other so-called "fringe" benefits, which the Company provides for
its executives at the comparable level. All stock
options and restricted stock awards or units granted to the
Employee shall be subject to a vesting schedule, which shall be
determined by the Compensation Committee of the
Board. The stock options and restricted stock awards or
units, if any, granted to the Employee shall also be subject to the
terms of the Company’s long-term incentive plan and
certificates. Any unvested stock options or restricted
stock awards or units subject to repurchase shall be forfeited to
the Company in the event (a) this Agreement is terminated by the
Company for Cause pursuant to Section 4 herein, or (b) either party
elects not to renew this Agreement pursuant to Section 2 herein,
except as provided in Section 3.6 herein with respect to the
initial grant of restricted stock units.
3.5 The
Company shall grant the Employee an option to purchase 75,000
shares of the Company's Common Stock at the fair
market value on the date of the Board's approval of the
grant. The Employee agrees that all such options shall
be subject to a four-year vesting schedule, vesting in equal
increments of 25% on each anniversary of their
issuance. Any unvested options shall be forfeited to the
Company in the event that (a) this Agreement is terminated by the
Company for Cause pursuant to Section 4 herein, or (b) either party
elects not to renew this Agreement pursuant to Section 2
herein.
Execution Copy
3.6 The
Company shall grant the Employee 50,000 ARIAD restricted stock
units on the date of the Board’s approval of the
grant. The Employee agrees that all such restricted
stock units shall be subject to a period of restriction as to
transfer and to repurchase by the Company with respect to 100% of
such grant until April 11, 2011, and the underlying shares of the
Company’s Common Stock shall be issued upon lapsing of the
period of restriction. In the event that (a) Employee
dies before April 11, 2011 or (b) this Agreement is not renewed
prior to December 31, 2010 pursuant to Section 2 herein, the
restrictions on these ARIAD restricted stock units will lapse, and
the underlying shares shall be issued within thirty (30) days of
the occurrence of either event. Notwithstanding the
foregoing, any restricted stock units shall be forfeited in the
event that this Agreement is terminated by the Company for Cause
pursuant to Section 4 herein.
4.
Termination by the Company.
The Company may terminate this Agreement, if any
one or more of the following shall occur:
(a) The
Employee shall die during the Term; provided ,
however , the Employee's legal representatives shall be
entitled to receive the compensation provided for hereunder to the
last day of the month in which Employee’s death
occurs.
(b)
The Employee shall become physically or mentally disabled, whether
totally or partially, so that the Employee is unable substantially
to perform the Employee’s services hereunder for (i) a period
of one-hundred eighty (180) consecutive days, or (ii)
for shorter periods aggregating one-hundred eighty (180) days
during any twelve (12) month period.
Execution Copy
(c) The Employee
acts, or fails to act, in a manner that provides Cause for
termination. For purposes of this Agreement, the term
"Cause" means (i) the failure by the Employee to perform any of
Employee’s material duties hereunder, (ii) the conviction of
the Employee of any felony, (iii) any acts of fraud or embezzlement
by the Employee or the conviction of any crime involving the
Company or any of its Affiliates, (iv) violation of any federal,
state or local law, or administrative regulation related to the
business of the Company, (v) a conflict of interest, (vi) conduct
that could result in publicity reflecting unfavorably on the
Company in a material way, (vii) failure to comply with the written
policies of the Company, or (viii) a material breach of the terms
of this Agreement by the Employee. If the conduct
constituting Cause hereunder is susceptible to cure, the Company
shall provide the Employee written notice of termination pursuant
to this Section 4, and Employee shall have thirty (30) days to cure
or remedy such failure or breach, in which case this Agreement
shall not be terminated. If the conduct is not
susceptible to cure, this Agreement shall terminate upon written
notice by the Company.
5.
Termination by the Employee .
5.1 The
Employee may terminate this Agreement, if any one or more of the
following shall occur:
(a)
a material breach of the terms of this Agreement by the Company and
such breach continues for thirty (30) days after the Employee gives
the Company written notice of such breach;
(b)
the Company shall make a general assignment for benefit of
creditors; or any proceeding shall be instituted by the Company
seeking to adjudicate it as bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief, or composition of it or its debts under law
relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking entry of an order for relief or the appointment
of a receiver, trustee, or other similar official for it or for any
substantial part of its property or the Company shall take any
corporate action to authorize any of the actions set forth above in
this subsection 5(b);
Execution Copy
(c)
an involuntary petition shall be filed or an action or proceeding
otherwise commenced against the Company seeking reorganization,
arrangement or readjustment of the Company's debts or for any other
relief under the Federal Bankruptcy Code, as amended, or under any
other bankruptcy or insolvency act or law, state or federal, now or
hereafter existing and remain undismissed or unstayed for a period
of thirty (30) days; or
(d)
a receiver, assignee, liquidator, trustee or similar officer for
the Company or for all or any part of its property shall be
appointed involuntarily.
(e) a
Change in Control as defined in Section 14.
6.1 If (i) the Company terminates this
Agreement without Cause or (ii) the Employee terminates this
Agreement pursuant to Section 5.1(a), then: (1) except in the case
of death or disability, the Company shall continue to pay Employee
his then-current salary for the remaining period of the applicable
Term; (2) all stock options granted pursuant to this Agreement that
would have vested during the Term shall vest upon the effective
date of such termination; and (3) the Company shall continue to
provide all benefits subject to COBRA at its expense for up to one
(1) year.
6.2 In the event of a consummation of a
Change in Control of the Company, and if the Employee gives notice
of termination within ninety (90) days after such occurrence, then
(i) all stock, stock options, restricted stock awards or units, and
similar equity rights granted to the Employee shall immediately
vest and remain fully exercisable through their original term with
all rights; and (ii) the Company shall continue to pay the Employee
his then-current salary for the shorter of (a) six (6) months, or
(b) the remaining period of the applicable Term.
Execution
Copy
In addition to all other benefits contained
herein, the Employee shall be entitled to:
(a)
Paid time-off of five (5) weeks per year taken in accordance with
the paid time-off policy of the Company.
(b) &nb
