RETENTION AGREEMENT

Employee Retention Agreement

You are currently viewing:

This Employee Retention Agreement involves

CUBIST PHARMACEUTICALS INC | Michael Bonney

. RealDealDocs™ contains millions of easily searchable legal documents and clauses from top law firms. Search for free - click here.

Title: RETENTION AGREEMENT
Governing Law: Massachusetts Date: 12/16/2005
Industry: BIOTRX Sector: HEALTH

Search Employee Retention Agreement by:

Exhibit 10

Exhibit 10.3

December 13, 2005

BY HAND DELIVERY

Michael Bonney

Cubist Pharmaceuticals, Inc.

65 Hayden Avenue

Lexington, MA 02421

Re: Retention Letter

Dear Mike:

You are a highly valuable employee of Cubist Pharmaceuticals, Inc. (including any successor organizations, “Cubist”). Cubist wishes to retain you as an employee, and is therefore willing to make certain commitments in order to induce you to remain an employee. This letter will confirm the agreement between you and Cubist (“Agreement”) in that regard. The Agreement is as follows:

1. Definitions. For the purposes of this Agreement, the following definitions apply:

(a) “Cause” means: (i) you commit of an act of dishonesty, fraud or misrepresentation in connection with your employment; (ii) you are convicted of, or plead nolo contendere to, a felony or a crime involving moral turpitude; (iii) you breach any material obligation under your Proprietary Information and Inventions Agreement or Cubist’s Code of Conduct and Ethics; (iv) you engage in substantial or continuing inattention to or neglect of your duties and responsibilities reasonably assigned to you by Cubist; (v) you engage in substantial or continuing acts to the detriment of Cubist or inconsistent with Cubist’s policies or practices; or (vi) you fail to carry out the reasonable and lawful instructions of your supervisor or the Cubist Board of Directors that are consistent with your duties.

(b) “Good Reason” means: (i) the failure of Cubist to employ you in your current or a substantially similar position, without regard to title, such that your duties and responsibilities are materially diminished without your consent (provided that you notify Cubist in writing of such diminution of duties within 60 days of the diminution); (ii) a reduction in your base salary rate and/or target annual bonus without your consent (unless such reduction is in connection with a proportional reduction in compensation to all or substantially all of Cubist’s employees); or (iii) a relocation of your primary place of employment more than 35 miles from your current site of employment without your consent.

(c) a “Change of Control” occurs: (i) when any person or entity other than Cubist or one of its subsidiaries becomes the owner of fifty percent (50%) or more of Cubist’s common stock or (ii) upon the effective date of an agreement of acquisition, merger, or consolidation that has been approved by Cubist’s stockholders and that contemplates that all or substantially all of the business and/or assets of Cubist shall be owned or otherwise controlled by another person or entity upon the effective date of such agreement.

(d) “Bonus” shall mean the greater of either (i) the current year target annual bonus amount or (ii) the previous year’s actual bonus amount.

2. Severance. (a) In the event that your employment is terminated by Cubist for any reason other than for Cause, then, following receipt by Cubist of your signed release, as more fully described in Section 7 below, Cubist shall pay you an amount equal to twenty four (24) months of your then-current base salary, with such payment to be made in twelve (12) equal semi-monthly installments.

(b) In the event that, within twenty four (24) months after a Change of Control, your employment is terminated either (i) by Cubist for any reason other than for Cause or (ii) by you for Good Reason, then Cubist shall make a one-time, lump-sum payment to you equal to twenty four (24) months of your then current base salary plus Bonus on the later of (i) your termination date or (ii) the eighth day following receipt by Cubist of your signed release, as more fully described in Section 7 below.

3. Withholding. All payments made by Cubist under this Agreement shall be reduced by any tax or other amounts required to be withheld by Cubist under applicable law.