Exhibit
10.39
January 3, 2005
Dominick Colangelo, Esq.
8926 Sawmill Court
Indianapolis, Indiana 46236
Dear Nick:
This letter will confirm our offer
to you of employment with Oscient Pharmaceuticals Corporation (the
“Company”), under the terms and conditions that
follow:
Position and Duties.
Effective January 1, 2005 (the
“Start Date”), you will be employed by the Company, on
a full-time basis as its Senior Vice President, Corporate
Development and Operations. You agree to perform the duties of your
position and such other duties as may reasonably be assigned to you
from time to time consistent with your position. You also agree
that, while employed by the Company, you will devote substantially
all of your business time and your reasonable best efforts, skill
and knowledge exclusively to the advancement of the business and
interests of the Company and its subsidiaries and to the discharge
of your duties and responsibilities for them. You warrant that you
are free to enter into and fully perform this Agreement and are not
subject to any employment, confidentiality, non-competition or
other Agreement which conflicts with this agreement.
1. Compensation and Benefits.
During your employment, as compensation for all services performed
by you for the Company and its subsidiaries, the Company will
provide you the following pay and benefits:
a. Base Salary. The Company
will pay you a base salary at the rate of Three Hundred and Five
Thousand Dollars ($305,000) per year, payable in accordance with
the regular payroll practices of the Company and subject to
increase from time to time by the Compensation Committee of the
Board of Directors of the Company (the “Compensation
Committee”) in its discretion (such base salary as in effect
from time to time, the “Base Salary”). Your first full
year merit review will occur on or before March 31, 2006, and you
will receive merit reviews at least annually thereafter.
b. Signing Bonus. You will
receive a one time signing bonus in the amount of One Hundred
Thousand Dollars ($100,000), payable within 10 days of the Start
Date.
c. Annual Bonus Compensation.
During employment, you will be eligible for an annual incentive
target of forty percent (40%) of your Base Salary. Bonus awards
will be determined by the Compensation Committee, based on your
performance and that of the Company against goals established
annually by the Compensation Committee after consultation with you.
Subject to Compensation Committee approval, up to half of any
annual bonus may be paid in the form of an equity award on terms to
be determined by the Compensation Committee.
d. Option Grants. In
connection with the commencement of your employment, you will be
granted an option to purchase 250,000 shares of the Company’s
common
stock, which will vest during your continued
employment with the Company in equal annual installments over a
four (4) year period, on the anniversary of the Start Date. The
exercise price per share for this option grant will be the fair
market value per share of the Company’s common stock as of
the Start Date. The terms of these options are governed by the
Company’s 2001 Incentive Plan and the stock option agreements
between the Company and you. Annually, based on company and
team/individual performance and subject to approval by the
Compensation Committee, you also will be eligible to receive
additional option grants priced at the Fair Market Value on the
date of grant, which if awarded, will vest quarterly over a three
year period.
e. Participation in Employee
Benefit Plans. You will be entitled to participate in all
employee benefit plans from time to time in effect on the same
basis as other senior executive employees of the Company, except to
the extent such plans are duplicative of benefits otherwise
provided to you under this Agreement. Your participation will be
subject to the terms of the applicable plan documents and
applicable Company policies.
f. Vacations and other Benefits.
Y ou will be subject to the Company’s standard vacation
policy, which initially provides for three (3) weeks of vacation
per year. Vacation may be taken at such times and intervals as you
shall determine, subject to the business needs of the Company.
Additionally, the Company will, at its expense, provide you with a
supplemental life insurance policy for the purpose of increasing
your term life coverage level to three times your Base
Salary.
g. Relocation Expense
Reimbursement. The Company shall reimburse you, upon proper
accounting, for reasonable and customary expenses up to One Hundred
Twenty Five Thousand Dollars ($125,000) incurred by you in the
course of relocating to the Boston, Massachusetts area. The Company
will provide relocation services through its preferred provider,
Relocation Outsource Inc. (ROI) whose services will be available to
you for all phases of your relocation. A list of covered expenses
was included in the relocation agreement attached to your offer
letter. Relocation expenses that are outside of these categories
must be approved in advance by the Company, which approval shall
not be unreasonably withheld or delayed. Your rights to seek
reimbursement pursuant to this Paragraph 1(g) shall expire on the
date twelve (12) months following the Start Date; provided, that
you shall have rights to reimbursement in accordance with this
Paragraph for any expenses incurred prior to such date so long as
you submit a reasonably detailed reimbursement request within
thirty days following such date. In addition, the Company shall pay
you any additional amount necessary to compensate you for any
federal, state and local taxes you may incur by reason of such
reimbursement payments (the “Gross Up Payment”) and any
additional amount necessary to compensate you for any such taxes
incurred by you by reason of the Gross Up Payment.
2. Confidential Information and
Restricted Activities. You acknowledge that, in consideration
for your employment with the Company, you have agreed to and
executed a joinder to Oscient Pharmaceuticals’ Intellectual
Property Policy, including Appendix I thereof (“Invention,
Assignment, Non-Disclosure and Covenant Not To Compete”),
which imposes certain non-competition, non-solicitation and
non-disclosure restrictions on you (such joinder being referred to
herein as the “Intellectual Property and Non-Compete
Agreement”).
3. Commitment re: Offerings.
You acknowledge and agree that, in consideration for your
employment with the Company, at the request of the Company you will
enter into an agreement with the Company’s lead underwriter
or placement agent for a Securities Transaction not to sell or
otherwise transfer or dispose of any Company securities for a
period of up to one hundred eighty (180) days, such agreement to be
in the form customary for such lead underwriter or placement agent
and the same as entered into by the other senior executive
employees of the Company. For the purposes of this Agreement,
“Securities Transaction” shall mean an offering of the
Company’s securities conducted by an underwriter or placement
agent.
4. Termination of Employment;
Severance. Your employment under this Agreement shall continue
until one party delivers to the other party a written notice of
termination setting forth the reason, if any, for the termination.
If you terminate your employment without Good Reason (as defined
below), you will give the Company two month’s written
notice.
a. In the event of termination of
your employment by the Company other than for Cause (as defined
below) or your termination of employment for Good Reason (as
defined below), the Company will: (i) continue to pay you your Base
Salary and provide you with the benefits set forth in Paragraph
1(e) hereof for the lesser of (x) a period of nine (9) months from
the date of termination or (y) such period of time tha
