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Exhibit 10.4
SEVERANCE AND SETTLEMENT AGREEMENT AND RELEASE
This AGREEMENT is entered into by and between Penwest
Pharmaceuticals Co. (the
"Company") and ALAN JOSLYN (the "Employee").
WHEREAS, the parties wish to resolve amicably the Employee's
separation from the
Company and establish the terms of the Employee's severance
arrangement;
NOW, THEREFORE, in consideration of the promises and conditions set
forth
herein, the sufficiency of which is hereby acknowledged, the
Company and the
Employee agree as follows:
1.
Termination Date. The Employee's effective date of termination
from the Company is
FEBRUARY 9, 2007.
2.
Monetary Consideration. In return for the execution of the
instant Severance and
Settlement Agreement and Release, the Company agrees to
continue to pay the
Employee's salary, for the period that the Employee
remains unemployed, at
the rate of $10,231 per pay period for up to six (6)
months from the
termination date (the "Severance Period") less all applicable
state and federal
taxes as severance pay. In no event shall the payment of
severance or Severance
period continue beyond the Employee's start date of new
employment or exceed
six months, which ever comes first. The severance pay
will be paid to the
Employee in accordance with the Company's regular payroll
practices, with the
first payment to be paid no earlier than the eighth (8th)
day after execution of
the Agreement. If the Employee elects to continue group
medical insurance
pursuant to the federal "COBRA" law, 29 U.S.C. Section 1161
et seq., then the
Company agrees that it shall continue to pay its share of
the Employee's health
and dental insurance premiums for the Severance Period
or the commencement of
new employment, which ever comes first. Thereafter, the
Employee may elect to
continue such coverage under COBRA for the remainder of
the COBRA period, with
the Employee paying 100% of the cost of such coverage.
All other employee
benefits, including 401K and Employee Stock Purchase Plan
(ESPP), will terminate
on the effective termination date of FEBRUARY 9,
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2007. The Employee
shall receive a reimbursement for purchases made through
the ESPP at the next
payroll period and in accordance with the Company's
regular payroll
practices.
3.
Bonus Consideration: At the next payroll period upon
effectiveness of this
Agreement, the Employee will be paid $25,000 for the
2006 bonus period.
4.
Equity Consideration. Upon effectiveness of this Agreement,
the vesting schedule
of 8,750 shares to purchase the Company's common stock
("Options") which were
to vest February 16, 2007 held by the employee shall be
accelerated in full,
subject to the terms of the Company's stock incentive
plans under which the
options were granted and the option agreements
evidencing the
options.
5.
Release. In consideration of the payment of the severance
benefits, which the
Employee acknowledges he would not otherwise be entitled
to receive, the
Employee hereby fully, forever, irrevocably and
unconditionally
releases, remises and discharges the Company, its officers,
directors,
shareholders, corporate affiliates, subsidiaries, parent
companies,
agents and employees
(each in their individual and corporate capacities), all
employee benefit plans
and plan fiduciaries (hereinafter, the "Released
Parties") from any and
all claims, charges, complaints, demands, actions,
causes of action,
suits, rights, debts, sums of money, costs, accounts,
reckonings, covenants,
contracts, agreements, promises, doings, omissions,
damages, executions,
obligations, liabilities, and expenses (including
attorneys' fees and
costs), of every kind and nature which the Employee ever
had or now has against
the Released Parties, including but not limited to, any
and all claims arising
out of the Employee's employment with and/or separation
from the Company,
including, but not limited to, all employment discrimination
claims under Title VII
of the Civil Rights Act of 1964, 42 U.S.C. Section
2000e et seq., the Age
Discrimination in Employment Act, 29 U.S.C. Section 621
et seq., the Americans
With
-2-
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Disabilities Act of
1990, 42 U.S.C., Section 12101 et seq., the Connecticut
Human Rights and
Opportunities Act, Conn. Gen. Stat. Section 46A-51 et seq.,
and the Connecticut
Equal Pay Law, Conn. Gen. Stat. Section 31-75 et seq.,
Conn. Gen. Stat.
Section 38a-543, all claims arising out of the Family and
Medical Leave Act, 29
U.S.C. Section 2601 et seq., the Fair Credit Reporting
Act, 15 U.S.C. Section
1681 et seq., the Employee Retirement Income Security
Act of 1974 ("ERISA"),
29 U.S.C. Section 1001 et s
