Exhibit 10.1
SEPARATION AGREEMENT AND
RELEASE
T HIS S EPARATION A GREEMENT AND R ELEASE (this “Agreement” ) is
made and entered into as of January 6, 2009 (the
“Execution Date” ), by and between
A CCELRYS
, I NC . ,
(the “Company” ) and Mark J. Emkjer (the
“Executive” ).
RECITALS
W HEREAS , Executive wishes to resign as President and
Chief Executive Officer of the Company and to resign as a member of
the Company’s Board of Directors effective January 5,
2009 and to resign as an employee of the Company effective
February 1, 2009, and the Company wishes to accept such
resignation;
W HEREAS , the
parties hereto desire to set forth the terms and conditions upon
which Executive’s employment with the Company will terminate
effective as of the Execution Date.
N OW ,
T HEREFORE
, in consideration of the mutual
covenants contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
AGREEMENT
1. Termination of
Employment. The parties
acknowledge and agree that effective as of the Execution Date:
(i) Executive has resigned, and the Company has accepted
Executive’s resignation, as a member of the Company’s
Board of Directors and as the Company’s President and Chief
Executive Officer; (ii) that certain Employment Agreement,
dated as of May 21, 2006, by and between the Company and
Executive (the “Employment Agreement” )
shall be deemed terminated, superseded and replaced in its entirety
by this Agreement; and (iii) neither the Company nor Executive
shall have any rights, duties, obligations or liabilities under the
Employment Agreement, which shall be deemed null and void and of no
further force or effect. Notwithstanding the foregoing, Executive
shall remain as an employee “at will” with the Company
through January 31, 2009, during which time Executive shall
continue to report to the Board of Directors of the Company and
shall provide such services and perform such tasks as are
reasonably requested by the Board of Directors of the Company or
its designee; provided , however , that effective
February 1, 2009, Executive hereby resigns from the Company as
an employee of the Company.
2. S EPARATION P AYMENTS ; T AX M ATTERS .
2.1 Severance
Payments.
(a) Subject to the terms of this Agreement, in
consideration of Executive’s release of claims against the
Company pursuant to Section 3 of this Agreement and
Executive’s covenants set forth in Sections 4 and 5 of this
Agreement, the Company shall: (i) pay to Executive, on
February 1, 2009, a lump-sum amount equal to $315,000 (less
applicable withholdings); (ii) pay to Executive, each month
for a period of twelve (12) months following February 1,
2009 (as defined below), an amount equal to $140,000 (less
applicable withholdings), the first payment of which shall be made
on February 15, 2009 and all payments of which shall be made
in accordance with the Company’s regular payroll practices;
and (iii) reimburse or otherwise pay Executive’s
Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA)
payments for medical and dental insurance under the Company’s
applicable plans for the lesser of (x) twenty four
(24) months from January 31, 2009 or (y) the date
upon which Executive becomes eligible for medical coverage from a
new employer, provided that Executive shall notify the Company no
later than fifteen (15) days after becoming eligible for such
coverage. The payments and benefits referenced in clauses
“(i)” through “(iii)” of the previous
sentence are referred to herein as the “Severance
Payments” .
(b) Each of the parties expressly acknowledges and
agrees that: (i) absent the terms of this Agreement, Executive
would not otherwise be entitled to receive any of the Severance
Payments in connection with Executive’s termination by way of
resignation; and (ii) in the event that Executive materially
breaches any provision of Sections 3, 4 or 5 of this Agreement,
Executive’s rights to receive any remaining Severance
Payments pursuant to Section 2.1(a) shall immediately
terminate and Executive shall no longer be entitled to receive any
such remaining Severance Payments.
2.2 Accrued Salary and Vacation; Equity. On
January 31, 2009, the Company shall pay to Executive all
accrued but unpaid salary and all accrued but unused paid time off
and vacation benefits earned through January 31, 2009, if any
(collectively, the “Required Payment” ).
Each of the parties expressly acknowledges and agrees that the
Required Payment is being made to Executive in accordance with
applicable laws and regulations and that Executive would be
entitled to receive the Required Payment regardless of whether or
not Executive enters into this Agreement. Executive acknowledges
and agrees that on January 31, 2009 all vesting under stock
options, restricted stock or any other equity awards shall cease,
and Executive shall only be entitled to exercise vested equity
awards and only in accordance with their terms.
2.3 Section 409A Compliance.
Notwithstanding anything to the contrary contained herein, no
portion of the Severance Payments will be paid during the six
(6) month period following the date of separation from service
unless the Company reasonably determines that paying such portion
immediately following the termination of Executive’s
employment would not result in the imposition of any tax under
Section 409A ( “Section 409A” ) of
the Internal Revenue Code of 1986, as amended (the
“Code” ), in which case such portion
shall be paid in accordance with Section 2.1(a). If any
portion of the Severance Payments is not paid to Executive in
accordance with Section 2.1(a) as a result of the previous
sentence, on the first day following such six (6) month
period, the Company will pay to Executive a lump-sum amount equal
to the cumulative portions of the Severance Payments that were not,
but would have otherwise been, paid to Executive during such
six-month period pursuant to Section 2.1(a). Thereafter,
Executive will receive the remaining Severance Payments in
accordance with Section 2.1(a).
2.4 Taxes. Executive will be responsible for
the payment of any tax liability incurred as a result of this
Agreement. The Company may withhold tax on any payments or benefits
provided to Executive pursuant to this Agreement as required by law
or regulation. Executive is solely responsible and liable for the
satisfaction of all taxes and penalties that may arise under
Section 409A of the Code, and the Company shall not have any
obligation to indemnify or otherwise hold Executive harmless from
any or all of such taxes. The Company shall have the sole
discretion to interpret the requirements of the Code, including
Section 409A, for purposes of this Section 2.4, but shall
only act in accordance with written advice from its accountants and
attorneys.
3. R ELEASE OF C LAIMS .
3.1 Release.
Effective as of the date that is
eight (8) days after the Execution Date (the
“Effective Date” ), Executive irrevocably
and unconditionally releases any and all Released Claims (as
defined below) that Executive may have against: (i) the
Company; (ii) each of the Company’s current and former
parents, subsidiaries, related companies, partnerships or joint
ventures; (iii) with respect to each of parties listed in the
foregoing clauses “(i)” and “(ii)”, such
party’s predecessors and successors; or (iv) with
respect to each of the parties listed in the foregoing clauses
“(i)”, “(ii)” and “(iii)”, all
of such party’s past, present, and future employees,
officers, directors, stockholders, owners, representatives,
assigns, attorneys, agents, insurers, employee benefit programs
(and the trustees, administrators, fiduciaries and insurers of such
programs) and any other persons acting by, through, under or in
concert with any of such persons or entities and their successors
(each, a “Company Released Party” and,
collectively, the “Company Released
Parties” ).
3.2 Released Claims. For purposes of this
Agreement, the term “Released Claims”
shall include, to the fullest extent permitted by applicable law,
all known and unknown claims, promises, causes of action or similar
rights of any type ( “Claims” ) that
Executive may have arising under the Employment Agreement, the
Company’s Fiscal Year 2009 Management Incentive Plan, any
federal, state or local laws (including statutes, regulations,
other administrative guidance and common law doctrines), including,
without limitation, the following: the Age Discrimination in
Employment Act (the “ADEA” ) and
Executive Order 11,141; Title VII of the Civil Rights Act of 1964,
Sections 1981 and 1983 of the Civil Rights Act of 1866, and
Executive Order 11,246; the Equal Pay Act, the Americans With
Disabilities Act and Sections 503 and 504 of the Rehabilitation Act
of 1973; California state laws that prohibit discrimination in
employment based on disability, race, creed, color, national
origin, ancestry, age, marital status, affectional or sexual
orientation, sex or military status; and any other federal, state,
or local laws that prohibit discrimination in employment; the
Employee Retirement Income Security Act of 1974; the Fair Labor
Standards Act of 1938; the Family and Medical Leave Act of 1993;
and any other federal laws relating to employment. In connection
with this Section 3, Executive expressly acknowledges that
some examples of
Released Claims include, without limitation:
(i) Claims that in any way relate to or
