Exhibit 10.1
SECOND AMENDED AND
RESTATED
SEVERANCE
AGREEMENT
This SECOND AMENDED AND RESTATED
SEVERANCE AGREEMENT (the “ Agreement ”) is
made and entered into as of the 18th day of September, 2008 by and
between PHARMACOPEIA, INC., a Delaware corporation (hereinafter,
the “ Company ”), and Rene Belder, M.D., an
individual (hereinafter, “ Employee
”).
RECITALS
WHEREAS, Employee is presently employed by the Company
the capacity of Senior Vice President, Clinical and Regulatory
Affairs of the Company, pursuant to a Letter Agreement between the
Company and Employee, dated November 2, 2006 (the
“Letter Agreement”).
WHEREAS, the Company and Employee previously entered into
an Amended and Restated Severance Agreement, dated as of
December 18, 2007 (the “Existing Severance
Agreement”), pursuant to which Employee is entitled to
certain payments and benefits in the event of a covered termination
of Employee’s employment with the Company.
WHEREAS, the Company and Employee wish to amend and
restate the Existing Severance Agreement to reflect the promotion
of Employee to the position of Senior Vice President, Clinical and
Regulatory Affairs of the Company from Vice President, Clinical and
Regulatory Affairs of the Company.
NOW, THEREFORE,
in consideration of their mutual
promises and intending to be legally bound, the parties agree as
follows:
1.
TERMINATION AND EFFECT OF
TERMINATION . Employee’s employment hereunder is
AT WILL and may be terminated at any time by the Company for any
reason. In the event of termination of Employee’s
employment, the Company shall have no liability to Employee for
compensation or benefits except as specified in this Section 1
or as required by the Company’s benefits policy.
(a)
Termination By The Company For
Cause .
Employee’s employment
may be terminated by the Company for Cause (as defined below) at
any time upon delivery of written notice to Employee. Upon
such a termination, the Company shall have no obligation to
Employee other than the payment of all accrued, but unpaid, base
salary and any unpaid expenses or expense reimbursements prior to
the effective date of such termination. For purposes of this
Agreement, “ Cause ” means the occurrence of any
one or more of the following events or conditions:
(i)
any gross failure on the part of
Employee (other than by reason of disability as provided in
Section 1(e) below) to faithfully and professionally
carry out Employee’s duties or to comply with any other
material provision of this Agreement, which failure continues for
thirty (30) days after written notice detailing such failure is
delivered by the Company; provided, that the Company shall not be
required to provide such notice in the event that such failure
(A) is not susceptible to remedy or (B) relates to the
same type of acts or omissions as to which notice has been given on
a prior occasion;
(ii)
Employee’s dishonesty (which
shall include without limitation any misuse or misappropriation of
the Company’s assets), or other willful misconduct (including
without limitation, any conduct on the part of Employee intended to
or likely to injure the business of the Company);
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(iii)
Employee’s conviction of any
felony or of any other crime involving moral turpitude, whether or
not relating to Employee’s employment;
(iv)
Employee’s insobriety or use
of drugs, chemicals or controlled substances either (A) in the
course of performing Employee’s duties and responsibilities
under this Agreement, or (B) otherwise affecting the ability
of Employee to perform the same;
(v)
Employee’s failure to comply
with a lawful written direction of the Company; or
(vi)
any wanton or willful dereliction of
duties by Employee.
(b)
Involuntary Termination By The
Company Without Cause . The Company may involuntarily terminate
Employee’s employment under this Agreement at any time
without Cause upon delivery of written notice to Employee.
Subject to the provisions of Section 1(g) hereof
(concerning a termination in connection with a Change in Control
(as defined in Section 1(g)), if Employee’s employment
is terminated involuntarily by the Company without Cause pursuant
to this Section 1(b), the Company shall:
(i)
pay Employee all compensation and
benefits accrued, but unpaid, up to the effective date of
termination of Employee’s employment;
(ii)
pay Employee, within thirty (30)
days after the effective date of termination of Employee’s
employment, a lump sum amount equal to nine (9) months of
Employee’s base salary in effect as of the effective date of
termination of Employee’s employment;
(iii)
pay Employee, within thirty (30)
days after the effective date of termination of Employee’s
employment, a lump sum pro rata portion of Employee’s target
incentive bonus for the calendar year in which Employee’s
employment is terminated as provided in this Section 1(b),
such portion to be based on the number of full months for which
Employee was employed during the year of termination;
(iv)
maintain Employee’s group
medical coverage until the earlier of (A) the end of a period
of nine (9) months following the effective date of such
termination, or (B) until such time as comparable medical coverage
is obtained by Employee; and
(v)
allow all vested options or other
incentive securities to be exercised pursuant to the terms of the
option agreement or other agreements under which such options or
other incentive securities were granted.
(c)
Termination By Employee For
Good Reason .
(i)
Benefits
. Employee may terminate Employee’s
employment under this Agreement for Good Reason (as defined below)
upon the provision of advance written notice to the Company
specifying in reasonable detail the events or conditions upon which
Employee is basing such termination. Employee must give such
notice within ninety (90) days after the event that gives rise to
Good Reason. The Company will be given the opportunity, but
shall have no obligation, to cure such events or conditions within
thirty (30) days after the provision by Employee of such
notice. If the Company elects in a written notice to Employee
not to cure such events or conditions or otherwise fails to so cure
such events or conditions within such thirty (30) day period,
Employee may terminate his employment with the Company for Good
Reason pursuant to this Section 1(c) within thirty (30)
days after the expiration of the “cure” period.
In the event of such termination, the Company shall:
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(A)
pay Employee all compensation and
benefits accrued, but unpaid, up to the effective date of
termination of Employee’s employment;
(B)
pay Employee, within thirty (30)
days after the effective date of termination of Employee’s
employment, a lump sum amount equal to nine (9) months of
Employee’s base salary in effect as of the effective date of
termination of Employee’s employment;
(C)
pay Employee, within thirty (30)
days after the effective date of termination of Employee’s
employment, a lump sum pro rata portion of Employee’s target
incentive bonus for the calendar year in which Employee’s
employment is terminated as provided in this Section 1(c),
such portion to be based on the number of full months for which
Employee was employed during the year of termination;
(D)
maintain Employee’s group
medical coverage until the earlier of (A) the end of a period
of nine (9) months following the effective date of such
termination, or (B) until such time as comparable medical
coverage is obtained by Employee; and
(E)
allow all vested options or other
incentive securities to be exercised pursuant to the terms of the
option agreement or other agreements under which such options or
other incentive securities were granted.
(ii)
Definition of “Good
Reason .” For purposes of this Agreement, “ Good
Reason ” means any one or more of the following events or
conditions:
(A)
any action or inaction that
constitutes a material breach by the Company of the terms of this
Agreement or the Letter Agreement;
(B)
any material change in the
geographic location at which Employee must perform services for the
Company, which, for purposes of this Agreement, means a requirement
that Employee commute more than fifty (50) miles from the offices
of the Company at which he was principally employed on the date of
this Agreement;
(C)
any material diminution of the
authority, duties or responsibilities of Employee, including
without limitation a material diminution in Employee’s
position as Vice President, Clinical and Regulatory Affairs;
or
(D)
any material reduction in
Employee’s base salary (other than such a reduction
applicable generally to substantially all employees of the
Company), which, for purposes of this Agreement, means a reduction
of more than twenty percent (20%) in Employee’s annual base
salary as in effect on the date of this Agreement or as the same
may be increased from time to time after such date.
(d)
Termination By Employee
Without Good Reason (Voluntary Resignation)
. Employee may voluntarily resign
Employee’s position and terminate Employee’s employment
under this Agreement without Good Reason at any time. Upon
such a termination, the Company shall have no obligation to pay
compensation and provide benefits to Employee other than the
payment of all accrued and unpaid base salary and any other unpaid
expenses or expense reimbursements prior to the effective date of
such termination.
(e)
Disability
. If Employee becomes disabled for more
than one hundred eighty (180) days in any twelve (12) month period,
the Company shall have the right to terminate Employee’s
employment without further liability upon written notice to
Employee. Without limiting the generality of
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the foregoing, Employee shall be
deemed disabled for purposes of this Agreement either (i) if
Employee is deemed disabled for purposes of any long-term
disability insurance policy paid for by the Company and at the time
in effect, or (ii) if in the exercise of the Company’s
reasonable judgment, due to accident, mental or physical illness,
or any other reason, Employee cannot perform Employee’s
duties. In the event the Company shall terminate Employee due
to disability, as described above, Employee shall be entitled to
receive only those benefits provided under the Company’s Long
Term Disability Plan, and Employee’s stock options and other
incentive compensation grants will be treated under the applicable
Disability section of the 2004 Stock Incentive Plan (as amended,
the “ 2004 Plan ”) or any other stock option or
incentive compensation plan of the Company under which they were
granted.
(f)
Death
. In the event of the death of Employee,
this Agreement shall automatically terminate and any obligation to
continue to pay compensation and benefits shall cease as of the
date of Employee’s death, except for the payment of all
accrued, but unpaid, base salary and any other unpaid expenses or
expense reimbursements prior to the date of death. In the
event of Employee’s death, Employee’s stock options and
other incentive compensation grants shall be treated under the
applicable Death section of the 2004 Plan or any other stock option
or incentive compensation plan of the Company under which they were
granted.
(g)
Change In Control
Termination .
(i)
Benefits
. In the event Employee’s employment
under this Agreement is terminated by the Company involuntarily
without Cause or Employee terminates Employee’s employment
with the Company for Good Reason (as defined in
Section 1(c) above), in either case at any time during
the period commencing two (2) months before and ending twelve
(12) months after the occurrence of a Change in Control, the
Company shall:
(A)
pay Employee all compensation and
benefits accrued, but unpaid, up to the effective date of
termination of Employee’s employment;
(B)
pay Employee, within thirty (30)
days after the effective date of termination of Employee’s
employment, a lump sum amount equal to twelve (12) months of
Employee’s base salary in effect as of the effective date of
Employee’s termination of employment;
(C)
p ay Employee, within thirty
(30) days after the effective date of termination of
Employee’s employment, a lump sum amount equal to one
hundred percent ( 100 %) of Employee’s target
incentive bonus;
(D)
maintain Employee’s group
medical coverage until the earlier of (A) the end of a period of
twelve (12) months following the effective date of termination
, or (B) such time as comparable medical coverage is
obtained by Employee.
Anything contained in this
Section to the contrary notwithstanding, Employee shall not be
entitled to any of the benefits set forth in this
Section 1(g)(i) if Employee either resigns and terminates
such employment voluntarily (other than for Good Reason, as
described above) or is terminated by the Company for
Cause.
For purposes of
Section 1(g) hereof, the term “ Company
” shall include any Acquiring Company (as defined below), and
all obligations of the Company under such Section shall be
assumed by any Acquiring Company.
(ii)
Stock Options
. In the event Employee’s employment
under this Agreement is terminated by the Company involuntarily
without Cause or Employee terminates his employment with the
Company for Good Reason, in either case at any time during the
period
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commencing two (2) months
before and ending twelve (12) months after the occurrence of a
Change in Control:
(A)
notwithstanding anything to the
contrary contained in the 2004 Plan or any other stock option or
incentive compensation plan of the Company, any unvested stock
options or other incentive securities which were granted to
Employee during the term of this Agreement under the 2004 Plan or
any such other stock option or incentive compensation plan shall
immediately vest on the date of such termination of
Employee’s employment, the expiration date of the exercise
period for such options or other securities shall be the
earl
