Exhibit 10.2
SEVERANCE
AGREEMENT
This Agreement is entered into as of
the 1st day of December, 2008 (the “ Effective
Date ”) by and between ImmunoGen, Inc., a
Massachusetts corporation (the “ Company
”) and Mitchel Sayare, Ph.D. (the “
Executive ”).
WHEREAS, the Company recognizes that
the Executive’s service to the Company is very important to
the future success of the Company;
WHEREAS, the Executive desires to
enter into this Agreement to provide the Executive with certain
financial protection in the event that his employment terminates
under certain conditions following a change in control of the
Company; and
WHEREAS the Board of Directors of
the Company (the “ Board ”) has
determined that it is in the best interests of the Company to enter
into this Agreement.
NOW, THEREFORE, for good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Company and the Executive hereby agree as
follows:
1.
Definitions
.
(a)
Cause . For purposes of this Agreement, “
Cause ” shall mean that the Executive has
(i) intentionally committed an act or omission that materially
harms the Company; (ii) been grossly negligent in the
performance of the Executive’s duties to the Company;
(iii) willfully failed or refused to follow the lawful and
proper directives of the Board; (iv) been convicted of, or
pleaded guilty or nolo contendre , to a felony;
(v) committed an act involving moral turpitude;
(vi) committed an act relating to the Executive’s
employment or the Company involving, in the good faith judgment of
the Board, material fraud or theft; (vii) breached any
material provision of this Agreement or any nondisclosure or
non-competition agreement between the Executive and the Company, as
all of the foregoing may be amended prospectively from time to
time; or (viii) breached a material provision of any code of
conduct or ethics policy in effect at the Company, as all of the
foregoing may be amended prospectively from time to
time.
(b)
Change in Control
. For purposes of this
Agreement, a “ Change in Control ” shall
mean the occurrence of any of the following events; provided
that “Change in Control” shall be interpreted in
a manner, and limited to the extent necessary, so that it will not
cause adverse tax consequences for either party with respect to
Section 409A of the Internal Revenue Code of 1986, as amended
(the “ Code ”), and Treasury
Regulations 1.409A-3(i)(5), and any successor statute,
regulation and guidance thereto:
(i)
Ownership. Any
“Person” (as such term is used in
Sections 13(d) and 14(d) of the Securities Exchange
Act of 1934, as amended) becomes the “Beneficial Owner”
(as defined in Rule 13d-3 under said Act), directly or
indirectly, of securities of the Company representing 50% or more
of the total voting power represented by the Company’s
then
Executive Severance Agreement
(24)
outstanding voting securities
(excluding for this purpose any such voting securities held by the
Company or its Affiliates (as defined in the Company’s 2006
Employer, Director and Consultant Equity Incentive Plan) or by any
employee benefit plan of the Company) pursuant to a transaction or
a series of related transactions which the Board does not approve;
or
(ii)
Merger/Sale of Assets.
(A) A merger or consolidation of the Company whether or not
approved by the Board, other than a merger or consolidation which
would result in the voting securities of the Company outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities
of the surviving entity or the parent of such corporation) at least
50% of the total voting power represented by the voting securities
of the Company or such surviving entity or parent of such
corporation, as the case may be, outstanding immediately after such
merger or consolidation; or (B) the stockholders of the
Company approve an agreement for the sale or disposition by the
Company of all or substantially all of the Company’s assets;
or
(iii)
Change in Board Composition. A
change in the composition of the Board, as a result of which fewer
than a majority of the directors are Incumbent Directors.
“Incumbent Directors” shall mean directors who either
(A) are directors of the Company as of November 11, 2006,
or (B) are elected, or nominated for election, to the Board
with the affirmative votes of at least a majority of the Incumbent
Directors at the time of such election or nomination (but shall not
include an individual whose election or nomination is in connection
with an actual or threatened proxy contest relating to the election
of directors to the Company).
(c)
Disability
. For purposes of this
Agreement, “ Disability ” shall mean that
the Executive (i) is unable to engage in any substantial
gainful activity by reason of any medically determinable physical
or mental impairment which can be expected to result in death or
can be expected to last for a continuous period of not less than
twelve (12) months, or (ii) is, by reason of any
medically determinable physical or mental impairment which can be
expected to result in death or can be expected to last for a
continuous period of not less than twelve (12) months,
receiving income replacement benefits for a period of not less than
three (3) months under a Company-sponsored group
disability plan. Whether the Executive has a Disability will be
determined by a majority of the Board based on evidence provided by
one or more physicians selected by the Board and approved by the
Executive, which approval shall not be unreasonably
withheld.
(d)
Good Reason
. For purposes of this
Agreement, “ Good Reason ” shall mean the
occurrence of one or more of the following without the
Executive’s consent: (i) a change in the principal
location at which the Executive performs his duties for the Company
to a new location that is at least forty (40) miles from the
prior location; (ii) a material change in the
Executive’s authority, functions, duties or responsibilities
as an executive of the Company, which would cause his position with
the Company to become of less responsibility, importance or scope
than his highest position with the Company at any time from the
date of this Agreement to immediately prior to the Change in
Control, provided , however , that such material
change is not in connection with the termination of the
Executive’s employment by the Company for Cause or death or
Disability and further provided that it shall not be
considered a material change if the Company becomes a subsidiary of
another entity and the Executive continues to hold a position in
the subsidiary that is at least as high as the highest position he
held with the Company at any time from the date of this Agreement
to
2
immediately prior to the Change in Control;
(iii) a material reduction in the Executive’s annual
base salary or (iv) a material reduction in the
Executive’s target annual bonus as compared to the target
annual bonus set for the previous fiscal year.
2.
Term of Agreement
. The term of this Agreement
(the “Term”) shall commence on the Effective Date and
shall continue in effect through June 30, 2009;
provided , however , that if a Change in Control
shall have occurred during the Term, the Term shall expire on the
last day of the twenty-fourth (24 th ) month
following the month in which such Change in Control occurred.
Termination of this Agreement shall not constitute Cause or Good
Reason (both terms as defined above).
3.
Termination; Notice; Severance
Compensation .
(a)
In the event that within a period of
two (2) months before or two (2) years
following the consummation of a Change in Control the Company
elects to terminate the Executive’s employment other than for
Cause (but not including termination due to the Executive’s
Disability), then the Company shall give the Executive no less than
sixty (60) days advance notice of such termination (the
“Company’s Notice Period”); provided
that the Company may elect to require the Executive to cease
performing work for the Company so long as the Company continues
the Executive’s full salary and benefits during the
Company’s Notice Period.
(b)
In the event that within a period of
two (2) months before or two (2) years
following the consummation of a Change in Control the Executive
elects to terminate his employment for Good Reason, then the
Executive shall give the Company no less than thirty (30) days
and no more than sixty (60) days advance notice of such
termination (the “Executive’s Notice Period”);
provided that the Company may elect to require the
Executive to cease performing work for the Company so long as the
Company continues the Executive’s full salary and benefits
during the Executive’s Notice Period. In order to effect a
termination for Good Reason pursuant to this Agreement, the
Executive must notice his intent to terminate for Good Reason not
later than ninety (90) days following the occurrence of the
Good Reason.
(c)
In the event that within a period of
two (2) months before or two (2) years
following the cons
