Exhibit 10.23
METABOLIX
where nature performs(TM) [LOGO]
[LOGO]
00 Xxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxxxx 00000-0000 XXX
Tel: 000.000.0000 . Fax: 000-000-0000
Web: xxx.xxxxxxxxx.xxx
August 29, 0000
Xxxxx Xxxx
00 Xxx Xxxxxx
Xxxxxx, XX 00000
Re: EMPLOYMENT AGREEMENT
Dear Xxxxx:
This letter is to confirm our understanding with respect to your employment
by Metabolix, Inc. (the "Company"). The terms and conditions agreed to in this
letter are hereinafter referred to as the "Agreement." In consideration of the
mutual promises and covenants contained in this Agreement, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
mutually acknowledged, we have agreed as follows:
1. EMPLOYMENT.
(a) GENERAL. The Company will employ you, and you will be employed
by the Company, as the Vice President, Chief Brand Officer, of the Company,
reporting to the Chief Executive Officer, and you shall have the
responsibilities, duty and authority commensurate with that position. You
will also perform such other and/or different services for the Company as
may be assigned to you from time to time. Your employment will commence on
or about September 1, 2006. You agree that if your employment hereunder
ends for any reason, you will tender your resignation to the Company of any
office you may then hold in the Company.
(b) DEVOTION TO DUTIES. While you are employed hereunder, you will
use your best efforts, skills and abilities to perform faithfully all
duties assigned to you pursuant to this Agreement and will devote your full
business time and energies to the business and affairs of the Company.
While you are employed hereunder, you will not undertake any other
employment from any person or entity without the prior written consent of
the Company. Notwithstanding the foregoing, nothing contained herein shall
be deemed to prohibit you from engaging in passive investment or charitable
activities, so long as they do not interfere with the performance of your
duties hereunder.
2. EMPLOYMENT AT WILL. Your employment hereunder will be on an
"at-will" basis and may be terminated by the Company or by you at any time for
any reason or for no reason.
Xxxxx Xxxx
August 29, 2006
Page 2
3. COMPENSATION.
(a) BASE SALARY. While you are employed hereunder, the Company will
pay you a base salary at the annual rate of $16,666.67 per month
(annualized at $200,000.00) (the "Base Salary"). This Base Salary may be
subject to upward (but not downward) adjustment from time to time in the
discretion of the Company. The Company will deduct from each monthly salary
payment all amounts required to be deducted or withheld under applicable
law or under any employee benefit plan in which you participate.
(b) BONUSES.
(i) In addition to the Base Salary, the Company shall pay you a
signing bonus of $20,000.00, payable at the same time as your first
paycheck after commencement of your employment.
(ii) In addition to the foregoing, the Company on or before
December 31, 2006, will establish a formalized bonus scheme and pay you an
annual bonus (a "Bonus") in an amount to be determined by the Company's
Compensation Committee. The amount will be based on several criteria,
including the financial condition of the Company and its overall
performance for the year, but will be strongly influenced by your
contributions toward the achievement of established corporate goals and
objectives, as well as other contributions that add recognizable value to
the Company. The present target for executive bonuses is 50% of Base Salary
(the "Target Bonus"). This Target Bonus will be subject to revision from
time to time by the Compensation Committee. In order to receive an annual
bonus, you must be employed at the time of a timely payment, which will be
paid on or before March 15 of the year following the year in which it is
earned.
(c) EQUITY COMPENSATION. Upon approval by the Compensation Committee
of the Company's Board of Directors, the Company shall grant you stock
options for the purchase of 200,000 shares of the Company's Common Stock at
an exercise price equal to the fair market value per share of the Common
Stock on the date of grant. Such stock options shall vest in sixteen (16)
quarterly installments over a period of four (4) years from the date of
commencement of your employment. Such options shall be incentive stock
options to the extent permitted under applicable tax law and regulations.
In addition, the Company, in the Board's sole discretion, may from time to
time grant to you stock options, restricted stock or other forms of equity
compensation pursuant to the Metabolix, Inc. 2005 Stock Plan or any other
authorized stock plan in effect at the time.
(d) VACATION. You will be entitled to five (5) weeks paid vacation
and paid holidays, accrued and used in accordance with the Company's
policies as currently in effect. All vacation days will be taken at times
mutually agreed by you and the Company and will be subject to the business
needs of the Company.
(e) FRINGE BENEFITS. You will be entitled to participate in employee
benefit plans which the Company provides or may establish for the benefit
of its senior executives
Xxxxx Xxxx
August 29, 2006
Page 3
generally (for example, group life, disability, medical, dental and other
insurance, retirement, pension, profit-sharing and similar plans)
(collectively, the "Fringe Benefits"). Your eligibility to participate in
the Fringe Benefits and receive benefits thereunder will be subject to the
plan documents governing such Fringe Benefits. Nothing contained herein
will require the Company to establish or maintain any Fringe Benefits.
4. TERMINATION.
(a) GENERAL. As an at-will employee, your employment may be
terminated at any time for any reason or for no reason. Upon termination,
unless otherwise specifically provided herein, you shall be eligible only
to receive (i) the portion of your Base Salary as has accrued prior to such
termination and has not yet been paid, (ii) an amount equal to the value of
your accrued unused vacation days, and (iii) reimbursement for expenses
properly incurred by you on behalf of the Company prior to such termination
if such expenses are properly documented in accordance with Company policy
and practice and submitted for reimbursement within thirty (30) days of the
termination date (collectively, the "Accrued Obligations"). Such amounts
will be paid promptly after termination in accordance with applicable law.
(b) TERMINATION WITHOUT CAUSE OR WITH GOOD REASON. Except as
provided in Section 4(c) hereof, in the event that your employment is
terminated by the Company without Cause or by you with Good Reason (each,
as defined below), in addition to the Accrued Obligations, and contingent
on your provision of a timely and complete release of claims against the
Company, you shall be entitled to receive continuation of your Base Salary
in effect at the time of termination for the period of twelve (12) months
following the termination. To the extent required by Section 409A of the
Internal Revenue Code of 1986, as amended (the "Code"), the first
installment of such Base Salary in the amount of six (6) months' Base
Salary shall be payable on the first business day following the six (6)
month anniversary of the effective date of termination, and the remainder
shall be payable in accordance with the Company's regular payroll
procedures thereafter. If Section 409A of the Code is not then applicable,
such Base Salary continuation shall commence immediately from the date of
termination. In addition, should the award of a Bonus have become
customary, you shall be entitled to a payment equal to the average of the
Bonuses paid to you (if any) in the two years preceding the termination, to
be paid (A) on the first business day following the six (6) month
anniversary of the effective date of termination, to the extent required by
Section 409A of the Code, or (B) if Section 409A of the Code is not then
applicable, within thirty (30) days following the termination. In addition
to the foregoing, you shall be entitled to receive payment of COBRA
premiums to maintain medical and dental benefits, if any, in effect at the
time of termination for the period of twelve (12) months following the
termination.
Xxxxx Xxxx
August 29, 2006
Page 4
(c) TERMINATION WITHOUT CAUSE OR WITH GOOD REASON BEFORE OR AFTER A
CHANGE OF CONTROL.
(i) In the event that your employment is terminated by the
Company without Cause or by you for Good Reason (each, as defined below)
within the twenty-four (24) month period immediately following or the two
month period immediately prior to a Change of Control (as defined below),
in addition to the Accrued Obligations, and contingent on your provision of
a timely release of claims against the Company, you shall be entitled to
receive:
(A) continuation of your Base Salary in effect at the
time of termination for the period of twelve (12) months following the
termination. To the extent required by Section 409A of the Code, the first
installment of such Base Salary in the amount of six (6) months' Base
Salary shall be payable on the first business day following the six (6)
month anniversary of the effective date of termination, and the remainder
shall be payable in accordance with the Company's regular payroll
procedures thereafter. If Section 409A of the Code is not then applicable,
such Base Salary continuation shall commence immediately from the date of
termination.
(B) In addition, should the award of a Bonus have become
customary, you shall be entitled to a payment equal to the average of the
Bonuses paid to you (if any) in the two years preceding the termination, to
be paid (A) on the first business day following the six (6) month
anniversary of the effective date of termination, to the extent required by
Section 409A of the Code, or (B) if Section 409A of the Code is not then
applicable, within thirty (30) days following the termination.
(C) continued payment of COBRA premiums to maintain
medical and dental benefits, if any, in effect at the time of termination
for the period of twelve (12) months following the termination; and
(D) full vesting of all options granted to you under the
Metabolix Inc. 1995 Stock Plan, the Metabolix Inc. 2005 Stock Plan, or any
authorized successor stock plan provided that the conditions to vesting
other than the passage of time have been satisfied.
(ii) You agree that the payments and benefits hereunder, and
under all other contracts, arrangements or programs that apply to you (the
"Company Payments"), shall be reduced to an amount that is one dollar less
than the amount that would trigger an excise tax under Section 4999 of the
Code, as determined in good faith by the Company's independent public
accountants, PROVIDED, HOWEVER, that the reduction shall occur only if the
reduced Company Payments received by you (after taking into account further
reductions for applicable federal, state and local income, social security
and other taxes) would be greater than the unreduced Company Payments to be
received by you minus (i) the excise tax payable with respect to such
Company Payments under Section 4999 of the Code; and (ii) all applicable
federal, state and local income, social security and other
Xxxxx Xxxx
August 29, 2006
Page 5
taxes on such Company Payments. You and the Company agree to cooperate in
good faith with each other in connection with any administrative or
judicial proceedings concerning the existence or amount of golden parachute
penalties with respect to payments or benefits that you receive.
(d) "CAUSE". As used herein, "Cause" shall be defined as (i) your
conviction for, or plea of nolo contendere, to a felony or a crime
involving moral turpitude, (ii) your commission of a material act of
personal dishonesty or a breach of fiduciary duty, in either case,
involving personal profit in connection with your employment by the
Company, (iii) your commission of an act which the Board of Directors shall
reasonably have found to have involved willful misconduct or gross
negligence on your part in the conduct of your duties under this Agreement,
(iv) your habitual absenteeism, (v) your material breach of any material
provision of this Agreement continuing for thirty days after your receipt
of written notice thereof from the Company, or (vi) the willful and
continued failure by you to perform substantially your duties with the
Company (other than any such failure resulting from your incapacity due to
physical or mental illness).
(e) "CHANGE OF CONTROL". As used herein, a "Change of Control" shall
occur or be deemed to have occurred only upon any one or more of the
following events:
(i) a merger or consolidation of the Company 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 fifty percent (50%) of the total voting power
represented by the voting securities of the Company or such surviving
entity or parent of such corporation outstanding immediately after such
merger or consolidation;
(ii) the sale or disposition by the Company of all or
substantially all of the Company's assets; or
(iii) any one person, entity or group, who is not a shareholder
at time of execution of this Agreement, acquires ownership of capital
stock of the Company that, together with the capital stock of the
Company already held by such person, entity or group, constitutes more
than 50% of the total fair market value or total voting power of the
capital stock of the Company; provided, however, if any one person,
entity or group is considered to own more than 50% of the total fair
market value or total voting power of the capital stock of the Company,
the acquisition of additional capital stock by the same person, entity
or group shall not be deemed to be a Change of Control, and further
provided that the foregoing shall not be deemed a Change of Control if
the average stock price paid for each share of stock held by the
person, entity or group is less than $8.00/share (provided that such
price shall be adjusted as appropriate to reflect any stock
Xxxxx Xxxx
August 29, 2006
Page 6
dividend, stock split, or recapitalization of the Company after the
date of this agreement).
(f) "Good Reason" shall be defined as, in the absence of a cure by
the Company within 30 days after written notice by you to the Board, a (i)
a change in title of Vice President, Chief Brand Officer, (ii) a material
diminution of responsibilities, duties or powers, (iii) a reduction in Base
Salary, Target Bonus, vacation or other benefits, except that benefits need
only be substantially equivalent, or (iv) a requirement that you relocate
your principal place of employment to (or that you travel more than 50 days
in any calendar year to the Company's principal place of business in) a
location more than 50 miles from its current location in Cambridge,
Massachusetts, PROVIDED THAT you must provide the Company with at least
thirty (30) days advance written notice of your intent to terminate your
employment hereunder and an opportunity to cure.
5. NONCOMPETITION, CONFIDENTIALITY AND INVENTIONS OBLIGATIONS. As a
condition of your employment with the Company and as a condition of this
Agreement, you must execute the Employee Noncompetition, Confidentiality and
Inventions Agreement attached hereto as EXHIBIT A.
6. DISCLOSURE TO FUTURE EMPLOYERS. You will provide, and the Company, in
its discretion, may similarly provide, a copy of the covenants contained in the
Employee Noncompetition, Confidentiality and Inventions Agreement to any
business or enterprise which you may, directly or indirectly, own, manage,
operate, finance, join, control or in which you may participate in the
ownership, management, operation, financing, or control, or with which you may
be connected as an officer, director, employee, partner, principal, agent,
representative, consultant or otherwise.
7. REPRESENTATIONS. You hereby represent and warrant to the Company that
you understand this Agreement, that you enter into this Agreement voluntarily
and that your employment under this Agreement will not conflict with any legal
duty owed by you to any other party.
8. GENERAL.
(a) NOTICES. All notices, requests, consents and other
communications hereunder which are required to be provided, or which the
sender elects to provide, in writing, will be addressed to the receiving
party's address set forth above or to such other address as a party may
designate by notice hereunder, and will be either (i) delivered by hand,
(ii) sent by overnight courier, or (iii) sent by registered or certified
mail, return receipt requested, postage prepaid. All notices, requests,
consents and other communications hereunder will be deemed to have been
given either (i) if by hand, at the time of the delivery thereof to the
receiving party at the address of such party set forth above, (ii) if sent
by overnight courier, on the next business day following the day such
notice is delivered to the courier service, or (iii) if sent by registered
or certified mail, on the fifth business day following the day such mailing
is made.
Xxxxx Xxxx
August 29, 2006
Page 7
(b) ENTIRE AGREEMENT. This Agreement, together with any Stock Option
Agreements executed by you and the Company (either prior to or in
conjunction with this Agreement), the Employee Noncompetition,
Confidentiality and Inventions Agreement and the other agreements
specifically referred to herein, embodies the entire agreement and
understanding between the parties hereto with respect to the subject matter
hereof and supersedes all prior oral or written agreements and
understandings relating to the subject matter hereof. No statement,
representation, warranty, covenant or agreement of any kind not expressly
set forth in this Agreement will affect, or be used to interpret, change or
restrict, the express terms and provisions of this Agreement.
(c) MODIFICATIONS AND AMENDMENTS. The terms and provisions of this
Agreement may be modified or amended only by written agreement executed by
the parties hereto.
(d) WAIVERS AND CONSENTS. The terms and provisions of this Agreement
may be waived, or consent for the departure therefrom granted, only by
written document executed by the party entitled to the benefits of such
terms or provisions. No such waiver or consent will be deemed to be or will
constitute a waiver or consent with respect to any other terms or
provisions of this Agreement, whether or not similar. Each such waiver or
consent will be effective only in the specific instance and for the purpose
for which it was given, and will not constitute a continuing waiver or
consent.
(e) ASSIGNMENT. The Company may assign its rights and obligations
hereunder to any person or entity that succeeds to all or substantially all
of the Company's business or that aspect of the Company's business in which
you are principally involved or to any Company Affiliate. You may not
assign your rights and obligations under this Agreement without the prior
written consent of the Company and any such attempted assignment by you
without the prior written consent of the Company will be void.
(f) GOVERNING LAW. This Agreement and the rights and obligations of
the parties hereunder will be construed in accordance with and governed by
the law of Massachusetts, without giving effect to the conflict of law
principles thereof.
(g) JURISDICTION, VENUE AND SERVICE OF PROCESS. Any legal action or
proceeding with respect to this Agreement will be brought in the courts of
Massachusetts or of the United States of America for the District of
Massachusetts. By execution and delivery of this Agreement, each of the
parties hereto accepts for itself and in respect of its property, generally
and unconditionally, the exclusive jurisdiction of the aforesaid courts.
(h) SEVERABILITY. The parties intend this Agreement to be enforced
as written. However, if any portion or provision of this Agreement is to
any extent declared illegal or unenforceable by a duly authorized court
having jurisdiction, then the remainder of this Agreement, or the
application of such portion or provision in circumstances other than those
as to which it is so declared illegal or unenforceable, will not be
affected thereby, and each
Xxxxx Xxxx
August 29, 2006
Page 8
portion and provision of this Agreement will be valid and enforceable to
the fullest extent permitted by law.
(i) HEADINGS AND CAPTIONS. The headings and captions of the various
subdivisions of this Agreement are for convenience of reference only and
will in no way modify or affect the meaning or construction of any of the
terms or provisions hereof.
(j) ACKNOWLEDGMENTS. You hereby acknowledge and recognize that the
enforcement of any of the provisions in this Agreement and the
Noncompetition, Confidentiality and Inventions Agreement may potentially
interfere with your ability to pursue a proper livelihood. You represent
that you are knowledgeable about the business of the Company and further
represent that you are capable of pursuing a career in other industries
other than the field of noncompetition as set forth in the Noncompetition,
Confidentiality and Inventions Agreement to earn a proper livelihood. You
recognize and agree that the enforcement of the Noncompetition,
Confidentiality and Inventions Agreement is necessary to ensure the
preservation, protection and continuity of the business, trade secrets and
goodwill of the Company. You agree that, due to the proprietary nature of
the Company's business, the restrictions set forth in the Noncompetition,
Confidentiality and Inventions Agreement are reasonable as to time and
scope.
(k) TAXES. All payments required to be made by the Company to you
under this Agreement shall be subject to the withholding of such amounts
for taxes and other payroll deductions as the Company may reasonably
determine it should withhold pursuant to any applicable law or regulation.
To the extent applicable, it is intended that this Agreement comply with
the provisions of Section 409A of the Code, and this Agreement shall be
construed and applied in a manner consistent with this intent. In the event
that any severance payments or benefits hereunder are determined by the
Company to be in the nature of nonqualified deferred compensation payments,
you and the Company hereby agree to take such actions as may be mutually
agreed to ensure that such payments or benefits comply with the applicable
provisions of Section 409A of the Code and the official guidance issued
thereunder. Notwithstanding the foregoing, the Company does not guarantee
the tax treatment or tax consequences associated with any payment or
benefit arising under this Agreement.
(l) COUNTERPARTS. This Agreement may be executed in two or more
counterparts, and by different parties hereto on separate counterparts,
each of which will be deemed an original, but all of which together will
constitute one and the same instrument.
Xxxxx Xxxx
August 29, 2006
Page 9
If the foregoing accurately sets forth our agreement, please so indicate by
signing and returning to us the enclosed copy of this Agreement.
Very truly yours,
Metabolix, Inc.
By: /s/ XXXXX X. XXXXXX
-------------------------
Name: Xxxxx X. Xxxxxx
Title: President and CEO
ACCEPTED AND APPROVED:
/s/ XXXXX XXXX 8/29/06
------------------------------ ------------------
Xxxxx Xxxx Date
ATTACHMENT: Exhibit A (Noncompetition, Confidentiality and Inventions Agreement)
