EMPLOYMENT AGREEMENT
This Employment Agreement (the “Agreement”) is made on May 23, 2023 by and between LARIMAR THERAPEUTICS, INC. (the “Company”) and RUSSELL G. CLAYTON SR., D.O. (the “Executive”).
Introduction
The Company desires to retain the services of the Executive pursuant to the terms and conditions set forth herein and the Executive wishes to be employed by the Company on such terms and conditions. The Executive will be a key employee of the Company, with significant access to information concerning the Company and its business. The disclosure or misuse of such information or the engaging in competitive activities would cause substantial harm to the Company.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:
salary, as in effect from time to time, (the “Base Salary”) will be reviewed at least annually by the Compensation Committee of the Board (the “Committee”) and may not be decreased, except in
connection with a proportionate reduction of the salaries of all the Company’s other executive officers.
Intellectual Property Assignment and Restrictive Covenant Agreement attached hereto as Appendix A (the “Restrictive Covenant Agreement”).
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“Cause” shall mean: (a) a good faith finding by the Company’ s Board (i) of a willful failure of the Executive to perform his reasonably assigned duties for the Company, which failure is not cured within ten days after written notice thereof, unless the Board determines in good faith such failure is not curable, or (ii) that the Executive has engaged in a material act of dishonesty, gross negligence or material misconduct; (b) the conviction of the Executive of, or the entry of a pleading of guilty by the Executive to, a felony; or (c) a breach by the Executive of any duty owed to or any agreement with the Company, which breach is not cured within ten days after written notice thereof, unless the Board determines in good faith such breach is not curable. For avoidance of doubt, any termination of the Executive’s employment due to a Disability (as defined below) will not be deemed a termination “without Cause.”
“Change in Control” means a “change in control event,” as that term is used in Treas. Reg. § 1.409A-3(i)(5)(i).
“Disability” means Executive’s inability to substantially perform his duties to the Company as a result of incapacity by reason of any medically determinable physical or mental impairment that can be expected to result in death or to last for a period of at least 12 months.
“Good Reason” for resignation shall exist upon, without the Executive’s written consent: (a) a change by the Company in the location at which the Executive performs his principal duties for the Company of more than 25 miles from the location at which the Executive was performing his principal duties for the Company prior to such change; (b) a reduction of the Executive’s Base Salary (other than a reduction permitted by Section 4(a)); (c) a reduction of the Executive’s target Bonus opportunity below that specified in Section 4(b); or (d) a material adverse change in the Executive’ s title, authority or duties; provided that no such event or condition in clauses (a) through (d) shall constitute Good Reason unless (x) the Executive gives the Company a written notice of termination not more than 30 days after the initial existence of the condition, (y) the grounds for termination (if susceptible to correction) are not corrected by the Company within 30 days of its receipt of such notice, and (z) the Executive’s termination occurs within 60 days following the Company’s receipt of such notice.
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chosen by the AAA). Any award or finding will be confidential. The arbitrator may not award attorneys’ fees to either party unless a statute or contract at issue specifically authorizes such an award. Any award entered by the arbitrators will be final, binding and non-appealable and judgment may be entered thereon by either party in accordance with applicable law in any court of competent jurisdiction. This arbitration provision will be specifically enforceable. Each party
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will be responsible for its own expenses relating to the conduct of the arbitration (including reasonable attorneys’ fees and expenses) and will share equally the fees of the arbitrator.
thereto, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of authoring any of the provisions of this Agreement.
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each case, after subtracting the expected federal, state and local taxes on such Total Payments and after taking into account the phase out of itemized deductions and personal exemptions attributable to such Total Payments). The reduction of the Total Payments contemplated in this paragraph will be implemented by determining the Parachute Payment Ratio (as defined below), as determined in good faith by the Company, for each Payment and then reducing the Total Payments in order
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beginning with the Payment with the highest Parachute Payment Ratio. For Payments with the same Parachute Payment Ratio, such Payments will be reduced based on the time of payment of such Payments, with the latest Payments reduced first. For Payments with the same Parachute Ratio and the same time of payment, each such Payment will be reduced proportionately. For purposes hereof, the term “Parachute Payment Ratio” shall mean a fraction, (x) the numerator of which is the value of the applicable Total Payment (as calculated for purposes of Section 280G of the Code), and (y) the denominator of which is the intrinsic (i.e., economic) value of such Total Payment.
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This Agreement has been executed and delivered on the date first above written.
LARIMAR THERAPEUTICS, INC.
By: /s/ Carole Ben-Maimon
Name: Carole Ben-Maimon
Title: President and CEO
EXECUTIVE
/s/ Russell Clayton
Russell G. Clayton Sr., D.O.
(SIGNATURE PAGE TO EMPLOYMENT AGREEMENT)
Appendix A
LARIMAR THERAPEUTICS, INC.
Confidentiality, Intellectual Property Assignment and
Restrictive Covenant Agreement (the “Agreement”)
In consideration and as a condition of my service relationship, whether as an employee, consultant, advisor or otherwise (collectively, “Service Relationship”) with Larimar Therapeutics, Inc. or any of its current or future parents, subsidiaries or affiliates (collectively, the “Company”), I agree as follows:
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thereof, are reasonable, proper and necessary to protect the Company’s legitimate business interests, including without limitation the Company’s intellectual property rights, Confidential Information and goodwill. I represent and agree that I am entering into this Agreement freely and with knowledge of its contents with the intent to be bound by the Agreement and the restrictions contained in it.
[The remainder of this page is intentionally left blank]
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IN WITNESS WHEREOF, the undersigned has executed this Confidentiality, Intellectual Property Assignment and Restrictive Covenant Agreement as of the date set forth below.
Signed: /s/ Russell Clayton Date: 5/23/2023
(sign name above)
Print Name: Russell G. Clayton Sr., D.O.
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Exhibit I
Prior Inventions
None
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