SEPARATION AGREEMENT AND GENERAL RELEASE
This Separation Agreement and General Release (the “Agreement”) is being entered into between Stephen Hurly (“Employee”) and Sesen Bio, Inc. (the “Company”) in connection with the termination of Employee’s employment with the Company as of August 7, 2018 (the “Separation Date”).
NOW, THEREFORE, Employee and the Company agree as follows:
1.Unpaid Wages; Vacation Pay. Employee will be paid all outstanding, accrued salary and accrued but unused vacation through the Separation Date, less the appropriate federal, state and local taxes and other withholdings, as determined by the Company.
a.If Employee timely signs this Agreement and does not revoke it and abides by its terms, the Company will pay to Employee (i) the total gross amount of Four Hundred Twenty-Five Thousand Dollars ($425,000), the equivalent of twelve (12) months of Employee’s base salary (“Salary Severance”) and (ii) the total gross amount of Two Hundred Twelve Thousand Five Hundred Dollars ($212,500), an amount equal to Employee’s annual target bonus payment for the year 2018 (“Bonus Severance”) (collectively, “Severance”). The first Salary Severance payment shall be made on the first regular payroll date occurring on or after the date following the Effective Date (as defined in Section 16(b) of this Agreement) and in an amount equal to the base salary Employee would have received had Employee remained employed from the Separation Date until such payment date. The remainder of the Salary Severance will be paid in equal installments on the Company’s regular payroll dates over the next 11 months until the Salary Severance is paid in full (hereinafter the “Severance Period”). The Bonus Severance payment will be paid in one lump sum on the first regular payroll date occurring on or after the Effective Date.
b.The Company will withhold the appropriate federal, state and local taxes and other legally permitted withholdings, as determined by the Company, from any payments made to Employee pursuant to this Agreement.
3.Benefits. As of Employee’s Separation Date, Employee is no longer eligible to participate in any of the Company’s benefit plans, including, but not limited to, any dental or medical insurance, long term care plans, retirement or 401(k) plans, vacation leave, sick leave, long term disability insurance, life insurance, incentive plans, or personal accident insurance. As additional consideration for executing this Agreement and not revoking the same, if Employee timely elects to participate in a healthcare continuation coverage program such as under Section 4980B of the Internal Revenue Code (“COBRA”) or any similar state medical and dental insurance continuation coverage program, the Company will pay its share of premium payments at the active employee’s rate for group health and dental insurance after the Separation Date through (i) a period of twelve (12) months following the Effective Date, (ii) the date Employee becomes employed with benefits substantially comparable to the benefits under the corresponding Company plan, or (iii) the date Employee becomes ineligible for COBRA benefits; provided, however, that such Company-paid premiums may be recorded as additional income pursuant to Section 6041 of the Internal Revenue Code of 1986, as amended (the “Code”) and not entitled to any tax qualified treatment to the extent necessary to comply with or avoid the discriminatory treatment prohibited by the Patient Protection and Affordable Care Act of 2010 and the Health Care and Education Reconciliation Act of 2010 or Section 105(h) of the Code. Employee shall be responsible for the entire COBRA premium should you elect to maintain this coverage after the earlier of the dates specified in sections 10.A.(ii)(1)-(3) above.
4.Acknowledgement. Employee acknowledges and agrees that, except as expressly provided in this Agreement, Employee has been fully paid any and all compensation due and owing to Employee, including all wages, salary, commissions, bonuses, incentive payments, profit-sharing payments, expense reimbursements, leave or other benefits. Employee further agrees that the Severance referred to in Section 2 is not compensation for Employee’s services rendered through the Separation Date, but rather constitutes consideration for the promises contained in this Agreement, and is above and beyond any wages or salary or other sums to which Employee is entitled from the Company under the terms of Employee’s employment with the Company or under any other contract or law.