Employee Matters Agreement, dated as of November 13, 2023, by and between Alkermes plc and Mural Oncology plc
Exhibit 10.2
EMPLOYEE MATTERS AGREEMENT
by and between
ALKERMES PLC
and
MURAL ONCOLOGY PLC
Dated as of November 13, 2023
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EMPLOYEE MATTERS AGREEMENT
TABLE OF CONTENTS
Page
Article I DEFINITIONS | 1 | |
Section 1.1 | General | 1 |
Article II TRANSFER OF MURAL EMPLOYEES; GENERAL PRINCIPLES | 5 | |
Section 2.1 | Transfer of Employment to Mural of Additional Employees; Post-Effective Time Transfers; Independent Contractors. | 5 |
Section 2.2 | Assumption and Retention of Liabilities | 6 |
Section 2.3 | Mural Participation in the Alkermes Plans | 7 |
Section 2.4 | Sponsorship of the Mural Plans | 7 |
Section 2.5 | No Duplication of Benefits; Service and Other Credit | 7 |
Section 2.6 | Reimbursements | 7 |
Section 2.7 | Approval of Plans | 7 |
Section 2.8 | Delivery of Shares; Registration Statement | 8 |
Section 2.9 | No Change in Control | 8 |
Section 2.10 | Labor Relations | 8 |
Article III DEFINED CONTRIBUTION PLANS | 8 | |
Section 3.1 | 401(k) Plan | 8 |
Article IV HEALTH AND WELFARE PLANS; PAYROLL; COBRA AND VACATION | 9 | |
Section 4.1 | Cessation of Participation in Alkermes Health and Welfare Plans | 9 |
Section 4.2 | Allocation of Health and Welfare Plan Liabilities | 9 |
Section 4.3 | Flexible Spending Plan Treatment | 10 |
Section 4.4 | Workers’ Compensation Liabilities | 10 |
Section 4.5 | Payroll Taxes and Reporting | 11 |
Section 4.6 | COBRA and HIPAA Compliance | 11 |
Section 4.7 | Vacation and Paid Time Off | 11 |
Article V INCENTIVE COMPENSATION, EQUITY COMPENSATION AND OTHER BENEFITS | 11 | |
Section 5.1 | Annual Cash-Based Incentive Plans | 11 |
Section 5.2 | Awards under the Alkermes Stock Plans | 12 |
Section 5.3 | Mural Blackout Period | 15 |
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Section 5.4 | Alkermes Blackout Period | 16 |
Section 5.5 | Section 409A | 16 |
Section 5.6 | Mural Director Obligations | 16 |
Article VI GENERAL AND ADMINISTRATIVE | 16 | |
Section 6.1 | Sharing of Participant Information | 16 |
Section 6.2 | Cooperation | 17 |
Section 6.3 | No Third Party Rights or Entitlements | 17 |
Section 6.4 | Audit Rights with Respect to Information Provided | 17 |
Section 6.5 | Fiduciary Matters | 17 |
Section 6.6 | Consent of Third Parties | 17 |
Section 6.7 | Assignment of “Claw-Back” or Recoupment Rights | 18 |
Section 6.8 | Proprietary Information and Inventions Agreements | 18 |
Article VII DISPUTE RESOLUTION | 18 | |
Section 7.1 | Negotiation | 18 |
Section 7.2 | Arbitration | 19 |
Section 7.3 | Continuity of Service and Performance | 19 |
Section 7.4 | Injunctive or Other Equity Relief | 19 |
Article VIII MISCELLANEOUS | 19 | |
Section 8.1 | Complete Agreement; Construction | 19 |
Section 8.2 | Transaction Agreements | 19 |
Section 8.3 | Survival of Agreements | 19 |
Section 8.4 | Expenses | 19 |
Section 8.5 | Notices | 20 |
Section 8.6 | Waivers | 20 |
Section 8.7 | Assignment | 21 |
Section 8.8 | Successors and Assigns | 21 |
Section 8.9 | Termination and Amendment | 21 |
Section 8.10 | Payment Terms | 21 |
Section 8.11 | Subsidiaries | 22 |
Section 8.12 | Third Party Beneficiaries | 22 |
Section 8.13 | Titles and Headings | 22 |
Section 8.14 | Governing Law | 22 |
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Section 8.15 | Severability | 22 |
Section 8.16 | Interpretation | 23 |
Section 8.17 | No Duplication; No Double Recovery | 23 |
Section 8.19 | Counterparts | 23 |
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EMPLOYEE MATTERS AGREEMENT
This EMPLOYEE MATTERS AGREEMENT (this “Agreement”), dated as of November 13, 2023, is entered into by and between Alkermes plc (“Alkermes”), an Irish public limited company, and Mural Oncology plc (“Mural”), an Irish public limited company. “Party” or “Parties” means Alkermes or Mural, individually or collectively, as the case may be.
W I T N E S S E T H:
WHEREAS, as contemplated by the Separation Agreement, Alkermes and Mural desire to enter into this Agreement to provide for the allocation of Assets, Liabilities and responsibilities with respect to certain matters relating to employees and other individual service providers (including employee compensation and benefit plans and programs) between them.
NOW, THEREFORE, in consideration of the foregoing and the mutual agreements, provisions and covenants contained in this Agreement, the Parties hereby agree as follows:
Article I
DEFINITIONS
Section 1.1 General. For purposes of this Agreement the following terms shall have the meaning ascribed to them in this Article I. Capitalized terms used and not defined herein shall have the meaning set forth in the Separation Agreement between the Parties, dated as of November 13, 2023 (the “Separation Agreement”).
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Article II
TRANSFER OF MURAL EMPLOYEES; GENERAL PRINCIPLES
Section 2.1 Transfer of Employment to Mural of Additional Employees; Post-Effective Time Transfers; Independent Contractors.
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Section 2.2 Assumption and Retention of Liabilities. Alkermes and Mural intend that employment-related Liabilities associated with Alkermes Participants are to be retained or assumed by Alkermes or an Alkermes Group member (other than, for the avoidance of doubt, a Mural Group member), and employment-related Liabilities associated with Mural Participants are to be assumed by Mural or a Mural Group member, in each case, except as specifically set forth herein. Accordingly, as of the Distribution Effective Time:
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Section 2.3 Mural Participation in the Alkermes Plans. Except as expressly provided in Article V of this Agreement, effective not later than the Distribution Effective Time, Mural and each Mural Group member shall cease to be a participating company in each Alkermes Plan, and Alkermes and Mural shall take all necessary action before the Distribution Effective Time to effectuate such cessation as a participating company.
Section 2.4 Sponsorship of the Mural Plans. Effective no later than immediately prior to the Distribution Effective Time, Alkermes and Mural shall take such actions (if any) as are required to cause each Mural Group member (other than Mural) to assume sole sponsorship of, and all Liabilities with respect to, each Mural Plan; provided that the parties shall agree prior to the Distribution Effective Time as to the treatment of any non-ERISA or voluntary Plans.
Section 2.5 No Duplication of Benefits; Service and Other Credit. Alkermes and Mural shall adopt, or cause to be adopted, all reasonable and necessary amendments and procedures to prevent Mural Participants from receiving duplicative benefits from the Alkermes Plans and the Mural Plans. With respect to Mural Employees, each Mural Plan shall provide that for purposes of determining eligibility to participate, vesting and entitlement to benefits, service prior to the Distribution Effective Time with Alkermes or an Alkermes Group member shall be treated as service with Mural or the applicable Mural Group member. Such service also shall apply for purposes of satisfying any waiting periods, evidence of insurability requirements, or the application of any preexisting condition limitations under any Mural Plan. Each Mural Plan shall, to the extent practicable, waive pre-existing condition limitations with respect to Mural Employees. To the extent permitted under the applicable plan, Mural shall procure that the applicable Mural Group member shall honor any deductibles incurred by Mural Employees and their eligible dependents under any Alkermes medical plan in which they participated immediately prior to the Distribution Effective Time during the then-elapsed portion of the calendar year prior to the Distribution Effective Time for purposes of satisfying any deductibles or out-of-pocket maximums under the Mural Plans in which they are eligible to participate after the Distribution Effective Time in the same plan year in which such deductibles were incurred. For the avoidance of doubt, the Mural Group shall not be required to honor any co-payments incurred by Mural Employees or their eligible dependents under any Alkermes Health and Welfare Plan for purposes of satisfying any out-of-pocket maximums under the Mural Plans in which they are eligible to participate after the Distribution Effective Time.
Section 2.6 Reimbursements. From time to time after the Distribution Effective Time, the Parties shall reimburse one another, within sixty (60) days following reasonable request of the Party requesting reimbursement and the presentation by such Party of such substantiating documentation as the other Party shall reasonably request, for the cost of any Liabilities satisfied or assumed by the Party requesting reimbursement or its Affiliates that are made, pursuant to this Agreement, the responsibility of the other Party or any of its Affiliates.
Section 2.7 Approval of Plans. Prior to the Distribution Effective Time, Alkermes shall have caused Mural to adopt the Mural Stock Plan and an employee stock purchase plan intended to meet the requirements of Section 423 of the Code and the regulations promulgated thereunder (the “Mural ESPP”) and have taken all actions as may be necessary to approve the Mural Stock Plan and the Mural ESPP in order to satisfy the applicable requirements of the Code and the applicable rules and regulations of Nasdaq.
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Section 2.8 Delivery of Shares; Registration Statement. From and after the Distribution Effective Time, Alkermes shall have sole responsibility for delivery of Alkermes Ordinary Shares pursuant to awards issued under an Alkermes Stock Plan in satisfaction of any obligations to deliver such shares under such Alkermes Stock Plan and shall do so without compensation from any Mural Group member. From and after the Distribution Effective Time, Mural shall have sole responsibility for delivery of Mural Ordinary Shares pursuant to awards issued under the Mural Stock Plan in satisfaction of any obligations to deliver such shares under the Mural Stock Plan and shall do so without compensation from any Alkermes Group member. From and after the Distribution Effective Time, Mural shall cause a registration statement on Form S-8 (or other appropriate form) to be filed with respect to such issued or issuable shares prior to the Distribution Effective Time and shall use commercially reasonable efforts to cause such registration statement to remain in effect for so long as there may be an obligation to deliver Mural shares under the Mural Stock Plan. Alkermes shall use commercially reasonable efforts (i) to assist Mural in completing such registration and (ii) to cause a registration statement on Form S-8 (or other appropriate form) of Alkermes to remain in effect for so long as there may be an obligation to deliver Alkermes shares under any Alkermes Stock Plan.
Section 2.9 No Change in Control. Alkermes and Mural each hereby agree that none of the transactions contemplated by the Separation Agreement or any of the Ancillary Agreements, including this Agreement, constitutes a “change in control,” “change of control,” “sale event,” or transaction having a similar name, as applicable, within the meaning of any Alkermes Plan or Mural Plan and, except as provided in this Agreement or as otherwise required by applicable law, no provision of this Agreement shall be construed to accelerate any vesting or create any rights or entitlement to any compensation or benefits on the part of any employee.
Section 2.10 Labor Relations. To the extent required by applicable Law, the Parties shall cooperate to provide notice, engage in consultation and take any similar action which may be required on its part in connection with the Separation. The Parties hereby agree that they are not aware of any applicable labor union, work council or similar employee organization that would require notice in connection with the Separation.
Article III
DEFINED CONTRIBUTION PLANS
Section 3.1 401(k) Plan.
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Article IV
HEALTH AND WELFARE PLANS; PAYROLL; COBRA AND VACATION
Section 4.1 Cessation of Participation in Alkermes Health and Welfare Plans. Prior to the Distribution Effective Time, Mural shall establish health and welfare plans (the “Mural Health and Welfare Plans”) which generally correspond to the Alkermes Health and Welfare Plans in which Mural Employees participate immediately prior to the Distribution Effective Time. Effective on or about the Distribution Date, Mural Employees who were participating in the Alkermes Health and Welfare Plans as of the date immediately prior to the Distribution Date shall cease to participate in the Alkermes Health and Welfare Plans and shall, as applicable, commence participation in the corresponding Mural Health and Welfare Plan in which they have enrolled. Mural shall cause Mural Employees and their covered dependents who participate in Alkermes Health and Welfare Plans as of the date immediately prior to the Distribution Date to be eligible to enroll as of the Distribution Date in such Mural Health and Welfare Plans as are made available to the Mural Employee.
Section 4.2 Allocation of Health and Welfare Plan Liabilities. All outstanding Liabilities relating to, arising out of or resulting from health and welfare coverage or claims incurred by or on behalf of Mural Employees or their covered dependents under the Alkermes Health and Welfare Plans on or before the Distribution Effective Time shall be retained by the Alkermes Group. Any Liabilities relating to, arising out of or resulting from health and welfare coverage or claims incurred by or on behalf of Mural Employees or their covered dependents under the Alkermes Health and Welfare Plans following the Distribution Effective Time shall be assumed by a member of the Mural Group; provided, however, that to the extent such a Liability is covered under an insurance policy maintained with respect to an Alkermes Health and Welfare Plan regardless of when the Liability arises, and such Liability is not covered under an insurance policy maintained with respect to a Mural Health and Welfare Plan, such Liability shall be retained by the Alkermes Group to the extent of such coverage; and provided further, however,
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that to the extent that the Alkermes Group receives prior to the Distribution Effective Time an invoice from a service provider billing the Alkermes Group for a service or product relating to health or welfare coverage for Mural Employees or their covered dependents following the Distribution Effective Time, the Alkermes Group shall be responsible for paying such invoice and a member of the Mural Group shall reimburse the Alkermes Group for any amount paid by the Alkermes Group. For the avoidance of doubt, the working rates will be used for reimbursement for the self-insured dental. For purposes of this Agreement, a claim shall be incurred upon the date upon which service or product giving rise to the Liability was provided. Any payments, repayments, reimbursements or credits consisting of, or representing, dividends, demutualizations, premium refunds, rebates, subrogation or similar reimbursements, overpayments, class action recoveries or like payments under, or relating to, any Alkermes Health or Welfare Plan whenever occurring shall remain the property solely of Alkermes and neither Mural, any Mural Group member nor any Mural Participant shall have any interest in or right to such Alkermes property.
Section 4.3 Flexible Spending Plan Treatment. Effective on or about the Distribution Date, Mural shall establish a dependent care spending account and a medical care spending account (the “Mural FSAs”), which Mural FSAs shall have terms that are substantially identical to the analogous Alkermes dependent care and medical care flexible spending accounts (the “Alkermes FSAs”) as in effect immediately prior to the Distribution Date.
Section 4.4 Workers’ Compensation Liabilities. All workers’ compensation Liabilities relating to, arising out of, or resulting from any claim by Mural Employees that result from an accident or from an occupational disease which is incurred or becomes manifest, as the case may be, on or before the Distribution Effective Time and while such individual was employed by Alkermes or an Alkermes Group member shall be retained by Alkermes. Any workers’ compensation Liabilities relating to, arising out of, or resulting from any claim by Mural Employees that result from an accident or from an occupational disease which is incurred or becomes manifest, as the case may be, following the Distribution Effective Time shall be assumed by Mural; provided, however, that to the extent such a Liability is covered under a workers compensation insurance policy of Alkermes or an Alkermes Group member regardless of when the Liability arises, and such Liability is not covered under a workers compensation insurance policy of Mural or a Mural Group member, such Liability shall be retained by Alkermes or an Alkermes Group member to the extent of such coverage; and provided further, however, that to the extent that Alkermes or an Alkermes Group member, as applicable, receives prior to the Distribution Effective Time an invoice for a covered expense with respect to such Liability, Alkermes shall be responsible for paying such invoice and Mural shall reimburse Alkermes for any amount paid by Alkermes. Notwithstanding the foregoing, Mural shall assume worker’s compensation Liabilities to the extent they are imposed on Mural under applicable Law or where the injury or illness related to the Liability is aggravated or subject to further injury after the Distribution Effective Time. A Liability which must be paid due to the existence of a deductible shall not be deemed to be covered by a workers compensation insurance policy for purposes of this Section 4.4. Subject to the foregoing, Mural and each Mural Group member shall also be solely responsible for all workers’ compensation Liabilities relating to, arising out of, or resulting from any claim incurred for a compensable injury sustained by a Mural Employee that results from an accident or from an occupational disease which is incurred or becomes manifest, as the case may be, after the Distribution Effective Time. Alkermes, each Alkermes
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Group member, Mural and each Mural Group member shall cooperate with respect to processing of claims, any notification to appropriate governmental agencies of the disposition and the issuance of new, or the transfer of existing, workers’ compensation insurance policies and claims handling contracts.
Section 4.5 Payroll Taxes and Reporting. Alkermes and Mural (i) shall, to the extent practicable, treat Mural (or a Mural Group member designated by Mural) as a “successor employer” and Alkermes (or the appropriate Alkermes Group member) as a “predecessor,” within the meaning of Sections 3121(a)(1) and 3306(b)(1) of the Code, with respect to Mural Employees for purposes of taxes imposed under the United States Federal Unemployment Tax Act or the United States Federal Insurance Contributions Act, and (ii) hereby agree to use commercially reasonable efforts to implement the standard procedure described in Section 4 of Revenue Procedure 2004-53. Without limiting in any manner the obligations and Liabilities of the Parties under the Tax Matters Agreement, including all withholding obligations otherwise set forth therein, Alkermes, each Alkermes Group member, Mural and each Mural Group member shall each bear its responsibility for payroll tax obligations and for the proper reporting to the appropriate governmental authorities of compensation earned by their respective employees after the Distribution Effective Time, including compensation related to the exercise of stock options or the vesting or exercise of other equity awards.
Section 4.6 COBRA and HIPAA Compliance. Alkermes or an Alkermes Group member shall retain the responsibility for administering compliance with the health care continuation requirements of COBRA for any COBRA qualified beneficiaries who incur a COBRA qualifying event or loss of coverage under the Alkermes Health and Welfare Plans at any time before the Distribution Date. Mural shall be responsible for administering compliance with the health care continuation requirements of COBRA, and the corresponding provisions of the Mural Health and Welfare Plans with respect to Mural Participants who incur a COBRA qualifying event or loss of coverage under the Mural Health and Welfare Plans at any time upon or after the Distribution Date. For the avoidance of doubt, COBRA costs will be invoiced monthly to Mural during the transition period, and Mural shall be responsible for the cost and administration of COBRA for any Mural Employees who are not eligible for the Mural Health and Welfare Plans in 2024 while continuing COBRA coverage.
Section 4.7 Vacation and Paid Time Off. As of the Distribution Effective Time, (which, to avoid doubt, is also the last day of employment at Alkermes (or an Alkermes Group Member, as applicable of any Mural Employee) or such earlier time as Alkermes determines, Alkermes or an Alkermes Group member (as determined by Alkermes) shall pay out, to each employee of Alkermes or Alkermes Group member who becomes an applicable Mural Group member as of the Distribution Effective Time, any accrued but unused vacation time and accrued but unused paid time off that is required to be paid out under applicable law (or, if broader than applicable law in this respect, Alkermes policy).
Article V
INCENTIVE COMPENSATION, EQUITY COMPENSATION AND OTHER BENEFITS
Section 5.1 Annual Cash-Based Incentive Plans. Following the Distribution Effective Time and on or about the date that Mural pays annual cash incentive bonuses to Mural
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Employees for fiscal year 2023, Alkermes (or a member of the Alkermes Group) shall pay each Mural Employee who was participating in the Alkermes plc Affiliated Company 2023 General Performance Pay Plan as of the Distribution Effective Time, a pro-rata annual cash bonus for fiscal year 2023 attributable to such Mural Employee’s service with Alkermes in fiscal year 2023 prior to the Distribution Effective Time, if any (each, an “Alkermes Pro Rata Bonus” and the aggregate amount of all Pro-Rata Bonuses, the “Aggregate Pro-Rata Bonus Amount”); provided, however, that the Aggregate Pro-Rata Bonus Amount shall not exceed the aggregate amount accrued by Alkermes for annual cash incentive bonuses for Mural Employees with respect to the Mural Employees’ service with Alkermes in fiscal year 2023 prior to the Distribution Effective Time. Mural shall be responsible for paying pro-rata annual cash incentive bonus payments for fiscal year 2023 to Mural Employees attributable to each Mural Employee’s service with Mural in 2023 after the Distribution Effective Time in accordance with Mural’s annual cash incentive plan for fiscal year 2023, if any (each, a “Mural Pro-Rata Bonus”). At least fifteen (15) days prior to the date that Mural (or a member of the Mural Group) makes such Mural Pro-Rata Bonus payments to Mural Employees, Mural shall provide Alkermes with the Alkermes Pro Rata Bonus amount for each applicable Mural Employee. Unless otherwise provided in a written employment agreement or offer letter between Mural (or a member of the Mural Group) and a Mural Employee, any Mural Employee who is not employed by Mural (or a member of the Mural Group) on the date that Mural (or a member of the Mural Group) makes Mural Pro-Rata Bonus payments shall not be eligible to receive an Alkermes Pro-Rata Bonus or a Mural Pro-Rata Bonus.
Section 5.2 Awards under the Alkermes Stock Plans. Alkermes and, where applicable, Mural, shall take all actions necessary or appropriate so that each Alkermes Option, Alkermes RSU and Alkermes PRSU outstanding immediately prior to the Distribution Effective Time shall be adjusted as set forth in this Section 5.2.
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Section 5.3 Mural Blackout Period. During the period beginning as of the Distribution Date and ending approximately thirty-five (35) days after the Distribution Date or such earlier date as may be determined by Mural, no Mural Participant who holds vested Mural Options may exercise such Options, and no Mural Participant who holds vested Mural PRSUs or RSUs may sell the Mural Ordinary Shares issued upon the settlement of such Mural PRSUs or RSUs other than shares sold to cover tax withholding obligations.
Section 5.4 Alkermes Blackout Period. During the period beginning as of the date that Mural Ordinary Shares begin trading on a “when-issued” basis on Nasdaq and ending as of the date that is approximately ten (10) trading days following the Distribution Date or such earlier
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date as may be determined by Alkermes, no Alkermes Participant who holds vested Alkermes Options may exercise such Options, and no Alkermes Participant who holds vested Alkermes PRSUs or RSUs may sell the Alkermes Ordinary Shares issued upon the settlement of such Alkermes PRSUs or RSUs other than shares sold to cover tax withholding obligations.
Section 5.5 Section 409A. The Parties agree that their intent is that all payments and benefits under this Agreement will comply with or be exempt from Section 409A of the Code to the extent applicable. This Agreement shall be interpreted such that all such payments and benefits either comply with or are exempt from Section 409A of the Code, and all provisions of this Agreement shall be construed in a manner consistent with the requirements for avoiding taxes or penalties under Section 409A of the Code. Notwithstanding anything in this Agreement to the contrary, Alkermes and Mural agree to negotiate in good faith regarding the need for any treatment of any payments or benefits hereunder different from that otherwise provided herein to ensure that the treatment of Alkermes or Mural Options, PRSUs, RSUs or other compensation hereunder does not cause the imposition of a tax under Section 409A of the Code.
Section 5.6 Mural Director Obligations. With respect to any non-employee director of Mural following the Distribution Effective Time, Mural shall be responsible for the payment of any fees or other obligations for service on the board of directors of Mural at or at any time after the Distribution Effective Time and any fees or other obligations for the service of a Mural director to the Mural Group prior to the Distribution Effective Time and Alkermes shall not have any responsibility for any such fees or other obligations.
Article VI
GENERAL AND ADMINISTRATIVE
Section 6.1 Sharing of Participant Information. To the maximum extent permitted under applicable Law, Alkermes and Mural shall share, and shall cause each member of its respective Group to share, with each other and their respective agents and vendors all participant information reasonably necessary for the efficient and accurate administration of each of the Alkermes Plans and the Mural Plans. Alkermes and Mural and their respective authorized agents shall, subject to applicable Laws regarding confidentiality and privacy, be given reasonable and timely access to, and may make copies of, all information relating to the subjects of this Agreement in the custody of the other Party, to the extent necessary for such administration. Without limiting the foregoing, and subject to applicable Law, Alkermes shall transfer to Mural any and all employment records and information (including, but not limited to, any Form I-9, Form W-2 or other Internal Revenue Service forms) with respect to Mural Employees and other records reasonably required by Mural to enable Mural properly to carry out its obligations under this Agreement. Alkermes shall retain copies of such records to the extent required or advisable under applicable law. Such transfer of records and information generally shall occur as soon as administratively practicable on or after the Distribution Effective Time. Each Party will permit the other Party reasonable access to employee records and information, to the extent reasonably necessary for such accessing Party to carry out its obligations hereunder (subject to applicable Law). Notwithstanding anything in this Agreement to the contrary, all confidential records and data relating to Mural Employees to be shared or transferred pursuant to this Agreement shall be subject to Section 7.7 of the Separation Agreement (Confidentiality) and the requirements of applicable law.
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Section 6.2 Cooperation. The Parties agree to reasonably cooperate to effect the terms and conditions of this Agreement, from and after the date hereof.
Section 6.3 No Third Party Rights or Entitlements. No provision of this Agreement or the Separation Agreement shall be construed to create any right, or accelerate entitlement, to any compensation or benefit whatsoever on the part of any future, present, or former employee of Alkermes, an Alkermes Group member, Mural, or a Mural Group member under this Agreement, the Separation Agreement, any Alkermes Plan or Mural Plan or otherwise. Except as expressly provided in this Agreement, nothing in this Agreement shall preclude Mural or any Mural Group member, at any time after the Distribution Effective Time, from amending, merging, modifying, terminating, eliminating, reducing, or otherwise altering in any respect any Mural Plan, any benefit under any Mural Plan or any trust, insurance policy or funding vehicle related to any Mural Plan; and except as expressly provided in this Agreement, nothing in this Agreement shall preclude Alkermes or any Alkermes Group member, at any time after the Distribution Effective Time, from amending, merging, modifying, terminating, eliminating, reducing, or otherwise altering in any respect any Alkermes Plan, any benefit under any Alkermes Plan or any trust, insurance policy or funding vehicle related to any Alkermes Plan.
Section 6.4 Audit Rights with Respect to Information Provided. Each of Alkermes and Mural, and their duly authorized representatives, shall have the right to conduct reasonable audits with respect to all information provided to it by the other Party pursuant to this Agreement. The Parties shall cooperate to determine the procedures and guidelines for conducting audits under this Section 6.4, which shall require reasonable advance notice by the auditing Party. The auditing Party shall have the right to make copies of any relevant records at its expense, subject to applicable Law. Failure of a third party service provider to provide information shall not constitute a breach of this Section 6.4; provided that the applicable Party has timely requested the information from such service provider.
Section 6.5 Fiduciary Matters. Alkermes and Mural each acknowledge that actions required to be taken pursuant to this Agreement may be subject to fiduciary duties or standards of conduct under ERISA or other applicable Law, and no Party shall be deemed to be in violation of this Agreement if it fails to comply with any provisions hereof based upon its good faith determination (as supported by advice from counsel experienced in such matters) that to do so would violate such a fiduciary duty or standard. Each Party shall be responsible for taking such actions as are deemed necessary and appropriate to comply with its own fiduciary responsibilities and shall fully release and indemnify the other Party for any Liabilities caused by the failure to satisfy any such responsibility.
Section 6.6 Consent of Third Parties. If any provision of this Agreement is dependent on the Consent of any third party (such as a vendor or Governmental Entity), Alkermes and Mural shall use commercially reasonable efforts to obtain such Consent, and if such Consent is not obtained, to implement the applicable provisions of this Agreement to the full extent practicable. If any provision of this Agreement cannot be implemented due to the failure of such third party to Consent, Alkermes and Mural shall negotiate in good faith to implement the provision in a mutually satisfactory manner. The phrase “commercially reasonable efforts” as used herein shall not be construed to require the incurrence of any non-routine or unreasonable expense or liability or the waiver of any right.
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Section 6.7 Assignment of “Claw-Back” or Recoupment Rights. To the extent a member of the Alkermes Group holds any repayment, “claw-back” or recoupment rights with respect to remuneration paid or provided to Mural Employees (e.g., the right to require repayment of compensation upon a termination of employment or misconduct by the employee) in connection with any relocation benefit, sign-on bonus, tuition benefit or otherwise, other than any repayment, “claw-back” or recoupment rights pursuant to any policy adopted pursuant to Section 10D of the Exchange Act, such rights are hereby assigned to Mural upon the Distribution Effective Time, it being agreed that the transactions contemplated by the Separation Agreement shall not, in and of themselves, trigger any such repayment or recoupment right. The Parties shall cooperate to execute any further documentation as may be necessary to evidence such assignment. The Parties shall cooperate to enforce any rights that any Alkermes Group member may have with respect to a Mural Employee under any policy adopted pursuant to Section 10D of the Exchange Act.
Section 6.8 Proprietary Information and Inventions Agreements. Effective as of the Distribution Effective Time, Alkermes shall, or shall cause the appropriate member of the Alkermes Group to, waive such rights under any proprietary information, confidentiality, inventions, restrictive covenant or similar agreement between any Mural Employee and any Alkermes Group member as Mural determines, and Alkermes agrees, in their reasonable discretion to be necessary or appropriate to permit such Mural Employee to perform such Mural Employee’s services to Mural or a Mural Group member from and after the Distribution Effective Time.
Article VII
DISPUTE RESOLUTION
Section 7.1 Negotiation. A Party seeking resolution of a controversy, dispute or Action arising out of, in connection with, or in relation to the interpretation, performance, nonperformance, validity or breach of this Agreement or otherwise arising out of, or in any way related to, this Agreement or the transactions contemplated hereby or thereby, including any Action based on contract, tort, statute or constitution (collectively, “Disputes”) shall provide written notice of such Dispute to the other Party, specifying the terms of such Dispute in reasonable detail (“Dispute Notice”). The Transition Committee (as defined in the Transition Services Agreements) shall attempt to resolve the Dispute through good faith negotiation for a reasonable period of time; provided that such reasonable period shall not, unless otherwise agreed by the Parties in writing, exceed thirty (30) days from the time of receipt by a Party of the Dispute Notice. If the Dispute has not been resolved within fifteen (15) days after receipt of the Dispute Notice, the respective Chief Executive Officers or their respective designees (with full settlement authority) of Alkermes and Mural shall meet in person (or where necessary, by phone) at a mutually acceptable time and, if applicable, place, and thereafter as often as they reasonably deem necessary, to attempt in good faith to resolve the Dispute. Any contractual time period or deadline under this Agreement to which such Dispute relates occurring after the Dispute Notice is received shall be tolled from the date in which a dispute is initiated until the conclusion of the arbitration process as outlined in this Article VII.
Section 7.2 Arbitration. Any Dispute that is not resolved pursuant to Section 7.1 within thirty (30) days after receipt of a Dispute Notice, unless such thirty (30) day period is otherwise
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extended by agreement of the Parties in writing, shall be resolved by final and binding arbitration pursuant to the procedures set forth in Section 8.2 of the Separation Agreement.
Section 7.3 Continuity of Service and Performance. Unless otherwise agreed in writing, the Parties shall continue to provide service and honor all other commitments under this Agreement during the course of a Dispute with respect to all matters not subject to such Dispute.
Section 7.4 Injunctive or Other Equity Relief. Nothing contained in this Agreement shall deny any Party the right to seek temporary injunctive relief in the context of a bona fide emergency or prospective irreparable harm in order to maintain the status quo while an arbitration initiated pursuant to Section 7.2 is pending; provided, however, that any other relief not expressly permitted under this Section 7.4 must be pursued in accordance with Section 7.2, with all remedies being cumulative to the extent allowed by applicable Law. The Parties further agree that any action brought under this Section 7.4 shall be brought exclusively in the courts within the State of Delaware set forth in Section 8.14, and that such courts shall have personal jurisdiction over the Parties in such action.
Article VIII
MISCELLANEOUS
Section 8.1 Complete Agreement; Construction. This Agreement, together with the Separation Agreement and other Ancillary Agreements, constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all previous negotiations, commitments, course of dealings and writings with respect to such subject matter. In the event and to the extent that there is a conflict or inconsistency between the provisions of this Agreement and the provisions of the Separation Agreement, this Agreement shall control.
Section 8.2 Transaction Agreements. Except as expressly set forth herein, this Agreement is not intended to address, and should not be interpreted to address, the matters specifically and expressly covered by the other Transaction Agreements.
Section 8.3 Survival of Agreements. Except as otherwise contemplated by this Agreement, all covenants and agreements of the Parties contained in this Agreement shall survive the Distribution Effective Time and remain in full force and effect in accordance with their applicable terms.
Section 8.4 Expenses.
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Section 8.5 Notices. All notices, requests, claims, demands and other communications under this Agreement shall be in writing and shall be given or made (and shall be deemed to have been duly given or made upon receipt) by delivery in person, by overnight courier service, by facsimile or email with receipt confirmed (followed by delivery of an original via overnight courier service) or by registered or certified mail (postage prepaid, return receipt requested) to the respective Party at the following addresses (or at such other address for a Party as shall be specified in a notice given in accordance with this Section 8.5):
To Alkermes: |
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| Alkermes plc |
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| c/o Alkermes, Inc. |
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| 900 Winter Street |
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| Waltham, Massachusetts 02451 |
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| Attn: David Gaffin |
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| Email: |
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To Mural: |
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| Mural Oncology plc |
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| c/o Mural Oncology, Inc. |
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| 852 Winter Street |
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| Waltham, Massachusetts 02451 |
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| Attn: Maiken Keson-Brookes |
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Section 8.6 Waivers. The delay or failure of either Party to exercise or enforce any of its rights under this Agreement will not constitute, or be deemed to be, a waiver of those rights, nor will any single or partial exercise of any such rights preclude any other or further exercise thereof or the exercise of any other right. No waiver of any provision of this Agreement will be effective unless it is in writing and signed by the Party against which it is being enforced.
Section 8.7 Assignment. No Party may assign any rights or delegate any obligations arising under this Agreement, in whole or in part, directly or indirectly, without the prior written consent of the other Party (such consent not to be unreasonably withheld, conditioned or delayed), and any attempt to so assign any rights or delegate any obligations arising under this Agreement without such consent shall be void. Notwithstanding the foregoing, no such consent shall be required for any such assignment or delegation (i) with respect to Alkermes, to a Subsidiary of Alkermes (so long as such Subsidiary remains a Subsidiary of Alkermes), (ii) with
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respect to Mural, to a Subsidiary of Mural (so long as such Subsidiary remains a Subsidiary of Mural) or (iii) to a bona fide Third Party in connection with a merger, reorganization, consolidation or the sale of all or substantially all the assets of a Party so long as the resulting, surviving or transferee entity assumes all the obligations of the assigning Party by operation of Law or pursuant to an agreement in form and substance reasonably satisfactory to the non-assigning Party; provided, however, that in the case of each of the preceding clauses (i) and (ii), no assignment permitted by this Section 8.7 shall release the assigning Party from liability for the full performance of its obligations under this Agreement. It is understood and agreed that any Party may cause any of its Subsidiaries to perform any or all of its obligations hereunder, and may designate any of its Subsidiaries to receive any of its entitlements hereunder.
Section 8.8 Successors and Assigns. The provisions of this Agreement and the obligations and rights hereunder shall be binding upon, inure to the benefit of and be enforceable by (and against) the Parties and their respective successors (whether by merger, acquisition of assets or otherwise) and permitted assigns.
Section 8.9 Termination and Amendment. This Agreement may be terminated, modified or amended, and the Distribution may be amended, modified or abandoned, at any time prior to the Distribution Effective Time by and in the sole and absolute discretion of Alkermes without the approval of Mural or the stockholders of Alkermes. In the event of such termination, no Party shall have any liability of any kind to the other Party or any other Person by reason of such termination. After the Distribution Effective Time, this Agreement may not be terminated, modified or amended except by an agreement in writing signed by Alkermes and Mural.
Section 8.10 Payment Terms.
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Section 8.11 Subsidiaries. Each of the Parties shall cause to be performed, and hereby guarantees the performance of, all actions, agreements and obligations set forth herein to be performed by any Subsidiary of such Party or by any entity that becomes a Subsidiary of such Party at or after the Distribution Effective Time, in each case to the extent such Subsidiary remains a Subsidiary of the applicable Party.
Section 8.12 Third Party Beneficiaries. This Agreement is solely for the benefit of the Parties and shall not be deemed to confer upon any Person other than the Parties any remedy, claim, liability, reimbursement, cause of Action or other right beyond any that exist without reference to this Agreement. Nothing in this Agreement is intended to amend any employee benefit plan or affect the applicable plan sponsor’s right to amend or terminate any employee benefit plan pursuant to the terms of such plan. The provisions of this Agreement are solely for the benefit of the Parties, and no current or former employee, officer, director, or independent contractor or any other individual associated therewith shall be regarded for any purpose as a third-party beneficiary of this Agreement.
Section 8.13 Titles and Headings. Titles and headings to sections herein are inserted for the convenience of reference only and are not intended to be a part of or to affect the meaning or interpretation of this Agreement.
Section 8.14 Governing Law. This Agreement will be governed by, construed and interpreted in accordance with the Laws of the State of Delaware, without reference to principles of conflicts of Laws. Each Party irrevocably consents to the exclusive jurisdiction, forum and venue of the Delaware Court of Chancery (and if the Delaware Court of Chancery shall be unavailable, any Delaware State court or the federal court sitting in the State of Delaware) over any and all claims, disputes, controversies or disagreements between the Parties under or related to this Agreement or any of the transactions contemplated hereby, including their execution, performance or enforcement, whether in contract, tort or otherwise. Each of the Parties hereby agrees that it shall not assert, and shall hereby waive, any claim or right or defense that it is not subject to the jurisdiction of such courts, that the venue is improper, that the forum is inconvenient or any similar objection, claim or argument.
Section 8.15 Severability. In the event any one or more of the provisions contained in this Agreement should be held invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein and therein shall not in any way be affected or impaired thereby. The Parties shall endeavor in good-faith negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions, the economic effect of which comes as close as possible to that of the invalid, illegal or unenforceable provisions.
Section 8.16 Interpretation. Interpretation of this Agreement shall be governed by the following rules of construction: (a) words in the singular shall be held to include the plural and vice versa, and words of one gender shall be held to include the other gender as the context requires; (b) references to the terms “Section,” “paragraph,” “clause,” “Exhibit” and “Schedule” are references to the Sections, paragraphs, clauses, Exhibits and Schedules of this Agreement unless otherwise specified; (c) the terms “hereof,” “herein,” “hereby,” “hereto,” and derivative or similar words refer to this entire Agreement, including the Schedules and Exhibits hereto; (d)
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references to “$” shall mean U.S. dollars; (e) the word “including” and words of similar import when used in this Agreement shall mean “including without limitation,” unless otherwise specified; (f) the word “or” shall not be exclusive; (g) references to “written” or “in writing” include in electronic form; (h) unless the context requires otherwise, references to “Party” shall mean Alkermes or Mural, as appropriate, and references to “Parties” shall mean Alkermes and Mural; (i) provisions shall apply, when appropriate, to successive events and transactions; (j) the table of contents and headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement; (k) Alkermes and Mural have each participated in the negotiation and drafting of this Agreement and if an ambiguity or question of interpretation should arise, this Agreement shall be construed as if drafted jointly by the parties and no presumption or burden of proof shall arise favoring or burdening either party by virtue of the authorship of any of the provisions in this Agreement or any interim drafts of this Agreement; and (l) a reference to any Person includes such Person’s successors and permitted assigns.
Section 8.17 No Duplication; No Double Recovery. Nothing in this Agreement, the Separation Agreement or any other Ancillary Agreement is intended to confer to or impose upon any Party a duplicative right, entitlement, obligation or recovery with respect to any matter arising out of the same facts and circumstances.
Section 8.18 Counterparts. This Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement, and shall become effective when one or more such counterparts have been signed by each of the Parties and delivered to each of the Parties. Counterparts may be delivered via electronic mail (including pdf or any electronic signature complying with the U.S. federal ESIGN Act of 2000, e.g., www.docusign.com) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.
[Signature Page Follows]
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IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the day and year first above written.
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| ALKERMES PLC | |
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| By: | /s/ Richie Paul |
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| Name: Richie Paul |
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| Title: Board Designated Signatory |
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| MURAL ONCOLOGY PLC | |
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| By: | /s/ Caroline Loew |
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| Name: Caroline Loew, Ph.D. |
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| Title: Director and Secretary |
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[Signature Page to Employee Matters Agreement]