first regular payroll cycle after the Release Agreement becomes effective. Cause shall mean any of the following: (i) dishonesty, embezzlement, misappropriation of assets or property of the Company; (ii) negligence, misconduct, neglect of duties, theft, fraud, or breach of fiduciary duty to the Company; (iii) failure to perform adequately your role at the Company, as determined in good faith by the Board of Directors; (v) material breach of any agreement with the Company; and (vi) the conviction of a felony, or any crime involving moral turpitude.
5. Subject to the approval of the Board of Directors of Cullinan Pharmaceuticals LLC (the LLC), the LLC will grant you incentive units (the Units) under the LLCs Profits Interest Plan (the Plan) equating to an ownership interest entitling you to 1.0% of the distributions made by the LLC with respect to the Common Units of the LLC in excess of the strike price associated with your Units, up to an aggregate initial seed and Series A equity investment of $150-200MM. The strike price of each Unit will be determined by the LLCs Board of Directors on the date such Units are granted and shall be equal to the amount that would be distributed in respect of a Common Unit of the LLC in a hypothetical liquidation of the LLC on the date of issuance of such Unit. The Units will be evidenced in writing by, and subject to the terms of the Plan and a Unit Grant Agreement provided by the LLC, which agreement will specify monthly vesting over four (4) years with a one (1) year cliff.
6. In certain instances in which an asset subsidiary is formed and invested in by the LLC, your equity grant target (at the time of the initial financing by the LLC) will be .15% of such asset subsidiarys fully-diluted capitalization; for the avoidance of doubt, your equity grant may in some cases be lower (e.g., depending on how much equity needs to be allocated to founders, universities and the like). Such equity grant will be evidenced in writing, which agreement will specify monthly vesting over four (4) years with a one (1) year cliff.
7. You will be required to execute the Companys standard form of Employee Invention, Non-Disclosure and Non-Solicitation Agreement (the Employee Agreement) as a condition of your employment.
8. You represent that you are not bound by any employment contract, restrictive covenant or other restriction preventing you from entering into employment with or carrying out your responsibilities for the Company, or which is in any way inconsistent with the terms of this letter.
9. This letter shall not be construed as an agreement, either expressed or implied, to employ you for any stated term, and shall in no way alter the Companys policy of employment at will, under which both you and the Company remain free to terminate the employment relationship for any reason, with or without cause, at any time, and with or without notice. Similarly, nothing in this letter shall be construed as an agreement, either express or implied, to pay you any compensation or grant you any benefit beyond the end of your employment with the Company, except to the extent specifically set forth above.
10. If you agree with the employment provisions of this letter, please sign the enclosed duplicate of this letter in the space provided below and return it to me along with a signed copy of the Employee Agreement.