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EXHIBIT 10.4
AGREEMENT CONCERNING TERMINATION OF
EMPLOYMENT OF XXXXXX XXXXXXX
The following sets forth the terms and conditions of the agreement (the
"Agreement") regarding the end of Xxxxxx Xxxxxxx'x ("Xx. Xxxxxxx") employment in
the position of Chief Scientific Officer of Genetronics Biomedical Ltd. and
Genetronics, Inc. (collectively, the "Company") effective as of September 7,
1999. Pursuant to Section 18 herein, the Agreement shall become effective on the
eighth day after this Agreement is executed by Xx. Xxxxxxx (the "Effective
Date"). Xxxxxx Xxxxxxx and the Company hereby agree as follows:
1. TERMINATION OF EMPLOYMENT AGREEMENT. Except for Section 5 of the
employment agreement between Xx. Xxxxxxx and the Company dated January
9, 1995, as amended from time to time (the "Employment Agreement"), a
copy of which is attached hereto as Exhibit A, the Employment Agreement
is hereby superseded by this Agreement and is null and void and of no
further force or effect. For the sake of clarity, Xx. Xxxxxxx expressly
acknowledges that Section 5 of the Employment Agreement contains
confidentiality and non-disclosure provisions therein to which he
remains, and shall remain, bound as set forth therein.
2. EMPLOYMENT. Xx. Xxxxxxx'x employment as Chief Scientific Officer and all
other employment positions Xx. Xxxxxxx may have held with the Company
were terminated effective as of September 7, 1999 (the "Separation
Date").
3. SEVERANCE PAY. The Company agrees to make severance payments to Xx.
Xxxxxxx in the form of: (a) continuation of his base salary in effect on
the Separation Date for a period of sixteen (16) months from the
Separation Date (the "Severance Period") and (b) a grant of an option to
purchase 97,000 shares of the common stock of the Company ("New Option")
at a price per share equal to ten percent (10%) more than the fair
market value of the Company's common stock on the date that is the last
trading day before the date of grant. The term of the New Options shall
be five years from the date of grant. The New Options will vest on
January 6, 2001, which is the last day of the Severance Period, and will
be exerciseable for the duration of the term of the New Options.
However, in the event the Company is acquired by, or merged with,
another entity prior to the vesting of the New Options, the New Options
will vest upon the completion of the merger or acquisition. The New
Options shall be governed pursuant to the terms and conditions of the
Genetronics Biomedical, Ltd. 1997 Stock Option Plan, as amended."The
sixteen months of severance payments will be paid on the Company's
ordinary payroll dates and will be subject to standard payroll
deductions and withholdings.
4. STOCK OPTIONS. The stock options listed in Exhibit B to this Agreement
("Existing Options") shall be fully vested as of the Effective Date of
this Agreement, and changed from ISO to non-qualifying options. Other
than as provided in this Section 4, you
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acknowledge that your Existing Options will continue to be governed by
the terms and conditions of the Genetronics Biomedical, Ltd. Stock
Option Plan under which each Existing Option was granted.
5. ACCRUED SALARY AND VACATION. Xx. Xxxxxxx agrees and acknowledges that
the Company has paid him all accrued salary, and all accrued and unused
vacation benefits earned through the Separation Date, if any, subject to
standard payroll deductions, withholding taxes and other obligations.
6. INSURANCE BENEFITS. To the extent provided by the federal COBRA law or,
if applicable, state insurance laws, and by the Company's current group
health insurance policies, Xx. Xxxxxxx will be eligible to continue his
health insurance benefits. Later, Xx. Xxxxxxx may be able to convert to
an individual policy through the provider of the Company's health
insurance, if he wishes. Xx. Xxxxxxx will be provided with a separate
notice of his COBRA rights. In the event that Xx. Xxxxxxx elects
continued coverage under COBRA, the Company will pay his COBRA health
insurance premiums (Company and employee contributions) for sixteen (16)
months from the Separation Date. Thereafter, Xx. Xxxxxxx shall be solely
responsible for the payment of the premium for such benefits to the
Company's health insurance provider, if Xx. Xxxxxxx desires to continue
such benefits.
7. LIFE INSURANCE. The Company agrees that it will maintain a life
insurance policy on Xx. Xxxxxxx'x life for his and his estate's benefit,
the terms of which shall be substantially similar to terms of the
personal policy maintained by the Company for his benefit prior to the
Separation Date, for a period of sixteen (16) months after the
Separation Date.
8. COMPANY EQUIPMENT. The Company agrees that, as part of this Agreement
and in consideration thereof, Xx. Xxxxxxx may keep for his own personal
use any Company computer, cellular telephone and facsimile machine
currently in his possession.
9. AUTOMOBILE. The Company agrees that, as part of this Agreement and in
consideration thereof, it will continue to pay for the lease payments
(approximate value of Fifteen Thousand Dollars ($15,000)) on the
automobile that was obtained for Xx. Xxxxxxx as an officer of the
Company for the duration of the existing lease period.
10. 401(k). The Company agrees that, as part of this Agreement and in
consideration thereof, the Company will purchase for Xx. Xxxxxxx the
same number of shares of common stock of the Company that he would have
received through the Company's 401(k) plan had he remained an employee
through January 7, 2001. Such stock shall be purchased for him quarterly
as it is for employees who participate in the Company's 401(K) plan.
11. OTHER COMPENSATION AND BENEFITS. Except as expressly provided herein,
Xx. Xxxxxxx acknowledges and agrees that he is not entitled to and will
not receive any additional
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employment-related compensation, severance, stock options, stock or
benefits from the Company after the Separation Date.
12. NON-DISCLOSURE OF THE TERMS OF THIS AGREEMENT. The provisions of this
Agreement shall be held in strictest confidence by Xx. Xxxxxxx and the
Company and shall not be publicized or disclosed in any manner
whatsoever; provided, however, that: (a) Xx. Xxxxxxx may disclose this
Agreement, in confidence, to his immediate family; (b) the parties may
disclose this Agreement in confidence to their respective attorneys,
accountants, auditors, tax preparers, and financial advisors; (c) the
Company may disclose this Agreement as necessary to fulfill standard or
legally required corporate reporting or disclosure requirements; and (d)
the parties may disclose this Agreement insofar as such disclosure may
be necessary to enforce its terms or as otherwise required by law.
13. NON-DISPARAGEMENT. The parties agree that neither they, nor their
officers, directors or employees will make any disparaging statements
about each other. However, in the interest of implementing open
discussion and disclosure among Board members, the parties agree that
this provision does not apply to statements made by the above
individuals in their capacity as directors to other directors of the
Company.
14. NON-SOLICITATION. Xx. Xxxxxxx agrees that for a period of one (1) year
from the Separation Date he will not hire or take away or cause to be
hired or taken away any employee of the Company for the purpose of
employment in any business or endeavor. He further agrees, without
prejudice to any and all other rights of the Company, that in the event
of his violation or attempted violation of the covenants contained in
this agreement, an injunction or other like remedy shall be the only
effective method to protect the Company's and its affiliates' rights and
property, and that an interim injunction may be granted immediately on
the commencement of any suit.
15. RETURN OF PROPERTY. Except as otherwise provided herein, upon the
Effective Date, Xx. Xxxxxxx agrees to return to the Company all Company
documents (and all copies thereof) and other Company property in his
possession or his control as an employee, including, but not limited to,
Company files, business plans, notes, samples, sales notebooks,
drawings, specifications, calculations, sequences, data,
computer-recorded information, tangible property, including, but not
limited to, software, credit cards, business cards, entry cards, keys
and any other materials of any nature pertaining to his work with the
Company as an employee, and any documents or data of any description (or
any reproduction of any documents or data) containing or pertaining to
any proprietary or confidential material of the Company, which is in his
possession by nature of his employment relationship with the Company. In
the event no property is returned, Xx. Xxxxxxx will be deemed to have
agreed and acknowledged that he has no Company documents of substantive
value in his possession, other than those documents in his possession
for reasonable use as a director or consultant.
16. TAX CONSEQUENCES. The Company makes no representations or warranties
with respect to the tax consequences of any payments to Xx. Xxxxxxx
under the terms of this
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Agreement. Xx. Xxxxxxx agrees and understands that he is responsible for
payment, if any, of local, state and/or federal taxes on the sums paid
hereunder by the Company and any penalties or assessments thereon. Xx.
Xxxxxxx further agrees to indemnify and hold the Company harmless from
any claims, demands, deficiencies, penalties, assessments, executions,
judgments, or recoveries by any government agency against the Company
for any amounts claimed due on account of his failure to pay federal or
state taxes or damages sustained by the Company by reason of any such
claims, including reasonable attorneys' fees.
17. RELEASE OF CLAIMS AGAINST THE COMPANY. In consideration of the
foregoing, Xx. Xxxxxxx hereby releases, acquits, and forever discharges
the Company, its parents and subsidiaries, and their officers,
directors, agents, servants, employees, attorneys, shareholders,
partners, successors, assigns, affiliates, customers, and clients of and
from any and all claims, liabilities, demands, causes of action, costs,
expenses, attorneys' fees, damages, indemnities and obligations of every
kind and nature, in law, equity, or otherwise, known and unknown,
suspected and unsuspected, disclosed and undisclosed, arising out of or
in any way related to agreements, acts or conduct at any time prior to
the Separation Date, including, but not limited to: all such claims and
demands directly or indirectly arising out of or in any way connected
with the Company's employment of Xx. Xxxxxxx, the termination of that
employment, the Company's performance of its obligations as his former
employer, and any claims arising from the Employment Agreement or his
offer letter; claims or demands related to salary, bonuses, commissions,
stock, or any other ownership interests in the Company, vacation pay,
fringe benefits, expense reimbursements, severance pay, or any form of
compensation; claims pursuant to any federal, state or local law or
cause of action including, but not limited to, the California Fair
Employment and Housing Act, the federal Civil Rights Act of 1964, as
amended; the federal Age Discrimination in Employment Act of 1967, as
amended; the federal Americans With Disabilities Act; tort law; contract
law; wrongful discharge; discrimination; harassment; fraud; defamation;
emotional distress; and breach of the implied covenant of good faith and
fair dealing. Notwithstanding the above, Xx. Xxxxxxx is not hereby
releasing any claims Xx. Xxxxxxx may have (i) under this Agreement; (ii)
for indemnification pursuant to and in accordance with the applicable
statutes, the applicable terms of the charters, articles of
incorporation or bylaws of the Company, any insurance policies
maintained by the Company which afford coverage to Xx. Xxxxxxx; (iii)
for rights or claims Xx. Xxxxxxx may have pursuant to any applicable
stock option plans or stock option agreements Xx. Xxxxxxx may have with
the Company; and (iv) any criminal, grossly negligent or fraudulent
conduct on the part of the Company, other than his own conduct, which
creates liability on the part of Xx. Xxxxxxx. For the sake of clarity,
Xx. Xxxxxxx expressly agrees that the provisions of this Section 17,
including part (iv) herein, shall not be interpreted to permit Xx.
Xxxxxxx to make a claim against the Company that is related to
termination of his employment with the Company or the Company's
performance of its obligations as his former employer, any claims
arising from the Employment Agreement, or any form of compensation he
received as an employee.
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18. ADEA WAIVER. Xx. Xxxxxxx further acknowledges that he is knowingly and
voluntarily waiving and releasing any rights he may have under the Age
Discrimination in Employment Act of 1967 ("ADEA"). He also acknowledges
that the consideration given for the waiver and release in the preceding
paragraphs hereof is in addition to anything of value to which he was
already entitled. Since Xx. Xxxxxxx is more than forty (40) years of age
when this release is signed, he hereby provides the further
acknowledgment that he is advised by this writing, as required by the
Older Workers Benefit Protection Act, that: (a) his waiver and release
do not apply to any rights or claims that may arise after the Effective
Date of this release; (b) he has the right to consult with an attorney
prior to executing this release (although he may voluntarily choose not
to do so); (c) he may have at least twenty-one (21) days to consider
this Agreement (although he may by his own choice execute this release
earlier); (d) he has seven (7) days following the execution of this
release to revoke this release; and (e) this Agreement shall not be
effective until the date upon which the revocation period has expired,
therefore making the effective date the eighth day after this release is
signed by Xx. Xxxxxxx (the "Effective Date").
19. RELEASE OF CLAIMS AGAINST XX. XXXXXXX. In consideration of the
foregoing, the Company, for and on behalf of itself, its directors,
officers, shareholders, successors and assigns hereby releases, acquits
and forever discharges Xx. Xxxxxxx and his assigns, transferees,
successors, heirs, agents and attorneys from any and all claims,
liabilities, demands, causes of action, costs, expenses, attorneys'
fees, damages, indemnities and obligations of every kind and nature, in
law, equity, or otherwise, known and unknown, suspected and unsuspected,
disclosed and undisclosed, arising out of or in any way related to
agreements, acts or conduct of Xx. Xxxxxxx within the course and scope
of his obligations and duties as an employee or officer of the Company
at any time prior to the Separation Date, including, but not limited to:
all such claims and demands directly or indirectly arising out of or in
any way connected with the Company's employment of Xx. Xxxxxxx, the
termination of that employment, his performance of his obligations and
duties as an employee, officer, and director of the Company, or arising
out of any agreement between Xx. Xxxxxxx and the Company, with the
exception of any claim arising out of (i) his obligations under this
Agreement; (ii) his obligations arising out of Section 5 of the
Employment Agreement or any other obligations relating to the
proprietary information of the Company; and (iii) any criminal, grossly
negligent, or fraudulent conduct by him which creates liability on the
part of the Company.
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20. SECTION 1542 WAIVER. In providing the releases set forth in Paragraphs
16 and 18 above, the parties agree that the releases include claims
which may be unknown to the parties at present. The parties hereby
acknowledge that they have read and understand Section 1542 of the Civil
Code of the State of California which reads as follows:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE
CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE
TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE
MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.
21. LEGAL ADVICE. The parties acknowledge that they have been given the
opportunity to seek the advice of independent legal counsel with respect
to this Agreement and they have been provided with sufficient time to
obtain such legal advice.
22. CONSULTING AGREEMENT. Xx. Xxxxxxx agrees to provide consulting services
to the Company as set forth in a separate consulting agreement.
23. NO OTHER AGREEMENTS. The parties acknowledge and represent to each other
that this Agreement is signed without reliance upon any promises,
representations or warranties whatsoever, whether expressed or implied,
which are not contained herein in writing concerning the matters herein
set forth.
24. ENTIRE AGREEMENT. This Agreement constitutes the complete, final and
exclusive embodiment of the entire Agreement between the parties with
regard to the subject matter hereof. It is entered into without reliance
on any promise or representation, written or oral, other than those
expressly contained herein. It may not be modified except in a writing
signed by Xx. Xxxxxxx and a duly authorized officer of the Company. Each
party has carefully read this Agreement, has been afforded the
opportunity to be advised of its meaning and consequences by his or its
respective attorneys, and signed the same of his or its free will.
25. APPLICABLE LAW. This Agreement shall be deemed to have been entered into
and shall be construed and enforced in accordance with the laws of the
State of California as applied to contracts made and to be performed
entirely within California.
26. SECTION HEADINGS. The section and paragraph headings contained in this
Agreement are for reference purposes only and shall not affect in any
way the meaning or interpretation of this Agreement.
27. COUNTERPARTS. This Agreement may be executed in two counterparts, each
of which shall be deemed an original, all of which together shall
constitute one and the same instrument.
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28. ACKNOWLEDGMENT. By executing this Agreement, each signatory acknowledges
that he or it has read and understands this Agreement and release and
further acknowledges that he or it has had the opportunity to review it
with an attorney. Each signatory further acknowledges that he or it is
executing this Agreement and release voluntarily and with full knowledge
of its terms and provisions and of legal rights and regard thereto.
IN WITNESS WHEREOF, the parties have duly authorized and caused this
Agreement to be executed as follows:
Dated this 6th day of December, 1999. Dated this 6th day of December, 1999.
GENETRONICS BIOMEDICAL, LTD.
/s/ Xxxxxx Xxxxxxx BY: /s/ Xxxxxx Xxxx
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XXXXXX X. XXXXXXX ITS: PRESIDENT AND CEO
Dated this 6th day of December, 1999.
GENETRONICS, INC.
BY: /S/ XXXXXX XXXX
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ITS: PRESIDENT AND CEO
Attachments:
Exhibit A: Employment Agreement
Exhibit B: Schedule of Outstanding Stock Options
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EXHIBIT A
EMPLOYMENT AGREEMENT
Filed as an exhibit to Registrant's Form 20-F for the period ended February 28,
1998
EXHIBIT B
SCHEDULE OF OUTSTANDING STOCK OPTIONS
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DATE OF PLAN NUMBER PRICE PER VESTING EXPIRATION
GRANT OF SHARE
OPTIONS (US$)
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09-04-96 1995 35,000 2.27 100% 09-03-01
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01-14-97 1995 25,000 2.81 100% 01-13-02
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01-27-97 1995 45,000 3.06 100% 01-26-02
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07-08-98 1997 35,200 2.48 100% 07-07-03
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10-20-98 1997 100,000 2.95 25% * 10-19-03
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* 100% TO BE VESTED AS OF THE EFFECTIVE DATE OF THIS AGREEMENT.
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