EMPLOYMENT AGREEMENT
AGREEMENT made as of July 23, 1999, between BIO-TECHNOLOGY GENERAL
CORP., a Delaware corporation with an office at 00 Xxxx Xxxxxx Xxxxx, Xxxxxx,
Xxx Xxxxxx 00000 (the "Company"), and Xxxxxx X. Xxxx, having a residence at 00
Xxxxxxxxx Xxxx, Xxxxxxxxx, Xxx Xxxxxx 00000 (the "Executive").
W I T N E S S E T H :
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WHEREAS, the Company desires that Executive be employed to serve in a
senior executive capacity with the Company, and Executive desires to be so
employed by the Company, upon the terms and conditions herein set forth.
NOW, THEREFORE, in consideration of the premises and of the mutual
promises, representations and covenants herein contained, the parties hereto
agree as follows:
1. EMPLOYMENT.
The Company hereby employs Executive and Executive hereby accepts such
employment, subject to the terms and conditions herein set forth. Executive
shall hold the office of Senior Vice President and General Counsel, reporting to
the Chief Executive Officer of the Company.
2. TERM.
The initial term of employment under this Agreement shall begin on the
date hereof (the "Employment Date") and shall continue for a period of two (2)
years from that date, subject to prior termination in accordance with the terms
hereof. Thereafter, this Agreement shall automatically be renewed for successive
two year terms unless either party shall give the other ninety (90) days prior
written notice of its intent not to renew this Agreement.
3. COMPENSATION.
(a) As compensation for the employment services to be rendered by
Executive hereunder, including all services as an officer or director of the
Company and any of its subsidiaries, the Company agrees to pay, or cause to be
paid, to Executive, and Executive agrees to accept, payable in equal
installments in accordance with Company practice, an initial annual salary of
$210,000. Executive's annual salary hereunder for the remaining years of
employment shall be determined by the Board of Directors in its sole discretion;
provided, however, that Executive's
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annual salary shall not be reduced during the term of this Agreement below the
highest annual salary paid to Executive at any time during such term.
(b) Executive shall be entitled to bonuses from time to time in such
amounts as may be determined by the Board of Directors in its sole discretion.
4. EXPENSES.
The Company shall pay or reimburse Executive, upon presentment of
suitable vouchers, for all reasonable business and travel expenses that may be
incurred or paid by Executive in connection with his employment hereunder.
Executive shall comply with such restrictions and shall keep such records as the
Company may deem necessary to meet the requirements of the Internal Revenue Code
of 1986, as amended from time to time, and regulations promulgated thereunder.
5. OTHER BENEFITS.
Executive shall be entitled to a vacation allowance of not less than
four (4) weeks per annum and to participate in and receive any other benefits
customarily provided by the Company to its senior management personnel
(including any profit sharing, pension, short and long-term disability
insurance, hospital, major medical insurance, dental insurance and group life
insurance plans in accordance with the terms of such plans) and including stock
option and/or stock purchase plans, all as determined from time to time by the
Board of Directors of the Company. Unused annual vacation may not be carried
over to other years except that with the consent of the Chief Executive Officer
the Executive may carry over unused vacation in those instances in which
Executive has been unable to utilize fully his annual vacation entitlement due
to exigencies of Company business matters and needs.
6. DUTIES.
(a) Executive shall perform such duties and functions as the Chief
Executive Officer of the Company shall from time to time determine in accordance
with what it is normal and customary for an individual holding Executive's
position to perform, and Executive shall comply in the performance of such
duties and functions with the policies of the Board of Directors.
(b) Executive agrees to devote his entire working time, attention and
energies to the performance of the business of the Company and of any of its
subsidiaries by which he may be employed; and Executive shall not without the
approval of the Board of Directors, directly or indirectly, alone or as a member
of any partnership or other business organization, or as an officer, director or
employee of any other corporation, partnership or other business organization,
be actively engaged in or concerned with any other duties or pursuits of a
business nature which interfere with the performance of his duties hereunder, or
which, even if non-interfering, may be, in the reasonable determination of the
Board of Directors of the Company in its sole discretion, inimical, or contrary,
to the best interests of the Company.
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(c) All fees, compensation or commissions received by Executive during
the term of this Agreement for personal services (including, but not limited to,
commissions and compensation received as a fiduciary or a director, and fees for
lecturing and teaching) rendered at the request of the Company shall be paid to
the Company when received by Executive, except those fees that the Board of
Directors determines may be kept by Executive.
(d) Nothing in this Section 6 or elsewhere in this Agreement shall be
construed to prevent Executive from investing or trading in non-conflicting
investments as he sees fit for his own account, including real estate, stocks,
bonds, securities, commodities or other forms of investments.
(e) The principal location at which the Executive shall perform his
duties hereunder shall be at the Company's offices in Iselin, New Jersey or at
such other location as may be designated from time to time by the Board of
Directors of the Company, provided that if the principal location of Executive's
duties is transferred from Iselin, New Jersey, the new principal location of
Executive's duties shall not be transferred beyond a 50-mile radius of Iselin,
New Jersey without Executive's consent. Notwithstanding the foregoing, Executive
shall perform such services at such other locations as may be required for the
proper performance of his duties hereunder, and Executive recognizes that such
duties may involve significant travel.
7. TERMINATION OF EMPLOYMENT; EFFECT OF TERMINATION.
(a) Executive's employment hereunder may be terminated at any time
upon written notice from the Company to Executive:
(i) upon the determination by the Board of
Directors, after Executive has received
notice that his performance is not
satisfactory for any reason which would not
constitute justifiable cause (as defined in
7(d)) and which notice specifies with
reasonable particularity how such
performance is not satisfactory, that
Executive has failed to remedy such
performance to the reasonable satisfaction
of the Board of Directors within thirty (30)
days of such notice; or
(ii) upon the determination by the Board of
Directors that there is justifiable cause
(as defined in 7(d)) for such termination
and upon ten (10) days' prior written notice
of same to Executive.
(b) Executive's employment shall terminate upon:
(i) the death of Executive; or
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(ii) the "disability" of Executive (as defined in 7(c))
pursuant to 7(f) hereof.
(c) For the purposes of this Agreement, the term "disability" shall
mean the inability of Executive, due to illness, accident or any other physical
or mental incapacity, substantially to perform his duties for a period of three
(3) consecutive months or for a total of six (6) months (whether or not
consecutive) in any twelve (12) month period during the term of this Agreement,
as reasonably determined by the Board of Directors of the Company in its sole
discretion after examination of Executive by an independent physician reasonably
acceptable to Executive.
(d) For the purposes hereof, the term "justifiable cause" shall mean
and be limited to:
(i) Executive's conviction (which, through lapse of time or
otherwise, is not subject to appeal) of any crime or offense
involving the Company's or its subsidiaries' money or other
property or which constitutes a felony in the jurisdiction
involved;
(ii) Executive's performance of any act or his failure to act, for
which it is determined by independent counsel retained by the
Board of Directors (which counsel shall not be an individual or
firm which at any time within the prior three (3) years has
represented the Company, any executive employed by Company, the
Board of Directors or any individual Director), after due
inquiry in which Executive is given the opportunity to be heard
and represented by counsel, that if Executive were prosecuted, a
crime or offense involving money or property of the Company or
its subsidiaries, or which would constitute a felony in the
jurisdiction involved, would have occurred and Executive would,
in all reasonable probability, be convicted; provided, however,
that if such independent counsel does not make such
determination, then the Company shall pay Executive's reasonable
counsel fees and expenses incurred in defending Executive during
such inquiry;
(iii) any disclosure which has not been authorized or subsequently
ratified by the Company or which is not required to be made
pursuant to any judicial proceeding or by statute or regulation,
by Executive to any person, firm or corporation other than the
Company, its subsidiaries and its and their directors, officers
and employees, of any confidential information or trade secret
of the Company or any of its subsidiaries;
(iv) any attempt by Executive to secure any improper personal profit
in connection with the business of the Company or any of its
subsidiaries; or
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(v) Executive's repeated and willful failure to comply with his
duties under 6(a) or 6(b) (other than failure to comply with
instructions or policies which are illegal or improper) where
such conduct shall not have ceased or been cured within thirty
(30) days following receipt by Executive of written warning from
the Board of Directors.
Upon termination of Executive's employment for justifiable cause, this Agreement
shall terminate immediately and Executive shall not be entitled to any amounts
or benefits hereunder other than such portion of Executive's annual salary as
has been accrued through the date of his termination of employment and
reimbursement of expenses pursuant to Section 4 hereof.
(e) If Executive shall die during the term of his employment
hereunder, this Agreement shall terminate immediately. In such event, the estate
of Executive shall thereupon be entitled to receive such portion of Executive's
annual salary as has been accrued through the date of his death and such bonus,
if any, as the Board of Directors in its sole discretion may determine to award
taking into account Executive's contributions to the Company prior to his death.
If Executive's death shall occur while he is on Company business, the estate of
Executive shall be entitled to receive, in addition to the other amounts set
forth in this subsection (e), an amount equal to one-half his then annual
salary.
(f) Upon Executive's "disability", the Company shall have the right to
terminate Executive's employment. Notwithstanding any inability to perform his
duties, Executive shall be entitled to receive his compensation (including
bonus, if any) as provided herein until he begins to receive long-term
disability insurance benefits under the policy provided by the Company pursuant
to Section 5 hereof (the period during which Executive continues to receive his
compensation hereunder being the "Transition Period"). During the Transition
Period, the Company shall (i) allow Executive to participate in the Company's
401k plan to the extent permitted by such plan and (ii) at Company's expense and
to the same extent that Executive had participated prior to termination of his
employment in the Company's health insurance, dental insurance, life insurance
and disability insurance programs, continue Executive's participation in such
programs. Any termination pursuant to this subsection (f) shall be effective on
the date thirty (30) days after which Executive shall have received written
notice of the Company's election to terminate.
(g) Notwithstanding any provision to the contrary contained herein, in
the event that Executive's employment is terminated by the Company at any time
for any reason other than justifiable cause, disability or death, or in the
event the Company shall fail to renew this Agreement:
(i) the Company shall pay to Executive, in full satisfaction and in
lieu of any and all other payments due and owing to Executive
under the terms of this Agreement (other than any payments
constituting reimbursement of expenses pursuant to Section 4
hereof), a severance payment in an amount equal to his then
annual salary plus the amount
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of the last bonus awarded to Executive (less all amounts, if any,
required to be withheld), payable bi-weekly in equal
installments,
(ii) Executive shall have a right to exercise any options which are
exercisable as of the date of termination at any time during a
period of six (6) months following the effective date of
termination;
(iii) the Company shall continue to allow Executive to participate in
the Company's 401k plan to the extent permitted by such plan for
twelve (12) months following the effective date of termination;
and
(iv) the Company shall continue to allow Executive to participate, at
the Company's expense and to the same extent that Executive had
participated prior to termination of his employment, in the
Company's health insurance, dental insurance, life insurance and
disability insurance programs, to the extent permitted under such
programs, until the earlier of twelve (12) months from the
effective date of termination or until such time as Executive
becomes eligible to participate in another employer's group
health, dental and disability insurance plans; provided, however,
that Executive shall notify the Company of his acceptance of a
position with a new employer, together with the specific date on
which Executive shall become eligible for coverage in such new
employer's health, dental, life and disability insurance
programs, such notice to be given within fifteen (15) days
following commencement of such employment.
(h) Executive may terminate his employment at any time upon thirty (30)
days' prior written notice to the Company. Upon Executive's termination of his
employment hereunder, this Agreement (other than Sections 4, 7, 10, 11, 12 and
13, which shall survive) shall terminate immediately. In such event, Executive
shall be entitled to receive such portion of Executive's annual salary as has
been accrued to date. Executive shall be entitled to reimbursement of expenses
pursuant to Section 4 hereof and to participate in the Company's benefit plans
to the extent participation by former employees is required by law or permitted
by such plans, with the expense of such participation to be as specified in such
plans for former employees.
8. REPRESENTATIONS AND AGREEMENTS OF EXECUTIVE.
(a) Executive represents and warrants that he is free to enter into this
Agreement and to perform the duties required hereunder, and that there are no
employment contracts or under standings, restrictive covenants or other
restrictions, whether written or oral, preventing the performance of his duties
hereunder or requiring him to perform employment, consulting, business related
or similar duties for any other person.
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(b) Executive agrees to submit to a medical examination and to cooperate
and supply such other information and documents as may be required by any
insurance company in connection with the Company's obtaining life insurance on
the life of Executive, and any other type of insurance or fringe benefit as the
Company shall determine from time to time to obtain.
9. REPRESENTATIONS OF COMPANY.
The Company represents and warrants that the Board of Directors has
consented to the Company entering into this Agreement with Executive on the
terms set forth herein and that all written consents, resolutions and approvals
required to give full force and effect to this Agreement and to the Company's
obligations hereunder have been obtained.
10. NON-INTERFERENCE.
Executive agrees that for a period of one year following the termination of
Executive's employment hereunder, Executive shall not, directly or indirectly,
request or cause any collaborative partners, universities, governmental
agencies, contracting parties, suppliers or customers with whom the Company or
any of its subsidiaries has a business relationship to cancel or terminate any
such business relationship with the Company or any of its subsidiaries or
solicit, interfere with or entice from the Company any employee (or former
employee) of the Company.
11. INVENTIONS AND DISCOVERIES.
(a) Insofar as is related to the principal business activities and products
of the Company and any of its subsidiaries or joint ventures, Executive shall
promptly and fully disclose to the Company, and with all necessary detail for a
complete understanding of the same, all developments, know-how, discoveries,
inventions, improvements, concepts, ideas, writings, formulae, processes and
methods of a financial or other nature (whether copyrightable, patentable or
otherwise) made, received, conceived, acquired or written during working hours,
or otherwise, by Executive (whether or not at the request or upon the suggestion
of the Company) during the period of his employment with, or rendering of
advisory or consulting services to, the Company or any of its subsidiaries,
solely or jointly with others (collectively the "Subject Matter").
(b) Executive hereby assigns and transfers, and agrees to assign and
transfer, to the Company, all his rights, title and interest in and to the
Subject Matter, and Executive further agrees to deliver to the Company any and
all drawings, notes, specifications and data relating to the Subject Matter, and
to execute, acknowledge and deliver all such further papers, including
applications for copyrights or patents, as may be necessary to obtain copyrights
and patents for any thereof in any and all countries and to vest title thereto
to the Company. Executive shall assist the Company in obtaining such copyrights
or patents during the term of this Agreement, and any time thereafter on
reasonable notice and at mutually convenient times, and Executive agrees to
testify in any prosecution or litigation involving any of the Subject Matter;
provided, however, that Executive shall be compensated in a timely manner at the
rate of $250.00 per hour (with a minimum of $1500 per
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day), plus out-of-pocket expenses incurred in rendering such assistance or
giving or preparing to give such testimony if it is required after termination
of his employment hereunder.
12. NON-DISCLOSURE OF CONFIDENTIAL INFORMATION.
(a) Executive shall not, during the term of this Agreement, or at any time
following termination of this Agreement, directly or indirectly, disclose or
make accessible (other than as is required in the regular course of his duties,
including, without limitation, disclosures to the Company's advisors and
consultants,) or as may be required by law or regulation or pursuant to a
judicial proceeding (in which case Executive shall give the Company prior
written notice of such required disclosure) or with the prior written consent of
the Board of Directors of the Company), to any person, firm or corporation, any
confidential information acquired by him during the course of, or as an incident
to, his employment or the rendering of his advisory or consulting services
hereunder, relating to the Company or any of its subsidiaries, the directors of
the Company or its subsidiaries, any client of the Company or any of its
subsidiaries, or any corporation, partnership or other entity owned or
controlled, directly or indirectly, by any of the foregoing, or in which any of
the foregoing has a beneficial interest, including, but not limited to, the
business affairs of each of the foregoing. Such confidential information shall
include, but shall not be limited to, proprietary technology, trade secrets,
patented processes, research and development data, know-how, market studies and
forecasts, competitive analyses, pricing policies, employee lists, personnel
policies, the substance of agreements with customers and others, marketing or
dealership arrangements, servicing and training programs and arrangements,
customer lists and any other documents embodying such confidential information.
This confidentiality obligation shall not apply to any confidential information
which thereafter becomes publicly available other than pursuant to a breach of
this Section 12(a) by Executive.
(b) All information and documents relating to the Company and its
affiliates as hereinabove described shall be the exclusive property of the
Company, and Executive shall use commercially reasonable best efforts to prevent
any publication or disclosure thereof. Upon termination of Executive's
employment with the Company, all such documents, records, reports, writings and
other similar documents containing confidential information, including copies
thereof, then in Executive's possession or control shall be returned and left
with the Company.
13. SPECIFIC PERFORMANCE.
Executive agrees that if he breaches, or threatens to commit a breach of,
any of the provisions of Sections 10, 11 or 12 (the "Restrictive Covenants"),
the Company shall have, in addition to, and not in lieu of, any other rights and
remedies available to the Company under law and in equity, the right to have the
Restrictive Covenants specifically enforced by any court of competent
jurisdiction, it being agreed that any breach or threatened breach of the
Restrictive Covenants would cause irreparable injury to the Company and that
money damages would not provide an adequate remedy to the Company.
Notwithstanding the foregoing, nothing herein shall constitute a waiver by
Executive of his right to contest whether a breach or threatened breach of any
Restrictive
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Covenant has occurred.
14. AMENDMENT OR ALTERATION.
No amendment or alteration of the terms of this Agreement shall be valid
unless made in writing and signed by both of the parties hereto.
15. GOVERNING LAW.
This Agreement shall be governed by the laws of the State of New Jersey
applicable to agreements made and to be performed therein.
16. SEVERABILITY.
The holding of any provision of this Agreement to be invalid or
unenforceable by a court of competent jurisdiction shall not affect any other
provision of this Agreement, which shall remain in full force and effect.
17. NOTICES.
Any notices required or permitted to be given hereunder shall be sufficient
if in writing, and if delivered by hand, or sent by certified mail, return
receipt requested, to the addresses set forth above or such other address as
either party may from time to time designate in writing to the other, and shall
be deemed given as of the date of the delivery or date of receipt.
18. WAIVER OR BREACH.
It is agreed that a waiver by either party of a breach of any provision of
this Agreement shall not operate, or be construed, as a waiver of any subsequent
breach by that same party.
19. ENTIRE AGREEMENT AND BINDING EFFECT.
This Agreement contains the entire agreement of the parties with respect to
the subject matter hereof and shall be binding upon and inure to the benefit of
the parties hereto and their respective legal representatives, heirs,
distributors, successors and assigns. Notwithstanding the foregoing, all prior
agreements between Executive and the Company relating to the confidentiality of
information, trade secrets, patents, indemnification, and stock options shall
not be affected by this Agreement.
20. SURVIVAL.
The termination of Executive's employment hereunder or the expiration of
this
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Agreement shall not affect the enforceability of Sections 4, 7, 9, 10, 11, 12
and 13 hereof.
21. FURTHER ASSURANCES.
The parties agree to execute and deliver all such further documents,
agreements and instruments and take such other and further action as may be
necessary or appropriate to carry out the purposes and intent of this Agreement.
22. HEADINGS.
The Section headings appearing in this Agreement are for the purposes of
easy reference and shall not be considered a part of this Agreement or in any
way modify, demand or affect its provisions.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date and year first above written.
BIO-TECHNOLOGY GENERAL CORP.
By: /s/ SIM FASS
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Date:
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/s/ XXXXXX X. XXXX
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Xxxxxx X. Xxxx
Date:_______________________________
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