November 10, 2008
November
10, 2008
VIA HAND
DELIVERY
Xx.
Xxxxxx X. Xxxxx
000
Xxxxxxxx Xxxx
West
Lafayette, IN 47906
Re: Severance
Agreement and Release of All Claims
Dear
Ed:
As you
were advised on November 6, 2008, your employment with XXXx has been separated
effective as of Friday, November 7, 2008.
In order
to ease your transition and resolve any disputes arising from your Employment
Agreement dated November 6, 2007, XXXx is prepared to offer you a severance
package with the terms detailed in this letter. In addition to the
severance amounts offered below, you will receive a check on Friday, November 14
for hours worked November 1 through November 10. This check will be
direct deposited and the pay stub will be mailed to your current address on file
with BASi.
Please
submit any outstanding expense statements as soon as possible. We
would like to finalize all claims in that regard within a short period of
time.
You will
receive information concerning your right to continuation of insurance pursuant
to the federal law known as COBRA by separate letter. In addition,
the process to have your money withdrawn from the 401K plan can be initiated at
your discretion. We have enclosed some literature explaining the
latest tax rules with regard to withdrawals that are not rolled over to another
plan or an IRA. Please contact Xxxx Xxxxxxxx (ext. 358) if you have
questions on this.
Please
return all keys, BASi property, credit cards, and the enclosed termination
agreement to me.
A.
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Terms.
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1.
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Definitions. The
terms “you” and “your” and “Chait” mean Xx. Xxxxxx X. Xxxxx, and anyone who has
or obtains any legal right or claims through him. “BASi” and
“Company” mean Bioanalytical Systems, Inc. and include its past and
present officers, directors, employees, agents, related corporations and
entities, affiliates, principals, insurers, shareholders, attorneys,
trustees, subsidiaries, predecessors, successors and assigns, any and all
employee benefit plans (and any fiduciary of such plans) sponsored by
XXXx. “Agreement” means this letter agreement which contains
the terms of the severance package and which includes a release of all
claims arising out of Xxxxx'x employment relationship with XXXx and the
termination of the employment relationship. “The Parties” means
Chait and XXXx.
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2.
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No Admission of
Liability. This Agreement shall not in any way be
construed as an admission by BASi that it has acted wrongfully with
respect to you or any other person, or that you have any rights whatsoever
against BASi.
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Xx.
Xxxxxx X. Xxxxx
November
10, 2008
Page
2
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3.
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Claims released by
Chait. By signing this Agreement, Chait unconditionally
and fully releases and forever discharges BASi from (a) any and all
possible claims, known or unknown, arising out of or from his employment
with BASi under any and all possible legal, equitable, tort, contract or
statutory theories, including but not limited to any claims for
constructive or wrongful discharge or breach of contract, except for any
claims relating to accrued and vested rights under a retirement plan; (b)
any and all claims arising on or before the date Chait signs this
Agreement, including but not limited to any charges, claims, demands or
actions under Title VII of the Civil Rights Act of 1964 and the Equal
Pay Act, 42 U.S.C. § 2000e et seq.,
Section 1981 of the Civil Rights Act of 1866, 42 U.S.C.
§ 1981, the Age Discrimination in Employment Act, the Older
Workers’ Benefit Protection Act, the Americans with Disabilities Act, 42
U.S.C. § 12101 et
seq., the Indiana Civil Rights Law, the Employee Retirement Income
Security Act, 29 U.S.C. § 1001 et seq., the United
States Constitution, the Indiana Constitution, any and all amendments to
said statutes, and any other federal, state or local statute or law,
ordinance or regulation, dealing in any way with employment or
employment-related benefits and all claims for costs and attorneys’ fees;
and (c) all claims Chait may have against BASi arising out of Xxxxx'x
employment and/or termination of employment with BASi, including any
claims arising out of his Employment Agreement dated November 6, 2007, any
bonus program, or any vacation policy. Xxxxx agrees and
understands that any claims he may have under the aforementioned laws,
statutes or any other federal, state or local law, ordinance, rule or
regulation are effectively waived by this Agreement. Xxxxx
understands that the signing of this Agreement prevents him from making
any further claims against XXXx in connection with his employment and the
termination of his employment with the
BASi.
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4.
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Waiver of
Re-employment. Xxxxx waives any right or claim of
reinstatement to employment with XXXx and agrees not to seek further
employment with XXXx. If Xxxxx does seek employment with BASi,
BASi is under no obligation to consider him for
employment.
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5.
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Payments and Benefits
to be Provided to Chait. In exchange for and in
consideration of Xxxxx'x agreement to release all claims against XXXx as
described in paragraph 3 and in consideration of the other promises
contained in this Agreement, XXXx agrees as
follows:
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x.
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XXXx
agrees to pay you a severance benefit of an amount equal to Twelve Months
salary (i.e.,
Thirteen Thousand Seven Hundred Fifty Dollars and No Cents ($13,750.00 per
month), for a gross amount of One Hundred Sixty-Five Thousand Dollars and
No Cents ($165,000.00), less tax and other deductions required by
law. These amounts will be paid to you in the form of salary
continuation beginning the first pay period following the Release
Effective Date and ending twelve months later. Unless you
notify XXXx’s payroll department of a different bank account, this amount
will be deposited in the bank account that you have previously designated
for direct deposit.
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Xx.
Xxxxxx X. Xxxxx
November
10, 2008
Page
3
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a.
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Additionally,
XXXx agrees to continue health insurance coverage for you and any covered
dependents under XXXx’s group health insurance program through December
31, 2008. You will be responsible for the employee portion of
the premium.
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x.
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Xxxxx
agrees that all of his stock options, including vested and unvested stock
options, shall be irrevocably terminated and of no further effect as of
the date hereof.
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6.
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Acknowledgement. Xxxxx
acknowledges that he is not entitled to any of the payments and benefits
listed in paragraph 5 of this Agreement unless he signs this
Agreement. Chait further acknowledges that: (a) the payments
and benefits listed in paragraph 5 of this Agreement are in lieu of any
amounts he may claim to have been entitled to under his Employment
Agreement dated November 6, 2007, BASi's vacation policy, and any
applicable bonus programs; and (b) the release of claims contained in
paragraph 3 of this Agreement includes any claims by him for further
payments or benefits under his Employment Agreement dated November 6,
2007, BASi's vacation policy and/or any applicable bonus
programs.
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7.
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Non-Disparagement. In
consideration of the promises made in this Agreement, Xxxxx agrees that he
shall not make any false, negative or disparaging remarks or comments to
any person and/or entity about BASI or any of its executives, nor shall
Chait make any statement that may subject BASi to potential embarrassment,
humiliation or any other negative consequence. In addition,
Xxxxx agrees that he shall not make any public statement, including but
not limited to, the media or to BASi employees, regarding the termination
of his employment with XXXx.
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8.
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Confidentiality. The
Parties agree that an essential condition and material term of this
Agreement shall be that the terms of this Agreement and all negotiations,
discussions, correspondence and other related matters that preceded it
shall be maintained confidential. Xxxxx agrees that neither he nor his
representatives shall in any way publish, reveal, disclose, or cause to be
published, revealed, or disclosed, any terms, information, or details of
this Agreement, or the negotiations and discussions that preceded
it. These restrictions on disclosure do not apply to
disclosures which may be required by law or by judicial or administrative
process or order. The Parties may disclose the terms of this Agreement to
BASi management or Xxxxx'x immediate family, attorney, or income tax
services provider, provided they agree to keep same confidential and not
make any disclosures in any manner that is inconsistent with the terms of
this Agreement.
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9.
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Consultation with
Attorney. Xxxxx agrees that he has read this Agreement
and the releases contained herein, that he understands all of the terms
hereof, that he has not been coerced, threatened or intimidated into
signing this Agreement, and that he executes this Agreement voluntarily
and with full knowledge of its meaning and consequences and that he has
had sufficient opportunity to consult with his attorney regarding this
Agreement. Xxxxx further acknowledges that XXXx hereby advises
him that he should consult with an attorney before executing this
Agreement.
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Xx.
Xxxxxx X. Xxxxx
November
10, 2008
Page
4
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10.
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Violation of Agreement
and Severability. Xxxxx agrees that if he breaches any
obligation set forth in this Agreement, BASi shall cease all payments to
him, as described in this Agreement. Xxxxx also understands and
agrees that in the event that this Agreement is ever held to be invalid or
unenforceable, in whole or in part, as to any particular type of claim or
charge or as to any particular circumstances, this Agreement shall remain
fully valid and enforceable as to all other claims, charges and
circumstances.
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11.
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Restrictive
Covenants. Xxxxx agrees that for the two (2) years
immediately following the effective date hereof (which, in the event of a
breach of this paragraph 11 by Xxxxx, shall be extended
automatically by a number of days equal to the number of days during which
the breach exists) (the “Restricted
Period”), Chait shall not directly or
indirectly:
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a.
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Customer
Non-Solicitation. Contact, solicit or communicate with
any Customer of the Company, or any Prospective Customer of the Company,
for the purpose of:
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i.
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diverting
or influencing or attempting to divert or influence any business of the
Company to a Competitor of the
Company;
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ii.
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marketing,
selling, distributing, leasing or providing any products or services in
competition with the services or products offered by the Company in the
Company’s Business; or
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iii.
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otherwise
interfering in any fashion with the Company’s Business or operations then
being conducted by the Company or the Company's relationship with any of
its Customers or Prospective
Customers.
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b.
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Employee
Non-Solicitation. Solicit, hire or employ any person who
is an employee of the Company or in any way (a) cause or assist or
attempt to cause or assist any employee to leave the Company or
(b) directly or indirectly seek to solicit, induce, bring about,
influence, promote, facilitate, or encourage any current employee of the
Company to leave the Company.
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c.
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Activities Not
Prohibited. The restrictions of this paragraph 11 shall not be deemed to
prevent Chait from owning (1) not more than 5%
of the issued and outstanding shares of any class of securities of an
issuer whose securities are listed on a national securities exchange or
registered pursuant to Section 12 of the Securities Exchange Act of 1934,
as amended, and/or (2) any issued and outstanding securities of BASi,
provided that Chait shall not, either directly or indirectly (i) act to
increase his direct or beneficial ownership of any class of equity
security of BASi, provided, however:
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Xx.
Xxxxxx X. Xxxxx
November
10, 2008
Page
5
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i.
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Neither
Chait nor any Affiliate (as such term is defined in Rule 405 under the
Securities Act of 1933 as amended) of Chait will: (i) acquire,
offer to acquire, or agree to acquire, directly or indirectly, by purchase
or otherwise, any voting securities or direct rights or options to acquire
any voting securities of BASi, (ii) make, or in any way participate,
directly or indirectly, in any "solicitation" of "proxies" to vote as such
terms are used in the proxy rules of the Securities and Exchange
Commission, or seek to advise or influence any person or entity with
respect to the voting of any voting securities of BASi, (iii) form, join,
or in any way participate in a "group" within the meaning of Section
13(d)(3) of the Securities Exchange Act of 1934, as amended, with respect
to any voting securities of BASi, or (iv) otherwise act, alone or in
concert with others, to seek to control or influence the management, Board
of Directors, or policies of BASi, or initiate, induce or attempt to
induce or give encouragement to any other person to initiate, any tender
or exchange offer for securities of BASi or for a change of control of
BASi. Xxxxx acknowledges that XXXx would not have an adequate
remedy at law for money damages in the event that this covenant were not
performed in accordance with its terms and therefore agrees that BASi
shall be entitled to specific enforcement of the terms hereof in addition
to any other remedy to which it may be entitled, at law or in
equity.
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d.
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Modification. In
the event a court of competent jurisdiction determines that any of the
foregoing restrictions are unreasonable in terms of geographic scope or
otherwise then Chait and the Company agree that the court is hereby
authorized to reduce the scope of said restriction through application of
the blue pencil doctrine and enforce this paragraph 11 as so reduced. If
any sentence, word or provision of this paragraph 11 shall be
determined to be unenforceable, the same shall be severed herefrom and the
remainder shall be enforced as if the unenforceable sentence, word or
provision did not exist. Xxxxx acknowledges that all of the
provisions contained in this Agreement, including the restrictions of the
covenant not to compete, are reasonable and necessary to protect the
legitimate interests of the
Company.
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e.
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Definitions.
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i.
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Competitor. A
“Competitor” shall mean any person or entity that provides research or
development resources to pharmaceutical, medical device or biotechnology
companies, or that provides outsourced drug development services,
biological services or products used in the development of pharmaceutical
products or in pharmaceutical or biological
research.
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Xx.
Xxxxxx X. Xxxxx
November
10, 2008
Page
6
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ii.
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Customer. A
“Customer” of the Company is any person or entity which, within the
twenty-four (24) month period preceding the date hereof, used, leased,
received or purchased or contracted to use, lease, receive or purchase any
of Company’s products or services.
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iii.
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Prospective
Customer. A “Prospective Customer” of the Company is any
person or entity to which, within the twenty-four (24) month period
preceding the date hereof, a proposal for services was submitted or which
was specifically identified by the Company as a prospective customer or
prospective client.
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iv.
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Business. The
"Business" is BASi's products and services offered as an alternative to
its clients' internal product development, compliance, and quality control
programs and outsourced drug development services, biological services and
products useful in developing pharmaceutical products and performing
pharmaceutical and biological
research.
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f.
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Confidentiality and
Other Matters. Xxxxx acknowledges that the terms of this
paragraph 11 are in addition to
the terms of Article 3 ("Confidentiality and Other Terms") of his
Employment Agreement dated November 6, 2007. In the event of
any conflict between the terms of this paragraph 11 and Article 3 of his
Employment Agreement, Xxxxx understands and agrees that the more
restrictive terms will control.
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12.
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Acceptance of
Agreement. To accept the terms of this Agreement, Xxxxx
must deliver this Agreement, after it has been signed and dated by him to
the undersigned in an envelope marked “Personal and
Confidential.”
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13.
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Xxxxx'x
Representations. Chait represents and warrants that in
the making and execution of this Agreement, he is not relying on any
representation, statement, or assertion of fact or opinion made by any
agent, attorney, employee, or representative of the persons, parties, or
corporations being released herein, and he hereby waives any right to rely
upon all prior agreements and/or oral representations made by any agent,
attorney, employee, or representative of such persons, parties, or
corporations even though made for the purpose of inducing him to enter
into this Agreement.
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14.
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Return of BASi’s
Property. Chait hereby represents and warrants that he
has returned to BASi all of BASi’s property that was in his possession or
control. This includes, but is not limited to, keys, credit
cards, phone cards, cellular telephones, pagers, directories, computer
hardware and software, books, documents, memoranda, and all other records,
and copies thereof.
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Xx.
Xxxxxx X. Xxxxx
November
10, 2008
Page
7
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15.
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Cooperation and
Transition Assistance. Xxxxx agrees that he will be
available to assist XXXx with transitional matters relating to his former
duties with XXXx, without additional compensation, for the severance
period discussed in paragraph 5,
above.
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16.
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Miscellaneous.
The Parties agree that this Agreement is deemed made and entered into in
the State of Indiana and in all respects shall be interpreted, enforced
and governed under the laws of the State of Indiana, unless otherwise
preempted by federal law. Jurisdiction and venue for litigation of any
dispute, controversy, or claim arising out of or in connection with this
Agreement shall lie exclusively in the federal or state courts in
Tippecanoe County, Indiana, and the Parties hereby consent to service of
process from said courts. This Agreement shall inure to the
benefit of and may be enforced by, and shall be binding on The Parties and
their heirs, executors, administrators, personal representatives, assigns,
and successors in interest. The language of all parts of this
Agreement shall be in all cases construed as a whole, according to its
fair meaning, and not strictly for or against the
drafter.
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17.
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Time to Consider this
Agreement. Xxxxx understands that he has until
twenty-one (21) days from the date of delivery of this Agreement to
consider the terms of this Agreement. Xxxxx understands that he
may sign this Agreement at any time during the twenty-one day
period. Xxxxx understands that he may revoke this Agreement if
he so chooses until seven (7) days after the date of
execution. Chait further understands that this Agreement will
not become effective or enforceable and that BASi’s obligations in
paragraph 5 of this Agreement to make payments and provide benefits will
not become effective or enforceable until seven (7) days from the date of
Chait's execution of this Agreement and provided that the Agreement is not
revoked during such seven day period ("Release Effective
Date").
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18.
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OWBPA
Disclosures. Xxxxx understands that the claims released by this
Agreement include claims under the Age Discrimination in Employment Act,
as modified by the Older Worker Benefit Protection Act
("OWBPA"). Xxxxx acknowledges that he has been advised by XXXx
to consult with an attorney concerning the requirements of the
OWBPA. By his signature below, Xxxxx signifies his
understanding that this Agreement satisfies the requirements of the
OWBPA.
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Sincerely,
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BIOANALYTICAL
SYSTEMS,
INC.
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Xxxxxxx
X. Xxxxxxxx
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President
& C.E.O.
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Xx.
Xxxxxx X. Xxxxx
November
10, 2008
Page
8
My
signature below represents my unconditional acceptance of all terms and
conditions contained in this Agreement.
Xx.
Xxxxxx X..
Xxxxx
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Date
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