Exhibit 10.2
[ALTEON LETTERHEAD]
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement"), dated as of February 11,
2002, by and between Alteon Inc., a Delaware corporation (the "Company"), and
Xxxxxx X. Xxxxxxxx (the "Employee").
WHEREAS, the Company wishes to employ the Employee as Senior Vice
President, Corporate Development; and
WHEREAS, the Employee wishes to enter into the employ of the Company as
its Senior Vice President, Corporate Development;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein, the parties hereby agree as follows:
1. Term of Employment. Subject to the terms and conditions
hereof, the Company will employ the Employee, and the Employee
will serve the Company, as Senior Vice President, Corporate
Development, for a period beginning on the date hereof and
terminating three years thereafter, subject to extension by
mutual agreement of the Company and the Employee (such term,
as it may be extended, is hereinafter referred to as the "Term
of Employment").
2. Duties. During the Term of Employment, the Employee will serve
as Senior Vice President, Corporate Development, subject to
the terms of this Agreement and the direction and control of
the Board of Directors, and/or the Chief Executive Officer of
the Company. The Employee will, during the Term of Employment,
serve the Company faithfully, diligently and competently and
to the best of Employee's ability, and will, consistent with
the dignity of the office of Senior Vice President, Corporate
Development, of the Company, hold, in addition to the office
of Senior Vice President, Corporate Development, of the
Company, such other offices in the Company to which Employee
may be appointed or assigned from time to time by the Board of
Directors and/or the Chief Executive Officer of the Company
and will discharge such duties in connection therewith. The
Employee shall devote substantially all of her business time
and attention to the performance of the duties hereunder;
provided, however, that the Employee may maintain a consulting
relationship with McKinsey & Company, Inc., so long as such
relationship does not interfere or conflict with her
responsibilities hereunder.
3. Compensation. During the Term of Employment, the Company will
pay to the Employee as compensation for the performance of
Employee's duties and obligations hereunder a base salary at
the rate of $215,000 per annum ("Salary"), payable in equal
semi-monthly installments. Such Salary shall be reviewed
annually by the Board of Directors of the Company in
accordance with the Company's compensation program. In each of
the Company's fiscal years during the Term of Employment, the
Employee shall be eligible to receive a cash bonus of up to
$30,000, to be awarded at the sole discretion of the Board of
Directors of the Company. The Board shall use as a basis for
determining the extent of such bonus awards the attainment of
stated goals and objectives for the Employee to be set by the
Compensation Committee of the Board after consultation with
the Chief Executive Officer.
4. Other Benefits. During the Term of Employment:
A. The Employee shall be entitled during the Term of
Employment to participate in employee benefit plans
and programs of the Company to the extent that
Employee's position, tenure, salary, age, health and
other qualifications make Employee eligible to
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participate. The Company does not guarantee the
adoption or continuance of any particular employee
benefit plan or program during the Term of
Employment, and the Employee's participation in any
such plan or program shall be subject to the
provisions, rules, regulations and laws applicable
thereto; provided, however, that during the Term of
Employment, the Employee shall be entitled to health
and hospital insurance benefits consistent with the
past practices of the Company in effect with respect
to Company personnel generally.
B. The Employee shall be entitled to 4 weeks vacation
per year while employed hereunder. Such vacation may
be taken by the Employee at such times as do not
unreasonably interfere with the business of the
Company. The accumulation of annual vacation time
earned, but not taken, will be in accordance with the
Company policy guidelines. Additional vacation will
be earned in accordance with Company policy.
C. The Company shall grant to the Employee an incentive
stock option (or to the extent that such option does
not qualify as an incentive stock option, a
non-qualified stock option), pursuant to the
Company's Amended 1995 Stock Option Plan (the
"Plan"), to purchase 200,000 shares of Common Stock
of the Company ("Common Stock") with an exercise
price equal to the closing price of the Company's
Common Stock on the date of the grant of the option.
Such option shall be in the form of, and on such
terms and conditions as provided in, the Company's
standard form of Stock Option Grant Agreement in
effect as of the date of this Agreement. Such Stock
Option Grant Agreement for such option shall provide,
on condition that the Employee is employed by the
Company on the relevant vesting dates, that such
options shall vest as follows:
i) 25,000 shares shall vest on the first
anniversary of the date of grant of the
option and 75,000 shares shall vest in 36
equal monthly installments on the first day
of each calendar month after the first
anniversary; and
ii) 100,000 shares shall vest upon the
accomplishment by the Employee of specified
milestones, as determined by the
Compensation Committee of the Board after
consultation with the Chief Executive
Officer.
5. Expenses. During the Term of Employment, the Company will
reimburse the Employee for all travel and other reasonable
business expenses incident to the rendering of services by the
Employee under this Agreement, subject to the submission of
appropriate vouchers and receipts in accordance with the
Company's policy from time to time in effect. The Employee
will initially be based in or near Washington, D.C.; provided,
however, that the Company anticipates, upon the receipt of
favorable data from one or more of its pending clinical
trials, it may request that Employee relocate to the Company's
principal offices. If the Company requests that Employee
relocate, the Company shall reimburse Employee for reasonable
agreed upon costs associated with such relocation. Prior to
such relocation, Employee shall be required to maintain her
own office, either in her home or at some other location of
her preference, and Employee shall be responsible for costs
associated with maintaining such office; provided, however,
the Company shall reimburse Employee for such reasonable costs
associated with such office as the Company may agree upon.
6. Death or Disability.
A. This Agreement shall be terminated by the death of
the Employee. In addition, this Agreement may be
terminated by the Board of Directors of the Company
if the Employee shall be rendered incapable by
illness or any other disability, from complying with
the terms, conditions and provisions on Employee's
part to be kept, observed and performed for a period
in excess of 180 days (whether or not consecutive) or
90 days consecutively, as the case may be, during a
12-month period during the Term of Employment
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("Disability"). If this Agreement is terminated by
reason of Disability of the Employee, the Company
shall give written notice to that effect to the
Employee in the manner provided herein. In the event
that the Employee receives disability insurance
benefits paid for by the Company during any period
prior to termination of this Agreement pursuant to
this Section 6(A), the Employee's Salary shall be
reduced by an amount equal to such disability
insurance benefits during such period.
B. In addition to and not in substitution for any other
benefits which may be payable by the Company with
respect to the death or Disability of the Employee in
the event of such death or Disability, the Salary
payable hereunder shall continue to be paid at the
then current rate for three months after the
termination of employment, and any bonus to which the
Employee would have been entitled for the year in
which Employee's death occurs shall be pro rated to
the date of Employee's death and paid not later than
three months after the termination of employment. In
the event of the death of the Employee during the
Term of this Agreement, the sums payable hereunder
shall be paid to Employee's personal representative.
7. Disclosure of Information, Inventions and Discoveries. The
Employee shall promptly disclose to the Company all processes,
trademarks, inventions, improvements discoveries and other
information related to the business of the Company
(collectively, "Developments") conceived, developed or
acquired by Employee alone or with others during the Term of
Employment or during any earlier period of employment by the
Company or any predecessor of the Company, whether or not
during regular working hours or through the use of materials
or facilities of the Company. All such Developments shall be
the sole and exclusive property of the Company, and, upon
request, the Employee shall promptly deliver to the Company
all drawings, sketches, models and other data and records
relating to such Developments. In the event any such
Development shall be deemed by the Company to be patentable,
the Employee shall, at the expense of the Company, assist the
Company in obtaining a patent or patents thereon and execute
all documents and do all such other acts and things necessary
or proper to obtain letters of patents and to invest in the
Company full right, title and interest in and to such
Developments.
8. Non-Disclosure. The Employee shall not, at any time during or
after the Term of Employment, divulge, furnish or make
accessible to anyone (otherwise than in the regular course of
business of the Company), or use for Employee's own account or
for the account of any person, any knowledge or information
with respect to confidential or secret processes, inventions,
discoveries, improvements, formulae, plans, materials, devices
or ideas or other know-how, whether patentable or not, with
respect to any confidential or secret development or research
work or with respect to any other confidential or secret
aspects of the Company's business (including, without
limitation, customer lists, supplier lists and pricing
arrangements with customers or suppliers).
9. Non-Competition. The Company and the Employee agree that the
services rendered by the Employee hereunder are unique and
irreplaceable. The Employee hereby agrees that, during the
Term of Employment and for a period of one year thereafter,
the Employee shall not (i) in any geographical area in the
United States or in those foreign countries where the Company,
during the Term of Employment, conducts or proposes to conduct
business or initiates activities, engage or participate in,
directly or indirectly (whether as an officer, director,
employee, partner, consultant, holder of an equity or debt
investment, lender or in any other manner or capacity), or
lend Employee's name (or any part or variant thereof) to any
business which is, or as a result of the Employee's engagement
or participation would become, competitive with any aspect of
the business of the Company, such business being the
commercialization of the measurement, prevention therapy or
reversal of glucose-mediated non-enzymatic crosslinking of
macro-molecules, and such other specific technologies in which
the Company has, during the Term of Employment, initiated
significant
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plans to develop products, (ii) deal, directly or indirectly,
in a competitive manner with any customers doing business with
the Company during the Term of Employment (except in
connection with the performance of the duties and obligations
of the Employee during the Term of Employment), (iii) solicit
any officer, director, employee, consultant or agent of the
Company to become an officer, director, employee, consultant
or agent of the Employee, Employee's respective affiliates or
anyone else, and (iv) engage in or participate in, directly or
indirectly, any business conducted under any name that shall
be the same as or similar to the name of the Company or any
trade name used by it. Ownership, in the aggregate, of less
than one percent of the outstanding shares of capital stock of
any corporation with one or more classes of its capital stock
listed on a national securities exchange or publicly traded in
the over-the-counter market shall not constitute a violation
of the foregoing provision.
10. Remedies. The Employee acknowledges that irreparable damage
would result to the Company if the provisions of Sections 7,
8, 9 or 14 were not specifically enforced, and agrees that the
Company shall be entitled to any appropriate legal, equitable
or other remedy, including injunctive relief, in respect to
any failure to comply with the provisions of Sections 7, 8, 9
or 14.
11. Termination for Cause. In addition to any other remedy
available to the Company, either at law or in equity, the
Employee's employment with the Company may be terminated by
the Board of Directors for cause, which shall include (i) the
Employee's conviction for, or plea of nolo contendere, to a
felony or a crime involving moral turpitude, (ii) the
Employee's commission of an act of personal dishonesty or a
breach of fiduciary duty involving personal profit in
connection with the Employee's employment by the Company,
(iii) the Employee's commission of an act which the Board of
Directors shall reasonably have found to have involved willful
misconduct or gross negligence on the part of the Employee in
the conduct of Employee's duties under this Agreement, (iv)
habitual absenteeism, (v) the Employee's material breach of
any material provision of this Agreement, (vii) the willful
and continued failure by the Employee to perform substantially
Employee's duties with the Company (other than any such
failure resulting from Employee's incapacity due to physical
or mental illness), or (viii) the Employee's failure, at any
time after the first anniversary of the date of this
Agreement, to relocate to the Company's principal office
within a reasonable time following the request of the Company.
In the event of termination under this Section 11, the
Company's obligations under this Agreement shall cease and the
Employee shall forfeit all rights to receive any future
compensation under this Agreement. Notwithstanding any
termination of this Agreement pursuant to this Section 11, the
Employee, in consideration of Employee's employment hereunder
to the date of such termination, shall remain bound by the
provisions of Sections 7, 8, 9 and 14 hereof.
12. Termination Without Cause. Each of the Company and Employee
may terminate this Agreement at any time for any reasons
whatsoever, without any further liability or obligation of the
Company to the Employee or of the Employee to the Company from
and after the date of such termination (other than liabilities
or obligations accrued but unsatisfied on, or surviving, the
date of such termination), by sending 30 days' prior written
notice to the other party. In the event (a) the Company elects
to terminate this Agreement prior to the end of the Term of
Employment, or (b) the Company gives Employee notice of its
election not to extend the Term of Employment beyond the
expiration of the then current Term of Employment, or (c) by
the date which is four months prior to the end of the then
current Term of Employment, the Company has not offered to
extend the then current Term of Employment, the Company shall
continue to pay the Employee the full Salary (exclusive of
bonuses, if any) as such Salary would have otherwise accrued
for a period of six months. In the event the Employee elects
to terminate prior to the end of the Term of Employment, the
Company's obligation to pay Salary shall cease as of the
effective date of termination. Notwithstanding any termination
of this Agreement pursuant to this Section 12, the Employee,
in consideration of Employee's employment hereunder to the
date of such termination, shall remain bound by
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the provisions of Sections 7, 8, 9 and 14 hereof. Any
termination of this Agreement by the Company as provided in
this Section 12 shall be in addition to, and not in
substitution for, any rights with respect to termination of
the Employee which the Company may have pursuant to Section
11.
13. Resignation. In the event that the Employee's services under
this Agreement are terminated under any of the provisions of
this Agreement (except by death), the Employee agrees to
deliver written resignation from all positions held with the
Company to the Board of Directors, such resignation to become
effective immediately; provided, however, that nothing herein
shall be deemed to affect the provisions of Sections 7, 8, 9
and 14 hereof relating to the survival thereof following
termination of the Employee's services hereunder, and
provided, further, that except as expressly provided in this
Agreement, the Employee shall be entitled to no further
compensation hereunder.
14. Data. Upon termination of the Term of Employment or
termination pursuant to Sections 6, 11 or 12 hereof, the
Employee or Employee's personal representative shall promptly
deliver to the Company all books, electronic data, memoranda,
plans, records and written data of every kind relating to the
business and affairs of the Company which are then in
Employee's possession.
15. Insurance. The Company shall have the right, at its own cost
and expense, to apply for and to secure in its own name or
otherwise, life, health or accident insurance or any or all of
them covering the Employee, and the Employee agrees to submit
to usual and customary medical examinations and otherwise to
cooperate with the Company in connection with the procurement
of any such insurance, and any claims thereunder.
16. Waiver of Breach. Any waiver of any breach of this Agreement
shall not be construed to be a continuing waiver or consent to
any subsequent breach on the part either of the Employee or of
the Company.
17. Assignment. This Agreement shall inure to the benefit of and
be binding upon the successors and assigns of the Company upon
any sale of all or substantially all of the Company's assets,
or upon any merger or consolidation of the Company with or
into any other entity, all as though such successors and
assigns of the Company and their respective successors and
assigns were the Company. Insofar as the Employee is
concerned, this Agreement, being personal, may not be
assigned.
18. Severability. To the extent any provision of this Agreement
shall be invalid or unenforceable, it shall be considered
deleted therefrom and the remainder of such provision and of
this Agreement shall be unaffected and shall continue in full
force and effect. In furtherance and not in limitation of the
foregoing, should the duration or geographical extent of, or
business activities covered by, any provision of this
Agreement be in excess of that which is valid and enforceable
under applicable law, then such provision shall be construed
to cover only that duration, extent or activities which may be
validly covered and enforceable.
19. Notices. All notices, requests and other communications
pursuant to this Agreement shall be in writing and shall be
deemed to have been duly given, if delivered in person or by
courier, telegraphed, telexed or by facsimile transmission or
five business days after being sent by registered or certified
mail, return receipt requested, postage paid, addressed as
follows:
If to the Employee:
Xxxxxx X. Xxxxxxxx
0000 Xxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
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If to the Company:
Alteon Inc.
000 Xxxxxxxx Xxxxx
Xxxxxx, Xxx Xxxxxx 00000
with a copy to:
Xxxxxxx X. Xxxxx, Esq.
Smith, Stratton, Wise, Xxxxx & Xxxxxxx, LLP
000 Xxxxxxx Xxxx Xxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Any party may, by written notice to the other in accordance
with this Section 19, change the address to which notices to
such party are to be delivered or mailed.
20. General. Except as otherwise provided herein, the terms and
provisions of this Agreement and any Stock Option Grant
Agreements entered into between the Employee and the Company
shall constitute the entire agreement by the Company and the
Employee with respect to the subject matter hereof, and shall
supersede any and all prior agreements or understandings
between the Employee and the Company, whether written or oral.
This Agreement may be amended or modified only by a written
instrument executed by the Employee and the Company. This
Agreement may be executed in any number of counterparts, all
of which, when executed, shall be deemed to be an original,
and all of which together shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the parties have executed this Employment Agreement
as of the day and year first above written.
ALTEON INC.
By: /s/ Xxxxxxx X. Xxxx
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Xxxxxxx X. Xxxx
President and Chief Executive Officer
/s/ Xxxxxx X. Xxxxxxxx
-----------------------------------------
Xxxxxx X. Xxxxxxxx
