EXHIBIT 10.1
SEPARATION AGREEMENT
This SEPARATION AGREEMENT (this "Agreement") is made and entered into
by and between Xxxxxxx Xxxxxx (the "Executive") and Neurologix, Inc., a
Delaware corporation (the "Company"), as of July 17, 2006.
WHEREAS, the Executive has been employed by the Company pursuant to an
Employment Agreement dated as of September 21, 2004 (the "Employment
Agreement");
WHEREAS, the Employment Agreement provides for certain payments to the
Executive upon the termination of his employment:
WHEREAS, the Executive desires to resign as Chief Executive Officer of
the Company effective July 17, 2006 and to resign his employment effective July
31, 2006;
WHEREAS, the Company and the Executive believe it is in the best
interest of the Company to enter into this Agreement and provide for an orderly
transition of the Executive from the Company and the post termination covenants
provided herein, in exchange for the enhanced benefits to the Executive set
forth herein.
NOW, THEREFORE, the Company and the Executive hereby agree as follows:
1. Resignation. The Executive shall cease to serve as the Company's
Chief Executive Officer effective as of July 17, 2006. The Executive's
employment with the Company shall terminate effective as of July 31, 2006 (the
"Termination Date").
2. Board of Directors. The Executive shall continue to serve on the
Company's Board of Directors and the Executive shall not receive any additional
consideration from the Company for such service.
3. Payments and Benefits.
(a) Compensation. The Company shall continue to pay Executive
his current base salary until the Termination Date.
(b) Accrued Compensation. Within ten (10) days following the
Termination Date, the Company shall pay to the Executive all
accrued but unpaid salary and the cash equivalent of any
accrued, but unused vacation, and shall reimburse the
Executive for any outstanding business expenses for which he
is entitled to be reimbursed.
(c) Severance Payment. The Company shall pay to the Executive
an aggregate severance payment of one hundred and eighty five
thousand dollars ($185,000) (the "Severance Amount"). Such
Severance Amount shall be payable in equal installments in
accordance with the Company's regular payroll practices for
the duration of the Severance Period (as defined below).
(d) Benefits. The Company shall provide the Executive with
any accrued employee benefits as of the Termination Date,
subject to the terms of the applicable employee benefit
plans. In addition, through September 30, 2007 (such period,
the "Severance Period"), the Company shall continue to
provide the Executive and his eligible dependents with
medical benefits no less favorable than the medical benefits
provided to the Executive and his eligible dependents
immediately prior to the Termination Date.
(e) No Mitigation. The Executive shall not be required to
mitigate the amount of any payment or benefit provided under
this Agreement by seeking other employment or otherwise, nor
shall the amount of any payment or benefit provided herein be
reduced by any compensation earned by the Executive
subsequent to the Termination Date.
4. Stock Options. All outstanding stock options held by the Executive
as of the Termination Date shall become vested and exercisable on the
Termination Date and shall terminate upon the later of (a) the fifteenth day of
the third month following the date that the Executive ceases to be a member of
the Company's Board of Directors or (b) December 31 of the calendar year which
includes the date that the Executive ceases to be a member of the Company's
Board of Directors (but in no extent later than the expiration of their
original term). The Executive shall consult in advance with the Company
regarding the sale of shares of the Company's common stock underlying such
options. In addition, the Company shall use its reasonable best efforts to
ensure that the Company files a Form S-8 covering the Company's common stock
underlying such options.
5. Nondisparagement. The Executive shall not make, participate in the
making of, or encourage any other person to make, any statements, written or
oral, that criticize, disparage, or defame the goodwill or reputation of, or
which are intended to embarrass or adversely affect the morale of, the Company
or any of its affiliates or any of their respective present, former or future
directors, officers, executives, and/or employees. The Executive further agrees
not to make any negative statements, written or oral, relating to Executive's
employment or the termination of his employment, or any aspect of the business
of the Company or any of its affiliates. In addition, the Company shall not
issue a public statement disparaging the Executive and agrees to use reasonable
efforts to prevent any of it officers, directors and/or employees from
disparaging the Executive. Nothing contained in the foregoing shall be deemed
to prohibit or restrict truthful testimony or statements in any legal or
administrative proceeding, action, investigation or inquiry regarding the
Company or the Executive's employment.
6. Confidentiality. The Executive shall hold in a fiduciary capacity
consistent with the Company's code of ethics for the benefit of the Company all
secret or confidential information, knowledge or data relating to the Company
or any of its affiliates that he has obtained during his employment by the
Company or any of its affiliates that is not public knowledge (other than as a
result of the Executive's violation of this Section 6) ("Confidential
Information"). The Executive shall not communicate, divulge or disseminate
Confidential Information at any time, except with the prior written consent of
the Company or as otherwise required by law or legal process.
7. Release. On or about the Termination Date, each of the Company and
the Executive shall execute the General Release and Waiver set forth in Exhibit
A hereto (the "Release").
8. Entire Agreement; Other Benefits. This Agreement contains the
entire agreement of the parties, relating to the Executive's employment by
Company and termination of employment and all other matters arising between
Company and the Executive prior to the date and time of execution hereof, and
supersedes all prior discussions, agreements, contracts and understandings
between the parties, including the Employment Agreement, other than Section 7
of the Employment Agreement which shall survive.
9. Return of Property and Company Information. Unless the Company
gives the Executive express permission to retain certain Company Information
for so long as the Executive continues to serve on the Company's Board of
Directors, the Executive agrees to return to Company, within five calendar (5)
days of the Executive's Termination Date, all Company Information, including,
but not limited to, documents and memoranda, and all other property belonging
to the Company which is in the Executive's possession or control. The term
Company Information as used in this Agreement means except as set forth above:
(a) Confidential Information including, without limitation, information
received from third parties under confidential conditions; and (b) other
technical business or financial information which the Company regards as
confidential and the use or disclosure of which might reasonably be considered
to be contrary to the interests of the Company. The Executive further agrees
that in the course of his employment with the Company, the Executive has
acquired Company Information as defined above. The Executive understands and
agrees that such Company Information has been disclosed to the Executive in
confidence and for Company use only. The Executive understands and agrees that
he (i) will not disclose confidential information to anyone in the Company not
authorized to have access to it; (ii) will not disclose or communicate Company
Information to any person outside the Company, except to the extent disclosure
is or may be required by a statue, by a court of law, by any governmental
authority having supervisory authority over the business of the Company or by
any administrative or legislative body (including a committee thereof) with
jurisdiction to order him to divulge, disclose or make accessible such
information; and (iii) will not make use of Company Information on the
Executive's own behalf, or on behalf of any third party. The Executive's
obligation in this Section 9 shall survive the termination of this Agreement.
10. Successors. This Agreement is personal to the Executive and
without the prior written consent of the Company shall not be assignable by the
Executive other than by will or the laws of descent and distribution. This
Agreement may not be assigned by the Company other than to the successor to all
or substantially all of its assets or business in a merger, sale, consolidation
or similar corporate transaction.
11. Amendment. This Agreement may be amended, modified or changed only
by a written instrument executed by the Executive and the Company.
12. Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware or federal law, where
applicable. The captions of this Agreement are not part of the provisions
hereof and shall have no force or effect.
13. Notices. All notices and other communications hereunder shall be
in writing; shall be delivered by hand delivery to the other party or mailed by
registered or certified mail, return receipt requested, postage prepaid; shall
be deemed delivered upon actual receipt; and shall be addressed as follows:
If to the Executive:
Xxxxxxx Xxxxxx, MD
000 Xxxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
Tel: 000-000-0000
With a copy to:
Xxxx X. Xxxxxxxxxx, Esq.
Xxxxxxxxx Xxxxxxx, LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Tel: 000-000-0000
If to the Company:
Neurologix, Inc.
Xxx Xxxxxx Xxxxx
Xxxx Xxx, XX 00000
Attn: Chief Financial Officer
Tel: 000-000-0000
With a copy to:
Xxxxxxx X Xxxxxx, Esq.
Xxxxxxx Xxxx Slate Xxxxxxx & Xxxx LLP
0 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Tel: 000-000-0000
or to such other address as either party shall have furnished to the other in
writing in accordance herewith.
14. Tax Withholding. Notwithstanding any other provision of this
Agreement, the Company may withhold from any amounts payable under this
Agreement, or any other benefits received pursuant hereto, such minimum
federal, state and/or local taxes as shall be required to be withheld under any
applicable law or regulation. Each of the Executive and the Company shall bear
their respective tax liabilities, if any, resulting from this Agreement. The
Executive acknowledges that the Company has made no representations about the
tax consequences of any amount received by him pursuant to the terms of this
Agreement.
15. Remedies. The Executive acknowledges and agrees that it would be
difficult to measure any damages caused to the Company which might result from
any breach of the provisions of this Agreement or Section 7 of the Employment
Agreement, and that, in any event, money damages would be an inadequate remedy
for any such breach. Accordingly, the Executive acknowledges and agrees that if
he breaches or threatens to breach, any portion of this Agreement or Section 7
of the Employment Agreement, the Company shall be entitled, in addition to all
other remedies that it may have, to an injunction or other appropriate
equitable relief to restrain any such breach without showing or proving any
actual damage to the Company and without the necessity of posting any bond or
other security.
IN WITNESS WHEREOF, each of the parties hereto has duly executed this
Agreement as of the date first set forth above.
/s/ Xxxxxxx Xxxxxx, MD
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Xxxxxxx Xxxxxx, MD
NEUROLOGIX, INC.
By: /s/ Xxxx X. Xxxxxx
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Name: Xxxx X. Xxxxxx
Title: Chief Financial Officer
