EMPLOYMENT AGREEMENT
This
EMPLOYMENT AGREEMENT (this
“Agreement”)
is
made and entered into this August 3, 2007 by and between Xxxxx X. Xxxxxx (the
“Executive”)
and
Healthcare Acquisition Corp., a Delaware corporation (the “Company”).
WITNESSETH:
WHEREAS,
the
Executive has been employed by PharmAthene, Inc., a Delaware corporation
(“PharmAthene”)
and a
party to the Agreement and Plan of Merger, dated as of January 19, 2007 (the
“Merger
Agreement”),
with
the Company and PAI Acquisition Corp. pursuant to which it is contemplated
that,
subject to satisfaction or waiver of all conditions set forth in the Merger
Agreement, PharmAthene will become the sole wholly-owned subsidiary of the
Company and the Company will change its name to PharmAthene, Inc.;
and
WHEREAS,
in
connection with the merger, the parties desire to transition the Executive
from
the position of Chief Executive Officer of PharmAthene, Inc., the pre-merger
company and merger party, to Chief Executive Officer of the Company;
and
WHEREAS,
in
entering into this Agreement, the Board of Directors of the Company (the
“Board”)
desires to provide the executive with substantial incentives to serve the
Company as one of its senior executives performing at the highest level of
leadership and stewardship to manage the Company’s future growth and development
and to maximize the returns to the Company’s stockholders;
NOW,
THEREFORE,
in
consideration of the foregoing and of the mutual covenants and obligations
hereinafter set forth, the parties hereto hereby agree as follows:
1.
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Employment;
Term. The
Company hereby agrees, provided that the Executive continues to be
employed by PharmAthene on the date of the consummation of the
contemplated merger, to employ the Executive and the Executive hereby
accepts employment by the Company upon the terms and conditions
hereinafter set forth for the period commencing on the date of
consummation of the contemplated merger (the “Effective
Date”)
and ending on the first anniversary of such date. The term of this
Agreement shall be automatically extended for an additional year
on each
anniversary of the date hereof unless written notice of non-extension
is
provided by either party to the other party at least 90 days prior
to such
anniversary. The period of the Executive’s employment under this
Agreement, as it may be terminated or extended from time to time
as
provided herein is referred to as the “Employment
Period.”
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2.
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Position
and Duties.
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a.
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Position
and Duties Generally. The
Executive shall be employed by the Company in the position of Chief
Executive Officer and shall faithfully render such executive, managerial,
administrative and other services as are customarily associated with
and
incident to such position and as the Company may from time to time
reasonably require consistent with such position. The Executive shall
report to the Board of Directors or the Board’s
designee.
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1
b.
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Other
Positions. The
Executive shall hold such other positions and executive offices with
the
Company and/or of any of the Company’s subsidiaries or affiliates as may
from time to time be authorized by the Board. The Executive shall
not be
entitled to any compensation other than the compensation provided
for
herein for serving during the Employment Period in any other office
or
position of the Company or any of its subsidiaries or affiliates,
unless
the Compensation Committee specifically approves such additional
compensation.
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c.
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Devotion
to Employment. Except
for vacation time taken in accordance with the Company’s vacation policy
in effect from time to time and in accordance with the terms of this
Agreement and for absences due to temporary illness, the Executive
shall
be a full-time employee of the Company and shall devote full time,
attention and efforts during the Employment Period to the business
of the
Company and the duties required of him in his position. During the
Employment Period, the Executive shall not be engaged in any other
business activity which, in the reasonable judgment of the Board
or its
designee, conflicts with the duties of the Executive hereunder, whether
or
not such activity is pursued for gain, profit or other pecuniary
advantage.
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d.
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Director
Status. The
Company shall (i) nominate the Executive for re-election to the Board
throughout the Employment Period on each occasion during the Employment
Period when his term as a director is scheduled to expire, (ii) in
all
proxy and other materials, recommend that the stockholders vote in
favor
of the Executive’s election as a director, (iii) not directly or
indirectly oppose or withdraw support from the Executive, and (iv)
solicit
proxies from the stockholders authorizing the named proxy holders
to vote
in favor of the Executive’s candidacy. The Executive agrees that in the
event of the termination of his employment under this Agreement or
of his
resignation, he shall tender his resignation from the Board as
well.
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e.
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Other
Directorships. The
Executive may serve as a non-management director of one or more businesses
or not-for-profit organizations provided, however, that the Executive
may
not serve in such capacity with respect to more than two organizations
at
any one time without the prior written approval of the
Board.
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3.
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Compensation;
Reimbursement.
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a.
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Base
Salary. For
the Executive’s services, the Company shall pay to the Executive an annual
base salary of not less than $392,000 per annum, payable in equal
periodic
installments according to the Company’s customary payroll practices, but
no less frequently than monthly. The Executive’s base salary shall be
subject to review annually by the Compensation Committee and shall
be
subject to increase at the option and sole discretion of the Compensation
Committee.
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b.
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Bonus.
The Executive shall be eligible to receive at the sole discretion
of the
Compensation Committee, an annual cash bonus of up to an additional
30% of
his base salary. In addition, the Executive may be eligible for additional
bonuses at the option and sole discretion of the Compensation Committee
based upon based upon the achievement of certain pre-determined
performance milestones.
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2
c.
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Benefits
Generally.
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i.
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In
addition to the salary and cash bonus described above, the Executive
shall
be entitled during the Employment Period to participate in such employee
benefit plans and programs of the Company, and shall be entitled
to such
other fringe benefits, as are from time to time made available by
the
Company generally to employees of the level, position, tenure, salary,
age, health and other qualifications of the Executive including,
without
limitation, medical, dental and vision insurance coverage for the
Executive and his dependents, disability, death benefit and life
insurance
and pension plans.
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ii.
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Without
limiting the generality of the foregoing, the Executive shall be
eligible
for such awards, if any, including stock and stock options under
the
Company’s 2007 Long-Term Incentive Plan or such other plan as the Company
may from time to time put into effect as shall be granted to the
Executive
by the Compensation Committee or other appropriate designee of the
Board
acting in its sole discretion.
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iii.
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The
Executive acknowledges and agrees that the Company does not guarantee
the
adoption or continuance of any particular employee benefit plan and
participation by the Executive in any such plan or program shall
be
subject to the rules and regulations applicable thereto.
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d.
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Stock
Options.
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i.
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Contemporaneously
with the execution of this Agreement, Executive has been granted
a stock
option to purchase 780,000 shares of the Company’s common stock (the
“Initial
Stock Option”)
pursuant to the Company’s 2007 Long-Term Incentive Plan and subject to the
terms and conditions of such Plan and of a stock option agreement,
dated
the date hereof, by the Company and the Executive which shall be
executed
contemporaneously with the execution of this Agreement.
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ii.
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The
Initial Stock Option shall have a term of 10 years and, subject to
possible acceleration of vesting as otherwise provided herein, the
Initial
Stock Option shall vest over a 5 year period with 25% of the shares
under
the Initial Stock Option being exercisable on the first anniversary
of the
grant date and the remainder of the Initial Stock Option vesting
monthly
on a pro-rata basis over the succeeding 48 months following the first
anniversary such that 100% of the shares under the Initial Stock
Option
shall be exercisable after 5 years from the grant date.
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iii.
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The
per share exercise price of the Initial Stock Option shall be the
fair
market value of a share of the common stock of the Company on the
date of
grant as determined by the Compensation Committee in accordance with
Section 409A of the Internal Revenue Code of 1986, as amended (the
“Code”)
and the regulations of and the interpretive guidance issued by the
Department of the Treasury.
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3
iv.
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The
number of shares subject to the Option shall be equitably adjusted
in the
event of any change in the number of shares of the Company’s commons stock
outstanding by reason of any stock dividend or split, reverse stock
split,
recapitalization, merger, consolidation, combination or exchange
of shares
or similar corporate change occurring after the commencement of the
Executive’s employment under this
Agreement.
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v.
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Additional
future grants of stock options may be made to the Executive at the
discretion of the Compensation Committee.
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e.
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Restricted
Stock Awards.
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i.
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Contemporaneously
with the execution of this Agreement, the Executive has been granted
a
restricted stock award of 100,000 shares of the Company’s common stock
(the “Initial
Restricted Stock Award”)
pursuant to the Company’s 2007 Long-Term Incentive Plan and subject to the
terms and conditions of such Plan and of a restricted stock agreement,
dated the date hereof, by the Company and the Executive which shall
be
executed contemporaneously with the execution of this Agreement.
The
shares issued under the Initial Restricted Stock Award (the “Restricted
Shares”)
shall, subject to possible acceleration of vesting as otherwise provided
herein, vest over a 5 year period with 25% of the Restricted Shares
subject to the Initial Restricted Stock Award vesting on the first
anniversary of the grant of the Initial Restricted Stock Award and
the
remainder vesting monthly on a pro-rata basis over the succeeding
48
months following the first anniversary such that 100% of the Restricted
Shares shall be vested after 5 years from the grant date. All Restricted
Shares (including any shares received by the Executive with respect
to the
Restricted Shares as a result of stock dividends, stock splits or
any
other form of recapitalization) shall be subject to (1) customary
restrictions on ownership and transfer set forth in the restricted
stock
agreement and (2) the vesting requirements set forth in this Section
3(e);
provided, however, that such vesting requirements shall be modified
upon
the termination of the Executive’s employment, other than in the event of
Voluntary Termination or Termination for Cause, in accordance with
Section
9 of this Agreement.
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ii.
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Except
as provided herein and in the restricted stock agreement, the Executive
shall have all rights of a stockholders with respect to the Restricted
Shares including the right to receive dividends or other distributions
and
the right to vote the Restricted Shares provided that any such dividends
or other distributions shall be retained by the Company unless and
until
the Restricted Shares in respect of which such dividends or other
distributions were paid shall have
vested.
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4
iii.
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During
the period prior to the time that any particular Restricted Shares
become
vested and the restrictions thereon lapse, the Executive may not
sell,
transfer, pledge or otherwise encumber or dispose of the Restricted
Shares
and any attempted sale, transfer, pledge or other encumbrance or
disposition (whether voluntary or involuntary) in violation of this
Section shall be null and void.
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iv. |
The
Compensation Committee shall appoint an executive officer of the
Company
or such other escrow holder who shall retain physical custody of
the each
certificate representing the Restricted Shares until the Restricted
Shares
have vested. Upon vesting of any Restricted Shares, the certificates
evidencing such Restricted Shares shall be delivered promptly to
the
Executive. In the case of the Executive’s death, such certificates shall
be delivered to the beneficiary designated in writing by the Executive
pursuant to a form of designation provided by the Company, to the
Executive’s legatee or to his personal representative as the case may be.
Unless registered under the Securities Act of 1933, as amended,
certificates evidencing the Restricted Shares shall bear the following
legend:
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THE
SHARES EVIDENCED BY THIS CERTIFICATE MAY NOT BE SOLD, TRANSFERRED, PLEDGED,
HYPOTHECATED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THE SECURITIES
ACT
OF 1933, AS AMENDED, OR UNLESS, IN THE OPINION OF COUNSEL FOR THE COMPANY,
SUCH
REGISTRATION IS NOT REQUIRED.
v. |
The
Company shall have the right, but not the obligation, to repurchase
from
the Executive, immediately upon the termination of the Executive’s
employment if such termination is a Termination for Cause, such Restricted
Shares as are vested on the date of termination at a cash price per
share
equal to the fair market value of such Restricted Shares on the date
of
termination.
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vi.
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Additional
future grants of restricted stock awards may be made to the Executive
at
the discretion of the Compensation Committee.
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f.
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Vacation.
The Executive shall be entitled to 30 days of vacation in each calendar
year.
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g.
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Expenses.
The Company shall reimburse the Executive in accordance with the
practices
in effect from time to time for other officers or staff personnel
of the
Company for all reasonable and necessary business and travel expenses
and
other disbursements incurred by the Executive for or on behalf of
the
Company in the performance of the Executive’s duties hereunder, upon
presentation by the Executive to the Company of appropriate supporting
documentation.
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5
h.
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Certain
Legal Expenses. The
Company shall reimburse the Executive for the reasonable attorneys’ fees
incurred by him in connection with the negotiation and preparation
of this
Agreement up to an aggregate of
$10,000.
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i.
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Perquisites.
The Executive shall be entitled to those perquisites as the Company
shall
make available from time to time to other executive officers of the
Company, which shall include, without limitation, the costs associated
with the use of an automobile in an amount not to exceed $1,000 per
month
and the costs for Executive’s use of a cellular telephone and personal
digital assistant to the extent such equipment is used for business
purposes.
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4.
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Death; Disability.
In
the event that the Executive dies or is incapacitated or disabled
by
accident, sickness or otherwise, so as to render the Executive mentally
or
physically incapable of performing the services required to be performed
by the Executive under this Agreement for a period that would entitle
the
Executive to qualify for long-term disability benefits under the
Company’s
then-current long-term disability insurance program or, in the absence
of
such a program, for a period of 120 consecutive days or longer (such
condition being herein referred to as a “Disability”)
then (i) in the case of the Executive’s death, the Executive’s employment
shall be deemed to terminate on the date of the Executive’s death and (ii)
in the case of a Disability, the Company, at its option, may terminate
the
employment of the Executive under this Agreement immediately upon
giving
the Executive notice to that effect. The determination to terminate
the
Executive in the event of a Disability shall be made by the Board
or the
Board’s designee. In the case of a Disability, until the Company shall
have terminated the Executive’s employment hereunder in accordance with
the foregoing, the Executive shall be entitled to receive compensation
provided for herein notwithstanding any such physical or mental
disability.
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5.
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Termination
For Cause. The
Company may terminate the employment of the Executive hereunder at
any
time during the Employment Period for “cause” (such termination being
herein referred to as a “Termination
for Cause”)
by giving the Executive notice of such termination, which termination
shall be effective on the date of such notice or such later date
as may be
specified by the Company. For purposes of this Agreement, “Cause”
means (i) the Executive’s willful and substantial misconduct that is
materially injurious to the Company and is either repeated after
written
notice from the Company specifying the misconduct or is continuing
and not
corrected within 20 days after written notice form the Company specifying
the misconduct, (ii) the Executive’s repeated neglect of duties or failure
to act which can reasonably be expected to affect materially and
adversely
the business or affairs of the Company after written notice from
the
Company specifying the neglect or failure to act, (iii) the Executive’s
material breach of any of the agreements contained in Sections 11,
12, 13
or 14 hereof or of any of the Company’s policies, (iv) the commission by
the Executive of any material fraudulent act with respect to the
business
and affairs of the Company, (v) the Executive’s conviction of (or plea of
nolo contendere to) a crime constituting a felony, (vi) demonstrable
gross
negligence, or (vii) habitual insobriety or use of illegal drugs
by the
Executive while performing his duties under this Agreement which
adversely
affects the Executives performance of his duties under this
Agreement.
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6
6.
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Termination
Without Cause.
The Company may terminate the employment of the Executive hereunder
at any
time without “cause” or fail to extend this Agreement pursuant to the
terms hereof (such termination being herein referred to as “Termination
Without Cause”)
by giving the Executive notice of such termination, upon the giving
of
which such termination shall take effect not later than 30 days from
the
date such notice is given.
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7.
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Voluntary
Termination by Executive.
Any termination of the employment of the Executive by the Executive
otherwise than as a result of death or Disability or for Good Reason
(as
defined below) (such termination being herein referred to as “Voluntary
Termination”).
A Voluntary Termination will be deemed to be effective immediately
upon
such termination.
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8.
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Termination
by Executive for Good Reason. Any
termination of the employment of the Executive by the Executive for
Good
Reason which shall be deemed to be equivalent to a Termination without
Cause. For purposes of this Agreement “Good
Reason”
means (i) any material breach by the Company of any of its obligations
under this Agreement, (ii) any material reduction in the Executive’s
duties, authority or responsibilities without his consent, (iii)
any
assignment to the Executive of duties or responsibilities materially
inconsistent with his position and duties contained in this Agreement
without his consent, (iv) a relocation of the Company’s principal
executive offices or the Company determination to require the Executive
to
be based anywhere other than within 25 miles of the location at which
the
Executive on the date hereof performs his duties; (v) the taking
of any
action by the Company which would deprive the Executive of any material
benefit plan (including, without limitation, any medical, dental,
disability or life insurance); or (vi) the failure by the Company
to
obtain the specific assumption of this Agreement by any successor
or
assignee of the Company or any person acquiring substantially all
of the
Company’s assets; provided, however, that the Executive may not terminate
the Employment Period for Good Reason unless he first provides the
Company
with written notice specifying the Good Reason and providing the
Company
with 20 days in which to remedy the stated
reason.
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9.
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Effect
of Termination of Employment.
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a.
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Voluntary
Termination; Termination For Cause.
Upon the termination of the Executive’s employment as a result of his
Voluntary Termination or a Termination For Cause, the Executive shall
not
have any further rights or claims against the Company under this
Agreement
except the right to receive (i) the unpaid portion of the base salary
provided for in Section 3(a) hereof, computed on a pro rata basis
to the
date of termination, (ii) payment of his accrued but unpaid amounts
and
extension of applicable benefits in accordance with the terms of
any
incentive compensation, retirement, employee welfare or other employee
benefit plans or programs of the Company in which the Executive is
then
participating in accordance with the terms of such plans or programs,
and
(iii) reimbursement for any expenses for which the Executive shall
not
have theretofore been reimbursed as provided in Section 3 hereof.
In such
event, the Initial Stock Option and shares of the Initial Restricted
Stock
Award to the extent not vested as of the date of termination shall
be
forfeited to the Company (without any further action on the part
of the
Company or the Executive) and the Executive shall have no further
rights
in such regard.
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7
b.
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Termination
Without Cause; Termination for Good Reason.
Upon the termination of the Executive’s employment as a result of a
Termination Without Cause or for Good Reason, the Executive shall
not have
any further rights or claims against the Company under this Agreement
except the right to receive (i) the payments and other rights provided
for
in Section 9(a) hereof and (ii) severance payments in the form of
a
continuation of the Executive’s base salary as in effect immediately prior
to such termination for a period of 12 months following the effective
date
of such termination. In such event, an amount of shares equal to
up to 25%
of the total aggregate amount of the Initial Stock Option and the
Restricted Stock Award granted to the Executive shall become vested.
The
balance of such unvested Initial Stock Option and shares of the Initial
Restricted Stock Award shall be forfeited to the Company (without
further
action on the part of the Company or the Executive) as of the date
of
termination and the Executive shall have no further rights with respect
to
such balance. To the extent that severance payments shall be payable
under
this Agreement such payments shall be in consideration for and only
after
the Executive executes a General Release containing terms reasonably
satisfactory to the Company.
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c.
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Death
and Disability.
Upon the termination of the Executive’s employment as a result of death or
Disability, neither the Executive nor the Executive’s beneficiaries or
estate shall have any further rights or claims against the Company
under
this Agreement except the right to receive the payments and other
rights
provided for in Section 9(a) hereof. In such event, an amount of
shares
equal to up to 25% of the total aggregate amount of the Initial Stock
Option and the Restricted Stock Award granted to the Executive shall
become vested. The balance of such unvested Initial Stock Option
and
shares of Initial Restricted Stock Award shall be forfeited to the
Company
(without further action on the part of the Company or the Executive)
as of
the date of termination and the Executive shall have no further rights
with respect to such balance.
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d.
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Forfeiture
of Rights.
In
the event that, subsequent to termination of employment hereunder,
the
Executive (i) breaches any of the provisions of Sections 11, 12,
13 or 14
hereof or (ii) makes or facilitates the making of any adverse public
statements or disclosures with respect to the business or securities
of
the Company, all payments and benefits to which the Executive may
otherwise have been entitled shall immediately terminate and be forfeited,
and any portion of such amounts as may have been paid to the Executive
shall forthwith be returned to the Company.
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10.
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Change
in Control Provisions.
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a.
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Effect
of Termination Following Change in Control.
In
the event of a Change in Control during the Employment Period and
a
subsequent termination of the Executive’s employment, either by the
Company as a consequence of the Change in Control or any other Termination
Without Cause or by the Executive for Good Reason, then (i) Executive
shall be entitled to receive (A) the payments and other rights provided
in
Section 9(b) of this Agreement and (B) the benefits and other rights
provided in Section 10(a) of this Agreement; and (ii) the Initial
Stock
Option and shares of the Initial Restricted Stock Award held by the
Executive and not then vested shall become immediately and fully
vested as
of the effective date of the
termination.
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8
b.
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Definition
of Change in Control.
For purposes of this Agreement, a “Change
in Control”
means and shall be deemed to have occurred upon: (i) an acquisition
subsequent to the date hereof by any person, entity or group (within
the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange
Act of
1934, as amended (the “Exchange
Act”))
(a “Person”),
of beneficial ownership (within the meaning of Rule 13d-3 promulgated
under the Exchange Act) of 30% or more of either (A) the then outstanding
shares of common stock of the Company (“Common
Stock”)
or (B) the combined voting power of the then outstanding voting securities
of the Company entitled to vote generally in the election of directors
(the “Outstanding
Company Voting Securities”);
excluding, however, the following: (1) any acquisition directly from
the
Company, other than an acquisition by virtue of the exercise of a
conversion privilege unless the security being so converted was itself
acquired directly from the Company, (2) any acquisition by the Company
and
(3) any acquisition by an employee benefit plan (or related trust)
sponsored or maintained by the Company; (ii) the approval by the
stockholders of the Company of a merger, consolidation, reorganization
or
similar corporate transaction, whether or not the Company is the
surviving
corporation in such transaction, in which outstanding shares of Common
Stock are converted into (A) shares of stock of another company,
other
than a conversion into shares of voting common stock of the successor
corporation (or a holding company thereof) representing 80% of the
voting
power of all capital stock thereof outstanding immediately after
the
merger or consolidation or (B) other securities (of either the Company
or
another company) or cash or other property; (iii) the approval by
stockholders of the Company of the issuance of shares of Common Stock
in
connection with a merger, consolidation, reorganization or similar
corporate transaction in an amount in excess of 40% of the number
of
shares of Common Stock outstanding immediately prior to the consummation
of such transaction; (iv) the approval by the stockholders of the
Company
of (A) the sale or other disposition of all or substantially all
of the
assets of the Company or (B) a complete liquidation or dissolution
of the
Company; or (v) the adoption by the Board of a resolution to the
effect
that any person has acquired effective control of the business and
affairs
of the Company.
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11.
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Disclosure
of Confidential Information. The
Executive shall not, directly or indirectly, at any time during or
after
the Employment Period, disclose to any person, firm, corporation
or other
business entity, except as required by law, or use for any purpose
except
in the good faith performance of the Executive’s duties to the Company,
any Confidential Information (as herein defined). For purposes of
this
Agreement, “Confidential
Information”
means all trade secrets and other non-public information of a business,
financial , marketing, technical or other nature pertaining to the
Company
or any subsidiary, including information of others that the Company
or any
subsidiary has agreed to keep confidential; provided, however, that
Confidential Information shall not include any information that has
entered or enters the public domain (other than through breach of
the
Executive’s obligations under this Agreement) or which the Executive is
required to disclose by law or legal process. Upon the Company’s request
at any time, the Executive shall immediately deliver to the Company
all
materials in the Executive’s possession which contain Confidential
Information.
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9
12.
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Restrictive
Covenant.
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a.
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Term
of Restrictive Covenant. The
Executive hereby acknowledges and recognizes that, during the Employment
Period, the Executive shall be privy to trade secrets and Confidential
Information critical to the Company’s business and the Executive further
acknowledges and recognizes that the Company would find it extremely
difficult or impossible to replace the Executive and, accordingly,
the
Executive agrees that, in consideration of the benefits to be received
by
the Executive hereunder, the Executive shall not, from and after
the date
hereof, throughout the Employment Period, and for a period of 12
months
following the termination of the Employment Period (i) directly or
indirectly engage in the development, production, marketing or sale
of
products that compete (or, upon commercialization, would compete)
with
products of the Company being developed (so long as such development
has
not been abandoned), marketed or sold at the time of the termination
of
the Employment Period (such business or activity being herein referred
to
as a “Competing
Business”)
whether such engagement shall be as an officer, director, owner,
employee,
partner, affiliate or other participant in any Competing Business,
(ii)
assist others in engaging in any Competing Business in the manner
described in the foregoing clause (i), or (iii) induce other employees
of
the Company or any subsidiary thereof to terminate their employment
with
the Company or any subsidiary thereof or engage in any Competing
Business
or hire any employees of the Company or any subsidiary unless such
persons
have not been employees of the Company for at least 12 months.
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b.
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Sufficient
Consideration. The
Executive understands that the foregoing restrictions may limit the
ability of the Executive to earn a livelihood in a business similar
to the
business of the Company, but nevertheless believes that the Executive
has
received and shall receive sufficient consideration and other benefits,
as
an employee of the Company and as otherwise provided hereunder, to
justify
such restrictions which, in any event (given the education, skills
and
ability of the Executive), the Executive believes would not prevent
the
Executive from earning a living.
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13.
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Non-Disparagement.
The
Executive shall not engage in conduct, through word, act, gesture
or other
means, or disclose any information to the public or any third party
which
(i) directly or indirectly discredits or disparages in whole or in
part
the company, its subsidiaries, divisions, affiliates and/or successors
as
well as the products and the respective officers, directors, stockholders
and employees of each of them; (ii) is detrimental to the reputation,
character or standing of these entities, their products or any of
their
respective officers, directors, stockholders and/or employees; or
(iii)
which generally reflects negatively on the management decisions,
strategy
or decision-making of these
entities.
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10
14.
|
Company
Right to Inventions. The
Executive shall promptly disclose, grant and assign to the Company,
for
its sole use and benefit, any and all inventions, improvements, technical
information and suggestions relating in any way to the business of
the
Company which the Executive may develop or acquire during the Employment
Period (whether or not during usual working hours), together with
all
patent applications, letters patent, copyrights and reissues thereof
that
may at any time be granted for or upon any such invention, improvement
or
technical information. In connection therewith: (i) the Executive
shall,
without charge, but at the expense of the Company, promptly at all
times
hereafter execute and deliver such applications, assignments, descriptions
and other instruments as may be necessary or proper in the opinion
of the
Company to vest title to any such inventions, improvements, technical
information, patent applications, patents, copyrights or reissues
thereof
in the Company and to enable it to obtain and maintain the entire
right
and title thereto throughout the world, and (ii) the Executive shall
render to the Company, at its expense (including a reasonable payment
for
the time involved in case the Executive is not then in its employ),
all
such assistance as it may require in the prosecution of applications
for
said patents, copyrights or reissues thereof, in the prosecution
or
defense of interferences which may be declared involving any said
applications, patents or copyrights and in any litigation in which
the
Company may be involved relating to any such patents, inventions,
improvements or technical information.
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15.
|
Enforcement.
It
is the desire and intent of the parties hereto that the provisions
of this
Agreement be enforceable to the fullest extent permissible under
the laws
and public policies applied in each jurisdiction in which enforcement
is
sought. Accordingly, to the extent that a restriction contained in
this
Agreement is more restrictive than permitted by the laws of any
jurisdiction where this Agreement may be subject to review and
interpretation, the terms of such restriction, for the purpose only
of the
operation of such restriction in such jurisdiction, shall be the
maximum
restriction allowed by the laws of such jurisdiction and such restriction
shall be deemed to have been revised accordingly herein.
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16.
|
Remedies;
Survival.
|
a.
|
Injunctive
Relief. The
Executive acknowledges and understands that the provisions of the
covenants contained in Sections 11, 12, 13 and 14 hereof, the violation
of
which cannot be accurately compensated for in damages by an action
at law,
are of crucial importance to the Company, and that the breach or
threatened breach of the provisions of this Agreement would cause
the
Company irreparable harm. In the event of a breach or threatened
breach by
the Executive of the provisions of Sections 11, 12, 13 or 14 hereof,
the
Company shall be entitled to an injunction restraining the Executive
from
such breach. Nothing herein contained shall be construed as prohibiting
the Company from pursuing any other remedies available for any breach
or
threatened breach of this Agreement.
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11
b.
|
Survival.
Notwithstanding
anything contained in this Agreement to the contrary, the provisions
of
the Sections 3, 9, and 11 through 17 hereof shall survive the expiration
or earlier termination of this Agreement until, by their terms, such
provisions are no longer operative.
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17.
|
Notices.
Notices and other communications hereunder shall be in writing and
shall
be delivered personally or sent by air courier or first class certified
or
registered mail, return receipt requested and postage prepaid, addressed
as follows:
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if
to the
Company prior to the Effective Date to:
2116
Financial Center
000
Xxxxxx Xxxxxx
Xxx
Xxxxxx, Xxxx 00000
with
a
copy to:
Ellenoff,
Xxxxxxxx & Schole, LLP
000
Xxxxxxxxx Xxxxxx, 00xx
Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attention:
Xxxxx Xxxxxxxx, Esq.
if
to the
Company after the Effective Date to:
PharmAthene,
Inc.
000
Xxxxxxx Xxxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxx,
XX 00000
with
a
copy to:
XxXxxxxx
& English, LLP
Four
Gateway Center
000
Xxxxxxxx Xxxxxx
Xxxxxx,
Xxx Xxxxxx 00000
Attention:
Xxxxxxx Xxxxxx, Esq.
if
to the
Executive to:
Xxxxx
X.
Xxxxxx
with
a
copy to :
12
All
notices and other communications given to any party hereto in accordance with
the provisions of this Agreement shall be deemed to have been given on the
date
of delivery, if personally delivered; on the business day after the date when
sent, if sent by air courier; and on the third business day after the date
when
sent, if sent by mail, in each case addressed to such party as provided in
this
Section 16 or in accordance with the latest unrevoked direction from such party.
18. |
Binding
Agreement; Benefit.
The provisions of this Agreement shall be binding upon, and shall
inure to
the benefit of, the respective heirs, legal representatives and successors
of the parties hereto.
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19. |
Governing
Law; Jurisdiction. This
Agreement shall be governed by, and construed and enforced in accordance
with, the laws of the State of Maryland applicable
to contract made and to be performed therein. Any action to enforce
any of
the provisions of this Agreement shall be brought in a court of the
State
of Maryland
or in Federal court located within that State. The parties consent
to the
jurisdiction of such courts and to the service of process in any
manner
provided by Maryland law. Each party irrevocably waives any objection
which it may now or hereafter have to the laying of the venue of
any such
suit, action or proceeding brought in such court and any claim that
such
suit, action or proceeding brought in such court has been brought
in an
inconvenient forum and agrees that service of process in accordance
with
the foregoing shall be deemed in every respect effective and valid
personal service of process upon such party.
|
20. |
Waiver
of Breach.
The waiver by either party of a breach of any provision of this Agreement
by the other party must be in writing and shall not operate or be
construed as a waiver of any subsequent breach by such other party.
|
21. |
Entire
Agreement; Amendments.
This Agreement contains the entire agreement between the parties
with
respect to the subject matter hereof and supersedes all prior agreements
or understandings among the parties with respect thereof. This Agreement
may be amended only by an agreement in writing signed by the parties
hereto.
|
22. |
Headings.
The section headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
|
23. |
Severability.
Any provision of this Agreement that is prohibited or unenforceable
in any
jurisdiction shall, as to such jurisdiction, be ineffective to the
extent
of such prohibition or unenforceability without invalidating the
remaining
provisions hereof, and any such prohibition or unenforceability in
any
jurisdiction shall not invalidate or render unenforceable such provision
in any other jurisdiction.
|
24. |
409A
Compliance.
The intent of the Executive and the company is that the severance
and
other benefits payable to the Executive under this Agreement not
be deemed
“deferred compensation” under, and shall otherwise comply with, Section
409A of the Internal Revenue Code of 1986, as amended. The Executive
and
the Company agree to use reasonable best efforts to amend the terms
of
this Agreement from time to time as may be necessary to avoid the
imposition of liability under Section 409A of the Code in any manner
that
does not materially alter the substantive rights and obligations
of the
parties hereunder.
|
13
25. |
Executive’s
Acknowledgement. The
Executive acknowledges (a) that he has had the opportunity to consult
with
independent counsel of his own choice concerning this Agreement and
(b)
that he has read and understands the Agreement, is fully aware of
its
legal effect and has entered into it freely based on his own
judgment.
|
26. |
Assignment.
This
Agreement is personal in its nature and the parties hereto shall
not,
without the consent of the other, assign or transfer this Agreement
or any
rights or obligations hereunder; provided, that the provisions hereof
shall inure to the benefit of, and be binding upon, each successor
of the
Company, whether by merger, consolidation, transfer of all or
substantially all of its assets or otherwise.
|
27. |
Counterparts.
This
Agreement may be executed in two or more counterparts, each of which
shall
for all purposes constitute one agreement which is binding on all
of the
parties hereto.
|
14
IN
WITNESS WHEREOF, the
parties have duly executed this Agreement as of the date first above written.
EXECUTIVE | ||
|
|
|
/s/ Xxxxx X. Xxxxxx | ||
Xxxxx X. Xxxxxx |
||
HEALTHCARE ACQUISITION CORP. |
By | /s/ Xxxx Pappjohn | |
Name: Xxxx Xxxxxxxxx |
||
Title:
Chairman
|
15