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CONSULTING AGREEMENT
THIS CONSULTING AGREEMENT ("Agreement") dated as of October 1,
1998, is made and entered into by and between OSI PHARMACEUTICALS, INC., a
Delaware corporation (the "Company"), and XXXX X. XXXXXXXX (the "Consultant").
W I T N E S S E T H:
WHEREAS, the Consultant has served as a director and Chief
Executive Officer of the Company since 1990 and was elected Chairman of the
Board in December, 1997;
WHEREAS, pursuant to the Company's plan of senior management
succession, the Consultant has today retired as Chief Executive Officer and will
continue to serve as Chairman of the Board;
WHEREAS, the Company has derived great value from the
Consultant's services as Chief Executive Officer, and the Company desires to
obtain consulting services from the Consultant in furtherance of the Company's
interests in addition to the services which the Consultant will continue to
provide as Chairman of the Board; and
WHEREAS, the Consultant desires to provide consulting
services to the Company on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the foregoing and the
mutual promises hereinafter set forth, the parties, intending to be legally
bound, hereby agree as follows:
1. ENGAGEMENT. The company hereby retains the Consultant and the
Consultant hereby agrees to provide consulting services to the Company upon the
terms and conditions set forth herein.
2. COMPENSATION.
(a) The Company shall pay to the Consultant a fee at the rate
of $295,400 per year for the period commencing October 1, 1998, and ending
December 31, 1998, and at the rate of $140,000 per year for the period
commencing January 1, 1999, and ending December 31, 1999, payable in monthly
installments on the first day of each month commencing October 1, 1998.
(b) Commencing January 1, 1999, the Consultant shall be
entitled to receive all compensation payable to outside directors in addition to
the compensation provided in this Section 2. Although in accordance with
policies adopted by the Company's Compensation Committee of the Board of
Directors, the Consultant will not be entitled to receive automatic grants of
options to purchase the Company's Common Stock pursuant to the Company's
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"formula plan" for outside directors, the Consultant will be eligible for
special grants of stock options from time to time as determined in the sole
discretion of the Compensation Committee.
(c) The Company shall provide the Consultant with the use of
an automobile and shall reimburse the Consultant for his reasonable and
necessary expenses in connection with the use of such vehicle in furtherance of
the business of the Company, provided that the Consultant properly accounts for
such expenses in accordance with Company policy.
(d) The Company shall provide the Consultant with the use of
an office and secretarial support at the Company's headquarters in Uniondale,
New York.
(e) The compensation and benefits expressly provided in this
Section 2 shall constitute the totality of compensation and benefits to which
the Consultant shall be entitled; provided that the Consultant shall be entitled
to be reimbursed for any expenses reasonably incurred by him in connection with
the performance of services under this Agreement pursuant to the Company's
regular established procedures for this purpose.
(f) The compensation and benefits provided in this Section 2
shall continue in effect through December 31, 1999. No later than September 30,
1999 (and each September 30 thereafter if this Agreement continues in accordance
with Section 4), the Company's Compensation Committee will determine the
compensation and benefits to be provided to the Consultant for the following
year.
3. CONSULTING SERVICES.
(a) During the term of this Agreement, the Consultant shall
perform such consulting services within his competence and expertise as shall be
reasonably requested by the Company. The Consultant commits to devote
approximately one-half of his working time to such consulting services.
(b) During the term of this Agreement, the Consultant shall
not, without the prior written consent of the Company, provide consulting
services for or to any other person or entity engaged in the same business as
the Company.
4. TERM. The term of this agreement will commence on October 1, 1998,
and shall continue until December 31, 1999. This agreement shall automatically
be extended for one or more additional one-year terms unless written notice of
termination is provided by either party to the other at least sixty (60) days
prior to the end of the then current term of this Agreement.
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5. CONFIDENTIAL AND PROPRIETARY INFORMATION.
(a) All information concerning the Company (whether written or
oral) disclosed in connection with this Agreement shall be received and retained
by the Consultant as strictly confidential. Notwithstanding the foregoing, there
shall be no obligation to retain as confidential information which (i) is in the
public domain at the time of receipt or comes into the public domain without
breach of this Section; (ii) can be shown to have been known by the Consultant
prior to receipt; (iii) becomes known to the Consultant through a third source
whose own knowledge was acquired entirely independent of the Consultant; or (iv)
is approved for disclosure by the Company in writing.
(b) All business or technical information identified by the
Company or reasonably identifiable as proprietary to the Company and which the
Consultant was put in a position to discover in the conduct of his duties
hereunder shall be and remain the exclusive property of the Company at all times
and shall be returned to the Company upon its request or upon termination of
this Agreement.
(c) The Consultant hereby agrees that any and all information,
inventions and discoveries, whether or not patentable, that he conceives and/or
creates during the term of this Agreement and any extensions thereof, and which
are a direct or indirect result of work performed hereunder, shall be the sole
and exclusive property of the Company. The Consultant hereby assigns to the
Company any and all right, title and interest which he has or may acquire in the
same. The Consultant further agrees that he will promptly execute any and all
applications, assignments or other instruments which an officer of the Company
or the Board of Directors of the Company shall deem necessary or useful in order
to apply for and obtain Letters Patent in the United States and all foreign
countries for said information, inventions and discoveries and in order to
assign and convey to the Company the sole and exclusive rights, title and
interest in and to said information, inventions, discoveries, patents
applications and patents thereon. The Company will bear the cost of preparation
of all such patent applications and assignments and the cost of prosecution of
all such patent applications in the United State Patent Office and in the patent
offices of foreign countries.
(d) The Consultant acknowledges that by reason of the
uniqueness of the Company's business that the covenants set forth in this
Section are reasonable and necessary for the protection of the Company's
legitimate business interests.
(e) The Consultant hereby acknowledges that irreparable harm
will result to the Company in the event of the breach of the covenants contained
in this Section. In the event that the Consultant breaches any of the covenants
contained in this Section, the Consultant agrees that in addition to all other
remedies or damages which may be available, the Company shall be entitled to
seek and obtain both temporary and permanent restraining orders or injunctions
issued by a court in order to prevent the violation of any of the covenants made
by the Consultant pursuant to this Agreement.
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(f) The Consultant expressly acknowledges and agrees that the
provisions of this Section shall survive the termination of this Agreement.
6. TERMINATION. Notwithstanding anything herein contained to the
contrary, if after the date hereof and prior to the end of the term of this
Agreement, (i) either (A) the consultant shall be physically or mentally
incapacitated or disabled or otherwise unable fully to discharge his duties
hereunder for a period of 90 consecutive days or for an aggregate of 90 days
within any period of twelve consecutive months, (B) the Consultant shall be
convicted of a felony or other crime involving moral turpitude, (C) the
Consultant shall commit any act or omit to take any action in bad faith and to
the detriment of the Company or any subsidiary or affiliate of the Company, or
(D) the Consultant shall breach any material term of this agreement and fail to
correct such breach within 10 days after receiving notice of the same, then, and
in each such case, the Company shall have the right to give notice of
termination of the Consultant's services hereunder as of a date to be specified
in such notice (which date may be the date such notice is given), and this
Agreement shall terminate on the date so specified; or (ii) the Consultant shall
die, then this Agreement shall terminate on the date of the Consultant's death.
7. EMPLOYMENT AGREEMENT. The Employment Agreement, dated February 9,
1990, between the Company and the Consultant is hereby terminated.
8. GOVERNING LAW. The validity, enforceability and interpretation of
this Agreement shall be determined in accordance with the laws of the State of
New York.
9. RELATIONSHIP CREATED. The relationship of the Consultant and the
Company is that of independent contractors. Nothing contained in this Agreement
shall be construed to place the Company and the Consultant in a relationship as
partners, joint venturers, employer and employee or principal and agent.
10. ASSIGNMENT. The Consultant shall not assign, convey or transfer
this Agreement or any part of his rights under this Agreement without the prior
written consent of the Company. Any such assignment, conveyance or transfer
without the Company's prior written consent shall be void.
11. NOTICES.
Any notice or other communication required or permitted to be
given pursuant to the provisions of this Agreement shall be deemed to have been
sufficiently given, if in writing and either delivered against receipt or sent
by registered or certified mail, with postage prepaid, addressed as indicated
and shall be deemed sent and delivered on the third day following the deposit
thereof in the United States mail:
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If to the Company:
OSI Pharmaceuticals, Inc.
000 Xxxxxxx Xxxxxxxxx Xxxx.
Xxxxxxxxx, Xxx Xxxx 00000-0000
Attn.: Xxxxxx X. Xxx Xxxxxxxx,
Vice President, Finance and Administration
If to the Consultant:
Xxxx X. Xxxxxxxx
00000 Xxxxxxxx Xxx
Xxxx Xxxx Xxxxx, XX 00000
Either party may, by notice as aforesaid, designate a different address
or addresses for notices or other communications intended for it.
12. PARTIES IN INTEREST. This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective heirs, administrators,
successors and permitted assigns.
13. MISCELLANEOUS.
(a) This Agreement constitutes the entire understanding
between the parties with respect to the subject matter hereof and supersedes and
cancels any and all previous contracts or agreements between the parties with
respect to the subject matter hereof. It may not be altered, amended or modified
except by written instrument duly executed by the parties hereto. This Agreement
shall become binding only after the same is signed by an officer of the Company
at its general offices.
(b) The headings contained herein are inserted for convenience
only and shall not be deemed to have any substantive meaning.
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(c) This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed on the day and year first above written.
OSI PHARMACEUTICALS, INC.
By: /s/ Xxxxx Xxxxxxx
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Name: Xxxxx Xxxxxxx, Ph.D.
Title: President and Chief Executive Officer
/s/ Xxxx X. Xxxxxxxx
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XXXX X. XXXXXXXX
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