EXHIBIT 10.1
FORM OF [AMENDED AND RESTATED] EMPLOYMENT AGREEMENT
THIS [AMENDED AND RESTATED] EMPLOYMENT AGREEMENT (this "Agreement") is
entered into by and between CancerVax Corporation, a Delaware corporation (the
"Company"), and _________ ("Executive"), and shall be effective as of
___________, ____ (the "Effective Date").
[WHEREAS, the Company and Executive desire to amend and restate that
certain Employment Agreement dated as of ___________, ____, between the Company
and Executive (the "Original Agreement"), to provide Executive with enhanced
severance benefits in the event of a qualifying termination of Executive's
employment.]
NOW, THEREFORE, in consideration of the mutual promises herein contained,
the parties agree as follows:
1. Definitions. As used in this Agreement, the following terms shall
have the following meanings:
(a) Board. "Board" means the Board of Directors of the Company.
(b) Bonus. "Bonus" means an amount equal to the average of
the bonuses awarded to Executive for each of the three (3) fiscal years prior to
the date of termination, or such lesser number of years as may be applicable if
Executive has not been employed for three (3) full years on the date of
termination. For purposes of determining Executive's "Bonus," to the extent
Executive received no bonus in a year due to a failure to meet the applicable
performance objectives, such year will still be taken into account (using zero
(0) as the applicable bonus) in determining Executive's "Bonus" for purposes of
Section 5. If any portion of the bonuses awarded to Executive consisted of
securities or other property, the fair market value thereof shall be determined
in good faith by the Board.
(c) Cause. "Cause" means any of the following:
(i) the commission of an act of fraud, embezzlement or
dishonesty by Executive that has a material adverse impact on the Company or any
successor or affiliate thereof;
(ii) a conviction of, or plea of "guilty" or "no contest" to,
a felony by Executive;
(iii) any unauthorized use or disclosure by Executive of
confidential information or trade secrets of the Company or any successor or
affiliate thereof that has a material adverse impact on any such entity;
(iv) Executive's gross negligence, insubordination or
material violation of any duty of loyalty to the Company or any other material
misconduct on the part of Executive;
(v) Executive's ongoing and repeated failure or refusal to
perform or neglect of Executive's duties as required by this Agreement, which
failure, refusal or neglect continues for fifteen (15) days following
Executive's receipt of written notice from the Board or the Company's Chief
Executive Officer (the "CEO") stating with specificity the nature of such
failure, refusal or neglect; or
(vi) Executive's breach of any material provision of this
Agreement;
provided, however, that prior to the determination that "Cause" under this
Section 1(c) has occurred, the Company shall (w) provide to Executive in
writing, in reasonable detail, the reasons for the determination that such
"Cause" exists, (x) other than with respect to clause (v) above which specifies
the applicable period of time for Executive to remedy his or her breach, afford
Executive a reasonable opportunity to remedy any such breach, (y) provide the
Executive an opportunity to be heard prior to the final decision to terminate
the Executive's employment hereunder for such "Cause" and (z) make any decision
that such "Cause" exists in good faith.
The foregoing definition shall not in any way preclude or restrict
the right of the Company or any successor or affiliate thereof to discharge or
dismiss Executive for any other acts or omissions, but such other acts or
omissions shall not be deemed, for purposes of this Agreement, to constitute
grounds for termination for Cause.
(d) Change of Control. "Change of Control" means and includes each
of the following:
(i) the acquisition, directly or indirectly, by any "person"
or "group" (as those terms are defined in Sections 3(a)(9), 13(d) and 14(d) of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the
rules thereunder) of "beneficial ownership" (as determined pursuant to Rule
13d-3 under the Exchange Act) of securities entitled to vote generally in the
election of directors ("voting securities") of the Company that represent forty
percent (40%) or more of the combined voting power of the Company's then
outstanding voting securities, other than:
(A) an acquisition by a trustee or other fiduciary
holding securities under any employee benefit plan (or related trust)
sponsored or maintained by the Company or any person controlled by the
Company or by any employee benefit plan (or related trust) sponsored or
maintained by the Company or any person controlled by the Company, or
(B) an acquisition of voting securities by the Company
or a corporation owned, directly or indirectly by the stockholders of the
Company in substantially the same proportions as their ownership of the
stock of the Company, or
(C) an acquisition of voting securities pursuant to a
transaction described in clause (iii) below that would not be a Change of
Control under clause (iii);
Notwithstanding the foregoing, the following event shall not
constitute an "acquisition" by any person or group for purposes of this Section
1(d): an acquisition of the Company's securities by the Company which causes the
Company's voting securities
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beneficially owned by a person or group to represent forty percent (40%) or more
of the combined voting power of the Company's then outstanding voting
securities; provided, however, that if a person or group shall become the
beneficial owner of forty percent (40%) or more of the combined voting power of
the Company's then outstanding voting securities by reason of share acquisitions
by the Company as described above and shall, after such share acquisitions by
the Company, become the beneficial owner of any additional voting securities of
the Company, then such acquisition shall constitute a Change of Control; or
(ii) during any period of two (2) consecutive years,
individuals who, at the beginning of such period, constitute the Board together
with any new director(s) (other than a director designated by a person who shall
have entered into an agreement with the Company to effect a transaction
described in clauses (i) or (iii) of this Section 1(d) whose election by the
Board or nomination for election by the Company's stockholders was approved by a
vote of at least two-thirds (2/3) of the directors then still in office who
either were directors at the beginning of the two (2) year period or whose
election or nomination for election was previously so approved, cease for any
reason to constitute a majority thereof; or
(iii) the consummation by the Company (whether directly
involving the Company or indirectly involving the Company through one or more
intermediaries) of (x) a merger, consolidation, reorganization, or business
combination or (y) a sale or other disposition of all or substantially all of
the Company's assets or (z) the acquisition of assets or stock of another
entity, in each case other than a transaction:
(A) which results in the Company's voting securities
outstanding immediately before the transaction continuing to represent
(either by remaining outstanding or by being converted into voting
securities of the Company or the person that, as a result of the
transaction, controls, directly or indirectly, the Company or owns,
directly or indirectly, all or substantially all of the Company's assets
or otherwise succeeds to the business of the Company (the Company or such
person, the "Successor Entity") directly or indirectly, at least a
majority of the combined voting power of the Successor Entity's
outstanding voting securities immediately after the transaction, and
(B) after which no person or group beneficially owns
voting securities representing forty percent (40%) or more of the combined
voting power of the Successor Entity; provided, however, that no person or
group shall be treated for purposes of this clause (B) as beneficially
owning forty percent (40%) or more of combined voting power of the
Successor Entity solely as a result of the voting power held in the
Company prior to the consummation of the transaction; or
(iv) the Company's stockholders approve a liquidation or
dissolution of the Company.
(e) Good Reason. "Good Reason" means the occurrence of any of the
following events or conditions without Executive's written consent and the
failure of the Company or any successor or affiliate to cure such event or
condition within thirty (30) days after receipt of written notice from
Executive:
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(i) a change in Executive's status, position or
responsibilities that, in Executive's reasonable judgment, represents a
substantial and material reduction in the status, position or responsibilities
as in effect immediately prior thereto; the assignment to Executive of any
duties or responsibilities that, in Executive's reasonable judgment, are
materially inconsistent with such status, position or responsibilities; or any
removal of Executive from or failure to reappoint or reelect Executive to any of
such positions, except in connection with the termination of Executive's
employment for Cause, as a result of his or her Permanent Disability or death,
or by Executive other than for Good Reason;
(ii) a material reduction in Executive's annual base salary,
except in connection with a general reduction in the compensation of the
Company's or any successor's or affiliate's personnel with similar status and
responsibilities;
(iii) the Company's or any successor's or affiliate's
requiring Executive (without Executive's consent) to be based at any place
outside a 50-mile radius of his or her place of employment as of the Effective
Date, except for reasonably required travel on the Company's or any successor's
or affiliate's business that is not materially greater than such travel
requirements prior to the Effective Date;
(iv) the Company's or any successor's or affiliate's failure
to provide Executive with compensation and benefits substantially equivalent (in
terms of benefit levels and/or reward opportunities) to those provided for under
each material employee benefit plan, program and practice as in effect
immediately prior to the Effective Date;
(v) any material breach by the Company or any successor or
affiliate of its obligations to Executive under this Agreement; or
(vi) any purported termination of Executive's employment or
service relationship for Cause by the Company or any successor or affiliate that
is not in accordance with the definition of Cause set forth in this Agreement.
(f) Permanent Disability. Executive's "Permanent Disability" shall
be deemed to have occurred if Executive shall become physically or mentally
incapacitated or disabled or otherwise unable fully to discharge his or her
duties hereunder for a period of ninety (90) consecutive calendar days or for
one hundred twenty (120) calendar days in any one hundred eighty (180)
calendar-day period. The existence of Executive's Permanent Disability shall be
determined by the Company on the advice of a physician chosen by the Company and
the Company reserves the right to have the Executive examined by a physician
chosen by the Company at the Company's expense.
(g) Stock Awards. "Stock Awards" means all stock options,
restricted stock and such other awards granted pursuant to the Company's stock
option and equity incentive award plans or agreements and any shares of stock
issued upon exercise thereof.
2. Employment Period. Subject to the provisions for earlier termination
hereinafter provided, Executive's employment hereunder shall be for a term (the
"Employment Period") commencing on the Effective Date and ending on ________.
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3. Services to Be Rendered.
(a) Duties and Responsibilities. Executive shall serve as ________
of the Company. In the performance of such duties, Executive shall report
directly to the CEO and shall be subject to the direction of the CEO and to such
limits upon Executive's authority as the CEO may from time to time impose. In
the event of the CEO's incapacity or unavailability, Executive shall be subject
to the direction of the Board. Executive hereby consents to serve as an officer
and/or director of the Company or any subsidiary or affiliate thereof without
any additional salary or compensation, if so requested by the CEO. Executive
shall be employed by the Company on a full time basis. Executive's primary place
of work shall be the Company's facility in Carlsbad, California, or such other
location within San Diego County as may be designated by the CEO from time to
time. Executive shall also render services at such other places within or
outside the United States as the CEO may direct from time to time. Executive
shall be subject to and comply with the policies and procedures generally
applicable to senior executives of the Company to the extent the same are not
inconsistent with any term of this Agreement.
(b) Exclusive Services. Executive shall at all times faithfully,
industriously and to the best of his or her ability, experience and talent
perform to the satisfaction of the Board and the CEO all of the duties that may
be assigned to Executive hereunder and shall devote substantially all of his or
her productive time and efforts to the performance of such duties. Subject to
the terms of the Employee Confidentiality and Invention Assignment Agreement
referred to in Section 7(b), this shall not preclude Executive from devoting
time to personal and family investments or serving on community and civic
boards, or participating in industry associations, provided such activities do
not interfere with his or her duties to the Company, as determined in good faith
by the CEO. Executive agrees that he or she will not join any boards, other than
community and civic boards (which do not interfere with his or her duties to the
Company), without the prior approval of the CEO.
4. Compensation and Benefits. The Company shall pay or provide, as the
case may be, to Executive the compensation and other benefits and rights set
forth in this Section 4.
(a) Base Salary. The Company shall pay to Executive a base salary
of $______ per year, payable in accordance with the Company's usual pay
practices (and in any event no less frequently than monthly). Executive's base
salary shall be subject to review annually by and at the sole discretion of the
Compensation Committee of the Board.
(b) Bonus. Executive shall participate in the CancerVax
Corporation Management Incentive Compensation Plan adopted by the Company or in
such other bonus plan as the Board may approve for the senior executives of the
Company.
(c) Benefits. Executive shall be entitled to participate in
benefits under the Company's benefit plans and arrangements, including, without
limitation, any employee benefit plan or arrangement made available in the
future by the Company to its senior executives, subject to and on a basis
consistent with the terms, conditions and overall administration of such plans
and arrangements. The Company shall have the right to amend or delete any such
benefit
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plan or arrangement made available by the Company to its senior executives and
not otherwise specifically provided for herein.
(d) Expenses. The Company shall reimburse Executive for reasonable
out-of-pocket business expenses incurred in connection with the performance of
his or her duties hereunder, subject to (i) such policies as the Company may
from time to time establish, and (ii) Executive furnishing the Company with
evidence in the form of receipts satisfactory to the Company substantiating the
claimed expenditures, (iii) Executive receiving advance approval from the CEO in
the case of expenses for travel outside of North America, and (iv) Executive
receiving advance approval from the CEO in the case of expenses (or a series of
related expenses) in excess of $5,000.
(e) Paid Time Off. Executive shall be entitled to such periods of
paid time off ("PTO") each year as provided under the Company's PTO policy and
as otherwise provided for senior executive officers.
(f) Equity Plans. Executive shall be entitled to participate in
any equity or other employee benefit plan that is generally available to senior
executive officers, as distinguished from general management, of the Company.
Except as otherwise provided in this Agreement, Executive's participation in and
benefits under any such plan shall be on the terms and subject to the conditions
specified in the governing document of the particular plan.
(g) Acceleration In Connection With a Change of Control. Subject
to any additional acceleration of exercisability described in Sections 5(b), (c)
and (d) below, in connection with a Change of Control (as defined in Section 1
above):
(i) The vesting and exercisability of fifty percent (50%) of
Executive's outstanding Stock Awards shall be automatically accelerated on the
date of such Change of Control.
(ii) If Executive's employment is terminated by the Company
without Cause, by Executive for Good Reason, or as a result of Executive's death
or Permanent Disability, the vesting and/or exercisability of each of
Executive's outstanding Stock Awards shall be automatically accelerated on the
date of termination as to the number of Stock Awards that would vest over the
twelve (12) month period following the date of termination had Executive
remained continuously employed by the Company during such period.
(iii) With respect to Stock Awards granted prior to the
Effective Date, if Executive's employment is terminated by the Company without
Cause or by Executive for Good Reason within twelve (12) months following a
Change of Control, the vesting and/or exercisability of any outstanding unvested
portions of such Stock Awards shall be automatically accelerated on the date of
termination.
(iv) With respect to Stock Awards granted on or after the
Effective Date, if Executive's employment is terminated by the Company without
Cause or by Executive for Good Reason within six (6) months prior to or twelve
(12) months following a Change of Control, the vesting and/or exercisability of
any outstanding unvested portions of such Stock
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Awards shall be automatically accelerated on the later of (A) the date of
termination or (B) the date of the Change of Control.
(v) The vesting pursuant to clauses (i), (ii), (iii) and
(iv) of this Section 4(g) shall be cumulative. The foregoing provisions are
hereby deemed to be a part of each Stock Award and to supersede any less
favorable provision in any agreement or plan regarding such Stock Award.
5. Termination and Severance. Executive shall be entitled to receive
benefits upon termination of employment only as set forth in this Section 5:
(a) At-Will Employment; Termination. The Company and Executive
acknowledge that Executive's employment is and shall continue to be at-will, as
defined under applicable law, and that Executive's employment with the Company
may be terminated by either party at any time for any or no reason, with or
without notice. If Executive's employment terminates for any reason, Executive
shall not be entitled to any payments, benefits, damages, awards or compensation
other than as provided in this Agreement. Executive's employment under this
Agreement shall be terminated immediately on the death of Executive.
(b) Termination by Death. If Executive's employment is terminated
by death, Executive's estate shall be entitled to receive (i) Executive's fully
earned but unpaid base salary, through the date of death at the rate then in
effect, plus all other amounts to which Executive is entitled under any
compensation plan or practice of the Company at the time of Executive's death,
(ii) Executive's annual base salary as in effect immediately prior to the date
of death, payable over the twelve (12) month period commencing on the date of
death in equal monthly installments, (iii) an amount equal to Executive's Bonus
for the year in which Executive's death occurs prorated for the period during
such year Executive was employed prior to his or her death, payable over the
twelve (12) month period commencing on the date of death in equal monthly
installments, and (iv) for the period beginning on the date of death and ending
on the date which is twelve (12) full months following the date of death (or, if
earlier, the date on which the applicable continuation period under COBRA
expires), the Company shall reimburse Executive's eligible dependents for the
costs associated with continuation coverage for such eligible dependents
pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended ("COBRA") (provided that Executive's dependents shall be solely
responsible for all matters relating to such continuation of coverage pursuant
to COBRA, including, without limitation, election of such coverage and his or
her timely payment of premiums).
(c) Termination for Permanent Disability. If Executive's
employment is terminated by the Company for Permanent Disability, Executive
shall be entitled to receive (i) Executive's fully earned but unpaid base
salary, through the date of termination at the rate then in effect, plus all
other amounts to which Executive is entitled under any compensation plan or
practice of the Company at the time such payments are due, (ii) Executive's
annual base salary as in effect immediately prior to the date of termination,
payable over the
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twelve (12) month period commencing on the date of termination in equal monthly
installments, (iii) an amount equal to Executive's Bonus for the year in which
the date of termination occurs prorated for the period during such year
Executive was employed prior to the date of termination, payable over the twelve
(12) month period commencing on the date of termination in equal monthly
installments, and (iv) for the period beginning on the date of termination and
ending on the date which is twelve (12) full months following the date of
termination (or, if earlier, the date on which the applicable continuation
period under COBRA expires), (A) reimburse Executive for the costs associated
with continuation coverage pursuant to COBRA for Executive and his or her
eligible dependents who were covered under the Company's health plans as of the
date of Executive's termination (provided that Executive shall be solely
responsible for all matters relating to his or her continuation of coverage
pursuant to COBRA, including, without limitation, his or her election of such
coverage and his or her timely payment of premiums), and (B) pay for and provide
Executive and such eligible dependents with life insurance benefits coverage to
the extent such Executive and/or such dependents were receiving such benefits
prior to the date of Executive's termination.
(d) Termination without Cause or for Good Reason. If Executive's
employment is terminated by the Company without Cause or by Executive for Good
Reason, Executive shall be entitled to receive, in lieu of any severance
benefits to which Executive may otherwise be entitled under any severance plan
or program of the Company, the benefits provided below:
(i) the Company shall pay to Executive his or her fully
earned but unpaid base salary, when due, through the date of termination
at the rate then in effect, plus all other amounts to which Executive is
entitled under any compensation plan or practice of the Company at the
time of termination;
(ii) Executive shall be entitled to receive severance pay in
an amount equal to the sum of:
(A) Executive's monthly base salary as in effect
immediately prior to the date of termination for the twelve (12)
month period following the date of termination, payable over the
twelve (12) month period commencing on the date of termination in
equal monthly installments, plus
(B) an amount equal to Executive's Bonus for the year
in which the date of termination occurs prorated for the period
during such year Executive was employed prior to the date of
termination, payable over the twelve (12) month period commencing on
the date of termination in equal monthly installments;
(iii) for the period beginning on the date of termination and
ending on the date which is twelve (12) full months following the date of
termination (or, if earlier, the date on which the applicable continuation
period under COBRA expires), (1) reimburse Executive for the costs
associated with continuation coverage pursuant to COBRA for Executive and
his or her eligible dependents who were covered under the Company's health
plans as of the date of Executive's termination (provided that Executive
shall be solely responsible for all matters relating to his or her
continuation of coverage pursuant to COBRA, including, without limitation,
his or her election of such coverage and his or her
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timely payment of premiums), and (2) pay for and provide Executive and
such eligible dependents with life insurance benefits coverage to the
extent such Executive and/or such dependents were receiving such benefits
prior to the date of Executive's termination; and
(iv) Executive shall be entitled to executive-level
outplacement services at the Company's expense, not to exceed $15,000.
Such services shall be provided by a firm selected by Executive from a
list compiled by the Company.
(e) Termination for Cause, Voluntary Resignation Without Good
Reason or Expiration of Employment Period. If Executive's employment is
terminated by the Company for Cause or by Executive without Good Reason (other
than as a result of Executive's death or Permanent Disability), or if the
Employment Period expires, the Company shall not have any other or further
obligations to Executive under this Agreement (including any financial
obligations) except that Executive shall be entitled to receive (i) Executive's
fully earned but unpaid base salary, through the date of termination at the rate
then in effect, and (ii) all other amounts or benefits to which Executive is
entitled under any compensation, retirement or benefit plan or practice of the
Company at the time of termination in accordance with the terms of such plans or
practices, including, without limitation, any continuation of benefits required
by COBRA or applicable law. In addition, if Executive's employment is terminated
by the Company for Cause or by Executive without Good Reason (other than as a
result of Executive's death or Permanent Disability), or if the Employment
Period expires, all vesting of Executive's unvested Stock Awards previously
granted to him or her by the Company shall cease and none of such unvested Stock
Awards shall be exercisable following the date of such termination. The
foregoing shall be in addition to, and not in lieu of, any and all other rights
and remedies which may be available to the Company under the circumstances,
whether at law or in equity.
(f) Release. As a condition to Executive's receipt of any
post-termination benefits described in this Agreement, Executive shall execute a
Release (the "Release") in a form reasonably acceptable to the Company. Such
Release shall specifically relate to all of Executive's rights and claims in
existence at the time of such execution, including any claims related to
Executive's employment by the Company and his or her termination of employment,
and shall exclude any continuing obligations the Company may have to Executive
following the date of termination under this Agreement or any other agreement
providing for obligations to survive Executive's termination of employment.
(g) Exclusive Remedy. Except as otherwise expressly required by
law (e.g., COBRA) or as specifically provided herein, all of Executive's rights
to salary, severance, benefits, bonuses and other amounts hereunder (if any)
accruing after the termination of Executive's employment shall cease upon such
termination. In the event of a termination of Executive's employment with the
Company, Executive's sole remedy shall be to receive the payments and benefits
described in this Section 5. In addition, Executive acknowledges and agrees that
he or she is not entitled to any reimbursement by the Company for any taxes
payable by Executive as a result of the payments and benefits received by
Executive pursuant to this Section 5, including, without limitation, any excise
tax imposed by Section 4999 of the Internal Revenue Code of 1986, as amended.
(h) No Mitigation. Executive shall not be required to mitigate the
amount of
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any payment provided for in this Section 5 by seeking other employment or
otherwise, nor shall the amount of any payment or benefit provided for in this
Section 5 be reduced by any compensation earned by Executive as the result of
employment by another employer or self-employment or by retirement benefits;
provided, however, that loans, advances or other amounts owed by Executive to
the Company may be offset by the Company against amounts payable to Executive
under this Section 5; provided, further, that, as provided in Sections 5(b), (c)
or (d), Executive's right to continued healthcare and life insurance benefits
following his or her termination of employment will terminate on the date on
which the applicable continuation period under COBRA expires.
(i) Return of the Company's Property. If Executive's employment is
terminated for any reason, or if the Employment Period expires, the Company
shall have the right, at its option, to require Executive to vacate his or her
offices prior to or on the effective date of termination and to cease all
activities on the Company's behalf. Upon the termination of his or her
employment in any manner, as a condition to the Executive's receipt of any
post-termination benefits described in this Agreement, Executive shall
immediately surrender to the Company all lists, books and records of, or in
connection with, the Company's business, and all other property belonging to the
Company, it being distinctly understood that all such lists, books and records,
and other documents, are the property of the Company. Executive shall deliver to
the Company a signed statement certifying compliance with this Section 5(i)
prior to the receipt of any post-termination benefits described in this
Agreement.
(j) Waiver of the Company's Liability. Executive recognizes that
his or her employment is subject to termination with or without Cause for any
reason and therefore Executive agrees that Executive shall hold the Company
harmless from and against any and all liabilities, losses, damages, costs and
expenses, including but not limited to, court costs and reasonable attorneys'
fees, which Executive may incur as a result of the termination of Executive's
employment. Executive further agrees that Executive shall bring no claim or
cause of action against the Company for damages or injunctive relieve based on a
wrongful termination of employment. Executive agrees that the sole liability of
the Company to Executive upon termination of this Agreement shall be that
determined by this Section 5. In the event this covenant is more restrictive
than permitted by laws of the jurisdiction in which the Company seeks
enforcement thereof, this covenant shall be limited to the extent permitted by
law.
6. Certain Covenants.
(a) Noncompetition. Except as may otherwise be approved by the
Board, during the term of Executive's employment, Executive shall not have any
ownership interest (of record or beneficial) in, or have any interest as an
employee, salesman, consultant, officer or director in, or otherwise aid or
assist in any manner, any firm, corporation, partnership, proprietorship or
other business that engages in any county, city or part thereof in the United
States and/or any foreign country in a business which competes directly or
indirectly (as determined by the Board) with the Company's business in such
county, city or part thereof, so long as the Company, or any successor in
interest of the Company to the business and goodwill of the Company, remains
engaged in such business in such county, city or part thereof or continues to
solicit customers or potential customers therein; provided, however, that
Executive
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may own, directly or indirectly, solely as an investment, securities of any
entity which are traded on any national securities exchange if Executive (x) is
not a controlling person of, or a member of a group which controls, such entity;
or (y) does not, directly or indirectly, own one percent (1%) or more of any
class of securities of any such entity.
(b) Confidential Information. Executive and the Company have
entered into the Company's standard employee confidentiality and invention
assignment agreement (the "Employee Confidentiality and Invention Assignment
Agreement"). Executive agrees to perform each and every obligation of Executive
therein contained.
(c) Solicitation of Employees. Executive shall not during the term
of Executive's employment and for the applicable severance period for which
Executive receives severance benefits following any termination hereof pursuant
to Section 5(c) or (d) above (regardless of whether Executive elects payment of
severance amounts payable thereunder in a lump sum) (the "Restricted Period"),
directly or indirectly, solicit or encourage to leave the employment of the
Company or any of its affiliates, any employee of the Company or any of its
affiliates.
(d) Solicitation of Consultants. Executive shall not during the
term of Executive's employment and for the Restricted Period, directly or
indirectly, hire, solicit or encourage to cease work with the Company or any of
its affiliates any consultant then under contract with the Company or any of its
affiliates within one year of the termination of such consultant's engagement by
the Company or any of its affiliates.
(e) Rights and Remedies Upon Breach. If Executive breaches or
threatens to commit a breach of any of the provisions of this Section 6 (the
"Restrictive Covenants"), the Company shall have the following rights and
remedies, each of which rights and remedies shall be independent of the other
and severally enforceable, and all of which rights and remedies shall be in
addition to, and not in lieu of, any other rights and remedies available to the
Company under law or in equity:
(i) Specific Performance. The right and remedy to have the
Restrictive Covenants specifically enforced by any court having equity
jurisdiction, all without the need to post a bond or any other security or to
prove any amount of actual damage or that money damages would not provide an
adequate remedy, it being acknowledged and agreed that any such breach or
threatened breach will cause irreparable injury to the Company and that money
damages will not provide adequate remedy to the Company; and
(ii) Accounting and Indemnification. The right and remedy to
require Executive (i) to account for and pay over to the Company all
compensation, profits, monies, accruals, increments or other benefits derived or
received by Executive or any associated party deriving such benefits as a result
of any such breach of the Restrictive Covenants; and (ii) to indemnify the
Company against any other losses, damages (including special and consequential
damages), costs and expenses, including actual attorneys' fees and court costs,
which may be incurred by them and which result from or arise out of any such
breach or threatened breach of the Restrictive Covenants.
11
(f) Severability of Covenants/Blue Pencilling. If any court
determines that any of the Restrictive Covenants, or any part thereof, is
invalid or unenforceable, the remainder of the Restrictive Covenants shall not
thereby be affected and shall be given full effect, without regard to the
invalid portions. If any court determines that any of the Restrictive Covenants,
or any part thereof, are unenforceable because of the duration of such provision
or the area covered thereby, such court shall have the power to reduce the
duration or area of such provision and, in its reduced form, such provision
shall then be enforceable and shall be enforced. Executive hereby waives any and
all right to attack the validity of the Restrictive Covenants on the grounds of
the breadth of their geographic scope or the length of their term.
(g) Enforceability in Jurisdictions. The Company and Executive
intend to and do hereby confer jurisdiction to enforce the Restrictive Covenants
upon the courts of any jurisdiction within the geographical scope of such
covenants. If the courts of any one or more of such jurisdictions hold the
Restrictive Covenants wholly unenforceable by reason of the breadth of such
scope or otherwise, it is the intention of the Company and Executive that such
determination not bar or in any way affect the right of the Company to the
relief provided above in the courts of any other jurisdiction within the
geographical scope of such covenants, as to breaches of such covenants in such
other respective jurisdictions, such covenants as they relate to each
jurisdiction being, for this purpose, severable into diverse and independent
covenants.
(h) Definitions. For purposes of this Section 6, the term
"Company" means not only CancerVax Corporation, but also any company,
partnership or entity which, directly or indirectly, controls, is controlled by
or is under common control with CancerVax Corporation.
7. Insurance. The Company shall have the right to take out life,
health, accident, "key-man" or other insurance covering Executive, in the name
of the Company and at the Company's expense in any amount deemed appropriate by
the Company. Executive shall assist the Company in obtaining such insurance,
including, without limitation, submitting to any required examinations and
providing information and data required by insurance companies.
8. Arbitration. Except as provided in Section 6, any claim or
controversy arising out of or relating to this Agreement shall be settled by
arbitration in San Diego, California, in accordance with the Employment
Arbitration Rules of the American Arbitration Association, and judgment on the
award rendered by the arbitrator may be entered in any court having
jurisdiction. Each party shall select one arbitrator and the two arbitrators so
chosen will select a third arbitrator who shall act as the sole arbitrator of
any dispute. Each party shall pay the fees of its own attorneys, the expenses of
its witnesses and all other expenses connected with presenting its case;
however, Executive and the Company agree that, to the extent permitted by law,
the arbitrator may, in his or her discretion, award reasonable attorneys' fees
to the prevailing party. Other costs of the arbitration, including the cost of
any record or transcripts of the arbitration, administrative fees, the fee of
the sole arbitrator, and all other fees and costs, shall be borne by the
Company.
9. General Relationship. Executive shall be considered an employee of
the Company within the meaning of all federal, state and local laws and
regulations including, but
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not limited to, laws and regulations governing unemployment insurance, workers'
compensation, industrial accident, labor and taxes.
10. Miscellaneous.
(a) Modification; Prior Claims. This Agreement sets forth the
entire understanding of the parties with respect to the subject matter hereof,
supersedes all existing agreements between them concerning such subject matter,
including the Original Agreement, and may be modified only by a written
instrument duly executed by each party.
(b) Assignment; Assumption by Successor. The rights of the Company
under this Agreement may, without the consent of Executive, be assigned by the
Company, in its sole and unfettered discretion, to any person, firm, corporation
or other business entity which at any time, whether by purchase, merger or
otherwise, directly or indirectly, acquires all or substantially all of the
assets or business of the Company. The Company will require any successor
(whether direct or indirect, by purchase, merger or otherwise) to all or
substantially all of the business or assets of the Company expressly to assume
and to agree to perform this Agreement in the same manner and to the same extent
that the Company would be required to perform it if no such succession had taken
place; provided, however, that no such assumption shall relieve the Company of
its obligations hereunder. As used in this Agreement, the "Company" shall mean
the Company as hereinbefore defined and any successor to its business and/or
assets as aforesaid which assumes and agrees to perform this Agreement by
operation of law or otherwise.
(c) Survival. The covenants, agreements, representations and
warranties contained in or made in Sections 5, 6, 8 and 10 of this Agreement
shall survive any termination of Executive's employment.
(d) Third-Party Beneficiaries. This Agreement does not create, and
shall not be construed as creating, any rights enforceable by any person not a
party to this Agreement.
(e) Waiver. The failure of either party hereto at any time to
enforce performance by the other party of any provision of this Agreement shall
in no way affect such party's rights thereafter to enforce the same, nor shall
the waiver by either party of any breach of any provision hereof be deemed to be
a waiver by such party of any other breach of the same or any other provision
hereof.
(f) Section Headings. The headings of the several sections in this
Agreement are inserted solely for the convenience of the parties and are not a
part of and are not intended to govern, limit or aid in the construction of any
term or provision hereof.
(g) Notices. All notices, requests and other communications
hereunder shall be in writing and shall be delivered by courier or other means
of personal service (including by means of a nationally recognized courier
service or professional messenger service), or sent by telex or telecopy or
mailed first class, postage prepaid, by certified mail, return receipt
requested, in all cases, addressed to:
If to the Company or the Board:
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CancerVax Corporation
0000 Xxxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxx 00000
Attention: Legal Affairs Department
If to Executive:
[Name and Address]
All notices, requests and other communications shall be deemed given on the date
of actual receipt or delivery as evidenced by written receipt, acknowledgement
or other evidence of actual receipt or delivery to the address. In case of
service by telecopy, a copy of such notice shall be personally delivered or sent
by registered or certified mail, in the manner set forth above, within three
business days thereafter. Any party hereto may from time to time by notice in
writing served as set forth above designate a different address or a different
or additional person to which all such notices or communications thereafter are
to be given.
(h) Severability. All Sections, clauses and covenants contained in
this Agreement are severable, and in the event any of them shall be held to be
invalid by any court, this Agreement shall be interpreted as if such invalid
Sections, clauses or covenants were not contained herein.
(i) Governing Law and Venue. This Agreement is to be governed by
and construed in accordance with the laws of the State of California applicable
to contracts made and to be performed wholly within such State, and without
regard to the conflicts of laws principles thereof. Except as provided in
Sections 6 and 8, any suit brought hereon shall be brought in the state or
federal courts sitting in San Diego, California, the parties hereto hereby
waiving any claim or defense that such forum is not convenient or proper. Each
party hereby agrees that any such court shall have in personam jurisdiction over
it and consents to service of process in any manner authorized by California
law.
(j) Non-transferability of Interest. None of the rights of
Executive to receive any form of compensation payable pursuant to this Agreement
shall be assignable or transferable except through a testamentary disposition or
by the laws of descent and distribution upon the death of Executive. Any
attempted assignment, transfer, conveyance, or other disposition (other than as
aforesaid) of any interest in the rights of Executive to receive any form of
compensation to be made by the Company pursuant to this Agreement shall be void.
(k) Gender. Where the context so requires, the use of the
masculine gender shall include the feminine and/or neuter genders and the
singular shall include the plural, and vice versa, and the word "person" shall
include any corporation, firm, partnership or other form of association.
(l) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same Agreement.
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(m) Construction. The language in all parts of this Agreement
shall in all cases be construed simply, according to its fair meaning, and not
strictly for or against any of the parties hereto. Without limitation, there
shall be no presumption against any party on the ground that such party was
responsible for drafting this Agreement or any part thereof.
(n) Withholding and other Deductions. All compensation payable to
Executive hereunder shall be subject to such deductions as the Company is from
time to time required to make pursuant to law, governmental regulation or order.
(Signature Page Follows)
15
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first set forth above.
CANCERVAX CORPORATION
By: _________________________________
[Name]
[Title]
______________________________________
[Name of Executive]
Schedule to Exhibit 10.1
The preceding form of [Amended and Restated] Employment Agreement was
entered into between the Company and the following persons. Each [Amended and
Restated] Employment Agreement has a different term as indicated below:
Expiration of Term of Date of
Name of Executive Title Base Salary Agreement Agreement
-------------------------- -------------------------- ----------- --------------------- ---------------------
Xxxxx X. Xxxx Senior Vice President,
Regulatory Operations and
Legal Affairs $260,000 February 8, 2009 November 15, 2004
Xxxxx X. Xxxxxx (1) Vice President, Quality $188,500 January 31, 2006 November 15, 2004
Xxx Xxxxxx Vice President, Clinical
Development $207,000 December 31, 2008 November 15, 2004
Xxxxxx X. Xxxxx Vice President, Human
Resources $185,000 January 14, 2009 November 15, 2004
Xxxxxxx X. Xx Xxx Senior Vice President and
Chief Financial Officer $241,000 April 1, 2009 November 15, 2004
Xxxxxx X. Xxxxxxxxx Executive Vice President
and Chief Operating
Officer $295,000 May 14, 2007 November 15, 2004
Xxxx Xxxxxxxxxxx, M.D. (2) Senior Vice President,
Medical and Regulatory
Affairs $224,000 January 4, 2009 November 15, 2004
Xxxxxx Xxx Xxxx Vice President, Research $208,000 November 25, 2005 November 15, 2004
Xxxxx X. Xxxxxxxxx(3) Vice President, Sales,
Marketing and Product
Planning $215,000 June 14, 2009 June 14, 2005
Xxxxxxx X. Xxxxxxxxx(4) Vice President,
Manufacturing Operations $215,000 June 23, 2009 June 23, 2005
(1) Xx. Xxxxxx'x employment agreement provides that she will work from our
manufacturing facility in Marina del Rey, California four days per week
and from her home in Pleasant Hill, California on Fridays. We will
reimburse Xx. Xxxxxx for airfare and ground transportation for travel
between Marina del Rey, California and Pleasant Hill, California and car
rental and lodging expenses while in Marina del Rey, California. Xx.
Xxxxxx'x monthly lodging reimbursement will not exceed $1,500 per month.
All such amounts payable to Xx. Xxxxxx will be grossed up for taxes
payable by Xx. Xxxxxx on such amounts.
(2) Dr. Petricciani's employment agreement provides that he will be permitted
to telecommute from his principal residence in Palm Springs, California.
In addition, we will reimburse Xx. Xxxxxxxxxxx for airfare and ground
transportation for travel between Carlsbad, California and Palm Springs,
California (or Xx. Xxxxxxxxxxx will receive a mileage reimbursement if he
chooses to use his personal automobile to commute to Carlsbad, California)
and lodging expenses while in Carlsbad, California. Dr. Petricciani's
monthly lodging reimbursement will not exceed $1,350 per month. All such
amounts payable to Xx. Xxxxxxxxxxx will be grossed up for taxes payable by
Xx. Xxxxxxxxxxx on such amounts.
(3) Xx. Xxxxxxxxx'x employment agreement provides that she will report to the
Chief Operating Officer.
(4) Xx. Xxxxxxxxx'x employment agreement provides that he will report to the
Chief Operating Officer. In addition, Xx. Xxxxxxxxx'x employment agreement
provides that in the event Xx. Xxxxxxxxx shall relocate from Del Mar,
California, to the Los Angeles, California, area at any time prior to
June 22, 2006, we will reimburse Xx. Xxxxxxxxx for real estate sales
commissions on Xx. Xxxxxxxxx'x primary residence of up to $60,000; closing
costs (excluding points) on the sale of Xx. Xxxxxxxxx'x family residence
in Del Mar, California, and on the purchase of a new residence in the Los
Angeles, California, area; reasnable costs associated with moving
household goods; and reasonable temporary living expenses for up to
60 days. In the event Xx. Xxxxxxxxx voluntarily separates from us within
12 months following the date of moving his family residence to the Los
Angeles, California, area, Xx. Xxxxxxxxx must reimburse us for all such
relocation costs on a pro-rata basis.
2
