SALARY CONTINUATION AGREEMENT THIS AGREEMENT dated as of September 18, 2006 is made by and between GenVec, Inc. (the “Company”), and Douglas J. Swirsky (the “Executive”).
Exhibit 10.2
THIS
AGREEMENT dated as of September 18, 2006 is made by and between GenVec, Inc.
(the “Company”), and Xxxxxxx X. Xxxxxxx (the “Executive”).
WHEREAS
the Company considers it essential to its best interests and to the best
interests of its stockholders to xxxxxx the continuous employment of its key
management personnel; and
WHEREAS
the Company has determined that appropriate steps should be taken to reinforce
and encourage the continued attention and dedication of the Company’s
management, including the Executive, to their assigned duties.
NOW,
THEREFORE, in consideration of the premises and the mutual covenants herein
contained, the Company and the Executive hereby agree as follows:
1. Defined
Terms.
Capitalized terms shall have the meaning provided in this
Agreement.
2. Term
of Agreement. This
Agreement shall become effective as of the date hereof and shall remain in
effect indefinitely thereafter provided, however, that the Company may terminate
this Agreement by giving the Executive at least 12 months advance written notice
of such termination.
3. Severance
Benefits.
(a) In
order to induce the Executive to continue to serve as an employee of the
Company, the Company agrees, under the terms and conditions set forth herein,
that the Company shall provide to the Executive the benefits described in
Sections 3.1 and 3.2 below (the “Severance Benefits”), if the Company
terminates the Executive’s employment without Cause and other than by reason of
death or disability.
(b) For
purposes of this Agreement, Cause shall mean:
(a) the
willful and continued failure of the Executive to substantially perform the
Executive's duties with the Company (other than any such failure resulting from
incapacity due to physical or mental illness);
(b) the
willful engaging by the Executive in illegal conduct or gross misconduct which
is materially and demonstrably injurious to the Company;
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(c) personal
dishonesty or breach of fiduciary duty to the Company that in either case
results or was intended to result in personal profit to the Executive at the
expense of the Company; or
(d) willful
violation of any law, rule or regulation (other than traffic violations,
misdemeanors or similar offenses) or cease-and-desist order, court order,
judgment or supervisory agreement, which violation is materially and
demonstrably injurious to the Company.
For
purposes of the preceding clauses, no act or failure to act, on the part of the
Executive, shall be considered "willful" unless it is done, or omitted to be
done, by the Executive in bad faith and without reasonable belief that the
Executive's action or omission was in the best interests of the Company. Any
act, or failure to act, based upon prior approval given by the Board or upon the
instructions or with the approval of the Executive's superior or based upon the
advice of counsel for the Company, shall be conclusively presumed to be done, or
omitted to be done, by the Executive in good faith and in the best interests of
the Company.
3.1 Severance
Payment. In lieu
of any further salary payments to the Executive for periods subsequent to the
Executive’s date of termination of employment with the Company (the “Date of
Termination”), the Company shall continue to pay to the Executive the
Executive’s base salary for a 12 month period. Such continued base salary shall
be paid in a manner consistent with the then current payroll practices of the
Company.
3.2 Continued
Benefits. For a
12 month period beginning on the Executive’s Date of Termination (the “Benefits
Period”), the Company shall provide Executive with life insurance and health
insurance (together, “Welfare Benefits”) under the Company’s employee benefit
plans and policies. During the Benefits Period, the Executive shall be entitled
to elect to change Executive’s level of coverage and/or Executive’s choice of
coverage options (such as the Executive only or family medical coverage) with
respect to the Welfare Benefits to be provided by the Company to the Executive
to the same extent that active employees of the Company are permitted to make
such changes; provided, however, that in the event of any such changes, the
Executive shall pay the amount of any cost increase that would actually be paid
by an active employee of the Company by reason of making the same changes in
Executive’s level of coverage or coverage options. In the event that the
Executive becomes employed by a new employer and is eligible to receive health
insurance and/or other welfare benefits (“New Coverage”), the Welfare Benefits
coverage provided under this Section 3.2 shall be secondary to such New
Coverage. Severance pay is not eligible for use under any of the Company’s
benefit plans, including, but not limited to, the Company’s 401(k) plan,
Employee Stock Purchase Plan, Incentive Stock Option Plan (i.e., for
vesting), etc.
3.3 Pro
Rata Bonus. The
Company shall pay to the Executive a lump sum cash payment equal to the product
of (x) the bonus paid to the Executive for the fiscal year preceding the
Executive's Date of Termination, divided by twelve (12) and multiplied by (y)
the number of months of service during the year of termination.
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4. Miscellaneous.
4.1 Non-Disparagement.
Executive
agrees that Executive will not make or publish any adverse, disparaging, untrue,
or misleading statement or comment about the Company or any of its officers,
directors, employees, or agents. The Company agrees that it will not make or
publish any adverse, disparaging, untrue, or misleading statement or comment
about Executive.
4.2 Non-Compete.
(a)
Executive acknowledges that, as a result of Executive’s positions with the
Company Executive has access to information with respect to the development,
implementation and management of the Company’s business strategies and plans,
including those which involve the Company’s finances, manufacturing, marketing,
operations, industrial relations and acquisitions. Accordingly, during the
period of Executive’s employment with the Company and for a period of 12 months
thereafter, Executive agrees that Executive shall not, directly or indirectly,
in any capacity, carry on, be engaged in, assist, consult for or have any
financial or other interest in any business which is in competition with the
business of the Company (provided that a financial interest of not more than two
percent (2%) in any company which is publicly traded and whose shares are listed
on a national stock exchange or as quoted on NASDAQ shall be permitted). In
addition, Executive shall not, on Executive’s behalf or on behalf of any firm,
partnership, corporation or any other person or entity, directly or indirectly,
during the twelve month period following Executive’s termination of employment
from the Company, for any reason whatsoever, solicit or offer employment to any
person who has been employed by the Company at any time during the twelve months
immediately preceding such solicitation. For purposes of this Section 4.2, a
business shall be deemed to be in competition with the business of the Company
if it is principally involved or if it has proposed to become principally
involved in the purchase, sale or other dealing in any property or product or
the rendering of any service purchased, sold, dealt in or rendered, by the
Company as a material part, or expected material part, of the business of the
Company.
(b) The
Executive and the Company agree that this covenant not to compete and the
covenant not to solicit are reasonable covenants under the circumstances,
Executive has been adequately compensated for such covenants, and further agree
that if in the opinion of any court of competent jurisdiction such restraint is
not reasonable in any respect, such court shall have the right, power and
authority to excise or modify such provision or provisions of this covenant as
to the court shall appear not reasonable and to enforce the remainder of the
covenant as so amended.
4.3 Nondisclosure. During
the Executive's employment with the Company and thereafter, the Executive shall
not disclose or use in any way any confidential business or technical
information or trade secret acquired in the course of such employment, other
than (i) information that is generally known in the Company's industry or
acquired from public sources, (ii) as required in the course of such employment,
(iii) as required by any court, supervisory authority administrative agency or
applicable law, or (iv) with the prior written consent of the
Company.
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4.4 No
Mitigation. The
Company agrees that, if the Executive’s employment by the Company is terminated
in a manner that results in the Executive becoming entitled to the Severance
Benefits, the Executive shall not be required to seek other employment or to
attempt in any way to reduce any amounts payable to the Executive by the Company
pursuant to this Agreement. Except to the extent provided in Section 3.2 hereof,
the amount of any payment or benefit provided for under this Agreement shall not
be reduced by any compensation earned by the Executive as the result of
employment by another employer or by retirement benefits.
4.5 Successors. In
addition to any obligations imposed by law upon any successor to the Company,
the Company shall be obligated to require any successor (whether direct or
indirect and whether by merger, consolidation, operation of law, or otherwise)
to the Company to expressly assume this Agreement and the obligations hereunder.
In the event of such a succession, references to the “Company” herein shall
thereafter be deemed to include such successor.
4.6 Death. This
Agreement shall inure to the benefit of and be enforceable by the Executive’s
personal or legal representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees. If the Executive shall die while any amount
or benefit would still be payable or required to be provided to the Executive
hereunder if the Executive had continued to live, all such amounts and benefits,
unless otherwise provided herein, shall be paid or provided in accordance with
the terms of this Agreement to the executors, personal representatives or
administrators of the Executive’s estate.
4.7 Notices. For the
purpose of this Agreement, notices and all other communications shall be in
writing and shall be deemed to have been duly given when delivered or mailed by
United States registered mail, return receipt requested, postage prepaid,
addressed to the respective addresses set forth below, or to such other address
as either party may have furnished to the other in writing in accordance
herewith, except that notice of change of address shall be effective only upon
actual receipt:
To the
Company:
|
GenVec,
Inc. |
|
00
Xxxx Xxxxxxx Xxxx Xxxx, |
|
Xxxxxxxxxxxx,
XX 00000 |
|
Attention:
Director of Human Resources |
|
To
the Executive: |
|
Xxxxxxx
X. Xxxxxxx |
|
GenVec,
Inc. |
|
00
Xxxx Xxxxxxx Xxxx Xxxx, |
|
Xxxxxxxxxxxx,
XX 00000 |
4.8 Modification;
Waiver. No
provision of this Agreement may be modified, waived or discharged unless such
modification, waiver or discharge is agreed to in writing and signed by the
Executive and such officer as may be specifically designated by the Board or its
delegee. The Company’s or the Executive’s failure to insist upon strict
compliance with the terms of this Agreement or the failure of the Company or the
Executive to assert any right the Company or the Executive may have hereunder
shall not be deemed a waiver of such provision or right or any other provision
of this Agreement.
4.9 Entire
Agreement. No
agreements or representations, oral or otherwise, express or implied, with
respect to the subject matter hereof have been made by either party which are
not expressly set forth in this Agreement.
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4.10 Applicable
Law. The
validity, interpretation, construction and performance of this Agreement shall
be governed by the laws of the State of Maryland without regard to principles of
conflicts of laws thereof.
4.11 Withholding. The
Severance Benefits shall be paid net of any applicable withholding required
under federal, state or local law and any additional withholding to which the
Executive has agreed.
4.12 Validity. The
invalidity or unenforceability of any provision of this Agreement shall not
affect the validity or enforceability of any other provision of this Agreement,
which shall remain in full force and effect.
4.13 No
Right to Continued Employment. Nothing
in this Agreement shall be deemed to give the Executive the right to be retained
in the employ of the Company, or to interfere with the right of the Company to
discharge the Executive at any time and for any lawful reason, subject in all
cases to the terms of this Agreement.
4.14 No
Assignment of Benefits. Except
as otherwise provided herein or by applicable law, no right or interest of the
Executive under this Agreement shall be assignable or transferable, in whole or
in part, either directly or by operation of law or otherwise, including without
limitation by execution, levy, garnishment, attachment, pledge or in any manner;
no attempted assignment or transfer thereof shall be effective.
4.15 Headings. The
headings and captions herein are provided for reference and convenience only,
shall not be considered part of this Agreement, and shall not be employed in the
construction of this Agreement.
IN
WITNESS WHEREOF, the Company has caused this Agreement to be executed by its
officer, thereunto duly authorized, and the Executive has executed this
Agreement, all as of the day and year first above written.
GENVEC,
INC.
/s/Xxxx
X. Fischer_________________________________
By: Xxxx
X. Xxxxxxx
Title:
President and Chief Executive Officer
EXECUTIVE:
/s/Xxxxxxx
X. Swirsky________________________________
Xxxxxxx X. Xxxxxxx
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