Exhibit 10.1
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into
this 28th day of October, 1999, by and between Innapharma, Inc., a Delaware
corporation (the "Company"), and XXXXXX X. XXXXXXXX ("Executive"), a resident of
Suffolk County, New York.
WHEREAS, the Company is engaged in the business of research and
development of new pharmaceuticals and related products and the licensing of
such pharmaceuticals and products to pharmaceutical manufacturing companies and
related marketing of such products.
WHEREAS, the Company desires that Executive render employment services
to the Company for a period of time specified hereinbelow, and as more
particularly described herein.
WHEREAS, Executive desires to render such employment services upon the
terms and conditions and at the rate(s) of compensation set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants, terms and
provisions herein contained and for other good and valuable consideration, the
parties hereto agree as follows:
1. EMPLOYMENT. The Company hereby employs Executive and Executive
hereby accepts employment by the Company for the period and upon the terms and
conditions hereinafter set forth.
2. CAPACITY AND DUTIES. Executive shall by employed by the Company as
Co-Chief Executive Officer, Co-Chairman of the Board of Directors and Secretary
for the Term specified in Section 5 below, and will faithfully and diligently
perform the services and functions relating to such offices or otherwise
reasonably incident to such offices, as may be assigned from time to time by the
Board of Directors. Executive will, during the term of this Agreement, devote
substantial and sufficient productive time and efforts as are necessary to
perform and discharge the duties and responsibilities of Executive which are set
forth herein and shall not take part in activities detrimental to the best
interests of the Company. The Company understands, agrees and acknowledges that
executive is currently Chairman of X.X. Xxxxxxx & Company, and intends to
continue in that position during the entire term of this Agreement.
3. OTHER BUSINESS ACTIVITIES. Except as provided above in paragraph 2,
during the Term of his employment, Executive shall not be employed by or
participate or engage in or be associated with the management or operation of
any business enterprise other than the Company that will substantially detract
from his ability to perform his duties to the Company, unless the Board gives
its prior written consent, such consent not to be unreasonably withheld.
Notwithstanding the foregoing, Executive shall not be prevented from engaging in
personal business, investment,
charitable or civic activities as long as such activities do not materially
interfere with the satisfactory discharge by Executive of his duties and
responsibilities hereunder.
4. TERM. The term of Executive's employment hereunder shall be three
(3) years commencing on December 15, 1999 (`Term"). The term of Executive's
employment shall thereafter automatically be renewed from year to year unless
and until either party shall give notice of his or its election to terminate
Executive's employment at least ninety (90) days prior to the end of the
then-current term, unless earlier terminated as hereinafter provided.
5. COMPENSATION, EXPENSES, BENEFITS.
a. BASE SALARY. As compensation for Executive's services
herein, the company shall pay to Executive a minimum annual base salary of One
Hundred Sixty Thousand Dollars ($160,000) ("Base Salary"), payable in periodic
equal installments not less frequently than monthly, less such sums as may be
required to be deducted or withheld under applicable provisions of federal,
state and local law and any additional withholdings authorized in writing by
Executive, provided that Executive shall be entitled to an annual increase in
salary of not less than ten percent (10%) of the prior year's salary.
Executive's Salary shall also be subject to normal periodic review by the Board
of Directors at least annually for increases based on the salary policies of the
company and the Executive's contributions to the enterprise.
b. BONUS COMPENSATION. Executive shall also be eligible to
participate in year-end bonus compensation which may be paid from time to time
by the Company at the end of the Company's fiscal year (or, if the Board of
Directors shall so determine, at such other time or times throughout the fiscal
year as may be appropriate) based upon the overall financial performance of the
Company, the Executive's individual performance and other standards as the Board
of Directors shall from time to time determine. Any bonus compensation shall be
payable on such terms and at such times as the Board of Directors of the Company
shall determine, less such sums as may be required to be deducted or withheld
under applicable provisions of federal, state and local law and any additional
withholdings authorized in writing by Executive.
c. BENEFITS. Executive shall be entitled to participate in all
of the employee benefit plans provided by the Company, including, but not
limited to, pension, 401(k), profit sharing, stock incentive, bonus or incentive
compensation, stock option, and stock purchase plans, group and individual
disability insurance, medical and dental insurance, group and individual life
insurance, and such other plans of the Company or additional benefit programs,
plans or perquisites as the Company may from time to time provide for its
executive officers.
d. EXPENSE REIMBURSEMENT. The Company shall reimburse Executive
for all ordinary and necessary business expenses incurred by him in the
performance of his duties and responsibilities hereunder, including, without
limitation, travel (including mileage and tolls) and entertainment expenses
reasonably related to the business or
interests of the Company. Such expenses shall either be billed directly to the
Company or reimbursed upon submission by Executive of receipts or other written
documentation of such expenses as required by the Company's policies from time
to time in effect.
e. VACATION. Executive will be entitled to six (6) weeks of
paid vacation per year, or such greater period as the Board of Directors may
from time to time approve. Any vacation not used in one year may be carried over
to the next year.
6. SERVICE AS OFFICER OF SUBSIDIARIES. Service as Director. During the
Term, Executive shall, if elected or appointed, serve or continue to serve as
(a) an officer of any subsidiaries of the Company in existence or hereafter
created or acquired and (b) a director of the Company and/or any such
subsidiaries of the Company, in each case without any additional compensation
for such services.
7. DIRECTORS AND OFFICERS' INSURANCE. From the beginning date of this
Agreement until its termination in accordance with the terms and provisions set
forth herein, the Company shall provide Executive with continuous and
uninterrupted directors and officers' liability insurance coverage, at the sole
cost and expense of the Company. The Company represents and warrants that it has
obtained such coverage and that such coverage is presently in force.
8. TERMINATION OF EMPLOYMENT. Executive's employment hereunder may be
terminated during the Term upon the occurrence of any one of the events
described in this Section.
a. DEATH OR DISABILITY. This Agreement and the employment
relationship created hereby will terminate upon the death or disability of
Executive. For purposes of this Section 8(a), "disability" shall mean for a
period of six (6) months in any twelve (12) month period Executive is incapable
of substantially fulfilling the duties set forth in the Agreement because of
physical, mental or emotional incapacity resulting from injury, sickness or
disease. In the event that Executive dies during the Term, the Company shall pay
to Executive's executors, legal representatives or administrators an amount
equal to the accrued and unpaid portion of his Base Salary and other
compensation for the month in which he dies.
b. TERMINATION BY THE COMPANY FOR CAUSE. The Company may
terminate Executive's employment hereunder at any time for "cause" upon written
notice to Executive. For purposes of this Agreement, "cause" shall mean: (i) any
material breach by Executive of any of his material obligations under Section 9
of this Agreement, (ii) any material failure by Executive to perform
satisfactorily the duties required by or appropriate for his position, as
determined by the Board of Directors in its reasonable discretion, or (iii)
other conduct of Executive involving any type of habitual intoxication, drug
addition, disloyalty to the Company or willful misconduct with respect to the
Company, including without limitation fraud, embezzlement, theft or proven
dishonesty in the course of his employment or conviction of a felony. The
Company may terminate Executive's employment for cause only after a written
demand for substantial
performance is delivered to Executive by the Board of Directors, which demand
shall specify the manner in which the Board believes Executive has not
substantially performed his duties. Executive shall not be deemed to have been
terminated for cause unless and until there shall have been delivered to him a
copy of a resolution duly adopted by the Board of Directors at a full meeting of
the Board called and held for that purpose, and following reasonable notice to
Executive and an opportunity for him to be heard before the full Board of
Directors. In the event of termination of Executive's employment for cause,
Executive shall continue to receive all salary, bonuses, and benefits under this
Agreement until the effective date of such termination.
c. TERMINATION BY EXECUTIVE. Executive shall have the right to
terminate this Agreement for any reason upon sixty (60) days written notice. In
the event Executive terminates this agreement, his salary, bonuses and benefits
will terminate effective the date of his termination of employment.
9. COMPANY PROPERTY AND CONFIDENTIALITY.
a. Executive recognizes and acknowledges that the Proprietary
Information (as hereinafter defined) is a valuable, special and unique asset of
the Company. As a result, both during the Term and thereafter, Executive shall
not, without he prior written consent of the Company, for any reason either
directly or indirectly divulge to any third party or use for his own benefit, or
for any purpose other than the exclusive benefit of the Company, any
confidential, proprietary, business and technical information or trade secrets
of the Company or of any subsidiary or affiliate of the Company ("Proprietary
Information") revealed, obtained or developed in the course of his employment
with the Company.
b. All right, title and interest in and to Proprietary
Information shall be and remain the sole and exclusive property of the Company.
During the Term, Executive shall not remove from the Company's offices or
premises any documents, records, notebooks, files, correspondence, reports,
memoranda or similar materials of or containing Proprietary Information, or
other materials or property of any kind belonging to the Company unless
necessary and appropriate in accordance with the duties and responsibilities
required by or appropriate for his position and, in the event that such
materials and property are removed, all of the foregoing shall be returned to
their proper files or places of safekeeping as promptly as possible after the
removal shall serve its specific purpose. Executive shall not make, retain,
remove and/or distribute any copies of any of the foregoing for any reason
whatsoever except as may be necessary in the discharge of his assigned duties
and shall not divulge to any third person the nature and/or contents of any of
the foregoing or of any other oral or written information to which he may have
access or with which for any reason he may become familiar, except as disclosure
shall be necessary in the performance of his duties. Upon termination of his
employment with the Company, Executive shall leave with or return to the Company
all originals and copies of the foregoing then in his possession, whether
prepared by Executive or others.
10. RESTRICTIVE COVENANT.
a. The services of Executive are unique and extraordinary and
essential to the business of the Company, especially since Executive shall have
access to the Company's customer lists, trade secrets and other privileged and
confidential information essential to the Company's business. Therefore,
Executive agrees that, if the term of his employment hereunder shall expire or
his employment shall at any time terminate for any reason whatsoever, with or
without cause, Executive will not at any time within one (1) year after such
expiration or termination, without the prior written approval of the Company,
directly or indirectly, anywhere in the United States of America, whether
individually or as a principal, officer, employee, partner, director, agent of
or consultant for any entity, (i) engage or participate in a business which, as
of such expiration or termination date, is similar to or competitive with,
directly or indirectly, that of the Company and shall not make any investments
in any such similar or competitive entity; (ii) cause or seek to persuade any
director, officer, employee, customer, agent, licensee or supplier of the
Company to discontinue the status, employment or relationship of such person or
entity with the Company, or to become employed in any activity similar to or
competitive with the activities of the Company; (iii) cause or seek to persuade
any prospective customer, licensee or supplier of the Company (which at the date
of cessation of Executive's employment with the Company was then actively being
solicited by the Company) to determine not to enter into a business relationship
with the Company; (iv) hire or retain any director, officer or employee of the
Company; or (v) solicit or cause or authorize to be solicited, for or on behalf
of him or any third party, any business which is competitive, directly or
indirectly, with the Company from (a) others who are, or were within one (1)
year prior to the cessation of his employment with the Company, customers or
licensees of the Company, or (b) any prospective customer or licensee of the
Company which at the date of such cessation was then actively being solicited by
the Company. There foregoing restrictions set forth in this Paragraph 10(a)
shall apply likewise during the Term.
b. Executive agrees promptly to disclose in writing to the
Board of Directors of the Company all ideas, processes, methods, devices,
business concepts, inventions, improvements, discoveries, know-how and other
creative achievements (hereinafter referred to collectively as "discoveries"),
whether or not the same or any part thereof is capable of being patented,
trademarked, copyrighted, or otherwise protected, which the Employee, while
employed by the Company, conceives, makes, develops, acquires or reduces to
practice, whether acting alone or with others and whether during or after usual
working hours, and which are related to the Company's business or interests, or
are used or usable by the Company, or arise out of or in connection with the
duties performed by Executive. Executive hereby transfers and assigns to the
Company all right, title and interest in and to such discoveries (whether
conceived, made, developed, acquired or reduced to practice on or prior to the
date hereof or hereafter), including any and all domestic and foreign copyrights
and patent and trademark rights therein and any renewals thereof. On request of
the Company, Executive will, without any additional compensation, from time to
time during, and after
the expiration or termination of, the Term, execute such further instruments
(including, without limitation, applications for copyrights, letters patent,
trademarks and assignments thereof) and do all such other acts and things as may
be deemed necessary or desirable by the Company to protect and/or enforce its
right in respect of such discoveries. All expenses of filing or prosecuting any
patent, trademark or copyright application shall be borne by the Company, but
the Employee shall cooperate in filing and/or prosecuting any such application.
c. Executive acknowledges and agrees that, prior to his
employment by the Company, he did not conceive, make, develop, acquire or reduce
to practice any discovery which is related to the Company's business or
interests or is used or usable by the Company.
11. INJUNCTIVE RELIEF. Executive acknowledges and agrees that, in the
event he shall violate any of the restrictions of Paragraph 2 or 10 hereof, the
Company will be without an adequate remedy at law and will therefore be entitled
to enforce such restrictions by temporary or permanent injunctive or mandatory
relief in any court of competent jurisdiction without the necessity of proving
damages and without prejudice to any other remedies which it may have at law or
in equity. Executive acknowledges and agrees that, in addition to any other
state having proper jurisdiction, any such relief may be sought in, and for such
purpose Executive consents to the jurisdiction of, the courts of the State of
New York.
12. WAIVER. No waiver of any of the provisions of this Agreement shall
be deemed, or shall constitute, a waiver of any other provision, whether or not
similar, nor shall any waiver constitute a continuing waiver. No failure to
enforce any right or provision hereunder shall preclude or affect the later
enforcement of such right or provision. No waiver shall be binding unless
executed in writing by the party making the waiver.
13. BINDING EFFECT. This Agreement shall be binding upon and inure to
the benefit of the parties hereto, their respective legal representatives and to
any successor of the Company, which successor shall be deemed to be substituted
for the Company under the terms of this Agreement. As used in this Agreement,
the term "successor" shall include any person, firm, corporation, or other
business entity which at any time, whether by merger, purchase or otherwise,
acquires all or substantially all of the assets or business of the Company.
14. SEVERABILITY. If any of the provisions, or portions thereof, of
this Agreement or the application thereof are held to be unenforceable or
invalid by any court of competent jurisdiction, the remainder of this Agreement
shall not be affected thereby and to this end only the provisions of this
Agreement are declared severable.
15. GOVERNING LAW, VENUE AND JURISDICTION. This Agreement and the
rights and obligations of the parties shall be governed by, construed and
enforced in accordance with the laws of the State of New York, without regard to
the conflict of law
rules of the State of New York. For purposes of venue and jurisdiction, this
Agreement shall be deemed made and to be performed in New York, and the parties
hereby select New York as the proper venue for any action filed to enforce,
construe or interpret this Agreement.
16. ATTORNEYS' FEES AND COSTS. In the event any attorney is employed by
either party to this Agreement with regard to any legal action, arbitration or
other proceeding brought by either party for the enforcement or interpretation
of this Agreement, or because of any alleged dispute, breach, default or
misrepresentation with respect to any provision of this Agreement, the party
prevailing in any such proceeding shall be entitled to recover reasonable
attorneys' fees and other costs and expenses incurred, in addition to any other
relief to which it may be entitled.
17. NOTICES. Any notices, consents, demands, requests, approvals and
other communications required or permitted to be given under this Agreement
shall be in writing unless otherwise so provided. Any written notice or
communication shall be personally delivered, telexed or faxed, or deposited in
the United States mail, postage prepaid, certified or registered return receipt
requested, as follows:
IF TO THE COMPANY:
------------------
000 Xxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
WITH A COPY TO:
--------------
Certilman Balin Xxxxx & Xxxxx, LLP
00 Xxxxxxx Xxxxxx
Xxxx Xxxxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxxxxx, Esq.
Facsimile: (000) 000-0000
IF TO EXECUTIVE:
----------------
0 Xxxxx Xxxx
Xxxxx Xxxxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Delivery or service of any written notice or communication shall be deemed
effective (i) if personally delivered, upon such delivery; (ii) if telexed or
faxed, upon acknowledgment or confirmation thereof; or (iii) if mailed, upon
receipt by the other party, but in any event within 72 hours after transmission.
18. AMBIGUITIES. The rule of construction that any ambiguities are to
be resolved against the drafting party shall not be employed in the
interpretation of this Agreement or of any amendments or exhibits thereto.
19. SECTION HEADINGS. The section headings in this Agreement are for
convenience only; they form no part of this Agreement and shall not affect its
interpretation.
20. FURTHER ASSURANCES. Each of the parties to this Agreement shall
executive and deliver such further instruments and take such other actions as
any other party shall reasonably request in order to effectuate the purpose of
this Settlement Agreement and the agreements attached as exhibits hereto.
21. COUNTERPARTS. This Agreement may be executed in counterparts, all
of which taken together shall be deemed an original agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
effective as of the day and year first written above.
EXECUTIVE: COMPANY:
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INNAPHARMA, INC.
a Delaware Corporation
--------------------------------
Xxxxxx X. Xxxxxxxx
By:
-----------------------------------
Xxxxx Xxxx
Co-Chief Executive Officer and
Co-Chairman of the Board
By:
-----------------------------------
Xxxx X. Xxxxxxxx
President
ADDENDUM TO EMPLOYMENT AGREEMENT OF XXXXXX X. XXXXXXXX
CHANGE OF TITLE. Executive and the Company agree that, at an
appropriate time during the Term, if both Executive and the Company agree,
Executive's title, as set forth in Paragraph 2 of the Agreement, may be changed
to a different, mutually acceptable title. In the event of such change of title,
all other provisions of the Agreement would remain in full force and effect.
VACATION. It is further agreed that the number of weeks of vacation set
forth in Paragraph 5(e) of the Agreement is hereby changed to five (5).
EXECUTIVE: COMPANY:
--------- -------
INNAPHARMA, INC.
a Delaware Corporation
--------------------------------
Xxxxxx X. Xxxxxxxx
By:
--------------------------------
Xxxxx Xxxx
Co-Chief Executive Officer and
Co-Chairman of the Board
By:
Xxxx X. Xxxxxxxx
-------------------------------
President
ADDENDUM TO EMPLOYMENT AGREEMENT OF XXXXXX X. XXXXXXXX
Reference is made to that certain Employment Agreement by and between
Innapharma, Inc. (the "Company") and Xxxxxx X. Xxxxxxxx ("Executive"), dated
December 15, 1999, as amended (the "Agreement").
WHEREAS, on or about February 6, 2001, the Company's Board of Directors
passed a resolution authorizing certain changes to the Agreement set forth
below,
NOW THEREFORE, in consideration of the mutual covenants, terms and
provisions herein contained and for other good and valuable consideration, the
parties hereby agree to amend the Agreement as follows:
4. TERM. The Term of the Agreement shall be extended by two years,
through and including December 15, 2004.
5. COMPENSATION. Paragraph 5(a) of the Agreement shall be replaced with
the following:
a. BASE SALARY. As compensation for Executive's services
herein, the company shall pay to Executive an annual base salary of Two Hundred
Fifty Thousand Dollars ($250,000) ("Base Salary"), payable in periodic equal
installments not less frequently than monthly, less such sums as may be required
to be deducted or withheld under applicable provisions of federal, state and
local law and any additional withholdings authorized in writing by Executive.
Executive's Salary shall be subject to normal periodic review by the Board of
Directors at least annually for increases based on the salary policies of the
company and the Executive's contributions to the enterprise.
The Agreement shall remain unchanged in all other respects.
EXECUTIVE: COMPANY:
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By:
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Xxxxxx X. Xxxxxxxx Xxxx X. Xxxxxxxx
President
Dated: February 9, 2001
ADDENDUM TO EMPLOYMENT AGREEMENT OF XXXXXX X. XXXXXXXX
Reference is made to that certain Employment Agreement by and between
Innapharma, Inc. (the "Company") and Xxxxxx X. Xxxxxxxx ("Executive"), dated
December 15, 1999, as amended (the "Agreement").
WHEREAS, on or about December 11, 2001, the Company's Board of
Directors passed a resolution authorizing certain changes to the Agreement set
forth below,
NOW THEREFORE, in consideration of the mutual covenants, terms and
provisions herein contained and for other good and valuable consideration, the
parties hereby agree to amend the Agreement as follows:
4. TERM. The Term of the Agreement shall be extended by one (1) year,
through and including December 15, 2005.
5. COMPENSATION. Paragraph 5(a) of the Agreement shall be replaced with
the following:
a. Base Salary. As compensation for Executive's services
herein, the company shall pay to Executive an annual base salary of Three
Hundred Thousand Dollars ($300,000) ("Base Salary"), payable in periodic equal
installments not less frequently than monthly, less such sums as may be required
to be deducted or withheld under applicable provisions of federal, state and
local law and any additional withholdings authorized in writing by Executive.
Executive's Salary shall be subject to normal periodic review by the Board of
Directors at least annually for increases based on the salary policies of the
company and the Executive's contributions to the enterprise.
The Agreement shall remain unchanged in all other respects.
EXECUTIVE: COMPANY:
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By:
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Xxxxxx X. Xxxxxxxx Xxxx X. Xxxxxxxx
President
Dated: December 18, 2001
ADDENDUM TO EMPLOYMENT AGREEMENT OF XXXXXX X. XXXXXXXX
Reference is made to that certain Employment Agreement by and between
Innapharma, Inc. (the "Company") and Xxxxxx X. Xxxxxxxx ("Executive(degree)'),
dated December 15, 1999, as amended (the "Agreement").
This addendum is made to correct an omission from the original
Agreement,
NOW THEREFORE, in consideration of the mutual covenants, terms and
provisions herein contained and for other good and valuable consideration, the
parties hereby agree to amend the Agreement as follows:
5. COMPENSATION. Expenses. Benefits. Paragraph 5(f) shall be added to
the Agreement as follows:
f. AUTOMOBILE ALLOWANCE. Executive shall receive an automobile
allowance of $500 per month for automobile wear and tear.
The Agreement shall remain unchanged in all other respects.
EXECUTIVE: COMPANY:
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By:
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Xxxxxx X. Xxxxxxxx Xxxx X. Xxxxxxxx
President
Dated: January 14, 2003
