Exhibit 10.10
EMPLOYMENT AGREEMENT
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THIS EMPLOYMENT AGREEMENT (the "Agreement") is made this 18th day of
August, 1999 (the "Effective Date") by Ventiv Health, Inc., a Delaware
corporation with its principal place of business at 0000 Xxxxxx xx xxx Xxxxxxxx,
Xxx Xxxx, XX 00000, (the "Corporation"), and Xxxxxxx X. Xxxxxxx, residing at 000
Xxxxxxxxxxx Xxxx, Xxxxxx, Xxx Xxxxxx 00000 (the "Executive"). The Corporation
shall be referred to herein as the "Employer."
WHEREAS, the parties wish to set forth the terms and conditions upon which
the Employer will employ the Executive;
NOW, THEREFORE, in consideration of the mutual covenants and promises
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties hereto, the parties
agree as follows:
1. Title; Duties
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The Employer hereby employs the Executive, and the Executive hereby accepts
employment with the Employer, upon the terms set forth in this Agreement. The
Executive's employment with the Employer shall commence on August 18, 1999. The
Executive shall serve as Chief Financial Officer during the term of his
employment under this Agreement. The Executive shall report directly to the
Chief Executive Officer or such other person as may be designated by him, who
shall have the authority to direct, control and supervise the activities of the
Executive. The Executive shall perform such services consistent with his
position as may be assigned to him from time to time by such person.
2. Extent of Services
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The Executive agrees to devote his entire business time and attention to
the performance of his duties under this Agreement. He shall perform his duties
to the best of his ability and shall use his best efforts to further the
interests of the Employer. The Executive shall perform his duties in the
Employer's New York metropolitan area office and will be required to travel as
necessary to perform the services required of him under this Agreement. The
Executive represents and warrants to the Employer that he is able to enter into
this Agreement and that his ability to enter into this Agreement and to fully
perform his duties hereunder are not limited to or restricted by any agreements
or understandings between the Executive and any other person. For the purposes
of this Agreement, the term "person" means any natural person, corporation,
partnership, limited liability partnership, limited liability company, or any
other entity of any nature.
3. Base Salary
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The Employer shall pay the Executive a base annual salary of $250,000.
This salary shall be payable in biweekly installments minus such deductions as
may be required by law or reasonably requested by the Executive. The Employer
will review the Executive's base salary no less often than annually in
conjunction with its regular review of executive salaries.
4. Bonus
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The Executive shall be eligible for a bonus of up to $100,000 in each
calendar year, based on the Executive's success in reaching or exceeding
performance objectives as determined by the President and Chief Executive
Officer or his designee, the amount of such bonus, if any, to be determined in
the discretion of the Employer. Notwithstanding the foregoing, if the Executive
remains employed by the Employer through December 31, 1999, the Executive shall
be entitled to an annualized bonus of up to $100,000 with the annualized bonus
prorated for the time period between August 18, 1999 and December 31, 1999.
Bonus payments will be done within 60 days after the close of each calendar
year. The Employee can elect to defer his bonus with the prior approval of the
Chief Executive Officer.
5. Term of Employment
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This contract shall have a three year term and will automatically renew for
successive one year periods unless terminated by either party with 90 days
notice. Not withstanding the term of this contract, the Executive is an
employee "at will" and may be terminated by the Employer at any time with or
without cause.
6. Stock Options and Restricted Stock
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(a) Stock Options
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Employer shall grant Executive nonqualified stock options for the purchase
of a number of shares of the common stock of the Employer. The grant date shall
be the date of distribution and the Fair Market Value will be the closing price
at the date of distribution. The nonqualified stock options will be for a
number of shares of common stock of the Employer having an aggregate Fair Market
Value of $2,000,000 and an aggregate exercise price equal to such Fair Market
Value. The Compensation Committee of the Board of Directors of the Employer
shall grant such options as soon as practicable after execution of this
Agreement and adoption of the stock option plan by the Employer's Board of
Directors.
The Executive shall be required to enter into a stock option agreement
providing for the grant of options, which shall provide that the options shall
vest at the rate of twenty-five (25%) per year on each anniversary of the date
of grant, such that the stock options shall be fully vested on the fourth
anniversary of such date, and provided that the Executive continues to be
employed by the Employer on each respective anniversary date.
The stock options shall be issued under the Employer's stock option plan
and subject to the terms of the stock option agreement, which are not
inconsistent with this Agreement or the stock option plan.
The Executive acknowledges and agrees that nothing in this Section 6
changes, alters or modifies the "at will" status of his employment with the
Employer.
(b) Restricted Stock
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The Executive shall also be granted by Employer restricted stock valued at
$1,000,000.00 (determined in the same manner as determined under 6(a) above) for
shares of common stock of Employer.
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Executive shall enter into a Restricted Stock Agreement which shall provide
that such restricted shares shall vest as follows:
(1) Forty percent (40%) will vest on the grant date;
(2) Fifteen percent (15%) will vest on the first and each successive
anniversary date of the grant date provided the Executive is
employed by Employer on each such anniversary date.
The Restricted Stock Agreement shall also provide that Executive is
precluded from selling, hedging, pledging or otherwise transferring any shares
of restricted stock in any manner for a period of four years from the date of
the grant.
With respect to this restricted grant only, and so long as Executive is
actively employed by Employer, Employer agrees to annually lend to Executive an
amount necessary for Executive to pay all federal and state income taxes
required of Executive as a result of the periodic vesting of such restricted
stock. In the event Executive is terminated for any reason, all outstanding
principal and interest under such loans shall be accelerated and become due and
payable, and be repaid to Employer upon the later of 4 years and 30 days from
the date of the grant or 30 days after termination. The specific terms of any
loan will be set forth in a separate Loan Agreement. Unless otherwise agreed to
by the parties, such terms will include the following: (i) so long as Executive
remains actively employed by Employer, each loan will be due and payable one
year after all restrictions lapse on all of the restricted stock, provided that
if Executive sells any of the formerly restricted stock before the end of such
one-year period, the loans shall be accelerated and due and payable upon the
consummation of such sale, but only to the extent of the proceeds of such sale
reduced by income taxes payable; and (ii) the principal amount of each loan
shall bear interest at the simple rate of 8% accruing from the date of
disbursement of such principal amount.
In the event that the Executive files an election pursuant to Section 83(b)
of the Internal Revenue Code of 1986, as amended (the "Code"), to be taxed with
respect to the fair market value of the restricted stock of this restricted
grant only, on the date such shares are transferred to the Executive the
Company will provide you with a loan, with the principal amount equal to the
amount of taxes payable on the compensation recognized as a result of the shares
of restricted stock and the 83(b) election. Interest shall be charged on this
loan at a rate of 8%. In the event Executive is terminated for any reason, all
outstanding principal and interest under such loan shall be accelerated and
become due and payable, and be repaid to Employer upon the later of 4 years and
30 days from the date of the grant or 30 days after termination. The specific
terms of any loan will be set forth in a separate Loan Agreement.
7. Fringe Benefits
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a. The Executive shall be entitled to all benefits generally available to
executive employees of the Employer.
b. The Executive shall be entitled to three (3) weeks of vacation during
each year of employment. Such vacation shall be taken at such times as
the Executive and the Chief Executive Officer of the Employer shall
agree. The Executive shall be entitled to sick leave and holidays in
accordance with the policy of the Employer as to its executive
employees.
c. The Employer will reimburse the Employee the full cost of COBRA which
Executive has elected from his former employer's health plan, until such
time that the Employee becomes eligible for the Employer's health plan.
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8. Reimbursement of Business Expenses
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The Employer shall reimburse the Executive in accordance with Employer's
policies for all reasonable out-of-pocket costs incurred or paid by the
Executive in connection with or related to, the performance of his duties,
responsibilities or services under this Agreement, upon presentation by the
Executive of documentation, expense statements, vouchers, and/or such other
supporting information as the Employer may reasonably request.
9. Non-Solicitation and Non-Competition
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a. Except as provided in paragraph (f) below, the Executive agrees that
while the Executive is employed pursuant to this Agreement and for a
period of twelve (12) months following termination of the Executive's
employment by the Employer for any reason (the "Non-Competition
Period"), whether by action of the Executive or the Employer, the
Executive will not, except as otherwise provided herein, engage or
participate, directly or indirectly as principal, agent, executive,
employer, consultant, stockholder, partner or in any other individual
capacity whatsoever, in the conduct or management of, or own any stock
or any other equity investment in or debt of, any business which is
competitive with any business conducted by the Employer.
b. For the purpose of this Agreement, a business shall be considered to be
competitive with the business of the Employer if such business is
engaged in providing outsourced marketing services to the pharmaceutical
and life sciences industry or any other business in which the Employer
is engaged at the time of termination of the Executive's employment.
c. During the Non-Competition Period, the Executive will not, for his own
benefit or for the benefit of any person or entity other than the
Employer, (i) solicit, or assist any person or entity other than the
Employer to solicit any officer, director, executive or employee of the
Employer to leave his/her employment, (ii) hire or cause to be hired for
Executive's benefit any present or former officer, director, executive
or employee of the Employer, or (iii) engage any present or former
officer, director, executive or employee of the Employer as a partner,
contractor, sub-contractor, employee, consultant or other business
associate of the Executive.
d. During the Non-Competition Period, the Executive will not (i) solicit,
or assist any person or entity other than the Employer to solicit, any
person or entity that is a client of the Employer, or has been a client
of the Employer during the twelve (12) months prior to the date of
termination of the Executive's employment, to purchase outsourced
marketing services or any other products or services the Employer
provides to a client at the time of termination of Executive's
employment, or (ii) interfere with any of Employers' business
relationships.
e. The Executive acknowledges that (i) the markets served by the Employer
are national in scope and are not dependent on the geographic location
of
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the executive personnel or the businesses by which they are employed,
and (ii) the above covenants are manifestly reasonable on their face,
and the parties expressly agree that such restrictions have been
designed to be reasonable and no greater than is required for the
protection of the Employer.
f. Nothing in this Agreement shall be deemed to prohibit the Executive from
owning equity or debt investments in any corporation, partnership or
other entity which is competitive with the Employer, provided that such
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investments (i) are passive investments and constitute one percent (1%)
or less of the outstanding equity securities of such an entity the
equity securities of which are traded on a national securities exchange
or other public market.
g. The parties to this Agreement mutually agree that, in recognition of
Employer's dependence on Executive's experience to carry out its
business plan and Executive's senior and key position in the Employer,
the restrictions detailed in Section 9 of this Agreement are necessary
and appropriate to give effect to the intended relationships of the
parties. Executive agrees that because damages arising from violations
of Section 9 of this Agreement are extremely difficult to quantify with
certainty, injunctive relief will be necessary to effect the intent of
such Section. Accordingly, Executive hereby consents to the imposition
of a preliminary or permanent injunction as a remedy to this breach of
Section 9 of this Agreement.
It is the desire and intent of the parties hereto that the restrictions set
forth in Section 9 of this Agreement shall be enforced and adhered to in every
particular, and in the event that any provision, clause or phrase shall be
declared by a court of competent jurisdiction to be judicially unenforceable
either in whole or in part whether the fault be in duration, geographic
coverage or scope of activities precluded the parties agree that they will
mutually petition the court to sever or limit the unenforceable provisions so as
to retain and effectuate to the greatest extent legally permissible the intent
of the parties as expressed in this Section 9 of this Agreement.
10. Confidential Information
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a. The Executive shall not (for his own benefit or the benefit of any
person or entity other than the Employer) use or disclose any of the
Employer's trade secrets or other confidential information. The term
"trade secrets or other confidential information" includes, by way of
example, matters of a technical nature, "know-how", computer programs
(including documentation of such programs), research projects, and
matters of a business nature, such as proprietary information about
costs, profits, markets, sales, lists of customers, and other
information of a similar nature to the extent not available to the
public, and plans for future development. After termination of this
Agreement, the Executive shall not use or disclose trade secrets or
other confidential information unless such information becomes a part
of the public domain other than through a breach of this Agreement or
is disclosed to the Executive by a third party who is entitled to
receive and disclose such information or the
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information is required to be disclosed by the order of a court or
governmental agency.
b. Upon the effective date of notice of the Executive's or the Employer's
election to terminate this Agreement, or at any time upon the request
of the Employer, the Executive (or his heirs or personal
representatives) shall deliver to the Employer all documents and
materials containing either trade secrets and confidential information
relating to the Employer's business or privileged information, and all
documents, materials and other property belonging to the Employer,
which in either case are in the possession or under the control of the
Executive (or his heirs or personal representatives).
c. All discoveries and works made or conceived by the executive during his
employment by the Employer, jointly or with others, that relate to the
Employer's activities shall be owned by the Employer. The terms
"discoveries and works" include, by way of example, inventions,
computer programs (including documentation of such programs), technical
improvements, processes, drawings, and works of authorship, including
sales materials which relate to wall media products, sampling/comparing
or services. The Executive shall promptly notify and make full
disclosure to, and execute and deliver any documents requested by, the
Employer to evidence or better assure title to such discoveries and
works by the Employer, assist the Employer in obtaining or maintaining
for itself at its own expense United States and foreign patents,
copyrights, trade secret protection and other protection of any and all
such discoveries and works, and promptly execute, whether during his
employment or thereafter, all applications or other endorsements
necessary or appropriate to maintain patents and other rights for the
Employer and to protect its title thereto. Any discoveries and works
which, within six (6) months after the termination of the Executive's
employment by the Employer, are made, disclosed, reduced to a tangible
or written form or description, or are reduced to practice by the
Executive and which pertain to work performed by the Executive while
with the Employer shall, as between the Executive and the Employer, be
presumed to have been made during the Executive's employment by the
Employer.
11. Severance
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a. The Executive is an employee "at will" and may be terminated by the
Employer at any time with or without cause.
b. Subject to the provisions of paragraph 11(e) below, if the Executive is
terminated or this Agreement is terminated by the Employer without
cause at any time, then so long as the Executive remains in
compliance withthe remaining obligations contained in this Agreement,
including paragraphs 9 and 10 hereof, the Executive shall continue to
receive from the Employer payments of his Base Salary then in effect
for a period of six months, minus such deductions as may be required by
law or reasonably requested by the Executive (the "Severance Payment").
In addition,
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regarding any vested portion of the Restricted Stock, all restrictions
imposed by the Employer shall lapse with respect to 50% of the vested
portion upon such termination.
c. For the purposes of this Agreement, "cause" shall mean any of the
following: (i) gross negligence or willful misconduct in the
performance of the Executive's duties hereunder; (ii) conviction of any
felony, or any misdemeanor involving dishonesty, fraud or moral
turpitude; (iii) subject to the provisions of the Americans With
Disabilities Act, physical or mental incapacity for a period of five
(5) consecutive months (such period of incapacity shall be deemed to be
continuously consecutive unless Executive has returned to work on a
full-time basis for eight (8) consecutive weeks); (iv) the occurrence
of any wrongful and intentional act or omission by the Executive which
has had or would reasonably be expected to have a material adverse
impact on the business, properties, results of operations, condition
(financial or otherwise) or prospects of the Employer; of (v) the
material failure of the Executive, for any reason, to devote his full
time and efforts in a diligent manner to the performance of his duties
and responsibilities hereunder.
d. Notwithstanding the above provisions, in the event there is a "change
in control" in Ventiv Health, Inc., then so long as the Executive
remains in compliance with the remaining obligations contained in this
Agreement, including paragraphs 9 and 10 hereof, the Executive shall
continue to receive from the Employer payments of his Base Salary then
in effect for a period of six months, minus such deductions as may be
required by law or reasonably requested by the Executive. The
provisions of this paragraph 11(d) shall have no effect if, following
such change in control and for a period of 1 year thereafter, Executive
remains employed by Employer. For the purposes of this paragraph 11(d),
a "change in control" is defined as a sale, transfer or other
disposition of all or substantially all of the assets of Ventiv Health,
Inc., or the consummation of a merger or consolidation of Ventiv
Health, Inc. which results in the stockholders of Ventiv Health, Inc.
immediately prior to such transaction owning, in aggregate, less than a
majority of the surviving or resulting entity or the sale of at least
80% of the outstanding capital stock of Employer to a person or group
of persons acting in concert.
e. In order to be eligible to receive any Severance Payment pursuant to
this paragraph 11, Executive must sign, prior to receiving such
Severance Payment, a complete release of all claims against Employer,
in a format to be determined by Employer.
12. Enforcement
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The Executive agrees that the Employer's remedies at law for any breach or
threat of breach by him of the provisions of Sections 9 and 10 hereof will be
inadequate, and that the Employer shall be entitled to an injunction or
injunctions to prevent breaches of the provisions of Sections 9 and 10 hereof
and to enforce specifically the terms and provisions thereof, in addition to any
other remedy to which the Employer may be entitled at law or equity.
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13. Attorney's Fees and Costs
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Executive agrees that in the event the Employer institutes any action to
enforce and/or prosecute this agreement, the Employer shall be entitled to
recover from Executive its reasonable attorney's fees and costs related to
instituting and maintaining such action.
14. Advance Notice of Prospective Employment
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Executive agrees that following the termination of his employment, prior to
accepting employment with, or agreeing to perform services for, any entity that
competes with the Employer, he will notify the Employer in writing of
Executive's employment or retention that may potentially violate any provision
of this Agreement.
15. Miscellaneous Provisions
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a. Notices. All notices required or permitted under this Agreement shall
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be in writing and shall be deemed effective upon personal delivery or
upon deposit with the United States Postal Service, by registered or
certified mail, postage prepaid, addressed to the other party at the
address set forth in the Employer's records.
b. Pronouns. Whenever the context may require, any pronouns used in this
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Agreement shall include the corresponding masculine, feminine or neuter
forms, and the singular forms of nouns and pronouns shall include the
plural, and vice versa.
c. Entire Agreement. This Agreement constitutes the entire agreement
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between the parties and supersedes all prior agreements and
understandings, whether written or oral, relating to the subject matter
of this Agreement, including, but not limited to, all prior agreements
and understandings relating to stock options or stock ownership in the
Employer.
d. Amendment. This Agreement may be amended or modified only by a written
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instrument executed by both the Employer and the Executive.
e. Governing Law. This Agreement shall be construed, interpreted and
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enforced in accordance with the laws of the State of New York, without
regard to its conflict of law principles.
f. Successors and Assigns. This Agreement shall be binding upon and
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inure to the benefit of both parties and their respective successors
and assigns; provided, however, that the obligations of the Executive
are personal and shall not be assigned or delegated by him.
g. Waiver. No delays or omissions by the Employer or the Executive in
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exercising any right under this Agreement shall operate as a waiver of
that or any other right. A waiver or consent given by the Employer or
the Executive on any one occasion shall be effective only in that
instance and shall not be construed as a bar or waiver of any right on
any other occasion.
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h. Captions. The captions appearing in this Agreement are for the
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convenience of reference only and in no way define, limit or affect the
scope or substance of any section of this Agreement.
i. Severability. In case any provision of this Agreement shall be held by
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a court with jurisdiction over the parties to this Agreement to be
invalid, illegal or otherwise unenforceable, the validity, legality and
enforceability of the remaining provisions shall in no way be affected
or impaired thereby.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the Day
and year first above written.
EMPLOYER EXECUTIVE
VENTIV HEALTH, INC.
By: /s/ Xxxx Xxxxxx /s/ Xxxxxxx X. Xxxxxxx
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Xxxx Xxxxxx Xxxxxxx X. Xxxxxxx
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