EXHIBIT 10.1
EMPLOYMENT AGREEMENT
THIS AGREEMENT, made as of this 14th day of October 2005, effective as of
January 18, 2005, by and between BEIJING MED-PHARM CORPORATION, a Delaware
corporation ("BMP"), and Xxxxx Xxx (the "Executive").
WHEREAS, BMP desires to continue the Executive's employment as President and
Chief Executive Officer, and the Executive desires to continue such employment
with BMP, upon the terms and conditions set forth in this Agreement.
WHEREAS, this Agreement will formalize the terms and conditions governing the
Executive's employment with BMP and the termination of that employment.
NOW, THEREFORE, the parties hereto agree as follows:
PART ONE - DEFINITIONS
For purposes of this Agreement, the following definitions shall be in effect:
1. "Agreement" means this Employment Agreement, as the same may, from time to
time, be amended in accordance with the provisions hereof.
2. "Board" means BMP's Board of Directors.
3. "Change in Control" means a change in the ownership or control of BMP
effected through any of the following transactions:
(i) a merger, consolidation or other reorganization approved by BMP's
stockholders, unless securities representing more than fifty percent (50%) of
the total combined voting power of the voting securities of the successor
corporation are immediately thereafter beneficially owned, directly or
indirectly and in substantially the same proportion, by the persons who
beneficially owned BMP's outstanding voting securities immediately prior to such
transaction,
(ii) a stockholder-approved sale, transfer or other disposition of all or
substantially all of BMP's assets,
(iii) the closing of any transaction or series of related transactions pursuant
to which any person or any group of persons comprising a "group" within the
meaning of Rule 13d-5(b)(1) of the 1934 Act (other than BMP or a person that,
prior to such transaction or series of related transactions, directly or
indirectly controls, is controlled by or is under common control with, BMP)
becomes directly or indirectly the beneficial owner (within the meaning of Rule
13d-3 of the 0000 Xxx) of securities possessing (or convertible into or
exercisable for securities possessing) more than fifty percent (50%) of the
total combined voting power of BMP's securities (as measured in terms of the
power to vote with respect to the election of Board members) outstanding
immediately after the consummation of such transaction or series of related
transactions, whether such
EXHIBIT 10.1
transaction involves a direct issuance from BMP or the acquisition of
outstanding securities held by one or more of BMP's existing stockholders, or
(iv) a change in the composition of the Board over a period of thirty-six (36)
consecutive months or less such that a majority of the Board members ceases, by
reason of one or more contested elections for Board membership, to be comprised
of individuals who either (A) have been Board members continuously since the
beginning of such period or (B) have been elected or nominated for election as
Board members during such period by at least a majority of the Board members
described in clause (A) who were still in office at the time the Board approved
such election or nomination.
However, the term Change of Control shall NOT include either of the following
events undertaken at the election of BMP:
a. any transaction, the sole purpose of which is to change the state in which
BMP is incorporated; or
b. a transaction, the result of which is to sell all or substantially all of the
assets of BMP to another corporation (the "surviving corporation") provided that
the surviving corporation is owned directly or indirectly by the shareholders of
BMP immediately following such transaction in substantially the same proportions
as their ownership of BMP's common stock immediately preceding such transaction.
4. "Change in Control Severance Benefits" means the various payments and
benefits to which the Executive may become entitled to under Paragraph 14 of
Part Four of this Agreement upon his Involuntary Termination in connection with
a Change in Control.
5. "Code" means the Internal Revenue Code of 1986, as amended.
6. "Competing Organization" means any person or legal entity engaged in, about
to engage in, or intending to engage in, the business of providing services to
foreign and/or domestic pharmaceutical companies, specifically: drug
distribution; physician-oriented drug promotion; product registration; clinical
trial management; and pre-market entry analyses.
7. "Competing Service" means any service of any person or legal entity other
than BMP, or a parent, subsidiary or affiliate of BMP, in existence or under
development, which during the term of this Agreement, competes with or is an
alternative to any present or planned future service of BMP, whether or not
actively marketed by BMP.
8. "Customer" means any individual, firm, partnership, corporation, company,
joint venture or governmental or military unit or any other entity or any
parent, subsidiary or affiliate of any of them which is negotiating or has a
contract with BMP or a parent, subsidiary or affiliate of BMP for the purchase,
sale or lease of BMP's or a parent's, subsidiary's or affiliate's services or
which has been solicited by BMP or a parent, subsidiary or affiliate of BMP with
respect to such purchase or lease during the Executive's employment with BMP.
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EXHIBIT 10.1
9. "Disability" means a physical or mental disability which renders it
impracticable for the Executive to continue to perform his duties under this
Agreement, whether with or without reasonable accommodation. The Executive shall
be deemed to have incurred such disability if (i) a physician selected by BMP
and reasonably satisfactory to the Executive advises BMP that the Executive's
physical or mental condition will render him unable to perform his duties under
this Agreement for a period of six (6) consecutive months, or (ii) due to a
physical or mental condition the Executive has not substantially performed the
material duties required of him hereunder for eighty percent (80%) or more of
the normal working days during a period of six (6) consecutive months.
10. "Employment Period" means the duration of the Executive's employment with
BMP pursuant to the terms of this Agreement.
11. "Involuntary Termination" means (i) BMP's termination of the Executive's
employment for any reason other than a Termination for Cause, (ii) the
termination of the Executive's employment by reason of his death or Disability,
or (iii) the Executive's voluntary resignation within thirty (30) days following
(A) a material reduction in the scope of his duties and responsibilities, (B) a
change in his level of reporting so that he no longer directly reports to the
Board, (C) a reduction in the annual rate of his base salary by more than
fifteen percent (15%), (D) a relocation of his principal place of employment by
more than fifty (50) miles, or (E) a material breach by BMP of any of its
obligations under this Agreement and the failure of BMP to cure such breach
within thirty (30) days after receipt of written notice from the Executive in
which the actions or omissions constituting such material breach are specified.
A greater than fifteen percent (15%) aggregate reduction in the Executive's base
salary shall NOT constitute grounds for an Involuntary Termination under clause
(C) above if substantially all of the other executive officers of BMP are
subject to the same aggregate reduction to their base salary.
12. "1934 Act" means the Securities Exchange Act of 1934, as amended.
13. "Option" means any option granted to the Executive under the Plan or
otherwise to purchase shares of common stock which is outstanding at the time of
(i) a Change in Control or (ii) his Involuntary Termination, whether or not in
connection with a Change in Control.
14. "Plan" means (i) BMP's 2004 Stock Incentive Plan, as subsequently amended or
restated from time to time, and (ii) any other stock incentive plan established
or implemented by BMP.
15. "Termination for Cause" means the termination of the Executive's employment
for any of the following reasons: (i) the Executive's conviction of a felony or
his commission of any act of personal dishonesty involving the property or
assets of BMP, (ii) a material breach by the Executive of one or more of his
obligations under this Agreement or his Proprietary Information and Inventions
Agreement with BMP, (iii) any intentional misconduct by the Executive which has
a material adverse effect upon BMP's
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EXHIBIT 10.1
business or reputation, (iv) the Executive's material dereliction of the major
duties, functions and responsibilities of his executive position, (v) a material
breach by the Executive of any of his fiduciary obligations as an officer of
BMP, or (vi) the Executive's willful and knowing participation in the
preparation or release of false or materially misleading financial statements
relating to the false or erroneous certification required of him under the
Xxxxxxxx-Xxxxx Act of 2002 or any securities exchange on which shares of BMP's
common stock are at the time listed for trading.
PART TWO - TERMS AND CONDITIONS OF EMPLOYMENT
1. Duties and Responsibilities.
A. The Executive shall continue to serve as the President and Chief Executive
Officer of BMP and shall in such capacity report to the Board. As the President
and Chief Executive Officer, the Executive shall have primary responsibility for
the formulation, implementation and execution of strategic policies relating to
BMP's business operations, financial objectives and market growth and shall
accordingly have overall responsibility for the formulation of the business plan
for each fiscal year to be submitted for Board approval.
B. In addition to the duties and responsibilities specified in Paragraph 1.A.,
the Executive shall continue to make business trips to the People's Republic of
China as required by the Board to assist Beijing Med-Pharm Marketing Calculating
Co. Ltd. ("BMP China") with various activities including, but not limited to,
directing marketing operations and meeting with distributors.
C. During the employment period specified in Paragraph 2, the Executive agrees
that he will: (i) serve BMP faithfully, diligently and to the best of his
ability under the direction of the Board, (ii) devote his best efforts and his
entire working time, attention and energy to the performance of his duties
hereunder and to promoting and furthering the interests of BMP, and (iii) not,
without the prior written approval of the Board, become associated with or
engaged in, any business other than that of BMP, and he will do nothing
inconsistent with his duties to BMP.
2. Employment Period. The Executive's employment with BMP shall be governed by
the provisions of this Agreement for the period commencing January 18, 2005, and
continuing through January 17, 2006. However, the term of the Executive's
employment pursuant to the terms of this Agreement shall automatically be
extended for successive one-year periods thereafter, unless either BMP or the
Executive elects, by written notice delivered to the other not later than sixty
(60) days prior to the start of any such one-year period, not to renew the term
of this Agreement. This Agreement may also be terminated at any time in
accordance with the termination of employment provisions set forth in Paragraph
10.
3. Cash Compensation.
A. For all services to be rendered by the Executive under this Agreement
(excluding services as an officer, director and member of any committee) and
such duties as the
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EXHIBIT 10.1
Board may assign him in accordance with Paragraph 1.A. and Paragraph 1.B., BMP
agrees to pay the Executive a base salary of $250,000 per annum, payable at such
times as is customary for salaried employees of BMP and in accordance with the
normal payroll practices of BMP.
B. For each fiscal year of BMP during the Employment Period, beginning with the
fiscal year commencing January 1, 2005, the Executive shall be entitled to
receive a cash bonus in an amount determined by the Board.
C. BMP shall deduct and withhold from the compensation payable to the Executive
hereunder any and all applicable federal, state and local income and employment
withholding taxes and any other amounts required to be deducted or withheld by
BMP under applicable statutes, regulations, ordinances or orders governing or
requiring the withholding or deduction of amounts otherwise payable as
compensation or wages to employees.
4. Equity Compensation.
A. The Executive has received a series of Options over his period of employment
to date with BMP. Each of those Options shall vest and become exercisable for
the shares of common stock subject to that Option in accordance with the
applicable vesting schedule currently in effect for each such Option.
B. The Executive shall be eligible to receive one or more additional Option
grants during the Employment Period, as the Board may deem appropriate in order
to provide him with sufficient equity incentive for his position.
C. The shares of common stock subject to the Options summarized in Paragraph
4.A., together with each additional Option which the Executive may subsequently
receive over the remainder of the Employment Period, shall be subject to the
applicable vesting acceleration provisions of either Paragraph 12 or Paragraph
14 should an Involuntary Termination of his employment occur during the
Employment Period.
5. Expense Reimbursement. BMP shall reimburse the Executive for reasonable
out-of-pocket expenses incurred in connection with BMP's and/or BMP China's
business, including travel expenses, food and lodging while away from home,
subject to such polices as BMP may from time to time reasonably establish for
its employees and subject to substantiation of expenses as required under
applicable federal and state tax laws and regulations.
6. Fringe Benefits.
A. The Executive shall, throughout the Employment Period, be eligible to
participate in all pension, profit-sharing and fringe benefit plans, such as
group term life insurance plans, group health plans, accidental death and
dismemberment plans, short-term and long-term disability programs, and any other
benefit programs which are made available to BMP's executives and for which the
Executive qualifies.
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EXHIBIT 10.1
B. BMP shall cause BMP China to arrange for the Executive's use of an automobile
while the Executive is working on BMP and/or BMP China business in the People's
Republic of China.
C. The Executive shall be entitled to receive four (4) weeks of paid vacation
each year, which shall be taken at such time or times as will not unreasonably
hinder or interfere with BMP business or operations. Vacation time may be
accrued from year to year in accordance with BMP's general vacation policy.
D. BMP will obtain and maintain at all times directors' and officers' liability
insurance for Executive, so long as such insurance can be obtained on terms
acceptable to the Board.
7. Indemnification. BMP agrees to defend the Executive and shall indemnify and
hold harmless the Executive to the fullest extent permitted by law from any and
all liability, costs and expenses which may be assessed against the Executive by
reason of the performance of his responsibilities and duties under the terms of
this Agreement, provided such liability does not result from the willful
misconduct or gross negligence of the Executive.
8. Proprietary Information.
A. The Executive hereby acknowledges that BMP and/or BMP China may, from time to
time during the Employment Period, disclose to the Executive confidential
information pertaining to BMP's and/or BMP China's business, strategic plans,
technology or financial affairs. All information, data and know-how, whether or
not in writing, of a private or confidential nature concerning BMP's and/or BMP
China's trade secrets, inventions, processes, systems, designs, drawings,
product innovations and developments, engineering, marketing strategies and
future marketing plans, customer lists, prospective customers, finances and
financial reports, employee information and other organizational information
(collectively, "Proprietary Information") is and shall remain the sole and
exclusive property of BMP and/or BMP China and shall not be used or disclosed by
the Executive except to the extent necessary to perform his duties and
responsibilities under this Agreement. All tangible manifestations of such
Proprietary Information (whether written, printed or otherwise reproduced) shall
be returned by the Executive upon the termination of the Employment Period, and
the Executive shall not retain any copies or excerpts of the returned items. The
foregoing restrictions on the use, disclosure and disposition of BMP's and/or
BMP China's Proprietary Information shall also apply to the Executive's use,
disclosure and disposition of any confidential information relating to the
business, technology or financial affairs of BMP's and/or BMP China's customers.
B. The Executive shall, concurrently with the execution of this Agreement,
execute and deliver to BMP a copy of the BMP standard form Proprietary
Information and Inventions Agreement and shall remain subject to the terms and
provisions of that agreement throughout the Employment Period and for such
period thereafter as provided pursuant to the terms of that agreement.
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EXHIBIT 10.1
9. Death or Disability. Upon the Executive's death or Disability during the
Employment Period, the employment relationship created pursuant to this
Agreement shall immediately terminate, and BMP shall pay the Executive or his
estate: (i) any unpaid base salary earned under Paragraph 3.A. for services
rendered through the date of death or Disability, (ii) the dollar value of all
accrued and unused vacation benefits based upon the Executive's most recent
level of base salary, and (iii) any bonus actually earned pursuant to Paragraph
3.B. for one or more fiscal years but not previously paid to the Executive at
the time of his death or Disability. In addition, the Executive shall be
entitled to the payments and benefits provided under Part Three or Part Four of
this Agreement, to the extent applicable.
10. Termination of Employment.
A. BMP may terminate the Executive's employment under this Agreement at any time
for any reason, with or without cause, by giving at least sixty (60) days prior
written notice of such termination to the Executive. If such termination notice
is given to the Executive, BMP may, if it so desires, immediately relieve the
Executive of some or all of his duties. However, during any such notice period,
the Executive shall continue to be entitled to his regular compensation and
benefits hereunder.
B. The Executive may terminate his employment under this Agreement at any time
by giving BMP at least sixty (60) days prior written notice of such termination.
C. BMP may, at any time, upon written notice discharge the Executive from
employment under this Agreement pursuant to a Termination for Cause. Such
termination will be effective immediately upon such notice.
D. Upon the termination of the Executive's employment for any reason (other than
Termination for Cause), during the Employment Period, the Executive shall be
paid (i) any unpaid base salary earned under Paragraph 3.A. for services
rendered through the date of such termination, (ii) the dollar value of all
accrued and unused vacation benefits based upon the Executive's most recent
level of base salary, and (iii) any bonus amount actually earned pursuant to
paragraph 3.B. for one or more fiscal years but not previously paid to the
Executive at the time of such termination of employment. In addition, the
Executive shall be entitled to the payments and benefits provided under Part
Three or Part Four of this Agreement, to the extent applicable.
E. If the Executive's employment is terminated by reason of a Termination for
Cause or should the Executive voluntarily resign (other than for a reason which
qualifies as grounds for an Involuntary Termination), then the following
provisions shall apply:
(i) BMP shall only be required to pay the Executive (a) any unpaid base salary
earned under Paragraph 3.A. for services rendered through the date of such
termination, (b) the dollar value of all accrued and unused vacation benefits
based upon the Executive's most recent level of base salary, and (c) any bonus
amount actually earned pursuant to Paragraph 3.B. for one or more fiscal years
but not previously paid to the Executive at the time of such termination of
employment.
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EXHIBIT 10.1
(ii) All vesting in the Executive's outstanding Options shall cease at the time
of such termination or resignation, and the Executive shall have until the
termination of each such Option (as determined in accordance with the applicable
stock option agreement) in which to exercise that Option for any shares for
which that Option is vested at the time of to the extent of the Executive's
termination or resignation.
(iii) The Executive shall not be entitled to any payments or benefits under Part
Three or Part Four of this Agreement.
PART THREE - NORMAL SEVERANCE BENEFITS
11. Entitlement.
A. Should the Executive's employment with BMP terminate during the Employment
Period by reason of an Involuntary Termination in the absence of a Change in
Control or more than twelve (12) months after a Change in Control event, the
Executive shall be entitled to receive the severance benefits provided under
this Part Three. Those benefits shall be subject to the Executive's compliance
with the restrictive covenants of Part Six of this Agreement, and shall in all
cases be in lieu of any other severance benefits to which the Executive might
otherwise be entitled by reason of his termination of employment under such
circumstances.
B. In addition, the Executive's entitlement to any severance benefits under this
Part Three shall be subject to the Executive's execution and delivery to BMP of
a general release which becomes effective in accordance with applicable law and
pursuant to which the Executive releases BMP and its officers, directors,
employees and agents from any and all claims the Executive may otherwise have
with respect to the terms and conditions of his employment with BMP and the
termination of that employment. In no event, however, shall such release cover
any claims, causes of action, suits, demands or other obligations or liabilities
relating to any payments or benefits to which the Executive is or becomes
entitled pursuant to the provisions of this Agreement.
12. Severance Benefits. The severance benefits payable to the Executive under
this Part Three shall consist of the following:
(a) Salary Continuation Payment. The Executive shall receive his base salary, at
the monthly rate in effect for him under Paragraph 3.A. at the time of his
Involuntary Termination, for a period of twelve (12) months in equal
installments in accordance with BMP's normal payroll practices, Subject to the
deferral restrictions of Paragraph 19, the first such payment shall be made not
later than the first pay day following the Executive's Involuntary Termination.
Each such salary continuation payment shall be subject to all applicable
withholding requirements as set forth in Paragraph 3.C.
(b) Option Acceleration. Each Option outstanding at the time of such Involuntary
Termination, to the extent not otherwise vested and exercisable for all the
shares at the time subject to that Option, will immediately vest and become
exercisable for all those option shares and may be exercised for any or all of
those shares as fully vested shares
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EXHIBIT 10.1
until the termination of that Option in accordance with the applicable stock
option agreement.
PART FOUR - CHANGE IN CONTROL SEVERANCE BENEFITS
13. Entitlement.
A. Should an Involuntary Termination occur within twelve (12) months after a
Change in Control event, the Executive shall be entitled to receive the
severance benefits provided under this Part Four. Those benefits shall be
subject to the Executive's compliance with the restrictive covenants of Part Six
of this Agreement and shall in all cases be in lieu of any other severance
benefits to which the Executive might otherwise be entitled by reason of his
termination of employment under such circumstances.
B. In addition, the Executive's entitlement to any severance benefits under this
Part Four shall be subject to the Executive's execution and delivery to BMP of a
general release which becomes effective in accordance with applicable law and
pursuant to which the Executive releases BMP and its officers, directors,
employees and agents from any and all claims the Executive may otherwise have
with respect to the terms and conditions of his employment with BMP and the
termination of that employment. In no event, however, shall such release cover
any claims, causes of action, suits, demands or other obligations or liabilities
relating to any payments or benefits to which the Executive is or becomes
entitled pursuant to the provisions of this Agreement.
14. Change in Control Severance Benefits. The Change in Control Severance
Benefits to which the Executive shall receive under this Part Four shall consist
of the following payments and benefits:
(a) Salary Continuation Payments. The Executive shall receive his base salary,
at the monthly rate in effect for him under Paragraph 3.A. at the time of his
Involuntary Termination, for a period of eighteen (18) months in accordance with
BMP's normal payroll practices, Subject to the deferral restrictions of
Paragraph 19, the first such payment shall be made not later than the first
payroll date following the Executive's Involuntary Termination. Each such salary
continuation payment shall be subject to all applicable withholding requirements
as set forth in Paragraph 3.C. However, these payments, together with the
benefits provided pursuant to Paragraph 14(b), shall be subject to the benefit
limitation provisions of Part Five of this Agreement.
(b) Option Acceleration. Each Option outstanding at the time of such Involuntary
Termination, to the extent not otherwise vested and exercisable for all the
shares at the time subject to that Option, will immediately vest and become
exercisable for all those option shares and may be exercised for any or all of
those shares as fully vested shares until the termination of that Option in
accordance with the applicable stock option agreement.
In no event shall the Executive be entitled to payments and benefits under both
Part Three and Part Four of this Agreement.
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EXHIBIT 10.1
PART FIVE - LIMITATION ON BENEFITS
15. Benefit Limit. The benefit limitations of this Part Five shall be applicable
in the event the Executive receives any benefits under this Agreement which are
deemed to constitute parachute payments under Code Section 280G.
In the event that any payments to which the Executive becomes entitled in
accordance with the provisions of this Agreement would otherwise constitute a
parachute payment under Code Section 280G, then such payments will be subject to
reduction to the extent necessary to assure that the Executive receives only the
greater of (i) the amount of those payments which would not constitute such a
parachute payment or (ii) the amount which yields the Executive the greatest
after-tax amount of benefits after taking into account any excise tax imposed
under Code Section 4999 on the payments provided to the Executive under this
Agreement (or any other benefits to which the Executive may become entitled in
connection with any change in control or ownership of BMP or the subsequent
termination of his employment with BMP).
Should a reduction in benefits be required to satisfy the benefit limit of this
Paragraph 15, then the salary continuation payments shall accordingly be reduced
to the extent necessary to comply with such benefit limit. Should such benefit
limit still be exceeded following such reduction, then the number of shares
which would otherwise be purchasable under the vesting-accelerated portion (if
any) of each Option (based on the amount of the parachute payment attributable
to such Option under Code Section 280G) shall be reduced to the extent necessary
to eliminate such excess.
PART SIX - RESTRICTIVE COVENANTS
16. Non-Compete. The Executive agrees that, during the Employment Period and for
a period of two (2) years following the date of his termination of employment
with BMP, he will not, without the prior written approval of BMP, directly or
indirectly, under any circumstances whatsoever, own, manage, operate, engage in,
control or participate in the ownership, management, operation or control of, or
be connected in any manner, whether as an individual, partner, stockholder,
director, officer, principal, agent, employee or consultant, or in any other
relation or capacity whatsoever, with any Competing Organization, wherever
located, who was a Customer at any time during the period one year prior to the
termination of the Executive's employment with BMP, for the purpose of inducing
such Customer to purchase or lease a Competing Service. Notwithstanding the
foregoing, nothing contained in this Paragraph 16 shall restrict the Executive
from making any investment in any company, so long as such investment consists
of no more than five percent (5%) of any class of equity securities of a company
whose securities are traded on a national securities exchange or in the
over-the-counter market.
17. Non-Interference. The Executive agrees that he will not, for a period of two
(2) years following the date of his termination of employment with BMP, directly
or indirectly, employ, hire, solicit or, in any manner, encourage any employee
of BMP to leave the employ of BMP.
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EXHIBIT 10.1
PART SEVEN - MISCELLANEOUS PROVISIONS
18. Cessation of Benefits. In the event of a material breach by the Executive of
any of his obligations under Paragraph 16 or Paragraph 17 of this Agreement or
any of his obligations under his Proprietary Information and Inventions
Agreement with BMP, he shall cease to be entitled to any further benefits under
Part Three or Part Four of this Agreement, including (without limitation) any
subsequent right to exercise any outstanding Options or to receive any further
salary payments.
19. Deferred Commencement Date. To the extent (i) any payments to which the
Executive becomes entitled under this Agreement in connection with his
Involuntary Termination constitute deferred compensation subject to Code Section
409A and (ii) the Executive is deemed at the time of such Involuntary
Termination to be a key employee under Code Section 416(i), then such payment or
payment shall not be made or commence until the earlier of (i) the expiration of
the six (6)-month period measured from the date of the Executive's "separation
from service" (as such term is at the time defined in Treasury Regulations under
Code Section 409A) with BMP (or any successor entity) or (ii) the date of the
Executive s death following such separation from service; provided, however,
that such deferral shall only be effected to the extent required to avoid
adverse tax treatment to the Executive, including (without limitation) the
additional twenty percent (20%) tax for which the Executive would otherwise be
liable under Code Section 409A(a)(1)(B) in the absence of such deferral. During
any period payment or payments to the Executive are deferred pursuant to the
foregoing, the Executive shall be entitled to interest on the deferred payment
or payments at a per annum rate equal to the highest rate of interest applicable
to six (6)-month money market accounts offered by the following institutions:
Citibank N.A., Xxxxx Fargo Bank, N.A. or Bank of America, on the date of such
"separation from service". Upon the expiration of the applicable deferral
period, any payments which would have otherwise been made during that period in
the absence of this Paragraph 19 shall be paid to the Executive or his
beneficiary in one lump sum. Any remaining amounts shall be paid as and when
they would otherwise become due under this Agreement.
20. Representations and Warranties of the Executive. The Executive represents
and warrants that his employment by BMP does not and will not violate any
agreement or instrument to which he is a party or by which he is bound, and the
Executive agrees that he will indemnify and hold harmless BMP, its directors,
officers and employees against any claims, damages, liabilities and expenses
(including reasonable attorneys' fees) which may be incurred, including amounts
paid in settlement, by any of them in connection with any claim based upon or
related to a breach of the Executive's representations and warranties set forth
in this Paragraph 20. In the event of any claim based upon or related to a
breach of the Executive's representations and warranties set forth herein, BMP
will give prompt written notice thereof to the Executive and the Executive shall
have the right to defend such claim with counsel reasonably satisfactory to BMP.
21. Successors and Assigns. The provisions of this Agreement shall inure to the
benefit of, and shall be binding upon, (i) BMP and its successors and assigns,
including
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EXHIBIT 10.1
any successor entity by merger, consolidation or transfer of all or
substantially all of BMP's assets (whether or not such transaction constitutes a
Change in Control), and (ii) the Executive, the personal representative of his
estate and his heirs and legatees.
22. Notices. Any notice required or permitted to be given under this Agreement
shall be in writing and shall be deemed given when personally delivered or sent
by overnight courier or certified mail, postage prepaid, return receipt
requested, to the respective addresses of the parties hereto as set forth above
or to such other address as either party may designate by notice to the other
party given as herein provided.
23. Waivers. Any waiver of the performance of the terms or provisions of this
Agreement shall be effective only if in writing and signed by the party against
whom such waiver is to be enforced. The failure of either party to exercise any
of his or its rights under this Agreement or to require the performance of any
term or provision of this Agreement, or the waiver by either party of any breach
of this Agreement, shall not prevent a subsequent exercise or enforcement of
such rights or be deemed a waiver of any subsequent breach of the same or any
other term or provision of this Agreement.
24. Survival of Terms. The terms of this Agreement and the respective
obligations of the parties hereto shall survive the termination of the
Executive's employment with BMP for as long as any obligation or duty remains
outstanding.
25. General Creditor Status. The benefits to which the Executive may become
entitled under Part Three or Part Four of this Agreement shall be paid, when
due, from BMP's general assets, and no trust fund, escrow arrangement or other
segregated account shall be established as a funding vehicle for such payments.
Accordingly, the Executive's right (or the right of the executors or
administrators of the Executive's estate) to receive such benefits shall at all
times be that of a general creditor of BMP and shall have no priority over the
claims of other general creditors.
26. Governing Documents. This Agreement, together with (i) the stock option
agreements evidencing the Executive's currently outstanding Options and any
future Option grants, and (ii) the Proprietary Information and Inventions
Agreement, shall constitute the entire agreement and understanding of BMP and
the Executive with respect to the terms and conditions of the Executive's
employment with BMP and the payment of severance benefits and shall supersede
all prior and contemporaneous written or verbal agreements and understandings
between the Executive and BMP relating to such subject matter. This Agreement
may only be amended by written instrument signed by the Executive and an
authorized officer of BMP. Any and all prior agreements, understandings or
representations relating to the Executive's employment with BMP, other than the
stock option agreements evidencing the Executive's currently outstanding
Options, are hereby terminated and cancelled in their entirety and are of no
further force or effect.
27. Governing Law. The provisions of this Agreement shall be construed and
interpreted under the laws of the State of Delaware, without giving effect to
the conflict of laws rules of such state.
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EXHIBIT 10.1
28. Severability. The provisions of this Agreement shall be severable and if any
part of any provision shall be held invalid or unenforceable, or any separate
covenant contained in any provision is held to be unduly restrictive and void by
a final decision of any court or other tribunal of competent jurisdiction, such
part, covenant or provision shall be construed or limited in scope to give it
maximum lawful validity, and the remaining provisions of this Agreement shall
nonetheless remain in full force and effect.
29. Injunctive Relief. The Executive expressly agrees that the covenants set
forth in Paragraph 16 and Paragraph 17 of this Agreement are reasonable and
necessary to protect BMP and its legitimate business interests, and to prevent
the unauthorized dissemination of Proprietary Information to competitors of BMP.
The Executive also agrees that BMP will be irreparably harmed and that damages
alone cannot adequately compensate BMP if there is a violation of Paragraph 16
or Paragraph 17 of this Agreement by the Executive, and that, in addition to any
rights or remedies BMP may have under Paragraph 18, injunctive relief against
the Executive is essential for the protection of BMP. Therefore, in the event of
any such breach, it is agreed that, in addition to any other rights or remedies
available to BMP, BMP shall be entitled as a matter of right to pursue
injunctive relief in any court of competent jurisdiction.
30. Arbitration.
A. Each party agrees that any and all disputes which arise out of or relate to
the Executive's employment, the termination of the Executive's employment or the
terms of this Agreement shall be resolved through final and binding arbitration.
Such arbitration shall be in lieu of any trial before a judge and/or jury, and
the Executive and BMP expressly waive all rights to have such disputes resolved
through trial before a judge and/or jury. Such disputes shall include, without
limitation, claims for breach of contract or of the covenant of good faith and
fair dealing, claims of discrimination, claims under any federal, state or local
law or regulation now in existence or hereinafter enacted and as amended from
time to time concerning in any way the subject of the Executive's employment
with BMP or its termination. The only claims not covered by this Agreement to
arbitrate disputes are: (i) claims for benefits under the unemployment insurance
benefits, (ii) claims for workers' compensation benefits under any of BMP's
workers' compensation insurance policy or fund, (iii) claims arising from or
relating to the restrictive covenants imposed upon the Executive pursuant to the
provisions of Paragraph 16 and Paragraph 17 of this Agreement, and (iv) claims
concerning the validity, infringement, ownership, or enforceability of any trade
secret, patent right, copyright, trademark or any other intellectual property
right, and any claim pursuant to or under any existing
confidential/proprietary/trade secrets information and inventions agreement(s)
such as, but not limited to, the Proprietary Information and Inventions
Agreement. With respect to such disputes, they shall not be subject to
arbitration; rather, they will be resolved pursuant to applicable law.
B. Arbitration shall be held in Xxxxxxxxxx County, Pennsylvania and conducted in
accordance with the National Rules for the Resolution of Employment Disputes of
the American Arbitration Association ("AAA Rules"), provided, however, that the
arbitrator shall allow the discovery authorized by applicable law in arbitration
proceedings,
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EXHIBIT 10.1
including, but not limited to, discovery available under the applicable state
and/or federal arbitration statutes. Also, to the extent that any of the AAA
Rules or anything in this arbitration section conflicts with any arbitration
procedures required by applicable law, the arbitration procedures required by
applicable law shall govern.
31. Counterparts. This Agreement may be executed in more than one counterpart,
each of which shall be deemed an original, but all of which together shall
constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Employment Agreement as of
the day and year written above.
BEIJING MED-PHARM CORPORATION
By: XXXXXX XXXXXXXXX
--------------------------------------
Title: Chairman of the Board
--------------------------------
EXECUTIVE
XXXXX XXX
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XXXXX XXX
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