EXECUTIVE EMPLOYMENT AGREEMENT
Exhibit
10.22
THIS
AGREEMENT
made as
of this 4th day of January 2005 by and between PROVECTUS
PHARMACEUTICALS, INC., a
Nevada
Corporation with its principal place of business in Knoxville, Tennessee (the
“Company”), and H. Xxxxx
Xxxx, Ph.D.
(the
“Executive”).
WITNESSETH:
WHEREAS,
the
Company recognizes the value of the Executive’s background and experience and
desires to employ the Executive as CEO of the Company; and
WHEREAS,
the
Executive wishes to be employed by the Company in such capacity;
and
WHEREAS,
the
Company and the Executive mutually desire that their employment relationship
be
set forth under the terms of a written employment agreement;
NOW,
THEREFORE,
in
consideration of the foregoing and of the promises and mutual agreements set
forth below, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto do hereby
agree
as follows:
| 1. |
Employment.
The Company agrees to employ the Executive, and the Executive agrees
to be
employed by the Company, on the terms and conditions set forth
herein.
|
| 2. |
Term
of Employment.
The employment of the Executive by the Company as provided under
Section 1
shall commence on January 4, 2005, and end on January 4, 2006 unless
further extended or sooner terminated as hereinafter provided. On
January
4, 2006 and on January 4th
of
each year thereafter, the term of the Executive’s employment hereunder
shall be extended automatically one (1) additional year, unless prior
to
the date of such automatic extension the Company shall have delivered
to
the Executive or the Executive shall have delivered to the Company
written
notice that the term of the Executive’s employment hereunder shall not be
extended.
|
| 3. |
Position
and Duties.
The Executive shall serve as CEO of the Company with responsibilities
and
authority as may from time to time be assigned by the Chief Executive
Officer and/or the Board of Directors of the Company. Executive agrees
to
perform faithfully and industriously the duties which the Company
may
assign to him.
|
| 4. |
Place
of Performance.
In connection with the Executive’s employment hereunder, the Executive
shall be based at the Company’s principal offices located in Knoxville,
Tennessee.
|
| 5. |
Compensation
and Benefits.
In consideration of the Executive’s performance of his duties hereunder,
the Company shall provide the Executive with the following compensation
and benefits during the term of his employment
hereunder.
|
| (a) |
Base
Salary.
The Company shall pay to the Executive an aggregate base salary at
a rate
of Two Hundred Thousand Dollars ($200,000) per annum, payable in
accordance with the Company’s normal payroll practices. Such base salary
may be increased from time to time by the Board of Directors in accordance
with the normal business practices of the
Company.
|
1
Compensation
of the Executive by the base salary payments shall not be deemed exclusive
and
shall not prevent the Executive from participating in any other compensation
or
benefit program of the Company. Such base salary payments (including increases
thereto) shall not in any way limit or reduce any other obligation of the
Company hereunder, and no other compensation, benefit or payment hereunder
shall
in any limit or reduce the obligation of the Company with respect to such base
salary.
| (b) |
Incentive
Compensation.
The Executive shall have the right to participate in any incentive
compensation plan or bonus plan adopted by the Company without diminution
of any compensation or benefit provided for in this
Agreement.
|
| (c) |
Expenses.
The Company, as applicable, shall promptly reimburse the Executive
for all
reasonable out-of-pocket expenses incurred by the Executive in his
performance of services hereunder, including all such expenses of
travel
and living expense while away from home on business of the Company,
provided that such expenses are incurred, accounted for and documented
in
accordance with the Company’s regular policies and in compliance with IRS
Guidelines.
|
| (d) |
Employee
Benefits.
The Executive shall be entitled to continue to participate in all
Company
employee benefit plans and arrangements for which he is eligible
in effect
on the date hereof in which the Executive participates (including,
but not
limited to, any employee benefit pension plan, stock option plan,
life
insurance plan, vacation plan, disability plan, and the group
health-and-accident and medical insurance plans) as such plans may
continue or be altered by the Company Board of Directors from time
to time
at the Board’s discretion.
|
| (e) |
Vacation.
The Executive shall be entitled to reasonable and customary vacation
in
each calendar year during the term of this Agreement, in accordance
with
the Company's present policies.
|
| (f) |
Services.
The Company shall furnish the Executive with office space, secretarial
and
administrative assistance, and such other facilities and services
as shall
be suitable to his position and adequate for the performance of his
duties
hereunder.
|
| 6. |
Termination:
This Agreement shall terminate upon the first to occur of the
following:
|
| (a) |
The
death of Executive;
|
| (b) |
The
permanent disability of Executive, as defined in Paragraph
7(a)(vi);
|
| (c) |
Termination
by Company "for cause" as defined in
Paragraph 7(a)(i);
|
| (d) |
Termination
by Company "without cause" or pursuant to a "Change in Control" as
defined
in Paragraph 7(a)(ii). The Company reserves the right to terminate
the
Executive at any time, subject to the Company's obligation to pay
the
Executive Compensation as otherwise provided for herein;
or
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2
| (e) |
Termination
by Executive, provided that Executive shall give not less than
thirty (30) days' written notice of termination.
|
(f)
A significant reduction in executive duties or his reporting responsibilities
to
the Board of Directors shall be deemed a termination
| 7. |
Compensation
and Benefits in the Event of Termination or Acquisition of the
Company.
In the event of the termination of the Executive’s employment by the
Company during the term of this Agreement, compensation and benefits
shall
be paid as set forth below.
|
| (a) |
Definitions.
For purposes of this Agreement, the following terms shall have the
meanings indicated:
|
| (i) |
As
used in Paragraph 6(c), termination "for cause" shall include, but
shall
not be limited to, termination for Executive's use of illegal
non-prescription drugs or drug or alcohol addiction; conviction of
a
felony; intentional breach of this Agreement by Executive; or willful
negligence in carrying out the activities for which employed. "For
cause"
is not intended to include disagreements over management philosophy
or
other such intangibles.
|
| (ii) |
“Change
in Control” shall mean either:
|
| (A) |
A
sale or other disposition of substantially all of the assets of Company
or
a sale or disposition of a majority of the issued and outstanding
common
stock of Company in a single transaction or in a series of transactions
to
a single person or entity or group of affiliated persons or entities
who
were not directors or shareholders of the Company prior to such
transaction; or
|
| (B) |
A
merger of consolidation of the Company with or into any other entity,
if
immediately after giving effect to such transaction more than fifty
percent (50%) of the issued and outstanding common stock of the
surviving entity of such transaction is held by a single person or
entity
or group of affiliated persons or entities who were not directors
or
shareholders of the Company prior to such
transaction.
|
| (C) |
for
purposes of this sub-paragraph (ii), the definition of “person” shall be
as defined in Section 13(d) and 14(d) of the Securities Exchange
Act of
1934.
|
| (iii) |
“Compensation”
shall mean the base salary provided for in Paragraph 5(a)
hereof.
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3
| (iv) |
“Coincident
with” shall mean any time within nine months prior to the occurrence of
a
Change in Control of the Company.
|
| (v) |
“Date
of Termination” shall mean (A) if the Executive’s employment is terminated
by reason of his death, his date of death; (B) if the Executive’s
employment is terminated for Disability, thirty (30) days after Notice
of
Termination is given (provided that the Executive shall not have
returned
to the performance of his duties as provided under sub-paragraph
(vi) of
this paragraph (a)); or (C) if the Executive’s employment is terminated by
action of either party for any other reason, the date specified in
the
Notice of Termination.
|
| (vi) |
“Disability”
shall mean the Executive’s failure to satisfactorily perform his regular
duties on behalf of the Company on a full-time basis for ninety (90)
consecutive days or such lesser period of time as provided under
the
disability insurance policy provided through Company, by reason of
the
Executive’s incapacity due to physical or mental illness, except where
within thirty (30) days after Notice of Termination is given following
such absence, the Executive shall have returned to the satisfactory,
full-time performance of such duties. Any determination of Disability
hereunder shall be made by the Board of Directors in good faith and
on the
basis of the certificates of a majority of at least three (3) qualified
physicians chosen by it for such purpose, one (1) of whom shall be
the
Executive’s regular attending
physician.
|
| (vii) |
“Notice
of Termination” shall mean a written notice which shall include the
specific termination provision under this Agreement relied upon,
and shall
set forth in reasonable detail the facts and circumstances claimed
to
provide a basis for termination of the Executive’s employment. Any
purported termination of the Executive’s employment hereunder by action of
either party shall be communicated by delivery of a Notice of Termination
to the other party. Any purported termination of the Executive’s
employment hereunder which is not effected in accordance with the
foregoing shall be ineffective for purposes of this
Agreement.
|
| (viii) |
“Retirement”
shall mean termination of the Executive’s employment pursuant to the
Company’s regular retirement policy applicable to the position held by the
Executive at the time of such
termination.
|
| (b) |
Termination
or Failure to Extend by Company Not for Cause Prior to a Change of
Control.
In the event the Executive’s employment hereunder is terminated by action
of the Company without cause prior to, but not coincident with, a
Change
of Control, or this Agreement is not extended by the Company without
cause
prior to, but not coincident with, a Change in Control, the Executive
shall be entitled to receive payments under this Agreement as though
the
Agreement was in effect through the end of the period set forth in
Paragraph 2 hereof, including any automatic extensions in effect
as of the
date of such termination. Any such payments due shall be paid on
a monthly
basis, subject to withholding and FICA and other applicable adjustments,
in accordance with the normal payroll practices of the Company. Executive
acknowledges that such payments serve as total satisfaction of Executive’s
claims under this Agreement.
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4
| (c) |
Termination
By the Company at any time For Cause or by the Executive Prior to
a Change
in Control.
In the event the Executive’s employment hereunder is terminated (A) by
action of the Company for Cause either before, coincident with, or
after a
Change in Control; (B) by action of the Executive prior to, but not
coincident with, a Change in Control; or (C) by reason of the Executive’s
death, disability or retirement prior to a Change in Control, the
following compensation and benefits shall be paid and provided the
Executive (or his beneficiary):
|
| (1) |
The
Executive’s base salary provided under Paragraph 5(a) through the last day
of the month in which the Date of Termination occurs, at the annual
rate
in effect at the time Notice of Termination is given (or death occurs),
to
the extent unpaid prior to such Date of
Termination;
|
| (2) |
The
pro rata portion of any incentive or bonus payment under Paragraph
5(b)
which has been earned prior to the Date of Termination, to the extent
unpaid prior to such date;
|
| (3) |
Any
benefits to which the Executive (or his beneficiary) may be entitled
as a
result of such termination (or death), under the terms and conditions
of
the pertinent plans or arrangements in effect at the time of the
Notice of
Termination under Paragraph 5(d);
and
|
| (4) |
Any
amounts due the Executive with respect to paragraph (c) of Section
5 as of
the Date of Termination.
|
| (d) |
Termination
by Company Not For Cause Coincident With or Following a Change in
Control
or by Executive Coincident With or Following a Change in
Control.
In the event that coincident with or following a Change in Control,
the
Executive’s employment hereunder is terminated or this Agreement is not
extended (A) by action of the Executive coincident with or following
a
Change in Control including the Executive’s death, disability or
retirement, or (B) by action of the Company not for cause coincident
with
or following a Change in Control, the Company shall pay and provide
the
Executive, subject to Company regulatory limitations, the compensation
and
benefits stipulated under sub-paragraph (c) immediately above; provided,
however, in addition thereto, the following compensation and benefits
shall be paid and provided the
Executive:
|
The
Company shall pay to the Executive in a lump sum, in cash, within 30 days
following the Date of Termination or on the effective date of the Change in
Control, whichever occurs later, an amount equal to 2.90 times the Compensation
paid in the preceding calendar year, or scheduled to be paid to the Executive
during the year of the Notice of Termination, whichever is greater, plus an
additional amount sufficient to pay United States income tax on the lump sum
amount so paid.
5
| (e) |
Continuation
of Benefits.
Following the termination of Executive’s employment hereunder, the
Executive shall have the right to continue in the Company’s group health
insurance plan or other Company benefit program as may be required
by
COBRA or any other federal or state law or
regulation.
|
| (f) |
Compensation
During Disability.
In the event of the Executive’s failure to satisfactorily perform his
duties hereunder on a full-time basis by reason of his incapacity
due to
physical or mental illness for any period not otherwise constituting
Disability as defined under sub-paragraph (vi) of Paragraph 7(a)
hereof,
the Executive’s employment hereunder shall not be deemed terminated and he
shall continue to receive the compensation and benefits provided
under
Paragraph 5 in accordance with the terms
thereof.
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| 8. |
Withholding.
Any provision of this Agreement to the contrary notwithstanding,
all
payments made by the Company hereunder to the Executive or his estate
or
beneficiaries shall be subject to the withholding of such amounts,
if any,
relating to tax and other payroll deductions as the Company may reasonably
determine should be withheld pursuant to any applicable law or regulation.
In lieu of withholding such amounts, the Company may accept other
provisions, provided that it has sufficient funds to pay all taxes
required by law to be withheld in respect of any or all such
payments.
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| 9. |
Notices.
All notices, requests, demands and other communications provided
for by
this Agreement shall be in writing and shall be sufficiently given
if and
when mailed in the continental United States by registered or certified
mail, or personally delivered to the party entitled thereto, at the
address stated below or to such changed address as the addressee
may have
given by a similar notice:
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To
the Company:
|
President
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Provectus
Pharmaceuticals, Inc.
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0000
Xxx Xxxxx Xxxxxxx, Xxxxx X
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Xxxxxxxxx,
XX 00000
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To
the Executive:
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H.
Xxxxx Xxxx, Ph.D.
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|
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C/o
Provectus Pharmaceuticals, Inc.
0000
Xxx Xxxxx Xxxxxxx
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Xxxxxxxxx,
Xxxxxxxxx 00000
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| 10. |
Successors:
Binding Agreement.
The Company shall require any successor (whether direct or indirect,
by
purchase, merger, consolidation or otherwise) to all or substantially
all
of the business and/or assets of the Company, by agreement in the
form and
substance satisfactory to the Executive, to expressly assume and
agree to
perform this Agreement in the same manner and to the same extent
that the
Company would be required to perform it if no such succession had
taken
place. Failure of the Company to obtain such agreement prior to the
effectiveness of any such succession shall be a breach of this Agreement.
For purposes of this Agreement, “Company” shall include any successor to
its business and/or assets as aforesaid which executes and delivers
the
agreement provided for in this Section or which otherwise becomes
bound by
all the terms and provisions of this Agreement by operation of
law.
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6
This
Agreement shall inure to the benefit of and be enforceable by the Executive’s
personal or legal representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees. If the Executive should die while any
amount would still be payable to him hereunder if he had continued to live,
all
such amounts, except to the extent otherwise provided under this Agreement,
shall be paid in accordance with the terms of this Agreement to his devisee,
legatee or other designee, or if there be no such designee, to the Executive’s
estate.
| 11. |
Modification,
Waiver or Discharge.
No provision of this Agreement may be modified, waived or discharged
unless such waiver, modification or discharge is agreed to in writing
signed by the Executive and an authorized officer of the Company.
No
waiver by either party hereto at anytime of any breach by the other
party
hereto of, or compliance with, any condition or provision of this
Agreement to be performed by such other party shall be deemed a waiver
of
similar or dissimilar provisions or conditions at the same or at
any prior
or subsequent time. No agreements or representations, oral or otherwise,
express or implied, with respect to the subject matter hereof had
been
made by either party which are not expressly set forth in this Agreement;
provided, however, that this Agreement shall not supersede or in
any way
limit the right, duties or obligations that the Executive or the
Company
may have under any other written agreement between such parties,
under any
employee pension benefit plan or employee welfare benefit plan as
defined
under the Employee Retirement Income Security Act of 1974, as amended,
and
maintained by the Company, or under any established personnel practice
or
policy applicable to the Executive.
|
| 12. |
Governing
Law.
The validity, interpretation, construction and performance of this
Agreement shall be governed by the laws of the State of Tennessee
to the
extent federal law does not apply.
|
| 13. |
Validity.
The invalidity or unenforceability of any provision of this Agreement
shall not affect the validity or enforceability of the other provisions
of
this Agreement, which latter provisions shall remain in full force
and
effect.
|
| 14. |
Miscellaneous.
|
| (a) |
No
Adequate Remedy At Law; Costs to Prevailing Party.
The Company and the Executive recognize that each party may have
no
adequate remedy at law for breach by the other of any of the agreements
contained herein, and, in the event of any such breach, the Company
and
the Executive hereby agree and consent that the other shall be entitled
to
injunctive relief or other appropriate remedy to enforce performance
of
such agreements. In the event of a breach of this Agreement, then
the
prevailing party in any litigation instituted to enforce such breach
shall
have the right to recover from the losing party its costs related
thereto,
including legal fees, court costs, and any other reasonable expenses
incurred.
|
7
| (b) |
Non-Assignability.
No right, benefit, or interest hereunder shall be subject to anticipation,
alienation, sale, assignment, encumbrance, charge, pledge, hypothecation,
or setoff in respect of any claim, debt or obligation, or to execution,
attachment, levy or similar process, or assignment by operation of
law.
Any attempt, voluntary or involuntary, to effect any action specified
in
the immediately preceding sentence shall, to the full extent permitted
by
law, be null, void and of no effect. Any of the foregoing to the
contrary
notwithstanding, this provision shall not preclude the Executive
from
designating one or more beneficiaries to receive any amount that
may be
payable after his death, and shall not preclude the legal representative
of the Executive’s estate from assigning any right hereunder to the person
or persons entitled thereto under his will or, in the case of intestacy,
applicable to his estate.
|
| 15. |
Counterparts.
This Agreement may be executed in one or more counterparts, each
of which
shall be deemed to be an original, but of which together will constitute
one and the same instrument.
|
IN
WITNESS WHEREOF,
the
Executive and the Company (by action of its duly authorized officers) have
executed this Agreement as of the date first above written.
| PROVECTUS PHARMACEUTICALS, INC. | ||
| |
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| Attest: | By: | /s/ Xxxxxxx X. Xxxxx, Ph.D., President |
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EXECUTIVE
/s/
H. Xxxxx Xxxx, Ph.D.,
CEO________________________________
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