EXHIBIT 10.49
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is entered into as
of June 16, 1998 by and between Discovery Laboratories, Inc., a Delaware
corporation (the "Company"), and Xxxxxxx Xxxxx (the "Executive").
WHEREAS, the Company and Executive desire that Executive be
employed by the Company and that the terms and conditions of such employment be
defined;
NOW, THEREFORE, in consideration of the employment of
Executive by the Company, the Company and Executive agree as follows:
1. Term of the Agreement. The Company shall employ Executive
and Executive shall accept employment for a period of three (3) years
commencing on June 16, 1998 (the "Commencement Date") and continuing until June
15, 2001, subject, however, to prior termination as hereinafter provided in
Section 5 (the "Employment Period").
2. Executive's Duties and Obligations.
a. Duties. Executive shall serve as Controller.
Executive shall be responsible for the day to day administrative, accounting and
financial needs of the Company. Executive shall also be responsible for the
Company's Human Resources requirements.
b. Location of Employment. Executive's principal
place of business shall be at the Company's office to be located within thirty
(30) miles of Doylestown, Pennsylvania.
c. Proprietary Information and Inventions Agreement.
Upon commencement of employment with the Company, Executive shall execute the
Company's standard form of Intellectual Property and Confidential Information
Agreement (the "Confidentiality Agreement") a copy of which is attached to this
Agreement as Exhibit A.
3. Devotion of Time to Company's Business
a. Full-Time Efforts. During her employment with the
Company, Executive shall devote substantially all of her business time,
attention and efforts to the high quality performance of her duties to the
Company.
b. No Other Employment. During her employment with
the Company, Executive shall not, whether directly or indirectly, render any
services of a commercial or professional nature to any other person or
organization, whether for compensation or otherwise, without the prior written
consent of the Company's Executive Committee or Board of Directors.
c. Non-Competition During Employment. During the
Employment Period and for eighteen (18) months after its termination, Executive
shall not, directly or indirectly, either as an employee, employer, consultant,
agent, principal, partner, stockholder, corporate officer, director, or in any
other individual or representative capacity (i) compete with the Company in the
business of developing or commercializing pulmonary surfactants, Vitamin D
analogs or any other category of compounds which forms the basis of the
Company's products or products under development (a "Competing Business"), or
(ii) directly or indirectly solicit employees of the Company.
4. Compensation and Benefits.
a. Base Compensation. During the term of this
Agreement, the Company shall pay to Executive base annual compensation of Fifty
Five Thousand Dollars ($55,000), less all required withholdings.
b. Bonuses.
(1) Incentive Bonus. Executive shall be eligible
for incentive bonuses in amounts to be determined by the Company's Compensation
Committee after consultation with the Company's Chief Executive Officer, to be
paid in either cash or equity, upon the achievement of each of the following
milestones (which bonuses shall be paid only once for each of the milestones):
(a) the successful completion of Phase II studies for any compound under
development in the Company's portfolio (each a "Portfolio Compound"); (b) the
successful completion of Phase III studies for any Portfolio Compound; and (c)
receipt of marketing approval in the United States for any Portfolio Compound.
(2) Additional Bonus. Executive shall be
eligible for such year-end bonus, which may be paid in either cash or equity, or
both, as is awarded at the discretion of the Compensation Committee of the Board
of Directors of the Company after consultation with the Company's Chief
Executive Officer.
c. Benefits. During her employment with the Company,
the Company shall provide reasonable medical and disability benefits to
Executive. In addition, the Company will provide to Executive term life
insurance on behalf of Executive's beneficiaries in the amount of Executive's
annual salary for the term of this Agreement.
d. Stock Options. The Board of Directors of the
Company has granted to Executive, on the date hereof, incentive stock options to
purchase: (i) 11,848 shares of Common Stock, $0.001 par value of the Company
(the "Common Stock"), pursuant to the terms of the Notice of Grant attached
hereto as Exhibit B. (ii) 6,125 shares of Common Stock, subject to acceleration
at such time as the market capitalization of the Company exceeds $75 million,
pursuant to the terms of the Notice of Grant attached hereto as Exhibit C, and
(iii) 7,760 shares of Common Stock, subject to acceleration upon consummation of
a corporate partnering deal having a total Value (as hereinafter defined) of at
least $20 million, pursuant to the terms of the Notice of Grant attached hereto
as Exhibit D. For purposes of this Agreement, "Value" shall mean the total
payments, including without limitation, contingent payments prior to or at
receipt of marketing approval for the Portfolio Compound involved in the
relevant agreement, to be paid to Discovery from corporate partnering
transactions of from any other transactions for the development, clinical
testing, regulatory approval, manufacturing and/or marketing of a Portfolio
Compound, including without limitation upfront fees, milestone payments,
research and development and other contractual commitments.
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5. Termination of Employment.
a. Termination for Good Cause. The Company may
terminate Executive's employment at any time for "Good Cause," as herein
defined. For the purposes of this Agreement, "Good Cause" includes, but is not
limited to, gross misconduct, gross neglect of duties, acts involving moral
turpitude, material breach by Executive of this Agreement or the Confidentiality
Agreement or any act or omission involving fraud, embezzlement, or
misappropriation of any property or proprietary information of the Company by
Executive which is not cured by Executive within fifteen (15) days after receipt
of written notice from the Company.
b. Termination without Good Cause. If Executive's
employment is terminated by the Company without Good Cause, the following
provisions shall apply:
(1) Executive shall be entitled to any
unpaid compensation accrued through the last
day of Executive's employment; (2) Executive
shall be entitled to receive severance
payments equal to her base compensation,
payable on normal
Company payroll dates, for a three (3) month period, subject to setoff or other
employment or consulting income received by Executive.
c. Death or Disability. This Agreement shall
terminate if Executive dies or is mentally or physically "Disabled" as herein
defined. For the purposes of this Agreement, "Disabled" shall mean a mental or
physical condition that renders Executive incapable of performing her duties and
obligations under this Agreement for three (3) or more consecutive months or for
a total of six (6) months during any twelve (12) consecutive months; provided,
that during such period the Company shall give Executive at least thirty (30)
days' written notice that it considers the time period for disability to be
running. If this Agreement is terminated under this Section 5.c., Executive or
her estate shall be entitled to any unpaid compensation accrued through the last
day of Executive's employment but shall not be entitled to any severance
benefits.
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6. Miscellaneous.
a. Governing Law. This Agreement shall be
interpreted, construed, governed and enforced according to the laws of the
Commonwealth of Pennsylvania as applied to agreements among Pennsylvania
residents entered into and to be performed entirely within Pennsylvania without
regards to the application of choice of law rules.
b. Amendments. No amendment or modification of the
terms or conditions of this Agreement shall be valid unless in writing and
signed by the parties hereto.
c. Severability. If one or more provisions of this
Agreement are held to be unenforceable under applicable law, such provision
shall be construed, if possible, so as to be enforceable under applicable law,
else, such provision shall be excluded from this Agreement and the balance of
the Agreement shall be interpreted as if such provision were so excluded and
shall be enforceable in accordance with its terms.
d. Successors and Assigns. The rights and obligations
of the Company under this Agreement shall inure to the benefit of and
shall be binding upon the successors and assigns of the Company. Executive shall
not be entitled to assign any of her rights or obligations under this Agreement.
e. Notices. All notices required or permitted under
this Agreement shall be in writing and shall be deemed effective upon personal
delivery, on the date of scheduled delivery by a nationally recognized overnight
service or two (2) days after deposit in the United States Post Office, by
registered or certified mail, postage prepaid, addressed to the other party at
the address shown below such party's signature, or at such other address or
addresses as either party shall designate to the other in accordance with this
Section 6.e.
f. Entire Agreement. This Agreement, including the
exhibits attached hereto, constitutes the entire agreement between the parties
with respect to the employment of Executive.
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date set forth above.
DISCOVERY LABORATORIES, INC.
/s/ Xxxxxx X. Xxxxxxxx
---------------------------------
By: Xxxxxx X. Xxxxxxxx, Ph.D.
Its: President
Address: 0000 Xxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
EXECUTIVE
/s/ Xxxxxxx Xxxxx
---------------------------------
Xxxxxxx Xxxxx
Address:
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