EXHIBIT 10.6
EMPLOYMENT AGREEMENT
THIS AGREEMENT (the "Agreement") is made and entered into as of the
11th day of November 1996, by and between Electropharmacology, Inc., a
Delaware Corporation (the "Company"), and Xxxx Xxx, Ph.D. (the "Executive").
WHEREAS, the Company desires to retain the Executive in its employ as the
Executive Vice President of Research, Development and Regulatory of the
Company for the period provided in this Agreement, and the Executive has
agreed to employment with the Company in accordance with the contractual
terms and conditions set forth below;
WHEREAS, the Company and the Executive have discussed and the Executive
has agreed that this Agreement supersedes any and all agreements, oral and
written, between the parties hereto with respect to the subject hereof, and
WHEREAS, this Agreement is intended to, and shall, set forth the
definitive agreement of the parties.
NOW THEREFORE, for and in consideration of the recitals and premises, and
the promises, covenants and agreements contained herein, and intending to be
legally bound hereby, the parties hereto agree as follows:
1. EMPLOYMENT. The Company hereby employs the Executive, and the
Executive hereby accepts such employment with the Company, for the term of
employment set forth in Section 2 hereof, all upon the terms and conditions
hereafter set forth.
2. TERM. Employment shall be for a term commencing on the date
hereof and, subject to prior termination under Section 8, Section 9, Section
10, Section 12 or Section 13 hereof, expiring December 31, 1999.
Notwithstanding the previous sentence, (commencing December 31, 1998), the
term of this Agreement shall automatically be extended for one additional
year upon the terms and conditions set forth herein, unless either party to
this Agreement gives the other party written
notice (delivered in accordance with Section 21 hereof and at least 90 days
prior to December 31, 1999) of such party's intention not to further extend
the term of this Agreement. For purposes of this Agreement, any reference to
the "term" of this Agreement shall include the original term and any
extension thereof.
3. DUTIES OF THE EXECUTIVE. The Executive shall serve as the
Executive Vice President of Research, Development and Regulatory of the
Company. The Executive shall perform such executive duties as a
vice-president for research, development and regulatory would normally
perform or as otherwise specified in the By-Laws of the Company as in effect
on the date of this Agreement, and shall perform, in addition thereto, such
other reasonable duties as the CEO may request. Except as may otherwise be
approved in advance by the CEO and except during vacation periods and periods
of absence due to sickness, personal injury or other disability; the
Executive shall devote substantially all of his normal working time and his
best efforts to the performance of his duties hereunder. Notwithstanding the
foregoing, nothing contained herein shall preclude the Executive from (i)
serving on the boards of directors of other companies or organizations with
the approval of the Board of Directors of the Company (the "Board") (not to
be unreasonably withheld) or (ii) pursuing his personal, financial and legal
affairs provided that such activity does not materially interfere with the
performance of the Executive's obligations hereunder.
4. COMPENSATION.
a) During the term of this Agreement, the Company shall pay
to the Executive a base salary and such bonus as may be awarded to the
Executive from time to time by the Board pursuant to Section 4(b) hereof.
b) or the period commencing on the date of this Agreement,
and ending December 31, 1999 the Executive's base salary shall be deemed to
be $180,000 on an annualized basis.
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h January 1 thereafter, for the calendar year then commencing, or portion
thereof falling within the terms of this Agreement, the Executive's base
salary, on an annualized basis, shall be not less than the product of 180,000
per year multiplied by the percentage obtained by dividing (i) the Consumer
Price Index for All Urban Consumers -- U.S. City Average (1982-84 = 100) (or,
if publication of that index is terminated, any substantially equivalent
successor thereto) for the month of July in the fiscal year of the Company
immediately preceding such January 1, as published by the Bureau of Labor
Statistics of the United States Department of Labor, by (ii) said Consumer
Price Index for the month of July 1995 provided that the Consumer Price Index
adjustment shall in no case be greater than 6% or less than 3% in any year.
The Executive's base salary may be increased from time to time by the Board,
but in no event shall the Executive's base salary payable for any calendar
year or portion thereof be less than the annualized base salary payable for
any previous calendar year, on an annualized basis, during the term of this
Agreement plus the then applicable Consumer Price Index adjustment provided
by the preceding sentence. During the term of the Agreement, Executive's
salary shall be reviewed at least annually by the Board to determine whether
an increase beyond the Executive's base salary is warranted and appropriate.
Except as set forth in this Section 4, such compensation shall be
payable at the times and in the manner consistent with the Company's general
policies regarding compensation of executive employees, but in no event less
frequently than bi-monthly. For so long as either (a) the Company's net
income for its preceding fiscal year is less than 5% of its gross revenues or
(b) the Company's gross revenues in its preceding fiscal year were less than
$10,000,000 (gross revenues to be determined in each case in accordance with
generally accepted accounting principles consistently applied), at the
Board's option the Company may defer payment of up to 33 1/3% of the
Executive's base salary each pay period during the year following such fiscal
year. Such deferred payments shall
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bear interest, recomputed as of the beginning of each month, at an annual
rate at that time equal to the then current prime rate as reported in the
Wall Street Journal (the "Prime Rate"). On the first business day of each
calendar year during the term of this Agreement the Company shall pay to the
Executive any amount deferred the previous calendar year, plus interest, all
or a portion of which may, at the Board's option, such determination to have
been made by the Board of Directors on or before January 1 of said calendar
year, be paid in the Company's common stock. The calculation of the number of
shares of stock the Executive shall receive pursuant to the preceding
sentence, shall be computed on the basis of the average of the fair market
value of the Company's common stock on the first twenty (20) trading days and
the last twenty (20) trading days of such calendar year. For purposes of this
Agreement, fair market value as of any date shall be equal to the last
reported sales prices of the Company's common stock on such date as reported
in the NASDAQ National Market System or, if such common stock is traded on a
national securities exchange, the last reported sales prices of the Company's
common stock on such date as reported on any such exchange on which the
Company's common stock is listed.
c) In addition to the base salary provided by Section 4(b) hereof,
the Executive shall be eligible annually to receive any incentive bonus (the
"Bonus"), that the Board may grant to him based on the Company's executive
compensation plan then in effect, based on the CEO's assessment of the
Executive's individual performance, which decision shall be made by the Board in
its sole discretion. The CEO shall give written notice to the Executive of the
grant of any such Bonus and the amount thereof upon direction of the Board and
Compensation Committee. Such Bonus shall be payable on the next date on which
the Executive is entitled to receive a payment of his base compensation. The
Board may from time to time authorize such additional compensation to the
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Executive, in cash, property, options or warrants as the Board may determine
in its sole discretion to be appropriate.
d) Simultaneously with the execution of this Agreement, the
Company shall grant to the Executive an option to purchase that number of
shares of the Company's common stock equal to 75,000 of the Company's common
stock at a price equal to the last reported sales prices of the Company's
common stock for the date hereof as reported in the NASDAQ National market
System. Such option shall be immediately exercisable with respect to 25,000
of the shares covered thereby and such option shall be exercisable with
respect to an additional 20,000 of the shares covered thereby on the first,
and on each of the additional 10,000 of the shares, second, third and fourth
anniversaries of the date of this Agreement. Notwithstanding the foregoing,
in the event the Executive's employment hereunder is terminated by the
Company other than for Cause (as defined herein) or by the Executive by
Permitted Resignation (as defined herein) prior to the end of the term of
this Agreement, such option shall immediately vest and become exercisable in
accordance with Section 11(c) hereof. If the Executive is terminated for
Cause (as defined herein), all stock options, whether or not vested, shall
immediately terminate without any payment made therefor. If the Executive
resigns (other than by Permitted Resignation), all unvested stock options
shall immediately terminate without any payment therefor. Upon the Employee's
death or Disability (as defined herein), all unvested stock options that are
to vest on the next anniversary date of this Agreement shall immediately vest
and become exercisable and all other unvested stock options shall immediately
terminate without any payment made therefor. The agreement evidencing such
option shall be substantially in the form attached hereto as Exhibit A.
5. EXECUTIVE BENEFITS.
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a) In addition to the compensation described in Section 4,
the Company shall make available to the Executive and his eligible dependents
such benefits which are comparable to those provided to other executive and
management employees of the Company, including without limitation, any group
hospitalization, health, dental care or sick leave plan, life or other
insurance or death benefit plan, travel or accident insurance, retirement
income or pension plan, employee stock option plan or other present or future
group employee benefit plan or program of the Company for which key
executives are or shall become eligible, and Executive shall be eligible to
receive during the period of his employment under this Agreement, and, to the
extent provided in Section 11 and Section 13 hereof, during any subsequent
period for which he shall be entitled to receive payment from the Company
under Section 11 or Section 13 hereof, all benefits for which key executives
are eligible under every such plan or program to the extent permissible under
the general terms and provisions of such plans and programs and in accordance
with the provisions thereof provided that, except to the extent specifically
set forth in Sections 4(c), 11, 12 and 13, the Executive shall not be
permitted to participate in management incentive programs or in termination
pay programs. The Executive shall be eligible to participate in any such plan
or program under the terms and conditions applicable to other executive and
management employees and in a manner commensurate with the Executive's
position and level of responsibility with the Company as compared to the
position and level of responsibility of other executive and management
employees of the Company as determined by the Board in its sole discretion.
b) In addition to any life insurance coverage made available
to the Executive under Section 5(a) hereof, the Company shall provide, at its
sole cost and expense, to the Executive a term life insurance contract on the
Executive's life in an amount one (1) time his annual
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base compensation, the proceeds of which shall be payable to such beneficiary
as Executive may designate.
c) The Company shall pay to Executive an automobile allowance
in the amount of $500 per month during the term of this Agreement.
d) The Executive shall be entitled to paid vacation per
Article 7 (page 29) of the Electropharmacology, Inc. Employee Manual as of
the date hereof. The Executive will accrue vacation time at a rate which
results in 15 days (120 hours) of paid vacation time per year in the first
through fourth years of continuous employment. In the fifth through
fourteenth year of continuous employment, executives accrue vacation time at
a rate which results in 22.5 days (180) hours of paid vacation per year. In
the fifteenth through nineteenth years of continuous employment, executives
accrue vacation at a rate which results in 25 days (200 hours) of paid
vacation per year. After the twenty-fourth year of continuous employment and
thereafter, executives accrue vacation at a rate which results in 30 days
(240 hours) of paid vacation per calendar year which shall be pro-rated for
partial years. Executive may carry over from year to year up to 500 hours of
unused vacation time. Notwithstanding anything herein to the contrary, the
Executive may not take more than two (2) weeks vacation during any twelve
(12) week period without the prior written permission of the Company, which
shall not be unreasonably withheld.
6. EXPENSES.
a) The Company shall also pay or reimburse the Executive for
all reasonable and necessary expenses incurred by the Executive in connection
with his duties on behalf of the Company in accordance with the general
policies of the Company and his employment by the Company pursuant to this
Agreement.
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b) MOVING EXPENSES. The Company shall pay the Executive a
total of $50,000 to reimburse him for his moving and related expenses.
7. PLACE OF PERFORMANCE. In connection with his employment by the
Company, unless otherwise agreed by the Executive, the Executive shall be
based at the principal executive offices of the Company, except for travel
reasonably required for Company business.
8. TERMINATION. The Company may terminate Executive's employment
hereunder for Cause which shall mean;
a) The Executive's conviction by, or entry of a plea of
guilty or nolo-contendere in, a court of competent and final jurisdiction for
any crime involving moral turpitude or punishable by imprisonment in the
jurisdiction involved (provided that if the Executive's conviction is
subsequently overturned, and the Company had terminated the Executive
pursuant to this Section 8(a), such termination shall be deemed to be without
Cause and the Executive shall be entitled to receive the payments and
benefits set forth in Section 11, together with interest at the then current
prime rate as reported in the Wall Street Journal, from the date such
payments would have been due to the Executive had such termination been
without Cause until the date such payments are made to the Executive);
b) Executive's breach of any of the covenants contained in
Section 25 of this Agreement;
c) Executive's commission of an act of fraud, whether prior
to or subsequent to the date hereof, upon Employer;
d) Executive's continuing repeated willful failure or refusal
to perform his duties as required by this Agreement, provided, that
termination of Executive's employment pursuant to this subparagraph (d) shall
not constitute valid termination for cause unless Executive shall have first
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received written notice from the Board stating with specificity the nature of
such failure or refusal and affording Executive at least fifteen (15) days to
correct the act or omission complained of;
e) Gross negligence, insubordination, or material violation by
Executive of any duty of loyalty to the Company or any other material
misconduct on the part of Executive, provided that termination of Executive's
employment pursuant to this subparagraph (e) shall not constitute valid
termination for cause unless Executive shall have first received written
notice from the Board stating with specificity the nature of such failure or
refusal and affording Executive at least fifteen (15) days to correct the act
or omission complained of;
f) A material breach of this Agreement by the Executive as
determined by the Company after the Executive has been given written notice
of such alleged breach, and not less than thirty (30) days to cure such
alleged breach or such longer period as may be reasonably necessary to cure
such breach provided that the Executive is diligently pursuing such cure.
9. RESIGNATION.
a) In the event that (i) the Company shall during the term of
this Agreement (A) fail to continue the Executive as Executive Vice President
of the Company, (B) reduce the Executive's base salary below the minimum
amount specified in Section 4(a) without the Executive's prior written
consent, (C) violate any material term of this Agreement, or (D) relocate the
Executive because of a, or due to a change of control (as defined herein),
provided that the Executive gives the Company written notice of such
violation and the Company fails to cure such violation within 30 days or such
longer period (the "Cure Period") as may be reasonably necessary to cure such
violation provided that the Company is diligently pursuing such cure, then
the Executive, at his sole option, may give notice to the Company at any time
within ten (10) days after the expiration of the Cure Period of his election
to resign and terminate this Agreement ("Permitted Resignation") effective
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immediately upon receipt of such notice (delivered in accordance with Section
21 hereof), or effective upon such other date (not later than ten (10) days
following such notice) that the Executive may designate in such notice.
b) The term "Relocate" shall mean requiring the Executive to
move more than fifty [50] miles from the then place of performance of the
Executive, as defined under Section 7 herein. A "Change of Control" shall
mean the occurrence during the term of this Agreement of any of the following
events;
A) the Company is merged, consolidated or reorganized into or
with another corporation or other legal person, and as a result of such
merger, consolidation or reorganization less than fifty percent (50%) of the
combined voting power of the then outstanding securities entitled to vote
generally in the election of directors ("Voting Stock") of such corporation
or person immediately after such transaction are held in the aggregate by the
holders of Voting Stock of the Company immediately prior to such transaction;
or
B) The Company sells or otherwise transfers all or
substantially all of its assets to another corporation or other legal person,
and as a result of such sale or transfer less than fifty percent (50%) of the
combined voting power of the then outstanding Voting Stock of such corporation
or person immediately after such sale or transfer is held in the aggregate by
the holders of Voting Stock of the Company immediately prior to such sale or
transfer; or
C) If, during any period of two consecutive years, (i)
individuals who at the beginning of any such period constitute the Directors
of the Company and (ii) such other persons as are nominated or elected by a
vote of the Directors of the company, collectively, cease for any reason to
constitute at least a majority of the Directors of the Company; provided,
however, that for purposes of this clause 9(b)(C) each Director who is first
elected, or first nominated for election by the
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Company's stockholders, by a vote of the Director's of the Company (or a
committee thereof) then still in office who were Director's of the company at
the beginning of any such period will be deemed to have been a Director of
the company at the beginning of such period.
10. DEATH. The term of this Agreement shall terminate on the death
of the Executive.
11. TERMINATION PAYMENTS AND BENEFITS. If the Executive's
employment hereunder is terminated by the Executive by Permitted Resignation
or by the Company other than for Cause, prior to the end of the term of this
Agreement, then the Company shall be obligated to pay to the Executive
certain termination payments and make available certain benefits as follows:
a) TERMINATION PAYMENT. The Company shall pay to the
Executive a lump sum in cash, payable within ten (10) business days after the
effective date of such termination, equal to one time the sum of (i) the
Executive's base salary pursuant to Section 4(a) PLUS (ii) the Executive's
average annual bonus granted pursuant to Section 4(c) hereof during the
two-year period (or such shorter period during which the Executive is
employed by the Company) immediately preceding the Executive's termination,
prorated for a partial year. In addition, (i) if at the time of termination
the remainder of the term is greater than one (1) year, and the Executive
remains unemployed one (1) year after the termination date, the Executive
shall be entitled to receive his base salary pursuant to Section 4(a) from
such one (1) year anniversary of the termination date until the earlier of
(A) the end of the term or (B) the date on which the Executive becomes
employed (subject to the limitation that the total amount paid to the
Executive pursuant to this Section 11(a) shall not exceed the total amount of
base salary the Executive would have received pursuant to Section 4(a)
between the termination date and the end of the term) and (ii) if at the time
of termination the remainder of the term is less than one (1) year, the
Executive will receive one (1) time the amount otherwise provided in this
Section 11(a).
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Notwithstanding any provision to the contrary contained herein, the Executive
shall be entitled to receive the payments provided for in the second sentence
of this Section 11(a) (A) only for so long as the Executive uses all
reasonable means available to him to diligently pursue new employment and (B)
provided the Executive accepts a reasonable offer of employment. It shall be
within the Company's sole and absolute discretion to determine, such
determination to be reasonably comparable to the practice of the industry,
whether the Executive has complied with the provisions of this Section 11(a).
b) Notwithstanding the foregoing provision of Section 11(a),
upon the closing of the Change of Control event and up to one year after the
Change of Control event, the Executive may resign and receive benefits under
Section 11(a) however, limited to the Executive's base salary pursuant to
Section 4(A) plus the Executive's average annual bonus granted pursuant to
Section 4(c) hereof during the two year period immediately preceding the
Executives resignation due to a change of control and required relocation
event.
c) BENEFITS. Notwithstanding any provision to the contrary in
any option agreement or other agreement or in any plan, except as provided
for under Section 8(a), (i) all of the Executive's outstanding stock options
shall immediately vest and become exercisable and the Executive shall have
the full term of the option to exercise any of the Executive's stock options,
and (ii) all restrictions on any other equity awards relating to continued
performance of services shall lapse.
Subject to Section 15, for one year following the termination
of this Agreement, the Company shall use its reasonable best efforts to
maintain in full force and effect for the continued benefit of the Executive
all employee welfare benefit plans and perquisite programs in which the
Executive was entitled to participate immediately prior to the Executive's
termination or shall arrange to make available to the Executive benefits
substantially similar to those which the Executive would otherwise have been
entitled to receive if his employment had not been terminated; provided,
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however; that (i) if the remainder of the term exceeds one (1) year, the
Company shall use its reasonable best efforts to continue to provide such
benefits to the Executive until the end of the term and (ii) if the remainder
of the term is less than one (1) year, the obligation of the Company pursuant
to this Section 11(c) shall extend for only one (1) year following the
termination date. Such welfare benefits shall be provided to the Executive on
the same terms and conditions (including, without limitation, employee
contributions toward the premium payments) under which the Executive was
entitled to participate immediately prior to his termination.
Notwithstanding the foregoing, with respect to the Executive's
continued coverage under the Company's medical and dental plan, or a
successor plan, pursuant to this provision, the Executive's "qualifying
event" for purposes of the Consolidated Omnibus Budget Reconciliation Act of
1985 ("COBRA") shall be his date of termination from the Company.
12. OTHER TERMINATION. If the Company terminates this Agreement for
Cause or if the Executive terminates this Agreement for any reason other than
by Permitted Resignation or if the Executive dies or in the event of the
Executive's Disability, then the Company and the Executive shall have no
further obligation hereunder except as follows or except as provided in any
available plan, program or agreement:
a) The Company shall pay the Executive his then current
minimum base salary through the effective date of such termination;
b) If the Executive terminated this Agreement other than by
Permitted Resignation, he shall receive such benefits, if any, as are afforded
by the Company under its then existing policies applicable to employees who
voluntarily terminate their employment; and
c) The Executive shall have the rights set forth in Section 13
hereof in the event of termination of this Agreement upon his Disability.
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13. DISABILITY.
a) In the event of the Executive's Disability (as defined
herein) during the term of this Agreement, the Executive's duties and
obligations hereunder shall cease and the Company shall pay to the Executive
in cash, for each calendar year until the Executive reaches the age of 65 and
at the times at which the Executive would have received payment of his base
salary, an amount equal to 60% of the sum of (i) the Executive's highest
annual base salary pursuant to Section 4(a) than in effect for the period
prior to the Executive's Disability. For this purpose, the Company shall
maintain in full force and effect during the term of this Agreement an
insurance policy with an insurance company that reasonably shall provide for
the payment of such amounts to the Executive upon his Disability.
b) "Disability" shall be defined as in the insurance policy
referenced in Section 13(a) hereof.
c) For the period during which the Executive is entitled to
receive payments under this Section 13, the Company shall use its reasonable
best efforts to maintain in full force and effect for the continued benefit
of the Executive all employee welfare benefit plans, as provided for under
the insurance policy limits, except for life insurance provided for under
Section 5(b); and except for the automobile allowance set forth in Section
5(c). Such welfare benefits shall be provided to the Executive on the same
terms and conditions (including employee contributions toward the premium
payments) under which the Executive was entitled to participate immediately
prior to his Disability.
d) The Company shall have no obligation under this Section 13
if the Executive is not insurable under an insurance policy with a reasonably
price premium, as determined by the Company in its sole absolute discretion.
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14. NO OTHER TERMINATION COMPENSATION. Except as specifically
provided in Sections 11, 12 and 13 hereof, upon termination of this Agreement
for any reason, the Executive shall not be entitled to any severance pay or
to any other compensation or payments (by way of salary, damages or
otherwise) of any nature relating to this Agreement or otherwise relating to
or arising out of his employment by the Company.
15. MITIGATION OBLIGATION. The Executive shall mitigate damages
including the amount of any payment provided for pursuant to Section 13 by
seeking other employment or otherwise; provided, however, that the Executive
is under no obligation to mitigate any amount provided for by insurance
policies under Section 13 hereof.
16. ARBITRATION. Any dispute between the parties under this
Agreement shall be submitted to arbitration and such arbitration shall be
conducted in accordance with the rules of the International Chamber of
Commerce ("ICC"). Each of the parties hereto shall appoint one person as an
arbitrator to hear and determine any such dispute and if the two arbitrators
so chosen shall be unable to agree, then the two arbitrators shall select a
third impartial arbitrator whose decision shall control. All arbitrators
selected shall have previously engaged in and conducted arbitrations for at
least the past three (3) years in accordance with the rules of the ICC. The
arbitrators shall have the right only to interpret and apply the provisions
of this Agreement and may not change any of its provisions except as
permitted by Section 23 hereof. The arbitrators shall permit reasonable
pre-hearing discovery of facts, to the extent necessary to establish a claim
or a defense to a claim, subject to supervision by the arbitrators. The
determination of the arbitrators shall be conclusive and binding upon the
parties and judgment upon the same may be entered in any court having
jurisdiction thereof. The arbitrators shall give written notice to the
parties stating his or their determination, and shall furnish to each party a
signed copy of such determination. Arbitration hereunder shall be final and
binding on the parties and
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may not be appealed. The expenses of arbitration, including reasonable
attorneys' fees, shall be borne by the losing party or as the arbitrators
shall otherwise equitably determine.
17. INDEMNIFICATION. To the maximum extent permitted under the
corporate laws of the State of Delaware or, if more favorable, the By-Laws of
the Company as in effect on the date of this Agreement, (a) the Executive
shall be indemnified and held harmless by the Company, as provided under
such corporate laws or such By-Laws, as applicable, for any and all actions
taken or matters undertaken, directly or indirectly, in the performance of
his duties and responsibilities under this Agreement or otherwise on behalf
of the Company, and (b)without limiting clause (a), the Company shall
indemnify and hold harmless the Executive from and against (i) any claim,
loss, liability, obligation, damage, cost, expense, action, suit, proceeding
or cause of action (collectively, "Claims") arising from or out of or
relating to the Executive's performance as an officer, director, employee or
agent of the Company or any of its affiliates or in any other capacity,
including, without limitation, any fiduciary capacity, in which the Executive
serves at the request of the Company, and (ii) any cost or expense
(including, without limitation, fees and disbursements of counsel)
(collectively, "Expenses") incurred by the Executive in connection with the
defense or investigation thereof. If any Claim is asserted or other matter
arises with respect to which the Executive believes in good faith the
Executive is entitled to indemnification as contemplated hereby, the Company
shall pay the Expenses incurred by the Executive in connection with the
defense or investigation of such Claim or matter (or cause such Expenses to
be paid) on a monthly basis, provided that the Executive shall reimburse the
Company for such amounts, plus simple interest thereon at the then current
prime rate as reported in the Wall Street Journal as in effect from time to
time, compounded annually, if the Executive shall be found, as finally
judicially determined by a court of competent jurisdiction, not to have been
entitled to indemnification hereunder.
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18. AGREEMENT. This Agreement supersedes any and all other
agreements, either oral or written, between the parties hereto with respect
to the subject matter hereof, and contains all of the covenants and
agreements between the parties with respect to such subject matter, and
Executive has received legal counsel regarding the entirety of the Agreement.
19. WITHHOLDING OF TAXES. The Company may withhold from any amounts
payable under this Agreement all federal, state, city or other taxes as the
Company is required to withhold pursuant to any law or government regulation
or ruling.
20. SUCCESSORS AND BINDING AGREEMENT.
a) The Company will reasonably require any successor (whether
direct or indirect, by purchase, merger, consolidation, reorganization or
otherwise) to all or substantially all of the business or assets of the
Company, by agreement in form and substance satisfactory to the Executive
acting reasonably, expressly to assume and agree to perform this Agreement in
the same manner and to the same extent the Company would be required to
perform if no such succession had taken place. This Agreement will be binding
upon and inure to the benefit of the Company and any successor to the
Company, including, without limitation, any persons acquiring directly or
indirectly all or substantially all of the business or assets of the Company
whether by purchase, merger, consolidation, reorganization or otherwise (and
such successor shall thereafter be deemed the "Company" for the purposes of
this Agreement).
b) This Agreement will inure to the benefit of and be
enforceable by the Executive's personal or legal representatives, executors,
administrators, successors, heirs, distributees and legatees.
c) The rights of the Company under this Agreement may without
the consent of Executive, be assigned by the Company in its sole and
unfettered discretion (a) to any
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person, firm, corporation, or other business entity which at any time,
whether by purchase, merger, or otherwise, directly or indirectly, acquires
all or substantially all of the assets or business of the Company, or (b) to
any subsidiary or affiliate of the Company (the "Company Group"), or any
transferee, whether by purchase, merger or otherwise, which directly or
indirectly acquires all or substantially all of the assets of the Company or
any other member of the Company Group.
21. NOTICES. For all purposes of this Agreement, all
communications, including, without limitation, notices, consents, requests or
approvals, required or permitted to be given hereunder will be in writing and
will be deemed to have been duly given when hand delivered or dispatched by
electronic facsimile transmission (with receipt thereof confirmed), or five
business days after having been mailed by United States registered or
certified mail, return receipt requested, postage prepaid, or three business
days after having been sent by a nationally recognized overnight courier
service such as Federal Express, UPS, or Purolator, addressed to the Company
(to the attention of the Secretary of the Company) at its principal executive
offices and to the Executive at his principal residence, or to such other
address as any party may have furnished to the other in writing and in
accordance herewith, except that notices of changes of address shall be
effective only upon receipt.
22. GOVERNING LAW. The validity, interpretation, construction and
performance of this Agreement will be governed by and construed in accordance
with the substantive laws of the State of Florida, without giving effect to
the principles of conflict of laws of such State.
23. SEVERABILITY AND REFORMATION. If any provision of this
Agreement is held to be illegal, invalid or unenforceable under any present
or future law, and if the rights or obligations of the parties under this
Agreement would not be materially and adversely affected thereby, such
provision shall be fully separable, and this Agreement shall be construed and
enforced as if such illegal, invalid or unenforceable provision had never
comprised a part thereof, the remaining provisions of this
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Agreement shall remain in full force and effect and shall not be affected by
the illegal, invalid or unenforceable provision or by its severance
therefrom, and, in lieu of such illegal, invalid or unenforceable provision,
there shall be added automatically as a part of this Agreement a legal, valid
and enforceable provision as similar in terms to such illegal, invalid or
unenforceable provision as may be possible, and the parties hereto request
the court or any arbitrator to whom disputes relating to this Agreement are
submitted to reform the otherwise illegal, invalid or unenforceable provision
in accordance with this Section 23.
24. SURVIVAL OF PROVISIONS. Notwithstanding any other provision of
this Agreement, the parties' respective rights and obligations under Sections
4, 5, 11, 12, 13, 14, 15, 16, 17, 19 and 25 hereof, and under any other
Sections that provide a party with rights (including, without limitation,
rights to receive payments) that have not been fully satisfied as of such
termination or expiration, will survive any termination or expiration of this
Agreement or the termination of the Executive's employment for any reason
whatsoever.
25. NONDISCLOSURE; COMPETITIVE ACTIVITY. With the exception of
Addendum "A" attached, the existing Agreement attached hereto as Exhibit B
(dated November 11, 1996) shall not be superseded but shall remain in full
force and effect and continue to be binding upon and inure to the benefit of
the Company and the Executive.
26. MISCELLANEOUS. 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 the Company. No waiver by either
party hereto at any time of any breach by the other party hereto or
compliance with any condition or provision of this Agreement to be performed
by such other party will be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time.
Unless otherwise noted, references to "Sections" are to sections of this
Agreement.
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The captions used in this Agreement are designed for convenient reference only
and are not to be used for the purpose of interpreting any provision of this
Agreement.
27. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of
which together will constitute one and the same agreement.
IN WITNESS WHEREOF; the parties hereof have executed this Agreement
as of the day and year first above written.
/s/ XXXX XXX
------------------------------
Xxxx Xxx
ELECTROPHARMACOLOGY, INC.
By: /s/ XXXXXX XXXXXXXXX
---------------------------
Name: Xxxxxx Xxxxxxxxx
-------------------------
Title: Chairman and CEO
------------------------
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ADDENDUM A
The Company acknowledges that the Executive has certain commercialization
rights to certain biomedical technologies licensed by HealthTech Development,
Inc. ("HTD"), including its wholly owned subsidiary, Applied Biological
Coatings & Implants Inc. ("ABCI"). The Company hereby agrees that the
Executive shall be entitled to retain all benefits that arise out of HTD and
ABCI and the Executive agrees that he will conclude his direct operational
involvement in HTD and ABCI activities within six (6) months of the date of
this Agreement and further agrees that he will limit such involvement to no
more than four (4) days per month during such six month period. The Executive
further agrees that he will bring to the Company's attention and negotiate in
good faith with the Company a licensing or acquisition agreement with respect
to each product or technology that is reasonably deemed to be within the
scope of the Company's business. If the Company elects not to pursue such a
license or acquisition opportunity, then the Executive shall be free to offer
it to a third party and retain any consideration derived therefrom without
any further obligation to the Company with respect to such product or
technology.
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