Exhibit 10.62
AGREEMENT
---------
THIS AGREEMENT (the "Agreement") is made as of August 27, 2001 by and
---------
between XXXX-XXXX XXXX ("Xxxx") and ANDRX CORPORATION (the "Company").
---- -------
RECITALS
--------
WHEREAS, Chen has been an employee of the Company since its inception; and
WHEREAS, Chen has served as the Company's Chief Scientific Officer ("CSO")
---
and Co-Chairman of the Board of Directors (the "Board") as well as President of
-----
its Andrx Pharmaceuticals, Inc. subsidiary;
WHEREAS, Chen wishes to retire as CSO, as President of Andrx
Pharmaceuticals, Inc., and as an officer and director of each of the Company's
other direct and indirect subsidiaries, but desires to remain as Co-Chairman of
the Board and is willing to continue to work with the Company as a consultant in
order to help ensure the timely completion of the projects in which he was
involved and the continued success of the Company; and
WHEREAS, the parties wish to set forth all obligations liabilities and
confirm all understandings between them pursuant to or arising out of Chen's
retirement as an employee of the Company and his continuing rights and
responsibilities as Co-Chairman of the Board and as a consultant to the Company.
AGREEMENT
---------
NOW THEREFORE, in consideration of the premises and mutual covenants set
forth herein, it is hereby agreed as follows:
1. Recitals. The foregoing recitals are true and correct in all respects
--------
and are incorporated herein by reference.
2. General.
-------
(a) The Company and Chen agree that due to Chen's retirement, his
employment with the Company and any subsidiaries is hereby terminated as of the
date reflected above (the "Effective Date").
(b) The Company agrees to use its best efforts to remove Chen as the
Company's representative or contact from the records of all applicable
governmental agencies and regulatory authorities including, but not limited to,
the Food and Drug Administration, the Internal Revenue Service, and the
Department of Revenue. The Company agrees to also use its best efforts to remove
Chen from all of the Company's federal, state and local licenses on a timely
basis if permitted by amendment or if not upon renewal of all such licenses. The
Company agrees to use its best efforts to provide Chen evidence of the
undertakings set forth in this paragraph (b) within thirty (30) days of the date
first written above.
3. Stock Options. The Company and Chen agree that, notwithstanding the
-------------
termination of Chen's employment with the Company, all Stock Option Agreements
and grants thereunder by and between Chen and the Company shall remain in full
force and effect and shall continue to vest according to their vesting
scheduling while Chen continues to serve as a member of the Board just as though
he had remained an employee of the Company.
4. Continuing Obligations; Covenant Not to Compete. Chen agrees to
-----------------------------------------------
continue serving as the Co-Chairman of the Board of Directors of the Company.
Chen acknowledges that while he remains a member of the Board of Directors of
the Company, he has fiduciary obligations to the Company and such other duties
as generally apply to directors, including the duty of care and loyalty. Chen
agrees that for a period of two (2) years form the Effective Date or one (1)
year after the date he ceases to be a member of the Company's Board, whichever
is later (the "Termination Date"), he will not directly or indirectly, whether
individually or through any form of entity, (i) engage in the business of
distributing pharmaceutical products manufactured by third parties to pharmacies
or physician offices, (ii) solicit or otherwise obtain business from any
pharmacy customers of the Company for other generic versions of products that
the Company was selling, attempting to develop, gain FDA approval to market or
was in the process of acquiring (as evidenced by written records) on the
Termination Date, (iii) solicit, market or otherwise motivate physicians to
prescribe pharmaceuticals which are intended to compete with the brand products
(whether approved by FDA as an ANDA or an NDA) that the Company was selling,
attempting to develop, gain FDA approval to market, or was in the process of
acquiring (as evidenced by written records) on the Termination Date, or (iv)
seek to develop any orally administered controlled release pharmaceuticals or
other pharmaceutical products that the Company had developed or was attempting
to develop on the Termination Date; provided however, the term "process of
-------- -------
acquiring" shall only include acquisitions that the Company is considering
acquiring if the Company takes actual steps to achieve such acquisition from the
seller thereof within 30 days of the Termination Date. As of the Effective Date,
the Company is neither engaged in the development of pharmaceuticals
administered by injection, nor the manufacture, marketing and distribution of
pharmaceuticals outside of the United States. Accordingly, as of the Effective
Date, Chen is free of any constraint by, or obligation to, the Company (a) to
develop, manufacture, market and/or sell, alone or with others, throughout the
world, including in any place that the Company does business, pharmaceuticals
which are administered by injection, and (b) to engage in the business of
manufacturing, marketing or distributing pharmaceutical products, however
administered, to pharmacies or physician offices in Asia (other than products
described in (ii) above). While Chen remains on the Board, he shall disclose any
conflicts of interest that might arise by the Company later commencing any
operations that would cause Chen's personal endeavors to be in conflict with the
Company, such as those described in the preceding sentence, and shall remove
himself from all such discussions and votes.
2
5. Director and Officer Insurance Policies. The Company agrees to
---------------------------------------
maintain all Director and Officer Insurance Policies (the "D & O Policies") and
--------------
the applicable limits in existence at the time of this Agreement. The Company
further agrees to maintain tail coverage pertaining to the D & O Policies
covering past actions by Chen for a period of five (5) years subsequent to the
Effective Date, or the date Chen ceases to be the Co-Chairman, whichever is
later.
6. Indemnification Agreements. The Company agrees to maintain in full
--------------------------
force and effect all indemnification agreements in existence as of the Effective
Date as they relate to Directors and Officers of the Company ("Indemnification
---------------
Agreements"). The Indemnification Agreements shall remain in effect without any
----------
limitation as to time.
7. Duty to Provide Information. The Company agrees to immediately inform
---------------------------
Chen, after being informed itself, of any actions, claims, demands,
investigations, lawsuits, proceedings and formal or informal inquiries by any
regulating authorities brought against the Company, arising out of any alleged
actions of Chen occurring during any period of time in which Chen served the
Company in any capacity.
8. Consulting Agreement. Chen agrees that upon reasonable request of the
--------------------
Company from time to time he shall be available telephonically, at no cost or
expense to the Company, to assist the Company to scale up the formulation and
otherwise effect a launch in a timely manner of those products he was involved
with while he was an employee of the Company. In the event that the Company
shall require Chen to travel in order to provide such advice, the Company shall
reimburse Chen for all expenses incurred by Chen in connection with such travel.
9. Cooperation with Actions, Investigations, etc.
---------------------------------------------
Chen agrees to assist the Company, as is reasonably necessary, in its
defense or prosecution of any legal action or suit, formal or informal inquiry
by any regulatory body which is currently existing or commenced in the future
and based on facts or subjects of which Chen has knowledge. Chen shall make
himself reasonably available, for information requests and consultation
regarding business affairs and transactions of the Company occurring or
commenced during Chen's employment by the Company in connection with the
prosecution or defense of any actions, claims, demands or proceedings filed
against the Company, or to cooperate with any investigation or formal or
informal inquiry by any regulating authorities governing the activities of the
Company. This provision shall not require Chen to serve as an expert in any
manner, but only as a fact witness connection with providing testimony. The
Company shall reimburse Chen for any and all expenses incurred by Chen in
connection with his responsibilities pursuant to this paragraph.
10. Right to Hire Counsel. Chen shall have the right to hire counsel of
---------------------
his choosing, at the Company's cost, for representation in connection with any
and all assistance in connection with all actions previously described in
paragraph 9.
11. The Company's Property. In connection with Chen's retirement, Chen
----------------------
shall return all the Company's property including credit cards and portable
communication devices
3
within ten (10) days of the execution of this Agreement. The Company's property
shall not include the items enumerated in Exhibit "A" to this Agreement.
-----------
12. Right to Hire Certain Employees. Chen agrees that for a period of two
-------------------------------
(2) years after his retirement or one (1) year after he ceases to be the Co-
Chairman, whichever is later, Chen shall not, either directly or indirectly, for
his own account or either as agent, servant or employee or as shareholder of any
corporation, or member of any firm, engage, hire, employ or solicit the
employment of any person who, at the time of termination of Chen's employment,
was an employee of the Company or its subsidiaries whose duties required such
employee to be familiar with the operation of the business of the Company or its
subsidiaries.
13. Confidential Information. Chen's rolodex, all of its contents,
------------------------
including telephone number and addresses to be taken by him from the Company
shall not be deemed confidential information or trade secrets of the Company.
All such other information proposed to be taken by Chen, if any, including his
personal files, shall first be determined solely by the Company whether or not
such information is confidential information or trade secrets before they are
taken by Chen. Chen agrees not to remove any information deemed by the Company
to be confidential information.
14. Notices. All notices, requests, consents and other communications
-------
required or permitted under this Agreement shall be in writing (including
electronic transmission) and shall be (as elected by the person giving such
notice) hand delivered by messenger or courier service (including overnight mail
service), electronically transmitted, or mailed (airmail if international) by
registered or certified mail (postage prepaid), return receipt requested,
addressed to:
Xxxx-Xxxx X. Xxxx
with a copy to:
Xxxxx X. Xxxxxx, Esq.
Bilzin Xxxxxxx Xxxx Xxxxx Price & Xxxxxxx
0000 Xxxxx Xxxxx Xxxxxxxxx Xxxxxx
Xxxxx, XX 00000
Facsimile: 305-374-7593
Andrx Corporation
0000 Xxxxxx Xxxxx
Xxxxx, Xxxxxxx 00000
Facsimile: (000) 000-0000
Attn: Xxxxx Xxxxx, Esq.
or to such other address as any party may designate by notice complying with the
terms of this Section. Each such notice shall be deemed delivered (a) on the
date delivered, if by personal delivery or courier; (b) on the date of
transmission with confirmation of receipt, if by electronic
4
transmission; and (c) on the date three (3) business days following the deposit
of the notice in a U.S. Mail depository (or, if applicable, in an appropriate
airmail deposition), properly addressed and with necessary postage.
15. Arbitration. Notwithstanding anything to the contrary in this
-----------
Agreement, the parties irrevocably agree that all claims for monetary damages
and disputes relating in any way to the performance, interpretation, validity or
breach of this Agreement shall be referred to final and binding arbitration,
before a single arbitrator, under the Florida Arbitration Code. The arbitrator
shall be selected by the parties, but if the parties are unable to reach
agreement on selection of the arbitrator within thirty (30) days after the date
on which the notice of arbitration is sent to the parties to the arbitration,
then either party may petition the circuit court within Broward County, Florida
and each party may submit up to three arbitrators to the court for the court's
consideration. The court's selection of an arbitrator shall be final and non-
appealable. In no event shall a party be entitled to punitive, treble or special
damages, or injunctive relief in any arbitration or judicial proceeding and all
parties hereby waive their rights to any punitive, treble or special damages, or
injunctive relief. In the event an arbitration panel or a court concludes that
the punitive, treble or special damages, or injunctive relief waiver contained
in the previous sentence is unenforceable, then the parties agree that the court
with subject matter jurisdiction over the confirmation of the award shall have
sole and exclusive jurisdiction to determine issues of entitlement and amount of
punitive, treble or special damages, or injunctive relief. The arbitrator shall
not have subject matter jurisdiction to decide any issues relating to the
statute of limitations or to any request for injunctive relief, and the parties
hereby stipulate to stay the arbitration proceeding (without the need of a bond)
until any such issues in dispute are resolved. Judgment upon the award rendered
by the arbitrator shall be final, binding and conclusive upon the parties and
their respective administrators, executors, legal representatives, heirs,
successors and permitted assigns, and may be entered in any court of competent
jurisdiction. All questions as to the meaning of the provisions of this
paragraph, or as to the arbitrababality of any dispute under this paragraph
shall be resolved by the arbitrator, shall be absolutely binding, and not
subject to judicial review. The costs and expenses of arbitration, including
counsel fees, shall be borne ultimately as the arbitrator directs.
16. Jurisdiction and Venue. Any arbitration, civil action or legal
----------------------
proceeding arising out of or relating to this Agreement shall be brought in the
courts of record in Broward County, Florida. Each party irrevocably consents to
the personal jurisdiction of such court in any such arbitration, civil action or
legal proceeding and waives any objection to the laying of venue of any such
arbitration, civil action or legal proceeding in such court. Service of any
court paper may be effected on such party in such other manner as may be
provided under applicable laws, rules of procedure or local rules.
17. Counterparts. This Agreement may be signed in two counterparts, which
------------
together shall constitute an original instrument.
18. Severability. Any term or provision of this Agreement that is invalid
------------
or unenforceable in any situation in any jurisdiction shall not effect the
validity or enforceability of the remaining terms and provisions hereof or the
validity or enforceability of the offending term or provision in any other
situation or in any other jurisdiction.
5
19. Entire Agreement. This Agreement, including the exhibits referred to
----------------
herein and which form a part of this Agreement, sets forth all obligations
liabilities and understandings between the parties to the other pursuant to or
arising out of Chen's retirement as CSO and President of Andrx Pharmaceuticals,
Inc. and continued responsibilities to the Company, and supersedes all prior and
contemporaneous agreements understandings, inducements or conditions, express or
implied, oral or written, except as herein contained.
IN WITNESS WHEREOF, Chen and the Company have caused this Agreement to be
executed and delivered as of the Effective Date.
Andrx Corporation
By:/s/ Xxxxx Xxxxx
-------------------------------
Name:
Office:
/s/ Xxxx-Xxxx Xxxx
----------------------------------
Xxxx-Xxxx Xxxx
6
