EXHIBIT 10.5
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT, dated October 28,1999 and effective as of November 1,
(the "Effective Date"), by and between AVAX Technologies, Inc., a Delaware
corporation (the "Corporation"), and Xx. Xxxxxx X. Xxxxxx, an individual (the
"Executive").
WHEREAS, the Corporation desires to employ the Executive and the Executive
desires to accept such employment, on the terms and conditions set forth herein;
and
WHEREAS, the Corporation and the Executive wish to replace the Employment
Letter Agreement dated October 8, 1999 hereby in its entirety;
NOW, THEREFORE, in consideration of the foregoing and the mutual promises
and covenants herein contained, it is agreed as follows:
1. EMPLOYMENT; DUTIES, POWERS AND AUTHORITY
(a) The Corporation engages and employs the Executive, and the Executive
hereby accepts engagement and employment as a corporate officer in the position
of Senior Vice President for Marketing, Sales, and Business Development of the
Corporation.
(b) The Executive shall perform his duties with all such powers and
authority as appertain to such office in accordance with and subject to overall
direction of the President and Chief Executive Officer (the "CEO") of the
Corporation. The Executive shall perform his duties hereunder from the
Corporation's offices and at such other places as shall be necessary according
to the needs, business or opportunities of the Corporation; provided, that the
Executive acknowledges and agrees that the performance by the Executive of his
duties hereunder may require significant domestic and international travel by
the Executive.
(c) As Senior Vice President for Marketing, Sales, and Business
Development, the Executive shall supervise, control, and be responsible for
marketing and sales of all products developed and sold by the Corporation and
for the development of new business opportunities within the Corporation's field
of business and shall have such other executive powers and duties as may from
time to time be prescribed by the CEO. The Executive shall report solely to the
CEO. The Executive shall also work closely with other executive officers of the
Corporation in pursuit of business development and marketing opportunities for
the Corporation.
(d) The Executive shall devote such of his time and efforts as shall be
necessary to the proper discharge of his duties and responsibilities under this
Agreement.
2. TERM
The Executive's employment hereunder shall, unless earlier terminated, be
for an initial term of three (3) years (the "Initial Period") commencing on the
Effective Date of this Employment Agreement. This Employment Agreement with the
Corporation shall be automatically renewed for successive one (1) year periods
(the "Renewal Period(s)"), which are subject to earlier termination as
hereinafter provided, unless either the Corporation or the Executive gives
written notice to the other that the Employment Agreement shall terminate at the
end of the Initial Period or the then-current Renewal Period at least three (3)
months prior to the end of such period. The Initial Period and any Renewal
Periods are collectively referred to herein as the "Employment Period."
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3. COMPENSATION
(a) As compensation for the performance of his duties on behalf of the
Corporation, the Executive shall be compensated during the Employment Period as
follows:
(i) A base salary of not less than $190,000 per annum (the "Base
Salary"), subject to annual review commencing 12 months from
the Effective Date;
(ii) The Executive shall be eligible to receive an annual incentive
bonus of up to 100% of his base salary beginning with the
first year of Employment. The CEO shall annually meet with the
Executive to establish such goals and performance standards as
the Board and CEO determine are to be taken into account in
determining the Executive's discretionary bonus awards. For
the first two years' bonus, it is the intent of the parties to
create realistic goals that would permit Executive's annual
bonus to be between 30%-45% of his base salary.
(iii) The Corporation shall withhold and appropriately pay all
applicable federal, state and local taxes, social security and
workers' compensation contributions and such other amounts as
may be required by law or agreed upon by the parties with
respect to the compensation payable to the Executive pursuant
to this Section 3(a) or otherwise in connection with his
employment by the Corporation.
(b) The Executive shall receive on the Effective Date options to
purchase 150,000 shares of Common Stock, par value $.004. These options shall
vest and be exercisable (subject to any resale restrictions of an underwriter of
the Corporation's securities), in accordance with the provisions and terms of
the Schedule attached as Exhibit II, and in accordance with the terms and
conditions contained in the Corporation's Stock Option Plan. In addition, from
time to time, at the discretion of the Board of Directors, the Executive may be
entitled to additional stock options pursuant to the Corporation's Stock Option
Plan at the sole discretion of the Board of Directors of the Corporation.
Anything herein to the contrary, all stock options shall vest upon any Change in
Control, as such term is defined in Section 9.
(c) The Corporation shall reimburse the Executive for all normal, usual
and necessary expenses incurred by the Executive in furtherance of the business
and affairs of the Corporation, including reasonable travel and entertainment,
against receipt by the Corporation of appropriate vouchers or other proof of the
Executive's expenditures and otherwise in accordance with such Expense
Reimbursement Policy as may from time to time be adopted by the Board of
Directors of the Corporation.
(d) The Executive shall be entitled, during the Employment Period, to
four (4) weeks vacation each year and to such other sick leave as is provided
under the normal policies in place from time to time for employees of the
Corporation.
(e) During the Employment Period, the Executive shall be entitled to
participate in any group insurance, life insurance, hospitalization, medical,
dental, health and accident, disability or similar plan or program of
Corporation now existing or established hereafter to the extent that he is
eligible under the general provisions thereof.
(f) Subject to paragraphs (c) through (e) of Section 9 below, the
Executive must be an employee of the Corporation at the time that any
compensation is due in order to receive such compensation.
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4. REPRESENTATIONS AND WARRANTIES BY EXECUTIVE AND CORPORATION
The Executive hereby represents and warrants to the Corporation as follows:
(a) Neither the execution and delivery of this Agreement nor the
performance by the Executive of his duties and other obligations hereunder
violate or will violate any statute, law, determination or award, or conflict
with or constitute a default under (whether immediately, upon the giving of
notice or lapse of time or both) any prior employment agreement, contract, or
other instrument to which the Executive is a party or by which he is bound.
(b) The Executive has the full right, power and legal capacity to
execute and deliver this Agreement and to perform his duties and other
obligations hereunder. This Agreement constitutes the legal, valid and binding
obligation of the Executive enforceable against him in accordance with its
terms. No approvals or consents of any persons or entities are required for the
Executive to execute and deliver this Agreement or perform his duties and other
obligations hereunder.
The Corporation hereby represents and warrants to the Executive as follows:
(a) The Corporation is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware, which has all
requisite corporate power and authority to own its properties and conduct its
business in the manner presently contemplated.
(b) The Corporation has full power and authority to enter into this
Agreement and to incur and perform its obligations hereunder. This Agreement
constitutes the legal, valid and binding obligation of the Corporation
enforceable against the Corporation in accordance with its terms.
(c) The execution, delivery and performance by the Corporation of this
Agreement does not conflict with or result in a breach or violation of or
constitute a default under (whether immediately, upon the giving of notice or
lapse of time or both) the certificate of incorporation or by-laws of the
Corporation, or any agreement or instrument to which the Corporation is a party
or by which the Corporation or any of its properties may be found or affected.
5. NON-COMPETITION
(a) The Executive understands and recognizes that his services to the
Corporation are special and unique and agrees that, during the Employment Period
and for a period of two years from the date of termination of his employment
hereunder, he shall not in any manner, directly or indirectly, on behalf of
himself or any person, firm, partnership, joint venture, corporation or other
business entity ("Person"), enter into or engage in any business activity that
is directly or indirectly competitive with the Corporation's business relating
to chemotherapies or immunotherapies for the treatment of cancer, either as an
individual for his own account, or as a partner, joint venturer, executive,
agent, consultant, salesperson, officer, director or shareholder of a Person
operating or intending to operate within the area that the Corporation is, at
the date of termination, conducting its business (collectively, "Restricted
Business"); provided, however, that nothing herein will preclude the Executive
from holding one percent (1%) or less of the stock of any publicly traded
company. This paragraph 5(a) shall be null and void if the Executive terminated
his employment for just cause pursuant to Section 10(a)(iv) below or if this
Agreement is terminated prior to the end of the Initial Term or any Additional
Term then in effect by the Corporation other than pursuant to Section 10(a)(ii)
or (iii) below.
(b) In the event that the Executive breaches any provisions of this
Section 5 or there is a threatened breach, then, in addition to any other rights
which the Corporation may have, the Corporation
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shall be entitled, without the posting of a bond or other security, to
injunctive relief to enforce the restrictions contained herein. In the event
that an actual proceeding is brought in equity to enforce the provisions of this
Section 5, the Executive shall not urge as a defense that there is an adequate
remedy at law nor shall the Corporation be prevented from seeking any other
remedies which may be available.
6. CONFIDENTIAL INFORMATION
(a) The Executive agrees that during the course of his employment and
for a period of five years after termination, he will not disclose or make
accessible to any other person, the Corporation's secret and confidential
products, services and technology, both current and under development, promotion
and marketing programs, lists, trade secrets and other confidential and
proprietary business information of the Corporation or any of its clients except
to the extent the same have become generally known to the public other than
through a breach of this Section 6. The Executive agrees: (i) not to use any
such information for himself or others during such five-year period; and (ii)
not to take any such material or reproductions thereof from the Corporation's
facilities at any time during his employment by the Corporation, except as
required in the Executive's duties to the Corporation. The Executive agrees
immediately to return all such material and reproductions thereof in his
possession to the Corporation upon request and in any event upon termination of
employment.
(b) Except with prior written authorization by the Corporation, the
Executive agrees not to disclose or publish any of the confidential, technical
or business information or material of the Corporation, its clients or any other
party to whom the Corporation owes an obligation of confidence, at any time
during or for a period of three (3) years after his employment with the
Corporation.
7. OWNERSHIP OF PROPRIETARY INFORMATION
(a) The Executive agrees that all secret and confidential information
that has been created, discovered or developed by the Corporation, its
subsidiaries, affiliates, successors or assigns (collectively, the "Affiliates")
(including, without limitation, information relating to the development of the
Corporation's business created by, discovered by, developed by or made known to
the Corporation or the Affiliates by Executive during the Term and information
relating to Corporation's customers, suppliers, consultants, and
licensees) and/or in which property rights have been assigned or otherwise
conveyed to the Corporation or the Affiliates, shall be the sole property of the
Corporation or the Affiliates, as applicable, and the Corporation or the
Affiliates, as the case may be, shall be the sole owner of all patents,
copyrights and other rights in connection therewith, including but not limited
to the right to make application for statutory protection. All of the
aforementioned information is hereinafter called "Proprietary Information." By
way of illustration but without limitation, Proprietary Informations shall
include all discoveries, structures, inventions, designs, ideas, works of
authorship, copyrightable works, trademarks, copyrights, formulas, data,
know-how, show-how, improvements, inventions, product concepts, techniques,
information or statistics contained in, or relating to, marketing plans,
strategies, forecasts, blueprints, sketches, records, notes, devices, drawings,
customer lists, patent applications, continuation applications,
continuation-in-part applications, file wrapper continuation applications and
divisional applications and information about the Corporation's or the
Affiliates' employees and/or consultants (including, without limitation, the
compensation, job responsibility and job performance of such employees and/or
consultants).
(b) The Executive further agrees that at all times, both during the
Employment Period and after the termination of this Agreement, he will keep in
confidence and trust all Proprietary Information, and he will not use or
disclose any Proprietary Information or anything directly relating to it without
the written consent of the Corporation or the Affiliates, as appropriate, except
as may be necessary in the ordinary course of performing his duties hereunder
and except for academic, non-commercial research purposes with the prior written
approval of the Board of Directors. The Executive acknowledges that the
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Proprietary Information constitutes a unique and valuable asset of the
Corporation and each Affiliate acquired at great time and expense, which is
secret and confidential and which will be communicated to the Executive, if at
all, in confidence in the course of performance of his duties hereunder, and
that any disclosure or other use of the Proprietary Information other than for
the sole benefit of the Corporation or the Affiliates would be wrongful and
could cause irreparable harm to the Corporation or the Affiliates, as the case
may be.
Notwithstanding the foregoing, the parties agree that, at all such times,
the Executive is free to use (i) information in the public domain not as a
result of a breach of this Agreement, (ii) information lawfully received from a
third party and (iii) the Executive's own skill, knowledge, know-how and
experience to whatever extent and in whatever way he wishes, in each case
consistent with his obligations as an officer of the Corporation and that, at
all times, the Executive is free to conduct any non-commercial research not
relating to the Corporation's business.
8. DISCLOSURE AND OWNERSHIP OF INVENTIONS
(a) During the Employment Period, the Executive agrees that he will
promptly disclose to the Corporation, or any persons designated by the
Corporation, all improvements, inventions, designs, ideas, works of authorship,
copyrightable works, discoveries, trademarks, copyrights, trade secrets,
formulas, processes, structures, product concepts, marketing plans, strategies,
customer lists, information about the Corporation's or the Affiliates' employees
and/or consultants (including, without limitation, job performance of such
employees and/or consultants), techniques, blueprints, sketches, records, notes,
devices, drawings, know-how, data, whether or not patentable, patent
applications, continuation applications, continuation-in-part applications, file
wrapper continuation applications and divisional applications having to do with
the products and services of the Corporation, made or conceived or reduced to
practice or learned by him, either alone or jointly with others, during the
Employment Period (all said improvements, inventions, designs, ideas, works of
authorship, copyrightable works, discoveries, trademarks, copyrights, trade
secrets, formulas, processes, structures, product concepts, marketing plans,
manufacturing or other strategies, customer lists, information about the
Corporation's or the Affiliates' employees and/or consultants, techniques,
blueprints, sketches, records, notes, devices, drawings, know-how, data, patent
applications, continuation applications, continuation-in-part applications, file
wrapper continuation applications and divisional applications shall be
collectively hereinafter called "Inventions").
(b) The Executive agrees that all Inventions shall be the sole property
of the Corporation to the maximum extent permitted by applicable law and to the
extent permitted by law shall be "works made for hire" as that term is defined
in the United States Copyright act (17 USCA, Section 101). The Corporation shall
be the sole owner of all patens, copyrights, trade secret rights, and other
intellectual property or other rights in connection therewith. The Executive
hereby assigns to the Corporation all right, title and interest he may have or
acquire in all Inventions. The Executive further agrees to assist the
Corporation in every possible way (but at the Corporation's expense) to obtain
and from time to time, enforce patents, copyrights or other rights in said
Inventions in any and all countries, and to that end the Executive will execute
all documents necessary:
(i) to apply for, obtain and vest in the name of the Corporation
alone (unless the Corporation otherwise directs) letters,
patents, copyrights or other analogous protection in any
country throughout the world and when so obtained or vested to
renew and restore the same; and
(ii) to defend any opposition proceedings in respect of such
applications and any opposition proceedings or petitions or
applications for revocation of such letters, patents,
copyrights or other analogous protection.
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(c) The Executive's obligation to assist the Corporation in obtaining
and enforcing patents and copyrights for the Inventions in any and all countries
shall continue beyond the Employment Period, but the Corporation agrees to
compensate the Executive a reasonable rate after the expiration of the
Employment Period for time actually spent by the Executive at the Corporation's
request on such assistance.
9. TERMINATION
(a) The Executive's Employment Period hereunder shall begin on the
Effective Date and shall continue for the period set forth in Section 2 hereof
unless sooner terminated upon the first to occur of the following events:
(i) The death of the Executive;
(ii) The Disability (as defined below in Section 10(b)) of the
Executive;
(iii) Termination by the CEO or the Board for "Just Cause", provided
that the Corporation shall have given proper notice thereof,
and the Executive shall have had at least a thirty (30) day
period to cure such "Just Cause." For the Purposes of this
Agreement, any of the following actions by the Executive shall
constitute "Just Cause":
(A) Material breach by the Executive of Sections 5, 6, 7, or
8 of this Agreement;
(B) Material breach by the Executive of any provision of this
Agreement other than Sections 5, 6, 7, or 8 which is not
cured by the Executive within 30 days of written notice
thereof from the Corporation;
(C) Continued negligent performance by the Executive of his
specified duties as Senior Vice President for Marketing,
Sales and Business Development, as determined by the
Board after prior written notice to the Executive and an
opportunity for the Executive to be heard by the Board;
(D) Any willful or deliberate misconduct or omission on the
part of the Executive intended to cause harm to the
Corporation; or
(E) The conviction of the Executive of (i) any felony or (ii)
any other crime involving moral turpitude;
(iv) Termination by the Executive for "Good Reason." Any of the
following actions or omissions by the Corporation shall
constitute "Good Reason", provided that the Executive shall
have given proper notice thereof, and the Corporation shall
have had at least a thirty (30) day period to cure such "Good
Reason" (the Corporation will not have the thirty day cure
period for a failure to timely pay Executive's base salary:
(A) Material breach by the Corporation of any provision of
this Agreement which is not cured by the Corporation
within 30 days of written notice
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thereof from the Executive to the Corporation, specifying
in reasonable detail the basis for such claimed breach;
(B) The failure of the Corporation to provide the Executive
with a position, authority or duties at least equivalent
to the most significant position, authority or duties
previously held by the Executive during the Employment
Period, or any reduction of the Compensation paid by the
Corporation to the Executive or any material reduction of
the benefits given by the Corporation to the Executive,
unless such reduction is deemed necessary by the Board or
CEO and is applicable to all officers of the Corporation,
if such circumstance is not remedied within (5) business
days after written notice from the Executive to the
Corporation; or
(C) Failure to timely pay the Executive's base salary.
(b) For purposes hereof, a "Change of Control" shall be deemed to occur
upon either of the following:
(i) The sale by the Corporation of all or substantially all of its
assets to any person (as such term is used in Sections 13(d)
and 14(d) of the Securities Exchange Act of 1934), the
consolidation of the Corporation with any person, or the
merger of the Corporation with any person as a result of which
merger the Corporation is no longer the surviving entity, or
if the Survivor, the Corporation is owned by a parent company,
unless, following such consolidation at least a majority of
the members of the Board of Directors of the surviving entity
or transferee are members of the Board of Directors of the
Corporation at the time of the initial action of the Board of
Directors providing for such consolidation, or
(ii) The sale or transfer by one or more of the Corporation's
shareholders, in one or more transactions, related or
unrelated to one or more persons under circumstances whereby
any person and its affiliates (as hereafter defined) shall own
as a result of such sale or transfer and thereafter, at least
one-half of the outstanding shares of the Corporation.
An "Affiliate" shall mean any person that directly or
indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, any other
person.
(c) For purposes hereof, a "Disability" of the Executive shall be deemed
to have occurred in the event (i) the Executive is absent from work or otherwise
substantially unable to assume his normal duties for a period of 30 successive
days or an aggregate of 60 days during any 12-month period because of physical
or mental disability, accident, illness or other cause other than approved
vacation or leave of absence or (ii) the Executive is deemed by a licensed
physician designated by the Corporation and reasonably acceptable to the
Executive to have a permanent disability such that Executive will be unable to
perform his duties under this agreement. The Corporation shall have the right to
have the Executive examined by a competent physician for purposes of determining
his physical or mental incapacity.
(d) Upon termination by Corporation pursuant to subparagraphs (i), (ii)
or (iii) of paragraph (a) above or by Executive other than pursuant to
subparagraph (iv) of paragraph (a) above, the Executive (or his estate in the
event of termination pursuant to subparagraph (ii)), shall be entitled to
receive the Base Salary accrued but unpaid as of the date of termination.
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(e) Upon termination by the Corporation (other than following a Change
of Control) for any reason other than as set forth in subparagraphs (i), (ii) or
(iii) of paragraph (a) above or by the Executive for any reason set forth in
subparagraphs (iv) of paragraph (a) above, then the Corporation shall pay the
Executive, as the Executive's sole damages for such termination, a lump sum
payment equal to one hundred percent (100%) of the annual Base Salary, at the
rate in effect at the time of such termination, without set-off for any salary
earned from alternative employment. In addition, any stock options granted to
the Executive, including, but not limited to Section 3(b), shall continue to
vest according to the provisions of Section 3(b) during the twelve (12) months
following such termination. Also, the Corporation shall pay Executive's family
coverage COBRA medical coverage co-payment for the entire COBRA coverage period
(f) Upon termination, following a Change of Control, by the Corporation
(other than as set forth in subparagraph (i), (ii) or (iii) of paragraph (a)
above) or by the Executive for any reason set forth in subparagraphs (iv) of
paragraph (a) above, then the Corporation shall pay the Executive, as the
Executive's sole damages for such termination, a lump sum payment equal to two
(2) times the annual Base Salary at the higher of the rate in effect at the date
of termination or the rate in effect on the date of the Change of Control. Such
amount(s) shall not be set-off against amount earned from alternative
employment. In addition, any stock options granted to the Executive, including,
but not limited to Section 3 (b), shall upon such termination become immediately
vested. Also, the Corporation shall pay Executive's family coverage COBRA
medical coverage co-payment for the entire COBRA coverage period
(g) It shall be condition to the Executive's right to receive the
benefits provided for in paragraphs (d) and (e) of Section 3 above that the
Executive shall have delivered to the Corporation a general release dated as of
the date of termination of the Executive's employment hereunder.
10. INDEMNIFICATION
The Corporation shall indemnify and hold the Executive harmless to the
fullest extent permitted by the General Corporation Law of the State of
Delaware, as amended from time to time, for all amounts, (including without
limitation, judgements, fines, settlement payments, expenses and attorney's
fees) incurred or paid by the Executive in connection with any action, suit,
investigation or proceeding arising out of or relating to the performance by the
Executive of services for, or acting by the Executive as an officer or employee
of, the Corporation or any other person or enterprise at the Corporation's
request, and shall to the fullest extent permitted by the General Corporation
Law of the State of Delaware, as amended from time to time, advance all expenses
incurred or paid by the Executive in connection with, and until disposition of,
any action, suit, investigation or proceeding arising out of or relating to the
performance by the Executive of services for, or acting by the Executive as an
officer or employee of, the Corporation or any other person or enterprise at the
Corporation's request.
11. INSURANCE
If requested by the Corporation, the Executive agrees to cooperate with the
Corporation in obtaining for the Corporation's benefit, at the Corporation's
expense, life insurance on his life. Such cooperation shall include completing
and signing such forms or applications, undergoing physical examinations, and
such other acts as may be required in order to obtain such insurance.
12. NOTICES
Any notice or other communication under this Agreement shall be in writing
and shall be deemed to have been given: when delivered personally against
receipt therefor; one (1) day after being sent by Federal Express or similar
overnight delivery; or three (3) days after being mailed registered or certified
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mail, postage prepaid, return receipt requested, to either party at the address
set forth below, or to such other address as such party shall give by notice
hereunder to the other party.
If to Corporation:
AVAX Technologies, Inc.
0000 Xxxx Xxxxxx, Xxxxx 000
Xxxxxx Xxxx, XX 00000
If to Executive:
Xx. Xxxxxx X. Xxxxxx
________________________
________________________
13. SEVERABILITY OF PROVISIONS
If any provision of this Agreement shall be declared by a court of
competent jurisdiction to be invalid, illegal or incapable of being enforced in
whole or in part, the remaining conditions and provisions or portions thereof
shall nevertheless remain in full force and effect and enforceable to the extent
they are valid, legal and enforceable, and no provision shall be deemed
dependent upon any other covenant or provision unless so expressed herein.
14. ENTIRE AGREEMENT; MODIFICATION
(a) This Agreement and the agreements and instruments referenced in
Section 3 (a) and (b) hereof contain the entire agreement of the parties
relating to the subject matter hereof and supersede in their entirety the
Employment Letter Agreement, and the parties hereto have made no agreements,
representations or warranties relating to the subject matter of this Agreement
which are not set forth herein or in the agreements and instruments referenced
in said Section 3(a) or (b). No modification of this Agreement shall be valid
unless made in writing and signed by the parties hereto.
(b) The Executive acknowledges that any cash and non-cash compensation
received by him prior to the execution of this Agreement shall be applied to the
obligations of the Corporation hereunder and that the execution of this
Agreement after the Effective Date is not intended to entitle the Executive to
any greater compensation than was originally set forth in the Employment Letter
Agreement.
15. BINDING EFFECT
The rights, benefits, duties and obligations under this Agreement shall
inure to, and be binding upon, the Corporation, its successors and assigns, and
upon the Executive and his legal representatives. This Agreement constitutes a
personal service agreement, and the performance of the Executive's obligations
hereunder may not be transferred or assigned by the Executive.
16. NON-WAIVER
The failure of either party to insist upon the strict performance of any of
the terms, conditions and provisions of this Agreement shall not be construed as
a waiver or relinquishment of future compliance therewith, and said terms,
conditions and provisions shall remain in full force and effect. No waiver of
any term or condition of this Agreement on the part of either party shall be
effective for any purpose whatsoever unless such waiver is in writing and signed
by such party.
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17. REMEDIES FOR BREACH
The Executive understands and agrees that any breach of Sections 5, 6, 7, 8
and 9 of this Agreement by the Executive could cause irreparable damage to the
Corporation and to the Affiliates, and that monetary damages alone would not be
adequate and, in the event of such breach, the Corporation shall have, in
addition to any and all remedies of law, the right to an injunction, specific
performance or other equitable relief to prevent or redress the violation of the
Executive's obligations under such Sections.
18. GOVERNING LAW
This Agreement shall be governed by, and construed and interpreted in
accordance with, the laws of the State of Missouri without regard to principles
of conflict of laws.
19. HEADINGS
The headings of paragraphs are inserted for convenience and shall not
affect any interpretation of this Agreement.
20. ATTORNEY FEES
In the event of a dispute between the parties arising out of this
Agreement, the successful party, whether or not arbitration is sought, shall be
reimbursed by the other party hereto for all costs and expenses of such dispute,
including, but not limited to, reasonable attorney fees.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
/s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx
AVAX TECHNOLOGIES, INC.
By: /s/ Xxxxxxx X. Xxxxx, M.D.
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Name: Xxxxxxx X. Xxxxx, M.D.
Title: President & Chief executive officer
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EXHIBIT I
INCENTIVE BONUS PLAN FOR
FIRST TWO YEARS OF EMPLOYMENT
1. BUSINESS/STRATEGY PLANS:
There shall be a bonus of 2% of Base Salary for the development of each
business plan for the commmercialization and distribution of products
developed and sold by the Corporation, such bonus to be paid for each
country (6 total for three plans) that a business plan is developed for,
provided such business plan is requested and reasonably approved by the
Chief Executive Officer (an "Approved Plan"). During the first year it is
anticipated that three such plans shall be prepared. In addition, there
will be a 9% bonus paid on the development of an overall corporate business
plan reasonable approved by the Chief Executive Officer.
2. TACTICAL ROLL-OUTS (BEGINNING SALES):
There shall be a bonus of 5% of Base Salary upon receipt of revenues from
sales resulting from public marketing (and excluding revenues from use of
products for clinical trials) to consumers for use of products developed by
the Corporation, such 5% bonus to be paid for each country (15% total for
three countries) in which such revenues are generated pursuant to an
Approved Plan.
3. ACTUAL SALES:
There will be a bonus based on actual sales of products developed and sold
by the Corporation, such bonus amount to be determined by mutual agreement
at the outset of marketing of such products. The range of this bonus shall
be between 0-15% of Base Salary.
The above bonus targets may be achieved regardless of how sales are
achieved. They may be achieved regardless of whether the Corporation is
responsible for or takes part in the marketing and sales of the products itself
(i.e. bonus targets may be met even if sales targets are achieved through a
business development agreement).
For the first two years of employment with the Corporation, the parties
contemplate a bonus of 35-40% of Base Salary based upon the above. If sales
projections are exceeded, additional bonuses for outstanding performance will be
paid up to a maximum of 100% of Base Salary (this would require hitting top
sales targets in multiple countries).
In addition to the above, the Executive shall participate in the
Corporation's stock option plan as developed and in place from time to time by
the Board, the vesting of such options which may occur based on achievement of
performance based goals established by the CEO or the Board.
In years following the first two years of employment, bonus targets will be
more heavily weighted towards sales figures.
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EXHIBIT II
AVAX COMMON STOCK, PAR VALUE $.004
OPTION VESTING SCHEDULE
Options to purchase shares of Common Stock, par value $.004, received by
the Executive in accordance with Section 3(b) of the Employment Agreement shall
vest and be exercisable (subject to resale restrictions for a period of up to 18
months in connection with and following any public offering, which may be
imposed by the Corporation or the managing underwriter(s) of such offering),
provided you are still employed by the Corporation on such dates, at the rate of
one-sixteenth of such amount of options per quarter until the fourth anniversary
of the Effective Date at which point all remaining options shall be vested.
Upon termination of employment, such vested options shall be exercisable
for up to 30 days thereafter; PROVIDED, HOWEVER, that if such termination is for
"Just Cause," pursant to Section 9(d) of the Employment Agreement, all options
hereunder, including vested options, shall be forfeited and of no force and
effect.
The tax consequences to you of the grant, vesting or exercise of any such
options or the sale of any shares of Common Stock issuable pursuant to such
options shall be the Executive's personal responsibility and not that of the
Corporation.
The issuance and terms of the options granted to the Executive will be
governed and controlled in accordance with the terms of the Stock Option
Agreement, which shall be entered into by and between the Executive and the
Corporation, and in accordance with the terms and conditions contained in the
Corporation's Stock Option Plan.
