Executive Employment Agreement
EXHIBIT
10.57
EMPLOYMENT
AGREEMENT (the "Agreement") made as of September 25, 2005 between ARIAD
Pharmaceuticals, Inc. (the "Company"), a Delaware corporation, and Xxxxxxx
X.
Xxxxxx (the "Employee").
1. Employment,
Duties and Acceptance.
1.1 The
Company hereby employs the Employee, for the Term (as hereinafter defined),
to
render full-time services to the Company, and to perform such duties as he
shall
reasonably be directed by the Chief Executive Officer of the Company to perform.
The Employee's title shall be designated by the Chief Executive Officer and
initially shall be Vice President and Chief Commercial Officer.
1.2
The
Employee hereby accepts such employment and agrees to render the services
described above.
1.3 The
principal place of employment of the Employee hereunder shall be in the greater
Boston, Massachusetts area, or other locations reasonably acceptable to the
Employee. The Employee acknowledges that for limited periods of time he may
be
required to provide services to the Company outside of the Boston, Massachusetts
area.
1.4 Notwithstanding
anything to the contrary herein, although the Employee shall provide services
as
a full-time employee, it is understood that the Employee may (a) have an
academic appointment and (b) participate in professional activities
(collectively, "Permitted Activities'); provided,
however,
that
such Permitted Activities do not interfere with the Employee's duties to the
Company.
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2. Term
of
Employment.
The
term
of the Employee's employment under this Agreement (the "Term") shall commence
on
November 14, 2005 (the "Effective Date"), or such other date mutually agreed
upon by the parties, and shall end on December 31, 2007, unless sooner
terminated pursuant to Section 4 or 5 of this Agreement; provided,
however,
that this
Agreement shall automatically be renewed for successive one-year terms (the
Term
and, if the period of employment is so renewed, such additional period(s) of
employment are collectively referred to herein as the "Term") unless terminated
by written notice given by either party to the other at least 90 days prior
to
the end of the applicable Term.
3. Compensation.
3.1
As full
compensation for all services to be rendered pursuant to this Agreement, the
Company agrees to pay the Employee, during the Term, a salary at the fixed
rate
of $275,000 per annum during the first year of the Term and increased each
year
thereafter by amounts, if any, to be determined by the Board of Directors of
the
Company (the "Board"), in its sole discretion, payable in equal biweekly
installments, less such deductions or amounts to be withheld as shall be
required by applicable law and regulations.
3.2
Each
year, Employee shall be eligible to receive a discretionary bonus of up to
a
target of 30% of base salary, which bonus shall be determined annually in the
sole discretion of the Board. The bonus, if any, may be paid in the form of
stock options, restricted stock awards or units, deferred compensation or cash,
as determined by the Board.
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3.3
The
Company shall pay or reimburse the Employee for all reasonable expenses actually
incurred or paid by him during the Term in the performance of his services
under
this Agreement, upon presentation of expense statements or vouchers or such
other supporting information as it may require.
3.4
The
Employee shall be eligible under any incentive plan, stock award plan, bonus,
deferred or extra compensation plan, pension, group health, disability,
long-term care, and life insurance or other so-called "fringe" benefits, which
the Company provides for its executives at the comparable level. All stock
options and stock awards granted to the Employee shall be subject to a vesting
schedule, which shall be determined by the Compensation Committee of the Board.
The stock options and stock awards, if any, to be granted to the Employee in
the
future shall also be subject to the terms of a stock option plan and certificate
and stock award plan and certificate, respectively. Any unvested options shall
be forfeited to the Company in the event (a) this Agreement is terminated by
the
Company for Cause pursuant to Section 4 herein, or (b) either party elects
not
to renew this Agreement pursuant to Section 2 herein.
3.5 The
Company shall grant the Employee an option to purchase 75,000 shares
of
the Company's Common Stock at the fair market value on the date of the Board's
approval of the grant. The Employee agrees that all such options shall be
subject to a four-year vesting schedule, vesting in equal increments of 25%
on
each anniversary of their issuance and shall be subject to the terms and
conditions of a stock option agreement between the Employee and the Company.
Any
unvested options shall be forfeited to the Company in the event (a) this
Agreement is terminated by the Company for Cause pursuant to Section 4 herein,
or (b) either party elects not to renew this Agreement pursuant to Section
2
herein.
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4. Termination
by the Company.
The
Company may terminate this Agreement, if any one or more of the following shall
occur:
(a) The
Employee shall die during the Term; provided,
however,
that the
Employee's legal representatives shall be entitled to receive the compensation
provided for hereunder to the last day of the month in which his death
occurs.
(b)
The
Employee shall become physically or mentally disabled, whether totally or
partially, so that he is unable substantially to perform his services hereunder
for (i) a period of 180 consecutive days, or
(ii)
for shorter periods aggregating 180 days during any 12 month
period.
(c)
The
Employee acts, or fails to act, in a manner that provides Cause for termination.
For purposes of this Agreement, the term "Cause" means (i) the failure by the
Employee to perform any of his material duties hereunder, (ii) the conviction
of
the Employee of any felony involving moral turpitude, (iii) any acts of fraud
or
embezzlement by the Employee involving the Company or any of its Affiliates,
(iv) violation of any federal, state or local law, or administrative regulation
related to the business of the Company, (v) breach of fiduciary duty, including,
but not limited to, conflict of interest, (vi) conduct that could result in
publicity reflecting unfavorably on the Company in a material way, (vii) failure
to comply with any written policies of the Company, or (viii) a breach of the
terms of this Agreement by the Employee. If the conduct constituting Cause
hereunder is susceptible to cure, the Company shall provide the Employee written
notice of termination pursuant to this Section 4, and Employee shall have 30
days to cure or remedy such failure or breach, in which case this Agreement
shall not be terminated. If the conduct is not susceptible to cure, this
Agreement shall terminate upon written notice by the Company.
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5.
Termination
by the Employee.
5.1 The
Employee may terminate this Agreement, if any one or more of the following
shall
occur:
(a)
a
material breach of the terms of this Agreement by the Company and such breach
continues for 30 days after the Employee gives the Company written notice of
such breach;
(b)
the
Company shall make a general assignment for benefit of creditors; or any
proceeding shall be instituted by the Company seeking to adjudicate it as
bankrupt or insolvent, or seeking liquidation, winding up, reorganization,
arrangement, adjustment, protection, relief, or composition of it or its debts
under law relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking entry of an order for relief or the appointment of a
receiver, trustee, or other similar official for it or for any substantial
part
of its property or the Company shall take any corporate action to authorize
any
of the actions set forth above in this subsection 5(b);
(c)
an
involuntary petition shall be filed or an action or proceeding otherwise
commenced against the Company seeking reorganization, arrangement or
readjustment of the Company's debts or for any other relief under the Federal
Bankruptcy Code, as amended, or under any other bankruptcy or insolvency act
or
law, state or federal, now or hereafter existing and remain undismissed or
unstayed for a period of 30 days; or
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(d)
a
receiver, assignee, liquidator, trustee or similar officer for the Company
or
for all or any part of its property shall be appointed
involuntarily.
6. Severance.
6.1
If
(i) the
Company terminates this Agreement without Cause or (ii) the Employee terminates
this Agreement pursuant to Section 5.1(a), then: (1) except in the case of
death
or disability, the Company shall continue to pay Employee his then-current
salary for the remaining period of the applicable Term; (2) all stock options
granted pursuant to this Agreement that would have vested during the Term shall
vest immediately prior to such termination; and (3) the Company shall continue
to provide all benefits subject to COBRA at its expense for up to one year.
7.
Other
Benefits.
In
addition to all other benefits contained herein, the Employee shall be entitled
to:
(a) Relocation
expenses for the Employee, consisting of (i) all reasonable direct out-of-pocket
costs of transporting the Employee, the Employee’s immediate family, and the
Employee's household items from the Employee's current residence in New Jersey
to a new residence in the greater Boston, Massachusetts area; (ii) reasonable
travel and lodging to visit the greater Boston, Massachusetts area to search
for
a new residence; (iii) reasonable costs of rent and primary services associated
with temporary housing at an approved location in the greater Boston,
Massachusetts area for a
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maximum
period of 60 days from the Employee’s start date or until he finds a suitable
residence, if earlier, and (iv) except as described in the next succeeding
sentence and subject to prior approval, the reasonable closing costs associated
with the Employee’s purchase of a new residence in the greater Boston,
Massachusetts area within ten months of the Employee's date of employment.
The
following closing (settlement) costs will not
be paid
by the Company: (1) real estate and other taxes, (2) insurance premiums other
than title insurance, and (3) commitment fees and prepaid interest (i.e.,
"points") in excess of 2%
(b)
Vacation
time of four weeks per year taken in accordance with the vacation policy of
the
Company.
(c)
After six
years of employment, one three-month period of fully paid leave of absence
in
accordance with Company policies in place at that time; it being understood
that
such policies may restrict the Employee from taking such leave of absence until
a time that is acceptable to the Company and may include other such
limitations.
(d)
Group
health, disability, long-term care, and life insurance.
(e) The
Company shall provide the Employee with an automobile allowance of $750 per
month and standard
tax preparation and planning services.
(f)
To
facilitate the Employee's relocation, the Company will provide the Employee
with
a one-time relocation advance (the “Relocation Advance”) in the amount of
$25,000 to be used towards the purchase of the Employee's new principal
residence (the "Residence"), payable by the Company at the time of closing
on
such residence (the “Closing”). The Employee shall be obligated to repay the
Relocation Advance within thirty days of the occurrence of any of the following
events: (a) the Employee terminates this Agreement prior to December 31, 2006,
except as provided pursuant to Section 5.1 herein, or (b) the Company terminates
this Agreement for Cause pursuant to Section 4 herein. As of December 31, 2006,
the Relocation Advance shall no longer be subject to repayment by the
Employee.
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8.
Confidentiality.
8.1 The
Employee acknowledges that, during the course of performing his services
hereunder, the Company shall be disclosing information to the Employee related
to the Company's Field of Interest, Inventions, projects and business plans,
as
well as other information (collectively, "Confidential Information"). The
Employee acknowledges that the Company's business is extremely competitive,
dependent in part upon the maintenance of secrecy, and that any disclosure
of
the Confidential Information would result in serious harm to the
Company.
8.2
The
Employee agrees that the Confidential Information only shall be used by the
Employee in connection with his activities hereunder as an employee of the
Company, and shall not be used in any way that is detrimental to the
Company.
8.3 The
Employee agrees not to disclose, directly or indirectly, the Confidential
Information to any third person or entity, other than representatives or agents
of the Company. The Employee shall treat all such information as confidential
and proprietary property of the Company.
8.4 The
term
"Confidential Information" does not include information that (a) is or becomes
generally available to the public other than by disclosure in violation of
this
Agreement, (b) was within the Employee's possession prior to being furnished
to
such Employee, (c) becomes available to the Employee on a nonconfidential basis
or (d) was independently developed by the Employee without reference to the
information provided by the Company.
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8.5
The
Employee may disclose any Confidential Information that is required to be
disclosed by law, government regulation or court order. If disclosure is
required, the Employee shall give the Company advance notice so that the Company
may seek a protective order or take other action reasonable in light of the
circumstances.
8.6 Upon
termination of this Agreement, the Employee shall promptly return to the Company
all materials containing Confidential Information, as well as data, records,
reports and other property, furnished by the Company to the Employee or produced
by the Employee in connection with services rendered hereunder. Notwithstanding
such return or any of the provisions of this Agreement, the Employee shall
continue to be bound by the terms of the confidentiality provisions contained
in
this Section 8 for a period of three years after the termination of this
Agreement.
8.7 In
connection with his employment by the Company, the Employee hereby acknowledges
that he may enter into more than one agreement with regard to (a) the
confidentiality of certain books, records, documents and business, (b) rights
to
certain inventions, proprietary information, and writings, (c) publication
of
certain materials, and (d) other related matters (the "Confidential Matters")
of
the Company (the "Confidentiality Agreements"). In order to clarify any
potential conflicts between certain respective provisions of such
Confidentiality Agreements, the Employee and the Company hereby agree that,
as
among such Confidentiality Agreements, the provision (or part thereof) in any
such Confidentiality Agreement which affords the greatest protection to the
Company with respect to the Confidential Matters shall control.
9. Inventions
Discovered by the Employee While Performing
Services Hereunder.
During
the
Term, the Employee shall promptly disclose to the Company any invention,
improvement, discovery, process, formula, or method or other intellectual
property, whether or not patentable, whether or not copyrightable (collectively,
"Inventions") made, conceived or first reduced to practice by the Employee,
either alone or jointly with others, while performing service hereunder. The
Employee hereby assigns to the Company all of his right, title and interest
in
and to any such Inventions. During and after the Term, the Employee shall
execute any documents necessary to perfect the assignment of such Inventions
to
the Company and to enable the Company to apply for, obtain, and enforce patents
and copyrights in any and all countries on such Inventions. The Employee hereby
irrevocably designates the Chief Patent Counsel to the Company as his agent
and
attorney-in-fact to execute and file any such document and to do all lawful
acts
necessary to apply for and obtain patents and copyrights and to enforce the
Company's rights under this paragraph. This Section 9 shall survive the
termination of this Agreement.
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10. Non-Competition
and Non-Solicitation.
During
the
Term and for a period of one year following the date of termination or
nonrenewal for any reason (other than termination pursuant to Section 5.1(a):
(a) the Employee shall not in the United States or in any country in which
the
Company shall then be doing business, directly or indirectly, enter the employ
of, or render any services to, any person, firm or corporation engaged in any
business competitive with the business of the Company or of any of its
subsidiaries or affiliates of which the Employee may become an employee or
officer during the Term; he shall not engage in such business on his own
account; and he shall not become interested in any such business, directly
or
indirectly, as an individual, partner, shareholder, director, officer,
principal, agent, employee, trustee, consultant, or any other relationship
or
capacity; provided, however, that nothing contained in this Section 10 shall
be
deemed to prohibit the Employee from acquiring, solely as an investment, shares
of capital stock of any public corporation; (b) neither the Employee nor any
Affiliate of the Employee shall solicit or utilize, or assist any person in
any
way to solicit or utilize, the services, directly or indirectly, of any of
the
Company's directors, consultants, members of the Board of Scientific and Medical
Advisors, officers or employees (collectively, "Associates of the Company").
This nonsolicitation and nonutilization provision shall not apply to Associates
of the Company who have previously terminated their relationship with the
Company.
10.1
If the
Employee commits a breach, or threatens to commit a breach, of any of the
provisions of this Section 10, the Company shall have the following rights
and
remedies:
10.1.1
The right
and remedy to have the provisions of this Agreement specifically enforced by
any
court having equity jurisdiction, it being acknowledged and agreed that any
such
breach or threatened breach shall cause irreparable injury to the Company and
that money damages shall not provide an adequate remedy to the Company;
and
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10.1.2
The right
and remedy to require the Employee to account for and pay over to the Company
all compensation, profits, monies, accruals, increments
or other benefits (collectively "Benefits") derived or received by the Employee
as the result of any transactions constituting a breach of any of the provisions
of the preceding paragraph, and the Employee hereby agrees to account for and
pay over such Benefits to the Company.
Each
of
the rights and remedies enumerated above shall be independent of the other,
and
shall be severally enforceable, and all of such rights and remedies shall be
in
addition to, and not in lieu of, any other rights and remedies available to
the
Company under law or in equity.
10.2 If
any of
the covenants contained in Section 8, 9 or 10, or any part thereof, is hereafter
construed to be invalid or unenforceable, the same shall not affect the
remainder of the covenant or covenants, which shall be given full effect without
regard to the invalid portions.
10.3 If
any of
the covenants contained in Section 8, 9 or 10, or any part thereof, is held
to
be unenforceable because of the duration of such provision or the area covered
thereby, the parties agree that the court making such determination shall have
the power to reduce the duration and/or area of such provision and, in its
reduced form, such provision shall then be enforceable.
10.4 The
parties hereto intend to and hereby confer jurisdiction to enforce the covenants
contained in Sections 8, 9 and 10 upon the courts of any state within the
geographical scope of such covenants. In the event that the courts of any one
or
more of such states shall hold any such covenant wholly unenforceable by reason
of the breadth of such scope or otherwise, it is the intention of the parties
hereto that such determination not bar or in any way affect the Company's right
to the relief provided above in the courts of any other states within the
geographical scope of such covenants, as to breaches of such covenants in such
other respective jurisdictions, the above covenants as they relate to each
state
being, for this purpose, severable into diverse and independent
covenants.
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11.
Indemnification.
The
Company shall indemnify the Employee, to the maximum extent permitted by
applicable law, against all costs, charges and expenses incurred or sustained
by
him in connection with any action, suit or proceeding to which he may be made
a
party by reason of his being an officer, director or employee of the Company
or
of any subsidiary or affiliate of the Company. The Company shall provide,
subject to its availability upon reasonable terms (which determination shall
be
made by the Board) at its expense, directors and officers insurance for the
Employee in reasonable amounts. Determination with respect to (a) the
availability of insurance upon reasonable terms and (b) the amount of such
insurance coverage shall be made by the Board in its sole
discretion.
12.
Notices.
All
notices, requests, consents and other communications required or permitted
to be
given hereunder shall be in writing and shall be deemed to have been duly given
if sent by prepaid telegram (confirmed delivery by the telegram service),
private overnight mail service (delivery confirmed by such service), registered
or certified mail (return receipt requested), or delivered personally, as
follows (or to such other address as either party shall designate by notice
in
writing to the other in accordance herewith):
If
to the
Company:
ARIAD
Pharmaceuticals, Inc.
00
Xxxxxxxxxx Xxxxxx
Xxxxxxxxx,
Xxxxxxxxxxxxx 00000
Attention:
Chief Executive Officer
Telephone:
(000)
000-0000
Facsimile:
(000) 000-0000
If
to the
Employee:
Xxxxxxx
X.
Xxxxxx
00
Xxxxxx
Xxxxxx
Xxxxx
Xxxx, Xxx Xxxxxx 00000
Telephone:
(000)
000-0000
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13.
General.
13.1 This
Agreement shall be governed by and construed and enforced in accordance with
the
laws of the Commonwealth of Massachusetts applicable to agreements made and
to
be performed entirely in Massachusetts.
13.2
The
Section headings contained herein are for reference purposes only and shall
not
in any way affect the meaning or interpretation of this Agreement.
13.3
This
Agreement sets forth the entire agreement and understanding of the parties
relating to the subject matter hereof, and supersedes all prior agreements,
arrangements and understandings, written or oral, relating to the subject matter
hereof. No representation, promise or inducement has been made by either party
that is not embodied in this Agreement, and neither party shall be bound by
or
liable for any alleged representation, promise or inducement not so set
forth.
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13.4
This
Agreement and the Employee's rights and obligations hereunder may not be
assigned by the Employee or the Company; provided,
however,
the
Company may assign this Agreement to an Affiliate or a successor-in
interest.
13.5 This
Agreement may be amended, modified, superseded, canceled, renewed or extended,
and the terms or covenants hereof may be waived, only by a written instrument
executed by the parties hereto, or in the case of a waiver, by the party waiving
compliance. The failure of a party at any time or times to require performance
of any provision hereof shall in no manner affect the right at a later time
to
enforce the same. No waiver by a party of the breach of any term or covenant
contained in this Agreement, whether by conduct or otherwise, in any one or
more
instances, shall be deemed to be, or construed as, a further or continuing
waiver of any such breach, or a waiver of the breach of any other term or
covenant contained in this Agreement.
14. Definitions.
As used
herein the following terms have the following meaning:
(a)
"Affiliate" means and includes any corporation or other business entity
controlling, controlled by or under common control with the corporation in
question.
(b) The
“Company’s Field of Interest” is the discovery, development and
commercialization of pharmaceutical products based on (a) intervention in cell
signaling and (b) gene and cell therapy. The Company’s Field of Interest may be
changed at any time at the sole discretion of the Company and upon written
notice to Employee.
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(c)
"Person"
means any natural person, corporation, partnership, firm, joint venture,
association, joint stock company, trust, unincorporated organization,
governmental body or other entity.
(d)
"Subsidiary" means any corporation or other business entity directly or
indirectly controlled by the corporation in question.
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space intentionally left blank.]
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IN
WITNESS
WHEREOF, the parties have executed this Agreement
as of the date first above written.
|
ARIAD
PHARMACEUTICALS, INC.
|
||
| |
|
|
| By: | /s/ Xxxxxx X. Xxxxxx | |
| Xxxxxx X. Xxxxxx, M.D. | ||
|
Chairman
and Chief Executive Officer
|
||
| EMPLOYEE | ||
| |
|
|
| /s/ Xxxxxxx X. Xxxxxx | ||
| Xxxxxxx X. Xxxxxx | ||
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