EMPLOYMENT AGREEMENT
EXHIBIT 10.67
EMPLOYMENT
AGREEMENT (this “Agreement”), dated as of
February 10, 2006 and effective as of March 16, 2006, by and between Par
Pharmaceutical Companies, Inc., a Delaware corporation (“Par” or “Employer”), and Xxxxxx Xxxxxxx
(“Executive”).
RECITALS:
A. WHEREAS, Employer wishes to employ Executive in the capacity of Executive Vice President
and Chief Financial Officer of Par, and Executive desires to provide services to Par in this
capacity; and
B. WHEREAS, Employer and Executive desire to formalize the terms and conditions of Executive’s
employment with Par.
In consideration of the mutual promises herein contained, the parties hereto hereby agree as
follows:
1. Employment.
1.1. General. Par hereby employs Executive effective March 16, 2006 (the “Effective
Date”), in the capacity of Executive Vice President and Chief Financial Officer of Par at the
compensation rate and benefits set forth in Section 2 hereof for the Employment Term (as defined in
Section 3.1 hereof). Executive hereby accepts such employment, subject to the terms and conditions
herein contained. In all such capacity, Executive shall perform and carry out such duties and
responsibilities as may be assigned to him from time to time by the Board and by the Chief
Executive Officer of Par reasonably consistent with Executive’s position and this Agreement, and
shall report to Xxxxx Xxxxxxx, President and Chief Executive Officer of Par.
1.2. Time Devoted to Position. Executive, during the Employment Term, shall devote
substantially all of his business time, attention and skills to the business and affairs of
Employer.
1.3. Certifications. Whenever the Chief Executive Officer of Par is required by law,
rule or regulation or requested by any governmental authority or by Par’s auditors to provide
certifications with respect to Par’s financial statements or filings with the Securities and
Exchange Commission or any other governmental authority, Executive shall sign such certifications
as may be reasonably requested by the Chief Executive Officer of Par and/or Employer, with such
exceptions as Executive deems necessary to make such certifications accurate and not misleading.
2. Compensation and Benefits.
2.1. Salary. At all times Executive is employed hereunder, Employer shall pay to
Executive, and Executive shall accept, as full compensation for any and all services rendered and
to be rendered by him during such period to Employer in all capacities, including,
but not limited to, all services that may be rendered by him to any of Employer’s existing
subsidiaries, entities and organizations hereafter formed, organized or acquired by Employer,
directly or indirectly (each, a “Subsidiary” and collectively, the “Subsidiaries”), the following:
(i) a base salary at the annual rate of $337,000 (Three Hundred and Thirty-Seven Thousand Dollars),
or at such increased rate as the Board (through its Compensation and Stock Option Committee), in
its sole discretion, may hereafter from time to time grant to Executive, subject to adjustment in
accordance with Section 2.2 hereof (as so adjusted, the “Base Salary”); and (ii) any additional
bonus and the benefits set forth in Sections 2.3, 2.4 and 2.5 hereof. The Base Salary shall be
payable in accordance with the regular payroll practices of Employer applicable to senior
executives, less such deductions as shall be required to be withheld by applicable law and
regulations or otherwise.
2.2. Adjustments in Base Salary. On each October 1 during the Employment Term, the
Base Salary shall be increased by that percentage, if any, by which the Consumer Price Index, Urban
Wage Earners and Clerical Workers, for the New York City metropolitan area, published by the United
States Government as of the month of September of such year exceeds such Index for the immediately
preceding September.
2.3. Bonus. Subject to Section 3.3 hereof, Executive shall be entitled to an annual
bonus during the Employment Term in such amount (if any) as determined by the Board based on such
performance criteria as it deems appropriate, including, without limitation, Executive’s
performance and Employer’s earnings, financial condition, rate of return on equity and compliance
with regulatory requirements. The target amount of Executive’s annual bonus shall be equal to 50%
(fifty percent) of his Base Salary. Executive shall receive a guaranteed minimum bonus for 2006 in
an amount equal to this bonus target.
2.4. Equity Awards. Executive shall be entitled to participate in long-term incentive
plans commensurate with his title and position, including, without limitation, stock option,
restricted stock, and similar equity plans of Employer as may be offered from time to time. In
connection herewith, Executive has been granted 15,000 shares of restricted common stock of Par and
options to purchase 50,000 shares of common stock on terms and conditions set forth in the 2004
Performance Equity Plan and Executive’s Stock Option Agreement (the “Sign-On Equity Award”). All
long-term incentive awards and grants pursuant to this paragraph shall vest incrementally over a
four-year period on each anniversary of the date of such grant and shall otherwise be subject to
the terms and conditions set forth in the 2005 or subsequently restated Equity Plan and the reward
agreement(s) relating to such shares.
2.5. Executive Benefits.
2.5.1. Expenses. Employer shall promptly reimburse Executive for expenses he
reasonably incurs in connection with the performance of his duties (including business travel and
entertainment expenses) hereunder, all in accordance with Employer’s policies with respect thereto
as in effect from time to time.
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2.5.2. Employer Plans. Executive shall be entitled to participate in such employee benefit
and welfare plans and programs as Employer may from time to time generally offer or provide to
executive officers of Employer or its Subsidiaries, including, but not limited to, participation in
life insurance, health and accident, medical plans and programs and profit sharing and retirement
plans.
2.5.3. Vacation. Executive shall be entitled to four (4) weeks of paid vacation per
calendar year, prorated for any partial year.
2.5.4. Automobile. Employer shall provide Executive with an automobile cash allowance
in the amount of $1,050 (gross) per month.
2.5.5. Life Insurance. Employer shall obtain (provided, that Executives qualifies on
a non-rated basis) a term life insurance policy, the premiums of which shall be borne by Employer
and the death benefits of which shall be payable to Executive’s estate, or as otherwise directed by
Executive, in the amount of $1 million throughout the Employment Term.
2.6. Signing Bonus. On the date hereof, Employer shall pay to Executive a one-time
signing bonus (the “Signing Bonus”) in the amount of $115,000 (One Hundred and Fifteen Thousand
Dollars), less such deductions as shall be required to be withheld by applicable law and
regulations. In the event Executive’s employment is terminated during the Initial Term by
Executive pursuant to Section 3.2.2 hereof or by Employer pursuant to Section 3.2.4 hereof,
Executive shall repay to Employer the Signing Bonus, less one-twelfth (1/12) of such amount for
each full thirty (30) day period during which Executive shall have been employed hereunder.
3. Employment Term; Termination.
3.1. Employment Term. Executive’s employment hereunder shall commence on the
Effective Date (as defined in Section 1.1 hereof) and, except as otherwise provided in Section 3.2
hereof, shall continue until the third (3rd) anniversary of the Effective Date (the “Initial
Term”). Thereafter, this Agreement shall automatically be renewed for successive one-year periods
commencing on the third (3rd) anniversary of the Effective Date (the Initial Term, together with
any such subsequent employment period(s), being referred to herein as the “Employment Term”),
unless Executive or Employer shall have provided a written notice of termination in respect of its
or his election not to renew the Employment Term to the other party at least 90 days prior to such
termination. Upon nonrenewal of the Employment Term pursuant to this Section 3.1 or termination
pursuant to Sections 3.2.1 through 3.2.6 hereof, inclusive, Executive shall be released from any
duties hereunder (except as set forth in Section 4 hereof) and the obligations of Employer to
Executive shall be as set forth in Section 3.3 hereof only.
3.2. Events of Termination. The Employment Term shall terminate upon the occurrence
of any one or more of the following events:
3.2.1. Death. In the, event of Executive’s death, the Employment Term shall terminate
on the date of his death.
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3.2.2. Without Cause By Executive. Executive may terminate the Employment Term at any
time during such Term for any reason whatsoever by giving a Notice of Termination to Employer. The
Date of Termination pursuant to this Section 3.2.2 shall be thirty (30) days after the Notice of
Termination is given.
3.2.3. Disability. In the event of Executive’s Disability (as hereinafter defined),
Employer may, at its option, terminate the Employment Term by giving a Notice of Termination to
Executive. The Notice of Termination shall specify the Date of Termination, which date shall not be
earlier than thirty (30) days after the Notice of Termination is given. For purposes of this
Agreement, “Disability” means disability as defined in any long-term disability insurance policy
provided by Employer and insuring Executive, or, in the absence of any such policy, the inability
of Executive for 180 days in any twelve (12) month period to substantially perform his duties
hereunder as a result of a physical or mental illness, all as determined in good faith by the
Board.
3.2.4. Cause. Employer may, at its option, terminate the Employment Term for “Cause”
based on objective factors determined in good faith by a majority of the Board as set forth in a
Notice of Termination to Executive specifying the reasons for termination and the failure of the
Executive to cure the same within ten (10) days after Employer shall have given the Notice of
Termination; provided, however, that in the event the Board in good faith
determines that the underlying reasons giving rise to such determination cannot be cured, then the
ten (10) day period shall not apply and the Employment Term shall terminate on the date the Notice
of Termination is given. For purposes of this Agreement, “Cause” shall mean (i) Executive’s
conviction of, guilty or no contest plea to, or confession of guilt of, a felony, or other crime
involving moral turpitude; (ii) an act or omission by Executive in connection with his employment
that constitutes fraud, criminal misconduct, breach of fiduciary duty, dishonesty, gross
negligence, malfeasance, willful misconduct or other conduct that is materially harmful or
detrimental to Employer; (iii) a material breach by Executive of this Agreement; (iv) continuing
failure to perform such duties as are assigned to Executive by Employer in accordance with this
Agreement, other than a failure resulting from a Disability; (v) Executive’s knowingly taking any
action on behalf of Employer or any of its affiliates without appropriate authority to take such
action; (vi) Executive’s knowingly taking any action in conflict of interest with Employer or any
of its affiliates given Executive’s position with Employer; and/or (vii) the commission of an act
of personal dishonesty by Executive that involves personal profit in connection with Employer.
3.2.5. Without Cause By Employer. Employer may, at its option, terminate the
Employment Term for any reason or no reason whatsoever (other than for the reasons set forth
elsewhere in this Section 3.2) by giving a Notice of Termination to Executive. The Notice of
Termination shall specify the Date of Termination, which date shall not be earlier than thirty (30)
days after the Notice of Termination is given.
3.2.6. Employer’s Material Breach. Executive may, at his option, terminate the
Employment Term upon Employer’s material breach of this Agreement and the continuation of such
breach for more than ten (10) days after written demand for cure of such breach is given to
Employer by Executive (which demand shall identify the manner in which Employer has materially
breached this Agreement). Employer’s material breach of this Agreement shall mean (i) the failure
of Employer to make any payment that it is required to
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make hereunder to Executive when such payment is due or within two (2) business days
thereafter; (ii) the assignment to Executive, without Executive’s express written consent, of
duties inconsistent with his positions, responsibilities and status with Employer, or a change in
Executive’s reporting responsibilities, titles or offices or any plan, act, scheme or design to
constructively terminate the Executive, or any removal of Executive from his positions with
Employer, except in connection with the termination of the Employment Term by Employer for Cause,
without Cause or Disability or as a result of Executive’s death or voluntary resignation or by
Executive other than pursuant to this Section 3.2.6; (iii) a reduction by Employer in Executive’s
Base Salary; or (iv) a permanent reassignment of Executive’s primary work location, without the
consent of Executive, to a location more than 35 miles from Employer’s executive offices in
Woodcliff Lake, New Jersey.
3.3. Certain Obligations of Employer Following Termination of the Employment Term.
Following termination of the Employment Term under the circumstances described below, Employer
shall pay to Executive or his estate, as the case may be, the following compensation and provide
the following benefits in full satisfaction and final settlement of any and all claims and demands
that Executive now has or hereafter may have hereunder against Employer. In connection with
Executive’s receipt of any or all monies and benefits to be received pursuant to this Section 3.3,
Executive shall not have a duty to seek subsequent employment during the period in which he is
receiving severance payments and the Severance Amount (as defined in Section 3.3.2 hereof) shall
not be reduced solely as a result of Executive’s subsequent employment by an entity other than
Employer.
3.3.1. For Cause. In the event that the Employment Term is terminated by Employer for
Cause, Employer shall pay to Executive, in a single lump-sum, an amount equal to any unpaid but
earned Base Salary through the Date of Termination.
3.3.2. Without Cause by Employer; Material Breach by Employer; Non-Renewal by
Employer. In the event that the Employment Term is terminated by Employer pursuant to Section
3.2.5 hereof or by Executive pursuant to Section 3.2.6 hereof, or is not renewed by Employer
pursuant to Section 3.1 hereof, Employer shall pay to Executive severance in an amount equal to
two (2) times his Base Amount. For purposes hereof, “Base Amount” shall mean the Base Salary in
effect at such applicable time plus, if Executive’s termination is not a result of, in whole or in
part, Executive’s performance in respect of his duties hereunder, the amount of Executive’s last
annual cash bonus pursuant to Section 2.3 hereof. Any payments made in accordance with this
Section 3.3.2 shall be made in twenty-four (24) equal monthly installments from the Date of
Termination in accordance with Employer’s regular payroll practices, subject to Executive’s
continued compliance with the terms of Section 4 hereof and the execution by Executive of
Employer’s standard form Release Agreement in effect at the time.
3.3.3. Without Cause By Executive; Election Not to Renew by Executive. In the event
that the Employment Term is terminated by Executive pursuant to Section 3.2.2 hereof or Executive
elects not to renew this Agreement pursuant to Section 3.1 hereof, Employer shall pay to Executive,
in a single lump-sum, an amount equal to any unpaid but earned Base Salary through the Date of
Termination.
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3.3.4. Death, Disability. In the event that the Employment Term is terminated by
reason of Executive’s death pursuant to Section 3.2.1 hereof or by Employer by reason of
Executive’s Disability pursuant to Section 3.2.3 hereof, Employer shall pay to Executive, subject
to, in the case of Disability, Executive’s continued compliance with Section 4 hereof, the
Severance Amount, less any life insurance and/or disability insurance received by Executive or his
estate pursuant to insurance policies provided by Employer (including pursuant to Section 2.5.5
hereof), payable in accordance with Section 3.3.2 hereof.
3.3.5. Post-Employment Term Benefits. In the event Executive is terminated pursuant
to Sections 3.2.1 through 3.2.6 hereof, inclusive, or either Employer or Executive elects not to
renew this Agreement pursuant to Section 3.1 hereof, Employer shall reimburse Executive for any
unpaid expenses pursuant to Section 2.5.1 hereof, and Executive will have the opportunity and
responsibility to elect COBRA continuation coverage pursuant to the terms of that law and will thus
be responsible for the execution of the continuation of coverage forms upon termination of his
insurance coverage. Except as provided immediately below, Executive will be responsible for all
COBRA payments. Specifically, if Executive is terminated pursuant to Sections 3.2.3, 3.2.5 or
3.2.6 hereof, or Employer elects not to renew this Agreement pursuant to Section 3.1 hereof,
Executive shall be entitled to participate, at Employer’s expense, in all medical and health plans
and programs of Employer in accordance with COBRA for a period of eighteen (18) months (the
“Benefits Period”), subject to the execution by Executive of Employer’s standard form Release
Agreement in effect at the time and Executive’s continued compliance with the terms of Section 4
hereof; provided, that Executive’s continued participation is legally possible under the
general terms and provisions of such plans and programs; and provided, further,
that in the event Executive is entitled to equal or comparable benefits from a subsequent employer
during the Benefits Period, Employer’s obligation with respect thereto pursuant to this Section
3.3.5 shall end as of such date.
3.3.6. Equity Awards.
(a) If, within twelve (12) months following a Change of Control (as defined in Section 3.4.1
hereof) of Employer, the Employment Term is terminated other than for Cause, then Executive (or his
estate) shall have twenty-four (24) months from the date of termination to exercise any vested
equity awards; provided, that the relevant equity award plan remains in effect and such
equity awards shall not have otherwise expired in accordance with the terms thereof. In connection
therewith, Employer agrees to use commercially reasonable efforts to amend Executive’s Equity Award
Agreements if necessary to effectuate the provisions of this Section 3.3.6(a).
(b) In the event that the Initial Term is not renewed by Employer pursuant to Section 3.1
hereof, then the Sign-On Equity Award granted to Executive shall thereupon vest and Executive shall
have twenty-four (24) months from such date to exercise such options. In addition, in the event
the Employment Term is terminated (i) by Employer pursuant to Section 3.2.5 hereof and the reason
for such termination is not related to the performance of Executive in his duties with respect to
Employer, or (ii) by Executive pursuant to Section 3.2.6 hereof, then all equity awards theretofore
granted to Executive shall thereupon vest and Executive shall have twenty-four (24) months from
such date to exercise such options. The provisions of this Section 3.3.6(b) shall only be
effective if and to the extent that
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the relevant equity award plan remains in effect and such equity awards shall not have
otherwise expired in accordance with the terms thereof. In connection therewith, Employer agrees
to use commercially reasonable efforts to amend Executive’s Equity Award Agreements if necessary to
effectuate the provisions of this Section 3.3.6(b).
3.4. Definitions.
3.4.1. “Change of Control” Defined. A “Change of Control” of Employer means (i) the
approval by the stockholders of Par of the sale, lease, exchange or other transfer (other than
pursuant to internal reorganization) by Par of all or substantially all of its respective assets to
a single purchaser or to a group of associated purchasers; (ii) the first purchase of shares of
equity securities of Par pursuant to a tender offer or exchange offer (other than an offer by Par)
for at least fifteen (15%) percent of the equity securities of Par; (iii) the approval by the
stockholders of Par of an agreement for a merger or consolidation in which Par shall not survive as
an independent, publicly-owned corporation; (iv) the acquisition (including by means of a merger)
by a single purchaser or a group of associated purchasers of securities of Par from either Par or
any third party representing thirty-five (35%) percent or more of the combined voting power of
Par’s then outstanding equity securities in one or a related series of transactions (other than
pursuant to an internal reorganization) or (v) the change of the membership of a majority of the
Board during any period of two (2) consecutive years, unless the election, or the nomination for
election by Par’s stockholders, of each new director was approved by a vote of at least two-thirds
of the directors of the Board still in office who were directors of Par at the beginning of the
period.
3.4.2. “Notice of Termination” Defined. “Notice of Termination” means a written
notice that indicates the specific termination provision relied upon by Employer or Executive and,
except in the case of termination pursuant to Sections 3.2.1, 3.2.2 or 3.2.5 hereof, that sets
forth in reasonable detail the facts and circumstances claimed to provide a basis for termination
of the Employment Term under the termination provision so indicated.
3.4.3. “Date of Termination” Defined. “Date of Termination” means such date as the
Employment Term is expired if not renewed or terminated in accordance with Sections 3.1 or 3.2
hereof.
4. Confidentiality/ Non-Solicitation/Non-Compete.
4.1. “Confidential Information” Defined. “Confidential Information” means any and all
information (oral or written) relating to Employer or any Subsidiary or any person controlling,
controlled by, or under common control with Employer or any Subsidiary or any of their respective
activities, including, but not limited to, information relating to: technology, research, test
procedures and results, machinery and equipment; manufacturing processes; financial information;
products; identity and description of materials and services used; purchasing; costs; pricing;
customers and prospects; advertising, promotion and marketing; and selling, servicing and
information pertaining to any governmental investigation, except such information which becomes
public, other than as a result of a breach of the provisions of Section 4.2 hereof. Without
limiting the foregoing, Confidential Information shall also include all information related to
products targeted for development by Employer and/or its Subsidiaries,
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subjects of research and development, projected launch dates, the United States Food and Drug
Administration (FDA) protocols, projected dates for regulatory filings, consumers studies, market
research, clinical research, business plans, content of the New Product Planning Committee
meetings, planned expenditures, profit margins, strategic evaluation plans and initiatives, and
those commissioned by Employer through outside vendors or consultants, and the content of all
business and strategic planning conducted with or through third parties. Executive’s obligation
not to disclose Confidential Information shall be as set forth in Section 4.2 of this Agreement,
and shall include his obligation not to place himself in any business position in which use or
disclosure of Employer’s confidences will be likely, expected or inevitable, for his own benefit or
the benefit of any other person or entity.
4.2. Non-disclosure of Confidential Information. Executive shall not at any time
(other than as may be required or appropriate in connection with the performance by him of his
duties hereunder), directly or indirectly, use, communicate, disclose or disseminate any
Confidential Information in any manner whatsoever for the benefit of any person or entity other
than Employer (except as may be required under legal process by subpoena or other court order).
4.3. Non-Solicitation. Executive shall not, while employed by Employer and for a
period of two (2) years following the Date of Termination, directly or indirectly, hire, offer to
hire, entice away or in any other manner persuade or attempt to persuade any officer, employee,
agent, lessor, lessee, licensor, licensee, customer, prospective customer, or supplier of Employer
or any of its Subsidiaries to discontinue or alter his or its relationship with Employer or any of
its Subsidiaries.
4.4. Non-Competition. Executive shall not, while employed by Employer and for a
period equal to the longer of either (a) the Initial Term as defined Section 3.1 hereof, or (b) one
year following the Date of Termination, directly or indirectly provide any services (whether in the
management, sales, marketing, public relations, finance, research, development, general office,
administrative, or other areas) as an employee, agent, stockholder, officer, director, consultant,
advisor, investor, or other representative of Employer’s competitors in the branded or generic
pharmaceutical industry in any state or country in which Employer does or seeks to do business.
Employer’s competitors include any entity, individual, or affiliate of such company or individual
that develops, sells, markets, or distributes any products that compete with or are the same or
similar to those of Employer. However, the restrictions of this paragraph 4.4 shall not apply if
the Employment Term is terminated by Employer pursuant to Section 3.2.5 hereof or by Executive
properly pursuant to Section 3.2.6 hereof; nor shall this paragraph prohibit Executive from being a
passive owner of not more than one percent (1%) of any publicly-traded class of capital stock of
any entity engaged in a competing business.
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4.5. Injunctive Relief. The parties hereby acknowledge and agree that (a) the type, scope
and periods of restrictions imposed in paragraph 4 are necessary, fair and reasonable to protect
Employer’s legitimate business interests and to prevent the inevitable disclosure of Employer’s
Confidential Information; (b) Employer will be irreparably injured in the event of a breach by
Executive of any of his obligations under this Section 4; (c) monetary damages will not be an
adequate remedy for any such breach; (d) Employer will be entitled to injunctive relief, in
addition to any other remedy which it may have, in the event of any such breach; and (e) the
existence of any claims that Executive may have against Employer, whether under this Agreement or
otherwise, will not be a defense to the enforcement by Employer of any of its rights under this
Section 4.
4.6. Non-exclusivity and Survival. The covenants of Executive contained in this
Section 4 are in addition to, and not in lieu of, any obligations that Executive may have with
respect to the subject matter hereof, whether by contract, as a matter of law or otherwise, and
such covenants and their enforceability shall survive any termination of the Employment Term by
either party and any investigation made with respect to the breach thereof by Employer at any time.
5. Miscellaneous Provisions.
5.1. Severability. If, in any jurisdiction, any term or provision hereof is
determined to be invalid or unenforceable, (a) the remaining terms and provisions hereof shall be
unimpaired; (b) any such invalidity or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction; and (c) the invalid or unenforceable
term or provision shall, for purposes of such jurisdiction, be deemed replaced by a term or
provision that is valid and enforceable and that comes closest to expressing the intention of the
invalid or unenforceable term or provision.
5.2. Execution in Counterparts. This Agreement may be executed in one or more
counterparts, and by the different parties hereto in separate counterparts, each of which shall be
deemed to be an original but all of which taken together shall constitute one and the same
agreement (and all signatures need not appear on any one counterpart), and this Agreement shall
become effective when one or more counterparts has been signed by each of the parties hereto and
delivered to each of the other parties hereto.
5.3. Notices. All notices, requests, demands and other communications hereunder shall
be in writing and shall be deemed duly given upon receipt when delivered by hand, overnight
delivery or telecopy (with confirmed delivery), or three (3) business days after posting, when
delivered by registered or certified mail or private courier service, postage prepaid, return
receipt requested, as follows:
If to Employer, to:
Par Pharmaceutical Companies, Inc.
000 Xxxx Xxxxxxxxx
Xxxxxxxxx Xxxx, Xxx Xxxxxx 00000
Attention: Chairman
Telecopy No. 000-000-0000
000 Xxxx Xxxxxxxxx
Xxxxxxxxx Xxxx, Xxx Xxxxxx 00000
Attention: Chairman
Telecopy No. 000-000-0000
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Copy to:
Xxxxxxxxx X. Xxxxxx, Esq.
Xxxxxxx, Del Deo, Dolan, Griffinger & Xxxxxxxxx, P.C.
Xxx Xxxxxxxxxx Xxxxx
Xxxxxx, Xxx Xxxxxx 00000-0000
Telecopy No.: (000) 000-0000
Xxxxxxx, Del Deo, Dolan, Griffinger & Xxxxxxxxx, P.C.
Xxx Xxxxxxxxxx Xxxxx
Xxxxxx, Xxx Xxxxxx 00000-0000
Telecopy No.: (000) 000-0000
If to Executive, to:
Xxxxxx Xxxxxxx
c/o Par Pharmaceutical, Inc.
000 Xxxx Xxxxxxxxx
Xxxxxxxxx Xxxx, Xxx Xxxxxx 00000
c/o Par Pharmaceutical, Inc.
000 Xxxx Xxxxxxxxx
Xxxxxxxxx Xxxx, Xxx Xxxxxx 00000
or to such other address(es) as a party hereto shall have designated by like notice to the other
parties hereto.
5.4. Amendment. No provision of this Agreement may be modified, amended, waived or
discharged in any manner except by a written instrument executed by both Par and Executive.
5.5. Entire Agreement. This Agreement and, with respect to Section 3.3.6 hereof,
Executive’s Equity Award Agreements and governing equity award plans, constitute the entire
agreement of the parties hereto with respect to the subject matter hereof, and supersede all prior
agreements and understandings of the parties hereto, oral or written. In the event of any conflict
between Section 3.3.6 hereof and Executive’s Equity Award Agreements and the governing equity award
plans, Section 3.3.6 shall govern.
5.6. Applicable Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of New Jersey applicable to contracts made and to be wholly performed
therein.
5.7. Headings. The headings contained herein are for the sole purpose of convenience
of reference, and shall not in any way limit or affect the meaning or interpretation of any of the
terms or provisions of this Agreement.
5.8. Binding Effect; Successors and Assigns. Executive may not delegate any of his
duties or assign his rights hereunder. This Agreement shall inure to the benefit of, and be binding
upon, the parties hereto and their respective heirs, legal representatives, successors and
permitted assigns. Employer shall require any successor (whether direct or indirect and whether by
purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or
assets of Employer, by an agreement in form and substance reasonably satisfactory to Executive, to
expressly assume and agree to perform this Agreement in the same manner and to the same extent that
Employer would be required to perform if no such succession had taken place.
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5.9. Waiver, etc. The failure of either of the parties hereto to at any time enforce
any of the provisions of this Agreement shall not be deemed or construed to be a waiver of any such
provision, nor to in any way affect the validity of this Agreement or any provision hereof or the
right of either of the parties hereto thereafter to enforce each and every provision of this
Agreement. No waiver of any breach of any of the provisions of this Agreement shall be effective
unless set forth in a written instrument executed by the party against whom or which enforcement of
such waiver is sought, and no waiver of any such breach shall be construed or deemed to be a waiver
of any other or subsequent breach.
5.10. Capacity, etc. Executive and Employer hereby represent and warrant to the other
that, as the case may be: (a) he or it has full power, authority and capacity to execute and
deliver this Agreement, and to perform his or its obligations hereunder; (b) such execution,
delivery and performance shall not (and with the giving of notice or lapse of time or both would
not) result in the breach of any agreements or other obligations to which he or it is a party or he
or it is otherwise bound; and (c) this Agreement is his or its valid and binding obligation in
accordance with its terms.
5.11. Enforcement; Jurisdiction. If any party institutes legal action to enforce or
interpret the terms and conditions of this Agreement, the prevailing party shall be awarded
reasonable attorneys’ fees at all trial and appellate levels, and the expenses and costs incurred
by such prevailing party in connection therewith. Any legal action, suit or proceeding, in equity
or at law, arising out of or relating to this Agreement shall be instituted exclusively in the
State or Federal courts located in the State of New Jersey, and each party agrees not to assert, by
way of motion, as a defense or otherwise, in any such action, suit or proceeding, any claim that
such party is not subject personally to the jurisdiction of any such court, that the action, suit
or proceeding is brought in an inconvenient forum, that the venue of the action, suit or proceeding
is improper or should be transferred, or that this Agreement or the subject matter hereof may not
be enforced in or by any such court. Each party further irrevocably submits to the jurisdiction of
any such court in any such action, suit or proceeding. Any and all service of process and any other
notice in any such action, suit or proceeding shall be effective against any party if given
personally or by registered or certified mail, return receipt requested or by any other means of
mail that requires a signed receipt, postage prepaid, mailed to such party as herein provided.
Nothing herein contained shall be deemed to affect or limit the right of any party to serve process
in any other manner permitted by applicable law.
5.12. Arbitration.
(a) Any dispute under Section 3 hereof, including, but not limited to, the determination by
the Board of a termination for Cause pursuant to Section 3.2.4 hereof, or in respect of the breach
thereof shall be settled by arbitration in New Jersey. The arbitration shall be accomplished in
the following manner. Either party may serve upon the other party written demand that the dispute,
specifying the nature thereof, shall be submitted to arbitration. Within ten (10) days after such
demand is given in accordance with Section 5.3 hereof, each of the parties shall designate an
arbitrator and provide written notice of such appointment upon the other party. If either party
fails within the specified time to appoint such arbitrator, the other party shall be entitled to
appoint both arbitrators. The two (2) arbitrators so appointed shall appoint a third arbitrator. If
the two arbitrators appointed fail to agree upon a
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third arbitrator within ten (10) days after their appointment, then an application may be made
by either party hereto, upon written notice to the other party, to the American Arbitration
Association (the “AAA”), or any successor thereto, or if the AAA or its successor fails to appoint
a third arbitrator within ten (10) days after such request, then either party may apply, with
written notice to the other, to the Superior Court of New Jersey, Bergen County, for the
appointment of a third arbitrator, and any such appointment so made shall be binding upon both
parties hereto.
(b) The decision of the arbitrators shall be final and binding upon the parties. The party
against whom the award is rendered (the “non-prevailing party”) shall pay all fees and expenses
incurred by the prevailing party in connection with the arbitration (including fees and
disbursements of the prevailing party’s counsel), as well as the expenses of the arbitration
proceeding. The arbitrators shall determine in their decision and award which of the parties is the
prevailing party, which is the non-prevailing party, the amount of the fees and expenses of the
prevailing party and the amount of the arbitration expenses. The arbitration shall be conducted, to
the extent consistent with this Section 5.12, in accordance with the then prevailing rules of
commercial arbitration of the AAA or its successor. The arbitrators shall have the right to retain
and consult experts and competent authorities skilled in the matters under arbitration, but all
consultations shall be made in the presence of both parties, who shall have the full right to
cross-examine the experts and authorities. The arbitrators shall render their award, upon the
concurrence of at least two of their number, not later than thirty (30) days after the appointment
of the third arbitrator. The decision and award shall be in writing, and counterpart copies shall
be delivered to each of the parties. In rendering an award, the arbitrators shall have no power to
modify any of the provisions of this Agreement, and the jurisdiction of the arbitrators is
expressly limited accordingly. Judgment may be entered on the award of the arbitrators and may be
enforced in any court having jurisdiction.
IN WITNESS WHEREOF, this Agreement has been executed and delivered by the parties hereto as of
the date first above written.
| PAR PHARMACEUTICAL, INC. |
||||
| By: | /s/ Xxxxxxx X. Xxxxxxxx | |||
| Name: | Xxxxxxx X. Xxxxxxxx | |||
| Title: | Vice President, Human Resources | |||
| /s/ Xxxxxx Xxxxxxx | ||||
| Xxxxxx Xxxxxxx |
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