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EXHIBIT 10(ii)
(ii) Employment Agreement between the Company and
Xxxxxx Xxxxx dated October 6, 1995.
EMPLOYMENT AGREEMENT
AGREEMENT dated October ___, 1995 (the "Effective Date") by and
between VIRAGEN, INC., a Delaware corporation ("Employer or the "Company"), and
XXXXXX XXXXX ("Employee").
W I T N E S S E T H:
WHEREAS, Employer desires to employ Employee upon the terms and
conditions hereinafter set forth and Employee desires to accept employment upon
such terms and conditions; and
WHEREAS, Employer and Employee desire to set forth in writing the
terms and conditions of their agreements and understandings with respect to
Employee's employment by Employer.
NOW, THEREFORE, Employer hereby employs Employee and Employee hereby
accepts employment under the following terms and conditions:
1. EMPLOYMENT
Employer hereby employs Employee, and Employee hereby accepts
employment by Employer, upon all the terms and conditions hereinafter set forth.
2. TERM
Subject to the provisions for earlier termination set forth in
Section 9 hereof, this Agreement shall commence on the Effective Date and shall
end as of the close of business of the day immediately preceding the second
anniversary of the Effective Date (the "Employment Term"). The term "first
year", as used herein, means the period commencing on the Effective Date and
ending as of the close of business of the day immediately preceding the first
anniversary of the Effective Date, the term "second year," as used herein,
means the period commencing on the first anniversary of the Effective Date and
ending as of the close of business of the day immediately preceding the second
anniversary of the Effective Date, and the term "year," as used herein, means,
as the context requires, the first year or the second year. Notwithstanding
any of the foregoing to the contrary, if this Employment Agreement is
terminated prior to the expiration of the Employment Term, a year shall mean,
with respect to the year during which termination occurs, the period commencing
on the first day of such year and
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ending as of the close of business of the day of termination of Employee's
employment, and "Employment Term" shall mean the period commencing on the
Effective Date and ending as of the close of business of the day of termination
of Employee's employment.
3. EMPLOYEE'S REPRESENTATIONS AND WARRANTIES
Employee represents and warrants to Employer that he is free
to accept employment with Employer as contemplated herein and has no other
written or oral obligations or commitments of any kind or nature which would in
any way interfere with his acceptance of employment pursuant to the terms
hereof or the full performance of his obligations hereunder or the exercise of
his best efforts in his employment hereunder.
4. DUTIES AND EXTENT OF SERVICES
Employee shall be employed as Employer's President and, as
such, shall, subject to the direction of Employer's Board of Directors,
supervise the conduct of all of Employer's operations and affairs, and perform
such other duties and responsibilities as may be assigned to Employee from time
to time consistent with such title by Employer's Board of Directors. Employee
agrees to devote sufficient time, skill, attention and energy diligently and
competently to perform the duties and responsibilities reasonably assigned to
him hereunder or pursuant hereto to the best of his abilities. Employee shall
use his best efforts to be loyal and faithful at all times and constantly
endeavor to improve his ability and his knowledge of the business of Employer
in an effort to increase the value of his services for the mutual benefit of
Employer and Employee. Employer acknowledges that Employee is a director and
President of Cytoferon Corp., and Employer consents to Employee continuing to
act as a director and President of Cytoferon Corp. Employer further
acknowledges that Employee acts as President and as a director for
International Data Base Service, Inc. and Cinescopic Corp., but has been
informed by Employee that Employee's duties for such companies are minimal.
Employee represents and warrants that his duties for Cytoferon Corp.,
International Data Base Service, Inc. and Cinescopic Corp. will not interfere
with the satisfactory performance of his obligations under this Agreement.
Employee agrees not to enter into any other employment agreement, other than
with subsidiaries and/or affiliates of the Company as may be approved by
Employer's Board of Directors, during the term hereof.
5. COMPENSATION
Employee shall receive an annual salary of $160,000 from the
date of this Agreement through the end of the first year of the Employment Term
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and $170,000 during the second year of the Employment term, payable in
accordance with the Company's normal payroll process, currently bi-weekly.
Additional consideration payable to Employee hereunder consists of (a) the
grant to Employee of options to acquire an 1,500,000 shares of common stock of
Employer (as further described below), and (b) the fringe benefits, if any,
that shall be made available to Employee described in this Agreement.
6. FRINGE BENEFITS AND EXPENSES
A. Employee Plans. Employee shall be eligible, from the date of this
Agreement, (subject to the terms and conditions of particular plans and
programs) to participate in such medical, hospitalization, group health,
accident, disability and life insurance programs and plans, such pension,
profit sharing, stock option, incentive compensation and stock purchase plans
and such other employee benefit programs to the same extent such plans and
programs are made generally available from time to time by Employer to all of
its other similarly-situated employees; provided, however, Employer shall be
under no obligation to make any of such plans or programs available to its
employees or continue any which currently or in the future exist, except as
otherwise required by law.
B. Automobile. From the date of this Agreement, Employer shall provide
to Employee an automobile, with related gas, maintenance and insurance
expenses, for the performance of Employee's duties on behalf of Employer as
specified herein.
C. Other Expenses. Employer shall promptly pay directly or reimburse
Employee for his reasonable out-of-pocket costs and expenses incurred in
connection with the performance of his duties and responsibilities hereunder
subject to the submission by Employee of appropriate invoices, receipts and
other supporting documentation, consistent with Employer's customary
reimbursement policies and procedures.
7. VACATIONS
Employee shall be entitled to normal vacation (of not less
than two weeks) taken by other members of senior management during each
twelve-month period of the Employment Term. Employee shall not be entitled to
be compensated for any unused vacation upon termination of this Agreement. The
periods during which Employee will be absent from work shall be determined by
Employee taking into account the needs of Employer's business and shall be
subject to the approval of the Board of Directors of Employer (which shall not
be unreasonably withheld).
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8. FACILITIES
Employer shall provide and maintain (or cause to be provided
and maintained) such facilities, equipment, supplies and personnel as it
reasonably determines is adequate for Employee's performance of his duties and
responsibilities under this Agreement.
9. TERMINATION OF EMPLOYMENT
A. Termination Events. Notwithstanding any provisions
of this Agreement to the contrary, Employee's employment may be terminated by
Employer with Cause (as hereinafter defined) effective upon the delivery of
written notice to Employee. In addition, Employee's employment shall terminate
(i) upon Employee's death or (ii) upon Employee becoming Disabled (as
hereinafter defined).
B. Definition of Disabled. For purposes of this
Agreement, Employee shall be deemed to be "Disabled" when, by reason of
physical or mental illness or of injury, he is unable to perform substantially
all of the duties and responsibilities required of him in connection with his
employment hereunder. No disability shall be deemed to exist until after
Employee shall be unable to perform his duties hereunder for ninety (90)
consecutive days (the "Disability Period"). If Employee shall have been under
a disability but shall have returned to work prior to the end of the Disability
Period, any new disability commencing within thirty (30) days of the
termination of the prior disability shall be a continuation of the prior
disability, and the period of all such disabilities shall be added together to
determine whether, or how much of, the Disability Period has elapsed.
C. Definition of Cause. For purposes of this Agreement, "Cause" shall
be: (a) conviction for fraud or criminal conduct (other than conviction of, or
a plea of guilty to, a traffic violation), from which no appeal can be taken;
(b) habitual drunkenness or drug addiction; (c) embezzlement; (d) material
sanctions against Employee in his capacity as an employee of Employer by
regulatory agencies governing Employer or against Employer because of wrongful
acts or conduct of Employee which have a material adverse affect upon the
Employer and its business; (e) material breach or default by Employee of any of
the material terms or conditions of this Agreement, and the continuation of
such material breach or default by Employee for a period of seven (7) days
following the date of receipt of written notice from Employer specifying the
breach or default of Employee; or (f) the resignation or quitting of Employee
prior to the end of the Employment Term (in this last event, Employee's
employment shall be deemed terminated with Cause on the date that he resigns or
quits).
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If Employee's employment is terminated by Employer without
Cause as defined in this Section, Employee shall be given sixty (60) days
written notice of termination by Employer and be entitled to receive the
greater of (i) two years compensation and fringe benefits/expenses as provided
for in Sections 5 & 6 hereof or (ii) compensation and fringe benefits/expenses
as provided for in sections 5 & 6 payable through the remainder of the
Employment Term as provided for in Section 2 hereof. Additionally, in the
event of termination without Cause, any outstanding but unexercised stock
options or warrants granted to Employee shall immediately vest and become fully
exercisable through their stated respective Exercise Period(s).
10. NON-DISCLOSURE OF CONFIDENTIAL INFORMATION
A. Confidential Information. Employee acknowledges that
Employee has been informed that it is the policy of Employer to maintain as
secret and confidential all information relating to (i) the financial
condition, businesses and interests of Employer and its affiliates, (ii) the
systems, know-how, products, services, costs, inventions, patents, patent
applications, formulae, research and development procedures, notes and results,
computer software programs, marketing and sales techniques and/or programs,
methods, methodologies, manuals, lists and other trade secrets heretofore or
hereafter acquired, sold, developed and/or used by Employer and its affiliates
and (iii) the nature and terms of Employer's and its affiliates' relationships
with their respective customers, clients, suppliers, lenders, vendors,
consultants, independent contractors and employees (all such information being
hereinafter collectively referred to as "Confidential Information"), and
Employee further acknowledges that such Confidential Information is of great
value to Employer and its affiliates and, in and by reason and as a result of
Employee's employment by Employer, Employee will be making use of, acquiring
and/or adding to such Confidential Information. Therefore, Employee
understands that it is reasonably necessary to protect Employer's and its
affiliates' trade secrets, good will and business interests that Employee agree
and, accordingly, Employee does hereby agree, that Employee will not directly
or indirectly (except where authorized by the Board of Directors of Employer
for the benefit of Employer and/or its affiliate(s) and/or as required in the
course of his employment) at any time hereafter divulge or disclose for any
purpose whatsoever to any persons, firms, corporations or other entities other
than Employer or its affiliates (hereinafter referred to collectively as "Third
Parties"), or use or cause or authorize any Third Parties to use, any such
Confidential Information, except as otherwise required by law.
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B. Employer's Materials. In accordance with the
foregoing, Employee furthermore agrees that (i) Employee will at no time retain
or remove from the premises of Employer or its affiliates any research and
development materials, drawings, notebooks, notes, reports, formulae, software
programs or discs or other containers of software, manuals, data, books,
records, materials or documents of any kind or description for any purpose
unconnected with the strict performance of Employee's duties with Employer and
(ii) upon the cessation or termination of Employee's employment with Employer
for any reason, Employee shall forthwith deliver or cause to be delivered up to
Employer any and all research and development materials, drawings, notebooks,
notes, reports, formulae, software programs or discs or other containers of
software, manuals, data, books, records, materials and other documents and
materials in Employee's possession or under Employee's control relating to any
Confidential Information or any property or information which is otherwise the
property of Employer or its affiliates.
11. COVENANT-NOT-TO-COMPETE
In view of the Confidential Information to be obtained by or
disclosed to Employee, because of the know-how acquired and to be acquired by
Employee, and as a material inducement to Employer to enter into this
Agreement, issue the Stock Options (as defined below) and continue to employ
Employee, Employee covenants and agrees that, so long as Employee is employed
by Employer and for a period of two (2) years after Employee ceases for any
reason to be employed by Employer, Employee shall not, directly or indirectly,
(i) divert business from, (ii) solicit or transact any business competitive
with Employer or its affiliates with, or (iii) sell any products or services
sold or offered by Employer or its affiliates to, any customer or former
customer of Employer or its affiliates. In addition, Employee covenants and
agrees that, so long as Employee is employed by Employer and for a period of
two (2) years after Employee ceases for any reason to be employed by Employer,
Employee hereby agrees to refrain from, anywhere in the world (the
"Geographical Area"), directly or indirectly owning, managing, operating,
controlling or financing, or participating in the ownership, management,
control or financing of, or being connected with or having an interest in, or
otherwise taking any part as a stockholder, director, officer, employee, agent,
consultant, partner or otherwise in, any business competitive with that engaged
in or being developed by Employer or its affiliates during Employee's term of
employment. Without limitation of the foregoing, Employer's business is
acknowledged to include the development, manufacture and sale of human
leukocyte interferon therapy and products and other natural or recombinant
technologies aimed at enhancing the human immune system. Employee acknowledges
that Employer's business is anticipated to be international in
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scope, that a similar business could effectively compete with Employer's and
its affiliates businesses from any location in the world, and that, therefore,
the restricted Geographical Area is reasonable in scope to protect Employer's
and its affiliates' trade secrets and legitimate business interests.
12. EMPLOYER'S REMEDIES FOR BREACH OF SECTIONS 10 & 11
Employee covenants and agrees that if Employee shall violate
or breach any of Employee's covenants or agreements provided for in Sections 10
or 11 hereof, Employer and/or its affiliates shall be entitled to an accounting
and repayment of all profits, compensation, commissions, remunerations or
benefits which Employee directly or indirectly has realized or realizes as a
result of, growing out of or in connection with any such violation or breach.
In addition, in the event of a breach or violation or threatened or imminent
breach or violation of any provisions of Sections 10 or 11 hereof, Employer
and/or its affiliates shall be entitled to a temporary and permanent injunction
or any other appropriate decree of specific performance or equitable relief,
without posting of bond, from a court of competent jurisdiction in order to
prevent, prohibit or restrain any such breach or violation or threatened or
imminent breach or violation by Employee, by Employee's partners, agents,
representatives, servants, employers or employees and/or by any third parties.
Employer shall be entitled to such injunctive or other equitable relief in
addition to any damages which are suffered, and the prevailing party shall be
entitled to reasonable attorneys' and paralegals' fees and costs and other
costs incurred in connection with any such litigation, both before and at trial
and at all tribunal levels. Resort by Employer and/or its affiliates to such
injunctive or other equitable relief shall not be deemed to waive or to limit
in any respect any other rights or remedies which Employer or its affiliates
may have with respect to such breach or violation.
13. REASONABLENESS OF RESTRICTIONS
A. Reasonableness. Employee acknowledges that any
breach or violation of Sections 10 or 11 hereof will cause irreparable injury
and damage and incalculable harm to Employer and its affiliates and that it
would be very difficult or impossible to measure the damages resulting from any
such breach or violation. Employee further acknowledges that Employee has
carefully read and considered the provisions of Sections 10, 11 and 12 hereof
and, having done so, agrees that the restrictions and remedies set forth in
such Sections (including, but not limited to, the time period, geographical and
types of restrictions imposed) are fair and reasonable and are reasonably
required for the protection of the business, trade secrets, interests and good
will of Employer and its affiliates.
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B. Severability. Employee understands and intends that
each provision and restriction agreed to by Employee in Sections 10, 11 and 12
hereof shall be construed as separate and divisible from every other provision
and restriction and that, in the event that any one of the provisions of, or
restrictions in, Sections 10, 11 and/or 12 hereof shall be held to be invalid
or unenforceable, the remaining provisions thereof and restrictions therein
shall nevertheless continue to be valid and enforceable as though the invalid
or unenforceable provisions or restrictions had not been included therein, and
any one or more of such valid provisions and restrictions may be enforced in
whole or in part as the circumstances warrant. In the event that any such
provision relating to time period and/or geographical and/or type of
restriction shall be declared by a court of competent jurisdiction to exceed
the maximum or permissible time period, geographical area or type of
restriction such court deems reasonable and enforceable, said time period
and/or geographical and/or type of restriction shall be deemed to become and
shall thereafter be the maximum time period and/or geographical restriction
and/or type of restriction which such court deems reasonable and enforceable.
C. Survivability. The restrictions, acknowledgments,
covenants and agreements of Employee set forth in Sections 10, 11, 12 and 13 of
this Agreement shall survive any termination of this Agreement or of Employee's
employment (for any reason, including expiration of the Employment Term). D.
Comparable Restrictions. Employer agrees that it will use its best efforts to
have other senior executives execute and observe agreements containing similar
provisions as are contained in Sections 10, 11 and 12 hereof.
14. STOCK OPTIONS
Effective the Effective Date, Employer hereby grants to
Employee options to acquire up to 1,500,000 shares of Common Stock (the
"Options"), subject to and upon the following terms and conditions:
(a) The Options shall be exercisable by Employee
for the period commencing from the Effective date and ending on the last day of
the 60th month following the Effective Date ("the Exercise Period").
(b) In the event Employee's employment is
terminated with Cause, all unexercised Options, and all Options which have been
exercised but which exercise has not been consummated by tender of payment for
the purchase of Common Stock, shall automatically terminate 90 days from the
date of Termination with Cause.
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(c) In the event of Employee's termination
without Cause, all outstanding but unexercised Options shall remain exercisable
in accordance with the provisions of this Section 14. In the event this
Agreement is not renewed at the end of the Employment Term, then the Options
shall continue to be exercisable in accordance with the provisions of this
Section 14.
(d) All outstanding but unexercised Options shall
remain fully exercisable in accordance with the provisions of this Section 14:
(i) if there occurs any corporate
transaction (which shall include a series of corporate transactions occurring
within 60 days or occurring pursuant to a plan), that has the result that
shareholders of the Employer immediately before such transaction cease to own
at least 66 2/3 percent of the voting stock of the Employer in a (a)
reorganization, (b) consolidation, (c) merger, (d) liquidation or (e) a similar
of corporate transaction;
(ii) if the shareholders of the Employer
shall approve a plan of merger, consolidation, reorganization, liquidation or
dissolution in which the Employer does not survive (unless the approved merger,
consolidation, reorganization, liquidation or dissolution is subsequently
abandoned); or
(iii) if the shareholders of the Employer
shall approve a plan for the sale, lease, exchange or other disposition of all
or substantially all the property and assets of the Employer (unless such plan
is subsequently abandoned).
(e) In the event Employee dies or becomes
Disabled, Employee or his personal representative shall have a period of twelve
(12) months following the date of Employee's death or the last day of the
Disability Period (as the case may be) to exercise all Options which were
exercisable on the date of Employee's death or that he became Disabled (as the
case may be).
(f) The purchase price payable for the Common
Stock pursuant to the Options shall be (i) as to 750,000 Options, $.50 per
share of Common stock and (ii) as to 750,000 Options, the price determined by
the Viragen, Inc., 1995 Stock Option Plan as of the Effective Date. At the
Employee's option, the payment for the shares of Common Stock may be made
either by check payable to the Employer or by execution and delivery by the
Employee to Employer of a Note(s) dated as of each Exercise Notice. The
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manner in which shares are pledged as collateral (if a Note or Notes are used)
shall be identical to those shares described in Section 14 herein.
(g) The closing of the purchase of shares of
Common Stock pursuant to the exercise of Options, an "Option Closing"), shall
occur on the tenth (10th) business day following the date the applicable
Exercise Notice was given. At the Option Closing (or at each Option Closing,
if more than one), Employer shall issue to Employee a stock certificate
evidencing the Option Purchased Stock.
(h) At Employee's request, subject to the
provisions of Sections 16 and 17 below and any applicable securities laws,
Employee may designate his spouse, children, siblings, nieces or nephews or a
trust for their benefit of which Employee is sole trustee to own and hold
record or beneficial title to all or portions of the Option Purchased Stock.
(i) The Options granted hereunder are personal to
Employee, and, except as permitted by subsection (h) above, may not be sold,
assigned, devised, transferred, pledged, hypothecated or in any way disposed
of, by operation of law or otherwise, at any time. Any purported sale,
assignment, devise, transfer, pledge, hypothecation or disposition shall be
utterly void and of no force or effect.
(j) If at any time while unexercised Options are
outstanding, there shall be any increase or decrease in the number of issued
and outstanding Shares through the declaration of a stock dividend or through
any recapitalization resulting in a stock split-up, combination or exchange of
Shares, then and in such event:
(i) appropriate adjustment shall be made
in the maximum number of Shares available for grant, so that the same
percentage of the Employers issued and outstanding Shares shall continue to be
subject to being so optioned; and
(ii) appropriate adjustment shall be made
in the number of Shares and the exercise price per Share thereof then subject
to any outstanding Option, so that the same percentage of the Employers issued
and outstanding shares shall remain subject to purchase at the same aggregate
exercise price.
15. REGISTRATION OF OPTION PURCHASED SHARES
Employer represents that all Option Purchased Shares will be issued
from shares authorized by and subject to the provisions of the Viragen, Inc.,
1995 Stock option Plan ("Option Plan"). Employer further represents
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such Option Plan and the underlying Option Purchased Shares have been
registered under the applicable regulations of the Securities and Exchange
Commission on Form S-8 and such registration is effective as of the Effective
Date. Employer warrants that such registration covering the Option Purchased
Shares will be maintained as effective for the longer of (i) the Employment
Term or (ii) the Exercise Period.
16. PLEDGE OF STOCK
Effective upon Employee's purchase(s) of the Stock and the
delivery of the Note(s), if same occurs, in order to secure Employee's
obligations under the Note(s), Employee hereby pledges, assigns and sets over
to Employer, and grants to Employer a security interest in, the Stock. The
Stock pledged pursuant hereto shall be maintained in escrow with Atlas,
Xxxxxxxx, Trop & Borkson, P.A. pursuant to the terms of a Pledge and Escrow
Agreement attached hereto as Exhibit B. As long as any shares of Stock remain
subject to the lien of the Pledge, such shares of Stock may not be further
pledged or encumbered in any manner, and shall not be sold, transferred or
otherwise disposed of, or attempted so to be, except pursuant to the
registration of the Stock pursuant to Section 15 above. The Escrow Agent shall
not be required to relinquish the Pledge or the Escrow Agent's possession of
the certificates evidencing the Stock, unless no later than concurrently with
the sale of the Stock pursuant to the registration on Form S-8 all Employee
Notes which are secured by such Stock are paid in full. In the event any of
the Stock is to be titled in the name of an immediate family member of Employee
or a trust pursuant to Sections ___ or 14(j), as a condition thereto the
designated title holder(s) of such Stock shall execute and deliver to Employer
a pledge and escrow agreement, in form and content reasonably satisfactory to
Employer and its counsel, consistent with the terms of this Section 16. No
transfer of Stock to, or designation by Employee of (for the purposes of owning
Stock) any person or entity shall relieve Employee of any of his obligations
under the Employee Note(s) or this Agreement. With respect to each Employee
Note under which a voluntary prepayment is made by Employee, provided that
interest payments on such Employee Note are current through the date of
prepayment and such Employee Note is not in default and has not been
accelerated, for each $3,000 of principal paid by Employee under such Employee
Note, an equivalent number of shares of the Stock pledged to secure such
Employee Note shall be released from the lien of the Pledge. As long as no
event of default has occurred with respect to an Employee Note and no event
giving right to accelerate such Employee Note has occurred, Employee shall
retain all voting rights with respect to all Stock securing such Employee Note.
Following an event of default or an acceleration event, Employer shall have and
may exercise all voting rights with respect to such Stock. Employee hereby
irrevocably appoints Employer
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Employee's attorney-in-fact for such purpose, it being acknowledged that such
appointment is coupled with an interest. Any dividends or distributions
payable in respect of any Stock subject to the Pledge shall automatically be
applied to pay down the Employee Note(s) in inverse order of their respective
maturity date(s). In the event of a default under any Employee Note, in
addition to and not in limitation or lieu of any other rights or remedies
Employer may have against Employee as a result of such default, Employer may
exercise all of its rights at law and in equity as a secured party, including
without limitation under the Uniform Commercial Code, with respect to all Stock
then securing the Employee Note with respect to which the default has occurred.
Upon a default, without limiting any of Employer's other rights and remedies,
Employer may conduct a public or private foreclosure sale of the Stock securing
the Employee Note with respect to which the default has occurred. Employee
agrees that 10 days notice to him of any private sale is fair and reasonable.
Employer may be the purchaser at any public foreclosure sale, and may bid any
commercially reasonable amount at such sale. In all events, in the event of a
public or private foreclosure sale, Employee shall be liable for any
deficiency. All of Employer's rights and remedies under the Employee Note(s),
the Pledge and this Agreement, and at law or in equity, are cumulative, and
none is intended to be in substitution or in lieu of, nor is the exercise of
one intended to be a waiver of, any other. Employer shall have no obligation
to proceed against the Stock before proceeding against Employee with respect to
any default under any of the Employee Notes.
17. EMPLOYEE'S DISCLOSURES & REPRESENTATIONS & WARRANTIES.
Employee hereby acknowledges, represents and warrants to,
and/or agrees with, Employer as follows:
(a) That Employee and his representatives and
agents (i) have received and read and are familiar with this Agreement and the
exhibit annexed hereto, (ii) are familiar with the business and operations
conducted and to be conducted by Employer and the risks attendant thereto,
(iii) have been given access to and have examined or have had an opportunity to
examine before the date hereof all applicable agreements, documents, records
and books and such other applicable information as are available and relevant
to such business and operations and to enable them to verify the accuracy of
any information, agreements, documents, records or books provided to them; and
that as a director and President of Employer, Employee is very familiar with
Employer's business, operations, properties and prospects, and the significant
risks attendant to any investment in Employer.
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(b) That no assurances, representations,
warranties or guarantees of any kind or nature whatsoever relating to the
profits, losses, appreciation, distributions and/or cash flow that are to be
realized, if any, by Employee as a result of this transaction or the investment
in Employer have been made to Employee or his tax, financial, legal or other
advisors or agents by Employer or any agent, employee or affiliate of Employer
and that, with respect to the tax aspects, treatments and benefits (if any) of
this transaction and the profits or losses of Employer, Employee is relying
solely upon the advice of his own tax advisors and upon his knowledge with
respect thereto in determining the availability of any tax advantages,
treatments or benefits to him.
(c) That Employee and/or his representatives and
agents have had an opportunity to ask questions of and receive satisfactory
answers from Employer and/or a person or persons authorized to act on
Employer's behalf concerning the terms and conditions of this Agreement, this
transaction and Employer and its currently contemplated business and
operations.
(d) That Employee has sufficient knowledge and
experience in financial and business matters to evaluate the merits and risks
of an investment in Employer and to make an informed decision with respect
thereto without the services of a purchaser representative.
(e) Subject to Employee's right to designate
family members to own the Stock, that Employee is or will be acquiring the
Options and the Optioned Purchased Stock for his own account, for investment
purposes only, and not with a view to the public sale or distribution thereof,
in whole or in part or directly or indirectly, and is able to bear the economic
and financial risk of an investment in Employer for an indefinite period of
time.
(f) That Employee has been represented by such
legal and/or tax counsel and other professional advisors (if any), each of whom
has been personally selected by Employee, as Employee has found necessary to
consult concerning the transactions contemplated in or by this Agreement.
(g) That Employee has full right, power and
authority to perform all obligations under this Agreement.
(h) That Employee understands that the Options
are nonassignable, and that the Optioned Purchased Stock may be sold or
transferred only pursuant to appropriate registration and qualification thereof
with appropriate federal and state agencies, unless an opinion of counsel
reasonably acceptable to Employer and Employer's counsel is
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provided to the effect that the proposed sale or transfer is exempt from
registration and qualification.
(i) All certificates evidencing the Stock shall
be legended, such legends to be in form and content reasonably determined by
Employer, restricting transfer of the Stock unless in compliance with
applicable securities laws and with respect to the Pledge.
Employee hereby agrees to indemnify and hold harmless Employer
and its shareholders, directors, officers, employees and agents from and
against any and all loss, damage, liability, cost or expense (including
reasonable attorneys' and paralegals' fees and costs before and at trial and at
all appellate levels) due to or arising out of any inaccuracy in, or breach of,
any representation, warranty or covenant of Employee contained in this Section
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18. INDEPENDENT COUNSEL
Employer and Employee agree that each of them have been, or
were advised and fully understand that they are entitled to be, represented by
independent legal counsel with respect to all matters contemplated herein, from
the commencement of negotiations at all times through the execution hereof.
19. LAW APPLICABLE
This Agreement shall be governed by and construed pursuant to
the laws of the State of Florida, without giving effect to conflicts of laws
principles.
20. NOTICES
Any notices required or permitted to be given pursuant to this
Agreement shall be sufficient, if in writing, and if personally delivered or
sent by certified or registered mail, return receipt requested, to his
residence, in the case of Employee, or to its then principal office, in the
case of Employer.
21. SUCCESSION
This Agreement shall inure to the benefit of and be binding
upon the parties hereto and their respective legal representatives, heirs,
assignees and/or successors in interest of any kind whatsoever; provided,
however, that Employee acknowledges and agrees that he cannot assign or
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delegate any of his rights, duties, responsibilities or obligations hereunder
to any other person or entity.
22. ENTIRE AGREEMENT
This Agreement constitutes the entire final agreement between
the parties with respect to, and supersedes any and all prior agreements
between the parties hereto both oral and written concerning, the subject matter
hereof and may not be amended, modified or terminated except by a writing
signed by the parties hereto.
23. SEVERABILITY
If any provision of this Agreement shall be held to be invalid
or unenforceable, and is not reformed by a court of competent jurisdiction,
such invalidity or unenforceability shall attach only to such provision and
shall not in any way affect or render invalid or unenforceable any other
provision of this Agreement, and this Agreement shall be carried out as if such
invalid or unenforceable provision were not contained herein.
24. NO WAIVER
A waiver of any breach or violation of any term, provision or
covenant contained herein shall not be deemed a continuing waiver or a waiver
of any future or past breach or violation. No oral waiver shall be binding.
25. ATTORNEYS' FEES
In the event that either of the parties to this Agreement
institutes suit against the other party to this Agreement to enforce any of his
or its rights hereunder, the prevailing party in such action shall be entitled
to recover from the other party all reasonable costs thereof, including
reasonable attorneys' and paralegals' fees and costs incurred before and at
trial and at all tribunal levels.
26. COUNTERPARTS
This Agreement may be executed in counterparts, each of which
shall be an original, but both of which together shall constitute one and the
same instrument.
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27. INDEMNITY OF EMPLOYEE
Employer shall indemnify and hold harmless Employee from and
against any and all claims, judgments, fines, penalties, liabilities, losses,
costs and expenses (including reasonable attorneys' fees and costs) asserted
against or incurred by Employee as a result of acts or omissions of Employee
taken or made in the course of performing his duties for Employer or by reason
of Employee acting or having acted as a director or officer of Employer, to the
maximum extend permitted by law, including Section 607.0850, Florida Statutes
(including the advancement of expense provisions thereof); provided, however,
that such indemnity shall not apply to acts or omissions of Employee which
constitute misconduct, gross negligence or which were intended by Employee to
personally benefit Employee, directly or indirectly, at the expense of
Employer, unless the matter which benefits Employee was first fully disclosed
to the Board of Directors of Employer and approved by said Board.
IN WITNESS WHEREOF, the undersigned have hereunto set their hands on
the day and year first above written.
VIRAGEN, INC.
By:
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XXXXXX X. XXXXXX
Executive Vice President
-------------------------
XXXXXX XXXXX
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