Exhibit 10.1
AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made and entered into February 19, 1999 and amended
and restated as of September 20, 2002 (this "Agreement"), by and between
Triangle Pharmaceuticals, Inc., a Delaware corporation (the "Company"), and
Xxxxx X. Xxxxxx ("Executive").
W I T N E S S E T H :
WHEREAS, Executive has been an employee of the Company since November
1, 1995;
WHEREAS, Executive and the Company entered into an Employment Agreement
dated February 19, 1999 (the "Original Employment Agreement"); and
WHEREAS, the Company and Executive desire to amend and restate the
Original Employment Agreement as set forth in this Agreement and this Agreement
shall replace and supersede the Original Employment Agreement.
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, and other good and valuable consideration, including the
employment of Executive by the Company under this Agreement, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. EMPLOYMENT. The Company hereby employs Executive as President and
Chief Operating Officer. Executive hereby accepts such employment upon the terms
and conditions set forth herein for the Term of the Agreement, as defined in
Section 2 hereof. While so employed, Executive agrees to devote his full time
and attention to carrying out his duties and responsibilities under this
Agreement and to use his best efforts, skills and abilities to further the
interests of the Company. While employed by the Company, Executive may not work
for any other entity, in any capacity, without the prior express written consent
of the Company. Executive agrees to comply with all applicable governmental
laws, rules and regulations, and policies, standards and regulations of the
Company now existing or hereafter promulgated.
2. TERM OF AGREEMENT.
(a) The term of this Agreement shall commence as of the date
and year first above written and shall continue until December 31,
2002, unless terminated earlier as provided herein. As used in this
Agreement, "Term of Agreement" means the period of time from the date
and year first above written to December 31, 2002.
(b) Executive is currently a member of the Company's Board of
Directors ("Board"). Upon the termination of this Agreement for any
reason, Executive shall deliver a written notice to the Company
indicating that, effective with the termination of his employment,
Executive is resigning as a member of the Board.
3. COMPENSATION.
(a) BASE SALARY. Executive shall commence receiving, effective
January 1, 2002, a base salary of $323,604 a year ("Base Salary") less
required federal and state withholdings and other authorized
deductions, payable in accordance with the Company's normal payroll
schedule.
(b) BONUS PAYMENT. On the earlier of December 1, 2002 or the
date of termination of this Agreement, unless such termination is by
the Company pursuant to Section 6(b) (for Cause) or by
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Executive pursuant to Section 6(c) (voluntary termination), Executive
shall receive a bonus of $113,261 (less required federal and state
withholdings and other authorized deductions), which amount shall be
paid in a lump sum ("Bonus Payment").
4. OTHER BENEFITS. Executive may be eligible to participate in the
Company's retirement and welfare benefit plans under the terms and conditions
established by the applicable plan documents. Executive shall be entitled
annually to paid vacation and other paid time off in compliance with all
applicable laws and in accordance with the terms and conditions of the Company's
vacation and professional leave policies, as may be amended from time to time in
the Company's sole discretion.
5. DISABILITY PAYMENTS. If Executive becomes eligible to receive
benefits under any short-term or long-term disability plan or policy sponsored
by the Company, then all payments and benefits provided by this Agreement,
including, but not limited to, the compensation described in Section 3, will
cease, and this Agreement shall terminate when Executive is considered to be a
terminated employee under the applicable policies and procedures of the Company.
6. TERMINATION OF EMPLOYMENT.
(a) TERMINATION OF EMPLOYMENT RELATIONSHIP. The employment
relationship between the Company and Executive shall terminate
automatically on December 31, 2002 or upon the termination of this
Agreement by either party as provided in Section 6, whichever shall
occur first.
(b) TERMINATION FOR CAUSE. The Board of Directors of the
Company may terminate this Agreement for Cause, as defined in Section
8, upon three (3) business days written notice which shall state the
reason for such termination and shall be delivered to Executive in
accordance with Section 16 hereof. Upon the mailing or the delivery in
person of such notice, Executive's duties and authority to act on
behalf of the Company shall cease immediately and his employment shall
be deemed to terminate on the date fixed in the notice.
(c) VOLUNTARY TERMINATION. Either the Company or Executive may
voluntarily terminate this Agreement upon thirty (30) days written
notice, for any reason, other than death or "Retirement," as defined in
Section 8.
(d) TERMINATION UPON DEATH OR RETIREMENT. This Agreement shall
terminate automatically, except as otherwise provided herein, upon
Executive's death or Retirement. If this Agreement is terminated on
account of Executive's Retirement, the parties shall be required to
carry out any provisions hereof which contemplate performance thereof
subsequent to termination and nothing contained herein shall be deemed
to preclude Executive and the Company from negotiating a mutually
acceptable basis upon which Executive continues his employment by the
Company in a full-time or part-time capacity.
(e) TERMINATION FOR GOOD REASON. Executive may terminate this
Agreement at any time upon three (3) business days written notice to
the Company for "Good Reason," as defined in Section 8.
7. EFFECT OF TERMINATION.
(a) TERMINATION FOR CAUSE. If this Agreement is terminated for
Cause pursuant to Section 6(b), the Company shall pay Executive such
Base Salary as Executive may be entitled to receive for services
rendered prior to the effective date of such termination and for any
accrued but unused vacation, including any banked vacation.
(b) VOLUNTARY TERMINATION BY EXECUTIVE. If Executive
voluntarily terminates this Agreement pursuant to Section 6(c), the
Company shall pay Executive such Base Salary as Executive may be
entitled to receive for services rendered prior to the effective date
of such termination and for any accrued but unused vacation, including
any banked vacation.
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(c) TERMINATION UPON DEATH OR RETIREMENT. If this Agreement is
terminated on account of Executive's death or Retirement pursuant to
Section 6(d), the Company shall pay Executive: such Base Salary as
Executive may be entitled to receive for services rendered prior to the
effective date of such termination; any accrued but unused vacation,
including any banked vacation. In addition, if this Agreement is
terminated on account of Executive's death, all outstanding options to
purchase shares of stock of the Company granted to Executive will
become fully vested and exercisable, and the Company's rights to
repurchase, and all other restrictions applicable to awards of
restricted stock, shall lapse on the date of Executive's death, subject
to the terms and conditions of the applicable plan documents and
agreement(s), except that any provisions of such plan documents and
agreements to the contrary notwithstanding, Executive's estate shall
have until and including December 31, 2004 to exercise any outstanding
option for vested shares of the Company's stock.
(d) TERMINATION WITHOUT CAUSE. Except as provided in Section
7(e), if this Agreement is terminated by the Company without Cause
pursuant to Section 6(c), then:
(i) The Company shall pay Executive such Base Salary
as he may be entitled to receive for services rendered prior
to the date of such termination (the "Payment for Services
Rendered");
(ii) The Company shall pay Executive for any accrued
but unused vacation, including any banked vacation (the
"Vacation Payment");
(iii) Subject the restrictions set forth in Sections
9 and 10, the Company shall pay Executive an amount equal to
one-twelfth (1/12) of Executive's Base Salary each month for a
period of eighteen (18) months, less required federal and
state withholdings and other authorized deductions, payable in
accordance with the regularly scheduled payroll of the Company
beginning on or after the Release Date, as defined in Section
8 (the "Eighteen Month Payment");
(iv) Subject to the restrictions set forth in
Sections 9 and 10, if Executive timely elects to continue
coverage under the Company's health care plan, pursuant to the
Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended ("COBRA"), the Company shall pay Executive at the end
of each month for the first eighteen (18) months beginning on
the first day of the first month following the Release Date,
an amount equal to Executive's monthly premium for the COBRA
coverage so elected (the "COBRA Payment"). The Company's
obligation under this Section 7(d)(iv) shall immediately cease
at such time as Executive becomes eligible for comparable
health coverage from another company. If Executive fails to
notify the Company that he is eligible for other health
coverage within thirty (30) days of becoming eligible for such
coverage, Executive shall be considered in breach of this
Agreement and shall be required to repay to the Company all
payments made under this Section 7(d)(iv); and
(v) Subject to the restrictions set forth in Section
9, the Company shall accelerate the vesting of any outstanding
option to purchase shares of stock of the Company granted to
Executive by one (1) year, and accelerate the lapse of all
repurchase rights and forfeiture restrictions applicable to
any restricted stock award by one (1) year, all subject to the
terms and conditions of the applicable plan documents and
agreement(s), except that, any provisions of such plan
documents and agreement(s) to the contrary notwithstanding,
Executive shall have until and including December 31, 2004 to
exercise any outstanding option for vested shares of the
Company's stock.
(e) TERMINATION FOLLOWING A CHANGE OF CONTROL. If this
Agreement is terminated following a Change of Control by the Company
without Cause, by the Executive for Good Reason, or by expiration of
the Term on December 31, 2002, then the Company shall pay Executive the
Payment for Services Rendered and the Vacation Payment. In addition to
the foregoing, and subject to the restrictions set forth in Section 9:
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(i) the Company shall pay Executive an amount equal
to one-twelfth (1/12) of Executive's Base Salary each month
for a period of twenty-four (24) months, less required federal
and state withholdings and other authorized deductions, (the
"Twenty-Four Month Payment"), which amount shall be payable in
accordance with the regularly scheduled payroll of the Company
beginning on or after the Release Date, as defined in Section
8;
(ii) all outstanding options to purchase shares of
stock of the Company granted to Executive will become fully
vested and exercisable, and the Company's rights to
repurchase, and all other restrictions applicable to awards of
restricted stock, shall lapse, all subject to the terms and
conditions of the applicable plan documents and agreement(s);
and
(iii) the Company shall pay Executive the COBRA
Payment. The Company's obligation under this Section 7(e)(iii)
shall immediately cease at such time as Executive becomes
eligible for comparable health coverage from another company.
If Executive fails to notify the Company that he is eligible
for other health coverage within thirty (30) days of becoming
eligible for such coverage, Executive shall be considered in
breach of this Agreement and shall be required to repay to the
Company all payments made under this Section 7(e)(iii).
(f) TERMINATION UPON EXPIRATION OF AGREEMENT. If this
Agreement is terminated due to the expiration of the Term as provided
in Section 2:
(i) the Company shall pay Executive the Payment for
Services Rendered;
(ii) the Company shall pay Executive the Vacation
Payment;
(iii) subject to the restrictions in Sections 9 and
10, the Company shall pay Executive the Eighteen Month
Payment;
(iv) subject to the restrictions in Section 9 and 10,
the Company shall pay Executive the Cobra Payment. The
Company's obligation under this Section 7(f)(iv) shall
immediately cease at such time as Executive becomes eligible
for comparable health coverage from another company. If
Executive fails to notify the Company that he is eligible for
other health coverage within thirty (30) days of becoming
eligible for such coverage, Executive shall be considered in
breach of this Agreement and shall be required to repay to the
Company all payments made under this Section 7(f)(iv); and
(v) subject to the restrictions set forth in Section
9, the Company shall accelerate the vesting of any outstanding
option to purchase shares of stock of the Company granted to
Executive by one (1) year, and accelerate the lapse of all
repurchase rights and forfeiture restrictions applicable to
any restricted stock award by one (1) year, all subject to the
terms and conditions of the applicable plan documents and
agreement(s), except that any provisions of such plan
documents and agreements to the contrary notwithstanding,
Executive shall have until and through December 31, 2004 to
exercise any outstanding option for vested shares of the
Company's stock.
(g) Notwithstanding the foregoing, except as otherwise
specified in Section 25, nothing herein shall be construed to entitle
Executive to any severance benefits beyond those specified in this
Section, and the severance benefits described in this Section are in
lieu of any other severance benefits which may be offered by the
Company, whether by the terms of this Agreement or otherwise, to any
employee.
(h) Notwithstanding the foregoing, the Company shall have the
right to waive or accelerate any applicable notice period for
termination of this Agreement and may terminate this Agreement
immediately upon payment to Executive of an amount which the Company
determines, in its sole discretion and in good faith, to be equal to
the amount of Base Salary Executive would have received if notice had
not been waived or accelerated by the Company.
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8. DEFINITIONS.
(a) For purposes of this Agreement, "Cause" shall be defined
as:
(i) Executive being formally charged with the
commission of a felony, or being convicted of a misdemeanor
involving moral turpitude.
(ii) Executive's demonstrable fraud or dishonesty.
(iii) Executive's use of illegal drugs or any illegal
substance, or his use of alcohol in any manner that materially
interferes with the performance of his duties under this
Agreement.
(iv) Executive's intentional, reckless or grossly
negligent conduct detrimental to the best interests of the
Company, including without limitation, any misappropriation or
unauthorized use of the Company's property or improper
disclosure of confidential information.
(v) Executive's failure to perform material duties
under this Agreement if such failure has continued for twenty
(20) days after Executive has been notified in writing by the
Company of the nature of Executive's failure to perform.
(vi) Executive's chronic absence from work for
reasons other than illness.
(vii) Executive's violation of the Company's policy
prohibiting sexual harassment.
(viii) Executive's violation of the Company's policy
prohibiting unlawful discrimination.
(b) For purposes of this Agreement, "Change of Control" shall
be deemed to have occurred if:
(i) ASSUMPTION OR ASSIGNMENT. A merger or asset sale
occurs in which this Agreement is assumed or assigned;
(ii) TENDER OFFER OR ACQUISITION. Any "person" as
defined in Section 3(a)(9) of the United States Securities
Exchange Act of 1934 (the "Act"), including a "group" (as that
term is used in sections 13(d)(3) and 14(d)(2) of the Act),
but excluding the Company and any Executive benefit plan
sponsored or maintained by the Company, including any trustee
of such plan acting as trustee, who:
(1) makes a tender or exchange offer for any
shares of the Company's stock pursuant to which at
least fifty percent (50%) of the Company's stock is
purchased; or
(2) together with its "affiliates" and
"associates" (as those terms are defined in Rule
12b-2 under the Act) becomes the "beneficial owner"
(within the meaning of Rule 13d-3 under the Act) of
at least fifty percent (50%) of the Company's stock;
(iii) MERGER OR CONSOLIDATION. The shareholders
of the Company approve one of the following transactions to
which the Company is a party:
(1) a merger or consolidation in which
securities possessing more than fifty percent (50%)
of the total combined voting power of the Company's
outstanding securities are transferred to a person or
persons different from the persons holding those
securities immediately prior to such transaction; or
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(2) the sale, transfer or other disposition
of all or substantially all of the Company's assets
in complete liquidation or dissolution of the
Company; or
(iv) CHANGE IN BOARD. When, during the Term of
Agreement, the individuals who, at the beginning of such
period, constitute the Board (the "Incumbent Directors") cease
for any reason other than death or retirement to constitute at
least a majority thereof; provided, however, that a director
who was not a director at the beginning of the Term of
Agreement shall be deemed to have satisfied such requirement,
and be an Incumbent Director, if such director was elected by,
or on the recommendation of or with the approval of, at least
two-thirds of the directors who then qualified as Incumbent
Directors either actually, because they were directors at the
beginning of the Term of Agreement, or by prior operation of
this Section.
(c) For purposes of this Agreement, "Good Reason" shall mean
the termination of Executive's employment by Executive following a
Change of Control on account of (i) a change in Executive's position
with the Company which materially reduces his level of responsibility;
(ii) a reduction in Executive's level of compensation (including base
salary, fringe benefits and participation in any corporate performance
based bonus or incentive programs) by more than fifteen percent (15%);
or (iii) a relocation of Executive's place of employment by more than
fifty (50) miles, provided and only if such change, reduction or
relocation is effected by the Company, without Executive's consent.
(d) "Release Date" shall mean the date on which the Release,
as defined in Section 9, is effective, which date shall be set forth in
the Release.
(e) For purposes of this Agreement, "Retirement" shall occur
at the Executive's election, exercisable by ninety (90) days prior
written notice, at the end of any fiscal year during which or after
Executive attains age seventy (70), or age fifty-five (55) and fifteen
(15) years of continuous service.
9. CONDITION OF PAYMENT OF BENEFITS.
(a) Executive agrees that he shall be entitled to the Eighteen
Month Payment, the COBRA Payment, the Twenty-Four Month Payment and the
benefits under the terms of Sections 7(d)(v), 7(e)(ii) and 7(f)(v), as
applicable, only if he timely executes a complete and general release
in a form substantially comparable to the release set forth in EXHIBIT
A hereto and incorporated herein by reference or in such other
comparable form as is determined by the Company in good faith to be
advisable due to legitimate legal or business needs of the Company, so
long as any such changes are consistent with the intent of this
Agreement and EXHIBIT A (the "Release"). The Release shall contain a
release by Executive and any beneficiary of Executive entitled to
receive all or any portion of the benefits specified in such Sections
of any claims arising from Executive's employment or association with
the Company or otherwise existing against the Company and its officers,
directors, agents, employees, shareholders, and representatives at the
time of execution of the release. The Company agrees to prepare and
deliver to Executive for execution the Release promptly following the
termination of employment. Notwithstanding any other provision set
forth herein, if the Executive elects not to execute the Release, then
Executive shall have no entitlement to the Eighteen Month Payment, the
COBRA Payment, the Twenty-Four Month Payment, or the benefits under
Sections 7(d)(v), 7(e)(ii) and 7(f)(v), as applicable, and Executive
shall be entitled only to payment of an amount equal to one-twelfth
(1/12) of Executive's Base Salary in effect at the time of the
termination, less required federal and state withholdings and other
authorized deductions, which amount shall be payable in a lump sum in
accordance with the regularly scheduled payroll of the Company. In
addition, if Executive elects not to execute the Release and he has
received the Bonus Payment, then he shall be required to repay the
entire Bonus Payment amount to the Company within thirty (30) days of
the termination of his employment.
(b) Notwithstanding anything to the contrary contained in this
Agreement, in the event that Section 10(d)(i) of this Agreement, to the
extent applicable pursuant to Section 10(e), is determined to be
unenforceable due to Executive's actions, to any extent, by a court or
arbitration panel, whether by
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preliminary or final adjudication, the Company shall not be liable for
the Eighteen Month Payment or the COBRA Payments payable pursuant to
Sections 7(d)(iv) or 7(f)(iv).
10. NONCOMPETITION AND NONSOLICITATION.
(a) NEED FOR COVENANTS. Executive acknowledges that the
Company has expended, and is expected to expend, large amounts of time,
money and effort in researching, developing, designing and testing its
products, developing and keeping a committed management team. Executive
acknowledges and agrees that as an employee of the Company, he has had
and will have access to, the benefit of, and acquire a considerable
amount of know-how, confidential and proprietary information, and other
valuable knowledge and goodwill with respect to the business of the
Company, which knowledge, information, know-how and goodwill would be
extremely detrimental to the Company if used by Executive to compete
with the Company, and Executive agrees that the Company is entitled to
be protected from the possibility, both during and after Executive's
employment terminates, of Executive becoming associated with a business
which competes with the Company. Executive further acknowledges that if
he did become associated with such a business, such business would
compete unfairly with the business of the Company in view of the trade
secrets and confidential, proprietary information which has and will
become known to the Executive by reason of being employed by the
Company. Executive further acknowledges that the nature of the
Company's products are such that its natural market will be worldwide
because the development of drugs for the treatment of HIV/HBV diseases
can be conducted worldwide and the Company's competition in the
development of drugs for the treatment of HIV/HBV diseases is located
throughout the world and competes in a worldwide market. Accordingly,
Executive hereby agrees that the time, geographic and other
restrictions contained in this Agreement are reasonable to protect the
legitimate interests of the Company and do not unfairly restrict or
penalize Executive.
(b) Executive agrees that during his employment and, for so
long of the period after his employment terminates as he may elect to
honor his obligations under this Section 10(b) but in any event no
longer than eighteen (18) months following the termination of his
employment (the "Noncompetition Period") with the Company for any
reason and by any party, Executive will not within the Restricted Area
defined below, directly or indirectly, engage in any other business or
be a consultant to or general partner, employee, officer or director of
any partnership, firm, corporation, or other entity, or act as an agent
for any of the foregoing persons or entities, if (i) such other
business, partnership, firm, corporation, entity or person is engaged
in for-profit activity in the pharmaceutical industry within the
Restricted Area, as defined below, and competes with the Company in the
field of HIV or HBV diseases or such other field in which the Company
has drug candidates in the clinical stage of development on the date of
termination or expiration of this Agreement; and (ii) Executive
performs duties in the same or similar functional area for such other
business, partnership, firm, corporation, entity or person as are
substantially comparable to, those performed by Executive at the
Company; and (iii) Executive's duties are performed in the United
States. As used in clause (i) of this Section 10(b), "competes" shall
mean that such business, partnership, firm, corporation, entity or
person is conducting clinical studies with respect to a proprietary
drug compound or candidate (i.e., owned or licensed) in the HIV or HBV
field or is marketing or co-marketing or co-promoting a drug in the HIV
or HBV field.
(c) For purposes of this Agreement, Restricted Area, means
any location within North America.
(d) Executive agrees that during the Term of Agreement and
for the Noncompetition Period, he will not, in the Restricted Area:
(i) encourage or solicit any employee or consultant
to the Company to leave the Company for any reason; or
(ii) solicit the business of any client or customer
of the Company (other than on behalf of the Company). However,
this obligation shall not affect any responsibility Executive
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may have as an employee of the Company with respect to the
bona fide hiring and firing of Company personnel.
(e) This Section 10 shall apply after termination of
employment only in the event that (i) the Company terminates
Executive's employment without Cause pursuant to Section 6(c) or (ii)
this Agreement terminates due to the expiration of the Term as provided
in Section 2. Accordingly, this Section 10 does not apply if (i) the
Company terminates Executive's employment pursuant to Section 6(b);
(ii) Executive voluntarily terminates his employment pursuant to
Section 6(c); (iii) Executive terminates his employment for Good Reason
pursuant to Section 6(c); (iv) the Company terminates Executive's
employment without Cause following a Change of Control; or (v)
Executive terminates his employment on account of Executive's
Retirement pursuant to Section 6(d).
(f) If, for any reason, any provision of this Section 10, to
the extent applicable pursuant to Section 10(e), is determined to be
unenforceable due to Executive's actions, by a court or arbitration
panel, whether by preliminary or final adjudication, or Executive
elects not to adhere to the restrictions of Sections 10(b) or
10(d)(ii), which is his right subject to forfeiture of his eligibility
for the payments and benefits described herein, the Company shall cease
immediately payment of the Eighteen Month Payment and the COBRA
Payments payable pursuant to Sections 7(d)(iv) or 7(f)(iv). Executive
agrees to notify the Company immediately of his election not to adhere
to Sections 10(b) or 10(d)(ii). If Executive fails to notify the
Company within thirty (30) days of making such election, Executive
shall be considered in breach of this Agreement, the Company shall have
no further obligations hereunder, and Executive shall be required to
repay to the Company all payments made for the Eighteen Month Payment
and the COBRA Payments payable pursuant to Sections 7(d)(iv) or
7(f)(iv).
(g) The Noncompetition Period shall be extended for any period
of time in which Executive is in violation of the provisions of Section
10 or period(s) of time required for legal action to enforce the
provisions of Section 10.
(h) Executive acknowledges and agrees that the provisions of
Section 10 are reasonable and necessary to protect the legitimate
business interests of the Company, and are reasonable with respect to
time and territory.
(i) In the event the duration, scope or geographic area in
Section 10 are determined to be unenforceable by a court or arbitration
panel, the parties agree that such duration, scope or geographic area
shall be deemed to be reduced to the greatest scope, duration or
geographic area which would be enforceable.
(j) The provisions of Section 10 shall be deemed severable,
and the invalidity or unenforceability of any provision (or part
thereof) shall in no way affect the validity or enforceability of any
other provisions (or remaining part thereof). Without limiting the
foregoing, in the event any of the restrictions on competition,
interference, or solicitation as set forth in Section 10 are determined
to be invalid or unenforceable, the provisions of Section 10 shall be
deemed severable, and the invalidity or unenforceability of any
provision (or part thereof) shall in no way effect the validity or
enforceability of any other provision (or remaining part thereof).
(k) The provisions of Section 10 shall survive the
termination of this Agreement and the employment relationship between
the parties.
11. REMEDIES. Executive acknowledges and agrees that any breach of
Section 10(d)(i) of this Agreement will result in irreparable damage and
continuing injury to the Company. Therefore, in the event of any breach or
threatened breach of Section 10(d)(i) by Executive, Executive acknowledges and
agrees that the Company shall be entitled, without limiting any other available
legal or equitable remedy (whether conferred by statute or otherwise), to an
injunction to be issued by any court of competent jurisdiction enjoining and
restraining Executive from committing any violation or threatened violation of
Section 10(d)(i), and Executive hereby consents to the issuance of such
injunction. The Company shall not be required to post any bond to obtain any
such injunction. Executive agrees that all remedies available to the Company by
reason of a breach of any of the foregoing
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provisions of this Agreement are cumulative and that none is exclusive and that
all remedies may be exercised concurrently or consecutively at the option of the
Company.
12. ARBITRATION. The parties agree that any and all disputes that they
have with one another which arise out of Executive's employment or under the
terms of this Agreement shall be resolved through final and binding arbitration,
as specified herein. This shall include, without limitation, disputes relating
to this Agreement, Executive's employment by the Company or the termination
thereof, claims for breach of contract or breach of the covenant of good faith
and fair dealing, and any claims of discrimination or other claims under any
federal, state or local law or regulation now in existence or hereinafter
enacted and as amended from time to time concerning in any way the subject of
Executive's employment with the Company or its termination. The only claims not
covered by this Section 12 are claims for benefits under the workers'
compensation laws or claims for unemployment insurance benefits, which will be
resolved pursuant to those laws. Binding arbitration will be conducted in
Durham, North Carolina, in accordance with the rules and regulations of the
American Arbitration Association. Each party will bear one half of the cost of
the arbitration filing and hearing fees, and the cost of the arbitrator.
Executive understands and agrees that the arbitration shall be instead of any
civil litigation and that the arbitrator's decision shall be final and binding
to the fullest extent permitted by law and enforceable by any court having
jurisdiction thereof. Notwithstanding the foregoing, the Company shall be
permitted to seek injunctive relief before any court within the State of North
Carolina for any alleged breach of Section 10(d)(i) of this Agreement.
13. MODIFICATION. No modification, amendment, or alteration of any
provision of this Agreement shall be effective unless contained in a written
agreement signed by the parties hereto, and then such modification, amendment,
or alteration shall be effective only in the specific instances and for the
specific purposes for which given.
14. SUCCESSORS AND ASSIGNS. This Agreement shall bind and inure to the
benefit of the parties and their respective successors and permitted assigns.
Upon prior notice to Executive, the Company may assign this Agreement to a
wholly-owned subsidiary, "spin-off' Company, or other entity affiliated with the
Company. Executive shall not assign his rights or obligations hereunder to any
person or entity without the prior written consent of the Company.
15. NO WAIVER. No delay or failure on the part of the Company in the
exercise of any right, power, or privilege under this Agreement shall impair any
such right, power, or privilege or be construed as a waiver of any default or
any acquiescence therein. No waiver shall be valid against the Company unless
made in writing and signed by it, and then only to the extent expressly
specified therein.
16. NOTICES. All notices and communications provided for hereunder
shall be in writing and personally delivered or sent by first-class, registered,
or certified mail, postage prepaid, and addressed as follows:
If to the Company:
Triangle Pharmaceuticals, Inc.
Attn: Director of Human Resources
0 Xxxxxxxxxx Xxxxx
0000 Xxxxxxxxxx Xxxxx
Xxxxxx, Xxxxx Xxxxxxxx 00000
If to Executive:
To the Executive's last known address as shown on the Company's
records.
Either party may change its address for notice purposes by notice to the other
party as specified herein.
17. RESTRICTIVE LEGENDS. Promptly, and in any event within five (5)
business days after any request is made by or on behalf of Executive to remove
any restrictive legends on any vested shares of the Company's stock owned by
Executive, the Company shall instruct its stock transfer agent to remove such
restrictive legends, except to
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the extent that such vested shares cannot be sold by Executive at the time of
such request pursuant to (i) a lock-up agreement entered into by Executive which
restricts the transfer of such shares (provided that the Company shall promptly
instruct its stock transfer agent to remove such restrictive legends following
the expiration of such lock-up period) or (ii) Rule 144 of the Regulations under
the Securities Act of 1933; provided that with respect to the portion of such
shares (if any) which Executive cannot sell pursuant to subsection (k) of Rule
144, the Company may require such notices, representations and other actions by
or from Executive and/or his/her agents as are customarily required and/or
reasonably necessary prior to directing the Company's stock transfer agent to
remove such restrictive legends therefrom. Solely with respect to this Section
17, reference to Executive shall include reference to Executive's spouse, an
immediate family member or other permissible transferee, to the extent such
transferee, consistent with applicable law, shall request the removal of any
restrictive legends. The Company agrees that any stock certificates issued upon
the exercise of options for stock of the Company shall be issued without any
restrictions on transfer. The provisions of this Section shall survive any
termination or expiration of this Agreement. Notwithstanding the foregoing, the
parties agree that (a) the lock-up periods in such agreements, if any, shall
expire upon the termination or expiration of this Agreement, provided that, upon
the reasonable request of any underwriter of the Company, Executive agrees to
consider in good faith the continuation of such lock-up periods in accordance
with their terms for a duration not to exceed three (3) months following the
termination of employment of Executive pursuant to this Agreement, provided
further that all executive officers and directors of the Company are bound by
substantially similar agreements, and (b) Executive shall in any event be deemed
for purposes of this Agreement to be able to sell pursuant to Rule 144 after
three (3) months have elapsed following the termination of employment of
Executive pursuant to this Agreement.
18. GOVERNING LAW. This Agreement shall be governed by and interpreted
in accordance with the laws of the State of North Carolina without reference to
its conflict of law provisions, and any legal action brought by the parties
related to this Agreement shall be brought in Durham County, North Carolina.
19. SEVERABILITY. If any provision or part thereof contained in this
Agreement shall be invalid or unenforceable under applicable law, that provision
or part thereof shall be ineffective to the extent of such invalidity only,
without in any way affecting the remainder of this Agreement.
20. ENTIRE AGREEMENT. This Agreement with attachments constitutes the
entire understanding of the parties with respect to the subject matter hereof.
This Agreement supersedes any and all other understandings and agreements,
either oral or in writing, between the parties hereto with respect to the
subject matter hereof and constitutes the sole and only Agreement between the
parties with respect to said subject matter. Each party to this Agreement
acknowledges that no representations, inducements, promises or agreements, oral
or otherwise, have been made by any party or by anyone acting on behalf of any
party, which are not embodied herein, and that no agreement, statement or
promise not contained in this Agreement shall be valid or binding or of any
force or effect. Notwithstanding the foregoing, Executive will adhere to and
honor all obligations to the Company as described in the Proprietary Information
and Inventions Agreement dated October 27, 1995, except that the provisions of
Section 3(h) and 3(i) of said agreement are superseded, and any agreement
providing for the award of stock options and/or restricted stock to which
Executive is a party.
21. DUPLICATION. If a benefit promised herein is otherwise provided by
the terms of a plan or policy sponsored by the Company on account of the same
event giving rise to the benefit under this Agreement, nothing herein shall be
construed to entitle Executive to duplicate benefits; however, if the terms of
this Agreement provide for an enhanced benefit, Executive shall be entitled to
the incremental benefit hereunder whether under the plan or policy or by direct
payments from the Company.
22. WITHHOLDING. All payments made hereunder shall be less taxes and
applicable withholdings.
23. GENDER. The use of the masculine gender is for convenience only and
shall be deemed to refer to the applicable gender.
24. SURVIVAL. The provisions of Sections 7 through 26 shall survive the
termination of this Agreement and the termination of Executive's employment.
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25. SAVING PROVISION. In the event that, prior to December 31, 2002,
(i) the Company terminates Executive's employment without Cause pursuant to
Section 6(c); or (ii) this Agreement terminates automatically following a Change
of Control, for purposes of the provisions of Section 7, this Agreement will be
deemed to have continued in effect until December 31, 2002 with the intent of
the parties being that Executive shall be paid all amounts and be entitled to
all benefits specified in Section 7 as though this Agreement remained in effect
until such date. By way of example, if this Agreement were to terminate pursuant
to clause (i) above on October 31, 2002, then the Eighteen Month Payment in
Section 7(d)(iii), the COBRA Payment in Section 7(d)(iv) and the one (1) year
periods in Sections 7(d)(v), 7(e)(ii), and 7(f)(v), as applicable, would each be
extended by a period of two months.
26. CONFIDENTIALITY. Except with the Company's express prior written
consent or as required by law, Executive shall keep the terms of this Agreement,
excluding the terms in Sections 1, 2, 10, 11 and 12, strictly confidential, and
shall not disclose the terms of this Agreement, excluding Sections 1, 2, 10, 11
and 12, to any persons other than Executive's immediate family and legal and
financial advisors, subject to their agreement to keep such terms confidential.
If required by law to produce a copy of this Agreement or to make such
disclosure, Executive shall give the Company reasonable written notice prior to
such production or disclosure and shall cooperate with the Company to limit such
disclosure in accordance with applicable law in all reasonable respects. Nothing
herein shall be interpreted as otherwise relieving Executive from any applicable
fiduciary and confidentiality obligations.
IN WITNESS WHEREOF, the parties have executed this Agreement the day
and year first above written.
TRIANGLE PHARMACEUTICALS, INC.
By: Xxxxxx X. Xxxxx
---------------------------------------------
Name: Xxxxxx X. Xxxxx
Authorized Representative
EXECUTIVE
/s/ Xxxxx X. Xxxxxx (SEAL)
------------------------------------------
Xxxxx X. Xxxxxx
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