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EXHIBIT 10.17
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT, entered into as of this 12th day of October,
2000 is made by and between CELL PATHWAYS, INC., a Delaware corporation
(hereinafter the "Company"), and Xxxxxx X. Xxxxxxx, ESQ. (hereinafter
"Executive").
RECITALS
WHEREAS, the Company wishes to retain the services of the Executive;
and
WHEREAS, Executive desires to enter the employ of the Company; and
WHEREAS, the Company and Executive wish to set forth in this Agreement
the terms and conditions of Executive's continued employment with the Company.
NOW, THEREFORE, the Company and Executive, in consideration of the
mutual promises set forth herein, agree as follows:
ARTICLE 1
TERM OF AGREEMENT
1.1 TERM OF AGREEMENT. This Agreement shall be effective and Executive
shall commence her employment as of October 2, 2000.
ARTICLE 2
EMPLOYMENT DUTIES
2.1 TITLE/RESPONSIBILITIES. Executive hereby accepts the position of
Senior VP, General Counsel & Secretary. Executive shall report to Chief
Executive Officer of the Company or as otherwise directed by the Chief Executive
Officer.
2.2 FULL-TIME ATTENTION. Executive shall devote her best efforts and
her full business time and attention to the performance of the services
customarily incident to such office and to such other services as the Chief
Executive Officer may reasonably request.
ARTICLE 3
COMPENSATION
3.1 BASE SALARY. Executive shall receive a Base Salary at an annual
rate of $190,000.00, payable in accordance with the Company's normal payroll
practices. The Company may increase Executive's Base Salary at any time.
3.2 ANNUAL INCENTIVE BONUS. In addition to Base Salary, Executive shall
be entitled to an annual bonus payment of up to 30% of Base Salary based upon
achievement by the Company of goals established annually. The Company in its
sole discretion shall determine whether such goals have been achieved. The
Company may increase the maximum amount which may be paid to
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Executive as an annual bonus payment from time to time. For the year 2000,
Executive shall be guaranteed a minimum bonus of $25,000.
3.3 PERFORMANCE STOCK OPTION PROGRAM. Executive shall be entitled to
participate in the Company's 1997 Equity Incentive Plan to the extent determined
by the compensation committee of the Board of Directors. Upon commencing
employment, Executive shall receive an incentive stock option to purchase
100,000 shares of the common stock of the Company under the terms and conditions
of the customary form of stock option agreement used under the Plan.
3.4 WITHHOLDINGS. All compensation and benefits payable to Executive
hereunder shall be subject to all federal, state, local and other withholdings
and similar taxes and payments required by applicable law.
ARTICLE 4
EXPENSE ALLOWANCES AND FRINGE BENEFITS
4.1 VACATION. Executive shall be entitled to the greater of four weeks
of annual paid vacation or the amount of annual paid vacation to which Executive
may become entitled under the terms of the Company's vacation policy for
employees during the term of this Agreement.
4.2 BENEFITS. During the term of this Agreement, the Company shall
provide Executive with participation in the same benefit programs which it
provides to its other employees, including but not limited to medical, pension,
bonus, stock, profit-sharing and savings plans and similar benefits as such
plans and benefits may be adopted by the Company from time to time. The amount
and extent of benefits to which Executive is entitled shall be governed by the
specific benefit plan as it may be amended from time to time.
4.3 BUSINESS EXPENSE REIMBURSEMENT. During the term of this Agreement,
Executive shall be entitled to receive proper reimbursement for all reasonable
out-of-pocket expenses incurred by her (in accordance with the policies and
procedures established by the Company) in performing services hereunder.
Executive agrees to furnish the Company reasonably adequate records and other
documentary evidence of such expenses for which Executive seeks reimbursement.
Such expenses shall be accounted for under the policies and procedures
established by the Company.
ARTICLE 5
CONFIDENTIALITY
5.1 PROPRIETARY INFORMATION. Executive represents and warrants that she
has previously executed and delivered to the Company the Company's Proprietary
Information and Inventions Agreement, a copy of which is attached hereto as
Exhibit A.
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5.2 RETURN OF PROPERTY. All documents, records, apparatus, equipment
and other physical property which is furnished to or obtained by Executive in
the course of her employment with the Company shall be and remain the sole
property of the Company. Executive agrees to return all such apparatus,
equipment and other physical property and not to make or retain copies,
reproductions or summaries of any non-public documents or records, except as
otherwise necessary while acting in the course of normal business activities.
ARTICLE 6
TERMINATION OF EMPLOYMENT
6.1 DEATH. Executive's employment shall automatically terminate upon
Executive's death. In such event, the Company shall pay to Executive's
beneficiaries or her estate, as the case may be, any Accrued Compensation. For
purposes of this Agreement, "Accrued Compensation" shall mean any accrued Base
Salary, any bonus compensation to the extent actually awarded by the Board but
not yet paid, any vested deferred compensation (other than pension plan or
profit-sharing plan benefits which will be paid in accordance with the
applicable plan), any benefits under any plans of the Company in which Executive
is a participant to the full extent of Executive's rights under such plans, any
accrued vacation pay and any appropriate business expenses incurred by Executive
in connection with her duties hereunder, all to the date of termination. No
other compensation or reimbursement of any kind, including but not limited to
severance compensation, shall be paid to Executive's beneficiaries or estate.
6.2 DISABILITY. If Executive is prevented from satisfactorily
performing her duties hereunder by reason of any physical or mental incapacity
for a period of more than one hundred eighty (180) consecutive days, or two
hundred forty (240) days out of three hundred sixty-five (365) days, then, to
the extent permitted by law, the Company may terminate her employment on account
of such incapacity. In such event, the Company shall, to the extent not
previously paid, pay to Executive all Accrued Compensation, which, for the
purposes of this Subsection 6.2, shall include Base Salary to the earlier of the
date of termination or the date of coverage under any applicable Company paid
disability insurance. No other compensation or severance payment shall be due
Executive, and no other liability shall be owed by the Company, in respect of
such termination. Nothing in this Section 6.2 shall affect Executive's rights
under any disability policy or plan in which she is a participant.
6.3 TERMINATION FOR CAUSE. The Company may terminate Executive's
employment for Cause (as defined below) without liability at any time with or
without advance notice to Executive. The Company shall pay Executive all Accrued
Compensation, but no other compensation or reimbursement of any kind, including
without limitation, severance compensation, shall be paid to Executive. The
Company's obligations under this Section 6.3 shall terminate upon complete
payment of Accrued Compensation. Termination shall be for "Cause" in the event
of the occurrence of any of the following: (a) any intentional action or
intentional failure to act by Executive which was performed in bad faith and to
the material detriment of the Company; (b) Executive intentionally refuses or
intentionally fails to act in accordance with any lawful and proper direction or
order of the
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Board or the Chief Executive Officer; (c) Executive willfully and habitually
neglects her duties of employment; or (d) Executive is convicted of a felony
crime involving moral turpitude which causes material detriment to the Company,
provided that in the event that any of the foregoing events is capable of being
cured, the Company shall provide written notice to Executive describing the
nature of such event and Executive shall thereafter have thirty (30) days to
cure such event.
6.4 TERMINATION WITHOUT CAUSE. At any time, the Company may terminate
Executive's employment, without liability, for any reason not specified in
Sections 6.1 through 6.3. If the Company elects to terminate Executive pursuant
to this Section 6.4, then (a) the Company shall pay Executive Base Salary in
installments for a period of one (1) year and (b) the Company shall pay
Executive's COBRA premiums for health care continuation coverage for a period of
eighteen (18) months or the time for which Executive is entitled to COBRA
continuation coverage by law, whichever is shorter. In consideration of such
severance compensation, Executive shall not solicit, or attempt to hire on
behalf of herself or any other party, any employee or exclusive consultant of
the Company for a period of twelve (12) months following the date of termination
of Executive's employment. If the Company terminates this Agreement or
Executive's employment other than pursuant to Section 6.1, 6.2 or 6.3, then this
Section 6.4 shall apply. The Company's obligations hereunder shall terminate
upon complete payment or completion of those items set forth in this Section
6.4.
6.5 TERMINATION BY EXECUTIVE. At any time, Executive may terminate her
employment by giving thirty (30) days advance written notice to the Company. The
Company shall pay Executive all Accrued Compensation, but shall not pay any
other compensation or reimbursement of any kind, including without limitation,
severance compensation. The Company's obligations under this Section 6.5 shall
terminate upon the payment of Accrued Compensation.
6.6 MITIGATION. Except as otherwise specifically provided herein,
Executive shall not be required to mitigate damages or the amount of any payment
provided under this Agreement by seeking other employment or otherwise, nor
shall the amount of any payment provided for under this Agreement be reduced by
any compensation earned by Executive as a result of employment by another
employer or by retirement benefits after the date of the termination without
cause.
ARTICLE 7
GENERAL PROVISIONS
7.1 GOVERNING LAW. The validity, interpretation, construction and
performance of this Agreement and the rights of the parties hereunder shall be
interpreted and enforced under Pennsylvania law without reference to principles
of conflicts of laws. The parties expressly agree that as the Company's
headquarters and principal place of business are located in Pennsylvania, it is
appropriate that Pennsylvania law govern this Agreement.
7.2 ASSIGNMENT; SUCCESSORS; BINDING AGREEMENT.
7.2.1 Executive may not assign, pledge or encumber her interest in
this Agreement or any part thereof.
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7.2.2 The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company, by operation of
law or by agreement in form and substance reasonably satisfactory to Executive,
to assume and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place.
7.2.3 This Agreement shall inure to the benefit of and be
enforceable by Executive's personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees. If
Executive should die while any amount is at such time payable to her hereunder,
all such amounts, unless otherwise provided herein, shall be paid in accordance
with the terms of this Agreement to Executive's devisee, legatee or other
designatee or, if there be no such designatee, to her estate.
7.3 NOTICE. For the purposes of this Agreement, notices and all other
communications provided for in this Agreement shall be in writing and shall be
deemed to have been duly given when hand-delivered or mailed by certified or
registered mail, return receipt requested, postage prepaid, addressed to the
respective addresses set forth below. Either party may furnish to the other
party in writing a different address; however, such notice of change of address
shall be effective only upon receipt.
To the Company: Cell Pathways, Inc.
000 Xxxxxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn: Xxxxx Xxxxxx
To Executive: Xxxxxx X. Xxxxxxx, ESQ.
000 Xxxxxx Xxxxxx
Xxxxxx Xxxx, XX 00000
7.4 MODIFICATION; WAIVER; ENTIRE AGREEMENT. No provisions of this
Agreement may be modified, waived or discharged unless such waiver, modification
or discharge is agreed to in writing signed by Executive and such officer as may
be specifically designated by the Board. No waiver by either party hereto at any
time of any breach by the other party of, or compliance with, any condition or
provision or this Agreement to be performed by such other party shall be deemed
a waiver of similar or dissimilar provisions or conditions at the same or any
prior or subsequent time. No agreements or representations, oral or otherwise,
express or implied, with respect to the subject matter hereof have been made by
either party which are not expressly set forth in this Agreement.
7.5 VALIDITY. Whenever possible, each provision of this Agreement will
be interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other
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provision or any other jurisdiction, but this Agreement will be reformed,
construed and enforced in such jurisdiction as if such invalid, illegal or
unenforceable provisions had never been contained herein.
7.6 CONTROLLING DOCUMENT. In case of conflict between any of the terms
and conditions of this Agreement and the documents herein referred to, or any
other documents or agreements affecting the terms and conditions of Executive's
employment, the terms and conditions of this Agreement shall control, and such
other documents shall be deemed to be amended hereby. Notwithstanding the
foregoing, nothing in this agreement shall be construed to modify any rights
granted Executive under any stock option agreement entered into by Executive and
Company.
7.7 EXECUTIVE ACKNOWLEDGMENT. Executive acknowledges (a) that she has
consulted with or has had the opportunity to consult with independent counsel of
her own choice concerning this Agreement, and has been advised to do so by the
Company, and (b) that she has read and understands the Agreement, is fully aware
of its legal effect, and has freely entered into it based on her judgment.
7.8 REMEDIES.
7.8.1 INJUNCTIVE RELIEF. The parties agree that the services to be
rendered by Executive hereunder are of a unique nature and that in the event of
any breach or threatened breach of any of the covenants contained herein, the
damage or imminent damage to the value and the goodwill of the Company's
business will be irreparable and extremely difficult to estimate, making any
remedy at law or in damages inadequate. Accordingly, the parties agree that the
Company shall be entitled to injunctive relief against Executive in the event of
any breach or threatened breach of the provisions of Article 2, Article 5 and
Exhibit A, in addition to any other relief (including damages) available to the
Company under this Agreement or under law.
7.8.2 NON-EXCLUSIVITY. Both parties agree that the remedies
specified in Section 7.8.1 above are not exclusive of any other remedy for the
breach by Executive or the terms hereof.
7.9 HEADINGS. The headings of the sections hereof are inserted for
convenience only and shall not be deemed to constitute a part hereof or to
affect the meaning thereof.
7.10 CONSTRUCTION. In the event of a conflict between the text of the
Agreement and any summary, description or other information regarding the
Agreement, the text of the Agreement shall control.
7.11 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, all of which taken together shall constitute one and the same
Agreement.
Executed by the parties as of the day and year first above written.
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CELL PATHWAYS, INC.
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Xxxxxx Xxxxxxxxxx
President & CEO
EXECUTIVE:
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Xxxxxx X. Xxxxxxx, ESQ.
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