EMPLOYMENT AGREEMENT
AGREEMENT made this 29th day of April, 1999, between IMMUCELL CORPORATION, a
Delaware Corporation (the "Company"), and Xxxxxxx X. Xxxxxxx, of Kennebunk,
Maine ("Xxxxxxx").
WITNESSETH:
In consideration of the mutual promises hereinafter contained, the parties
hereto agree as follows:
1. EMPLOYMENT AND TERM. The Company hereby employs Xxxxxxx and Xxxxxxx hereby
accepts employment by the Company subject to the provisions of this Agreement
for a term commencing on April 29, 1999 and ending upon the date of termination
of Brigham's employment with the Company.
2. DUTIES OF XXXXXXX. Xxxxxxx shall be employed by the Company as Vice
President, Chief Financial Officer, Treasurer and Secretary to perform such
duties consistent with such a position as Vice President, Chief Financial
Officer, Treasurer and Secretary as its Board of Directors shall assign Xxxxxxx
from time to time. Xxxxxxx shall serve the Company faithfully and diligently,
use his best efforts to promote the interests of the Company, and shall devote
his full time and efforts to the business and affairs of the Company.
3. COMPENSATION.
(a) BASE SALARY. As compensation for his services hereunder, the Company shall
pay Xxxxxxx $7,916.66 per month, beginning on February 1, 1999. During the
entire term of this agreement, Brigham's salary shall be subject to periodic
review and adjustment by the Board of Directors of the Company, which Board of
Directors may in its sole discretion change the salary to an amount greater than
that provided for therein; provided, however, that in no event may the Company's
Board of Directors decrease Brigham's salary below that which is provided for
herein.
(b) EMPLOYEE BENEFITS. During the term of this Agreement the Company shall
provide Xxxxxxx with the standard health, life, and disability insurance
coverage that is provided to the Company's other non-officer employees. Xxxxxxx
shall also be eligible to receive all other employee benefits of the Company in
the same manner and to the same extent as other employees of the Company in
accordance with the Company's policies, including, without limitation, any
incentive pay programs offered by the Company to all of its non-officer
employees.
(c) NONQUALIFIED STOCK OPTIONS.
--------------------------
(1) GRANT. By unanimous resolution of the full Board of Directors on March
1, 1999 the Company granted to Xxxxxxx an option (`Option') to
purchase thirty-one thousand and one hundred (31,100) shares of
ImmuCell common stock (`Shares') at a price equal to $1.3125 per
share.
-1-
(2) VESTING. Brigham's right to purchase the Shares subject to this Option
shall vest as follows: (i) As to 10,366 Shares on and after March 1,
2000; (ii) As to an additional 10,367 Shares on and after March 1,
2001; and (iii) As to the remaining 10,367 Shares on and after March
1, 2002.
(3) EXERCISE. Except as hereinafter provided, the Option may be exercised
in full or in part at any time to the extent vested in accordance with
subsection (2). In no event may the Option be exercised to purchase
fewer than one hundred (100) Shares, unless fewer than one hundred
(100) Shares are subject to the Option.
The purchase price for the Shares acquired upon exercise of
the Option shall be paid (i) in cash or certified check, or (ii) at
the discretion of the Compensation and Stock Option Committee of the
Board of Directors of the Company by delivery of one or more stock
certificates, duly endorsed, evidencing other Shares with a Fair
Market Value on the date of exercise equal to the option price, or
(iii) at the discretion of the Compensation and Stock Option
Committee, by a combination of the methods described in (i) or (ii).
As soon as practicable after Xxxxxxx has tendered payment of the
purchase price to the Company, the Company shall provide Xxxxxxx with
a Certificate evidencing the Shares purchased. Such certificate shall
include any legends required under federal or state securities laws.
In the event of Brigham's termination of employment with the
Company (except for by reason of "just cause" as provided by
subsection (c) of Section 4 of this Agreement), disability or death,
the Option shall be exercisable during the eighteen-month period
following the date of Brigham's termination. In the event of Brigham's
termination for "just cause" as provided by subsection (c) of Section
4, the Option shall be exercisable for the three month period
following such termination only to the extent it was exercisable at
the time of such termination.
(4) EXPIRATION OF OPTION. This Option shall expire at 5:00 p.m., Eastern
time on February 28, 2009, unless sooner terminated as provided in
Section (c)(3) above, and may not be exercised thereafter.
(5) NONTRANSFERABILITY. Xxxxxxx may not transfer the Option other than
by will or the laws of descent and distribution. During Brigham's
lifetime, only Xxxxxxx may exercise the Option.
(6) CHANGE IN CONTROL. In the event of a change in control of the Company,
Brigham's right to purchase Shares subject to the Option shall vest
immediately. For purposes of this Amendment, `change in control' shall
mean any one of the following events:
(a) Any person shall become beneficial owner,
directly or indirectly, of securities representing fifty
percent (50%) or more of the combined voting power of the
Company's then outstanding stock.
-2-
As used in this Paragraph 6 (a), `beneficial owner'
shall have the meaning ascribed to it from time to time under
rules promulgated by the Securities and Exchange Commission
pursuant to Section 13 (d) of the Securities Exchange Act of
1934, or any similar successor statute or rule; and a `person'
shall include any natural person, corporation, partnership,
trust, association, or any group or combination thereof, whose
ownership of the Company stock would be reportable pursuant to
such provision of the Securities Exchange Act of 1934 and the
rules and regulations promulgated thereunder;
(b) The Company's stockholders approve (i) any
consolidation or merger of the Company in which the Company is
not the continuing or surviving corporation or pursuant to
which shares of Company common stock would be converted into
cash, securities or other property, or (ii) any sale, lease,
exchange, liquidation or other transfer (in one transaction or
a series of transactions) of all or substantially all of the
assets of the Company.
(c) Any other event which a majority of all the
Company's Directors who are not employees of the Company
determines constitutes a change of control.
(7) NO REGISTRATION OF SECURITIES. The parties agree that the Company
presently intends to rely on the securities registration exemption
contained in Section 10502 (1) (L) of the Revised Maine Securities Act
and that, accordingly, no registration or exemption filing shall be
made by the Company under such Act with respect to the Shares. Xxxxxxx
acknowledges that transfer of the Shares may be restricted by
applicable federal and state securities laws and that the Shares when
issued shall contain an appropriate legend to that effect.
Notwithstanding the foregoing, the Company agrees to register these
shares in conjunction with its next Registration Statement on Form S-8
to be filed with the Securities and Exchange
Commission.
(d) BONUS. A cash bonus will be paid to Xxxxxxx by the Company if certain
performance objectives are met during any fiscal year. These objectives will be
specified by the Company's Board of Directors on an annual basis. Each and any
such annual incentive compensation agreement shall be incorporated by reference
into this Employment Agreement. Any bonus earned during a fiscal year will be
paid by 1 February of the next fiscal year.
4. TERMINATION OF EMPLOYMENT.
(a) VOLUNTARY TERMINATION. Should Xxxxxxx voluntarily terminate his employment
with the company, Xxxxxxx hereby covenants that, for a period of one (l) year he
will abide by the terms of the "Agreement in Connection with Employment" dated
August 24, 1989 between Xxxxxxx and the Company, a copy of which is appended
hereto as ATTACHMENT A.
-3-
(b) OTHER TERMINATION. (i) Should Brigham's employment with the Company
terminate for any reason except through Brigham's voluntary act or by
termination for "just cause" as provided by subsection (c) of this Section 4 or
(ii) should Brigham's status or position with the Company be in any way altered
without Brigham's consent so as to materially reduce Brigham's status or
responsibilities in a manner inconsistent with his position as Vice President
and Chief Financial Officer of the Company (it being understood that the Board
of Directors may at any time elect other individuals to the offices of Treasurer
and Secretary without diminution in Brigham's status or responsibilities as Vice
President and Chief Financial Officer) and should Xxxxxxx resign from all
offices and positions held with the Company in response to such change or
alteration in his status or position with the Company or (iii) should the
Company terminate Brigham's employment at any time, Xxxxxxx shall receive from
the Company salary and benefits at the monthly level existing prior to
termination for an additional three (3) months after the date of termination of
Brigham's employment.
In consideration for the payments to be made to him pursuant to this subsection
(b), Xxxxxxx shall be bound by the provisions of subsection (a) of this Section
in the same manner as if his termination had been voluntary, and Xxxxxxx shall
not compete with the Company as provided therein for a period of one (1) year
from the date of termination of Brigham's employment by the Company.
(c) TERMINATION FOR JUST CAUSE. Notwithstanding the forgoing provisions of this
Section 4, a majority of the Board of Directors of the Company may at any time
terminate the employment of Xxxxxxx for just cause (as hereinafter defined) upon
seven (7) days' written notice to Xxxxxxx. Upon the expiration of such seven (7)
day period, Brigham's employment with the Company shall cease, and from and
after such date the Company shall have no further liability or obligation to
make any payments or provide any benefits which would otherwise be paid to
Xxxxxxx hereunder, except as such have accrued on or before such date. In the
event of the termination of Brigham's employment for just cause as provided
herein, Xxxxxxx shall be bound by the provisions of subsection (a) of this
Section in the same manner as if his termination had been voluntary, and Xxxxxxx
shall not compete with the Company as provided therein for a period of one (1)
year from the date of termination of Brigham's employment.
As used in this subsection (c), "just cause" shall be deemed to include only the
following:
(i) Brigham's conviction of a felony involving moral turpitude or
dishonesty; or
(ii) Brigham's persistent failure to comply with the reasonable
directives or assignments of the Company's Board of Directors, provided
that such directives or assignments are consistent with Brigham's
status and position as set forth in Section 2 of this Agreement; or
(iii) Brigham's persistent failure to devote his full time and efforts
to the business and affairs of the Company in the manner contemplated
by Section 2 of this Agreement.
-4-
(d) CERTAIN EVENTS. In the event that (i) following the termination of Brigham's
employment pursuant to subsection (b) of this Section 4 the Company shall fail
to pay Xxxxxxx when due, or within ten (10) business days thereafter, all
current sums payable to Xxxxxxx pursuant to said subsection (b), or (ii)
following the termination of Brigham's employment for any reason whatsoever, the
Company or any successor or assignee of the Company entitled to the benefits of
this Agreement shall cease to conduct the business of the company engaged in by
the Company at the times of such termination, then, and in either such event,
the covenants against competition set forth in subsections (a), (b), and (c) of
this Section 4 shall be terminated and Xxxxxxx shall thereafter not be bound by
the provisions thereof. The termination of said covenants against competition
shall not alter or affect the obligation of the Company to make any payments
required to be made to Xxxxxxx pursuant to the provisions of subsection (b) of
this Section 4.
5. COVENANT CONCERNING OTHER EMPLOYEES. Should Xxxxxxx voluntarily terminate his
employment with the Company for any reason whatsoever, Xxxxxxx hereby covenants
that, for a period of one (1) year, Xxxxxxx will not directly or indirectly
persuade, induce or otherwise encourage any other employee of the Company to
leave the employ of the Company to join or form any other firm, corporation,
partnership, association, joint venture, trust or business entity of any kind
engaged in, or to be engaged in the future in, any business which is similar to
or competitive with the business now or at any time hereafter engaged in by the
Company.
6. MISCELLANEOUS.
a) NOTICE. Any notice required to be given hereunder shall be given in writing
and shall be delivered by hand or sent by registered or certified mail, postage
prepaid, return receipt requested, or by Federal Express, if to the Company, at
the address of its principal offices on the date upon which such notice is
given, and if to Xxxxxxx, at the then current residential address of Xxxxxxx (as
reflected on the records of the Company) by any of the aforesaid means. Any such
notice shall be effective when delivered in person or deposited in the United
States mails in accordance with the provisions of this subsection.
b) DEATH. In the event of the death of Xxxxxxx during the term of this Agreement
while he shall be an employee of the Company, Brigham's compensation pursuant to
Section 3 hereof shall cease as of the last day of the month in which Brigham's
death occurs. Any remaining amounts owing to Xxxxxxx pursuant to Section 3
hereof in respect to such month shall be paid to his estate or shall pass by
applicable laws of descent and distribution. In the event of the death of
Xxxxxxx after he has terminated his employment with the Company, but prior to
the payment of all amounts payable to him pursuant to the provisions of
subsection (b) of Section 4 hereof, the remaining such amounts shall be paid to
the representatives of Brigham's estate.
(c) INJUNCTIVE RELIEF. The parties agree that the extent of damage to the
Company in the event of the breach by Xxxxxxx of the noncompetition covenants
contained in the agreement attached hereto as ATTACHMENT A would be difficult or
impossible to ascertain and that there would be no adequate remedy at law
available to the Company in the event of such breach. Therefore, in the event of
any such breach, the Company shall be entitled to enforce any or all of such
covenants by injunction or
-5-
other equitable relief in addition to receiving damages or other relief to which
the Company may be entitled.
(d) BINDING EFFECT; ASSIGNMENt. The provision of this Agreement shall be binding
upon and shall inure to the benefit of the Company and its successors and
assigns and to the benefit of Xxxxxxx and his heirs and legal representative.
This Agreement is a personal contract and the rights and interest of Xxxxxxx
herein may not be sold, transferred, assigned, pledged, or hypothecated and any
such attempted sale, transfer, assignment, pledge or hypothecation shall be
null, void and of no effect.
(e) ENTIRE AGREEMENT. Except as set forth in the next succeeding sentence, this
Agreement contains the entire agreement between the parties hereto with respect
to the transactions contemplated herein and supersedes all prior agreements and
understandings, written and oral with respect to the subject matter hereof,
including without limitation the Employment Agreement dated November 8, 1991
between Xxxxxxx and the Company, and may not be amended or modified except by an
instrument in writing signed by both parties hereto. It is understood and agreed
that the following additional agreements shall remain in full force and effect
and shall not be superceded by this Agreement: (i) the "Agreement in Connection
with Employment" dated August 24, 1989 and appended hereto as ATTACHMENT A, (ii)
the provisions regarding the nonqualified stock options granted to Xxxxxxx
contained in the Amendment to Employment Agreement dated April 13, 1992 between
Xxxxxxx and the Company, and (iii) all other incentive and non-qualified stock
option agreements previously entered into between Xxxxxxx and the Company, which
agreements remain in full force to the same extent they were in force before
this Agreement was executed.
(f) SEVERABILITY. If any provision of this Agreement is declared invalid,
illegal or unenforceable, such provision shall be severed and all remaining
provisions shall continue in full force and effect.
(g) LAW GOVERNING. This Agreement shall be governed by and enforced in
accordance with the laws of the State of Maine
IN WITNESS WHEREOF, the parties hereto have executed this Agreement, intending
the same to take effect as a sealed instrument, as of the date first above
written.
IMMUCELL CORPORATION
/s/ Xxxxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxx
--------------------------- ---------------------------
Xxxxxxx X. Xxxxxxx By: Xxxxxxx X. Xxxxxx
Vice President and Chief Financial Member, Compensation and
Officer Stock Option Committee
-6-
