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EXHIBIT 10.124
FORM OF
SEVERANCE COMPENSATION AGREEMENT
SEVERANCE COMPENSATION AGREEMENT (the "Agreement"), dated
_____________, 199_, between ECOGEN INC., a Delaware corporation (the
"Company"), and ________________________ (the "Executive").
The Company's Board of Directors has determined that it is
important to reinforce and encourage the continued attention and dedication of
members of the Company's management, including the Executive, to their assigned
duties. Therefore, the Company is providing the Executive the benefits set
forth in this Agreement in the event the Executive's employment with the
Company is terminated in certain circumstances.
1. Termination. (a) If the Executive's employment
with the Company is terminated by the Company or by the Executive at any time,
the Company shall pay the Executive the compensation set forth in Section 2,
unless such termination is a result of (i) the Executive's death, (ii) the
Executive's Disability (as defined below), (iii) the Executive's Retirement (as
defined below), (iv) Cause (as defined below) or (v) the Executive's
termination of the Executive's employment other than for Good Reason (as
defined below) within six months of the event constituting Good Reason.
(b) "Disability" means the Executive's incapacity due to
physical or mental illness, as evidenced by the Executive being absent from the
Executive's duties with the Company for a period of six months within any
12-month period and, within 30 days after written notice of termination is
thereafter given by the Company, not returning immediately to the performance
of the Executive's duties. For the purposes of this Agreement, the Executive's
"absence" shall include the inability of the Executive to perform the
Executive's duties substantially on a full-time basis.
(c) "Retirement" means termination by the Company or the
Executive of the Executive's employment on account of the Executive's having
reached age 65 or such other age as shall have been fixed in any retirement
arrangement
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established with the Executive's consent with respect to the Executive.
(d) "Cause" means (i) the Executive's material fraud,
misappropriation or embezzlement in connection with the Company or (ii)
repeated and intemperate use of alcohol or illegal drugs which interferes with
the Executive's performance of Executive's duties, each as determined by and
set forth in a resolution duly adopted by the affirmative vote of the members
of the Company's Board of Directors, at a meeting of the Board called and held
for the purpose of making a determination of Cause and after reasonable notice
to the Executive and an opportunity for the Executive and the Executive's
counsel to be heard before the Board, finding that in the good faith opinion of
the Board the Executive was guilty of the conduct set forth above and
specifying the particulars thereof in detail.
(e) "Good Reason" means (without the Executive's prior
express written consent):
(i) any material reduction in the Executive's position,
duties, responsibilities or status with the Company or any removal
of the Executive from, or any failure to reelect the Executive to,
any position consistent with the Executive's duties,
responsibilities and status except in connection with the
termination of the Executive's employment (x) for Disability,
Retirement or Cause, (y) as a result of the Executive's death or
(z) by the Executive other than for Good Reason; or
(ii) a reduction by the Company in the Executive's
salary; or
(iii) any failure by the Company to permit the Executive
to participate in any benefit plan or arrangement which is
generally available to employees of the Company (hereinafter,
"Benefit Plans"); or
(iv) any change in any incentive, bonus or compensation
plan or other arrangement which is likely to materially reduce, in
the aggregate, the total compensation payable to the Executive; or
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(v) a relocation of the Company's principal executive
offices to a location which is greater than twenty-five miles from
the Company's current place of business or the Company's
relocation of the Executive to a place other than the Company's
principal executive offices; or
(vi) any material breach by the Company of this
Agreement or violation of law in respect of the executive's
employment; or
(vii) any failure by the Company to obtain the assumption
of this Agreement by any successor or assign of the Company; or
(viii) any purported termination of the Executive's
employment which is not effected pursuant to a Notice of
Termination satisfying the requirements of Section 1(f).
(f) Any termination by the Company pursuant to Section 1(b),
1(c) or, 1(d) shall be communicated by a Notice of Termination. A "Notice of
Termination" means a written notice indicating the specific provisions in this
Agreement relied upon and, in reasonable detail, the facts and circumstances
claimed to provide a basis for termination of the Executive's employment under
the provision so indicated.
(g) "Date of Termination" means (i) if this Agreement is
terminated by the Company for Disability, 30 days after Notice of Termination
is given to the Executive, provided that the Executive shall not have returned
to the performance of the Executive's duties on a full-time basis during such
30-day period, (ii) if the Executive's employment is terminated by the Company
for any other reason, the date on which a Notice of Termination is given or
(iii) if the Executive gives notice of such termination, immediately upon the
giving of such notice.
2. Compensation. If the requirements of Section 1 are
fulfilled, the Company shall continue to pay to the Executive, as severance
pay, the Executive's base salary for a period of 18 months following the
Termination Date and shall, for such period, continue to (a) cover the
Executive and the Executive's family on all life insurance, health insurance,
hospitalization, dental, drug prescription, disability and accidental death and
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dismemberment plans and policies of the Company that the Executive and the
Executive's family are participating in at the time of termination on the same
basis of participation as applied prior to termination, to the extent such
plans and policies permit non-employees to participate therein and subject to
any other terms and conditions of such plans and policies and (b) provide the
Executive with other standard benefits available at the time to the Company's
executive officers, such as automobile privileges; provided, however, if any of
the plans described in clause (a) above do not permit the participation therein
of persons who are not employees of the Company, the Company shall endeavor, in
lieu thereof, to replace such benefit for the Executive with a substantially
equivalent benefit to the extent such benefit may be obtained on commercially
reasonable terms.
3. Mitigation; Other Contractual Rights. (a) The Executive
shall not be required to mitigate damages or the amount of any payment provided
for 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 the Executive as the result of employment by another
employer after the Date of Termination or otherwise.
(b) This Agreement, and any payment provided for hereunder,
shall not reduce any amounts otherwise payable, or in any way diminish the
Executive's existing rights or rights that would accrue solely as a result of
the passage of time, under any Benefit Plan, Incentive Plan or Securities Plan,
employment agreement or other contract, plan or arrangement.
4. Successors. (a) The Company shall require any successor
or assign (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 agreement in form and substance satisfactory to the Executive,
expressly, absolutely and unconditionally 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 or assignment had taken place.
Any failure of the Company to obtain such agreement prior to the effectiveness
of any such succession or assignment shall be a material breach of this
Agreement and shall entitle the Executive to terminate the Executive's
employment for Good Reason. "Company" means, as used throughout this
Agreement, the Company as hereinbefore
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defined and any successor or assign to its business and/or assets as aforesaid
that executes and delivers the agreement provided for in this Section or that
otherwise becomes bound by this Agreement by operation of law.
(b) This Agreement shall inure to the benefit of and be
enforceable by the Executive's personal and legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees. If the
Executive should die while any amounts are still payable to the Executive
hereunder, all such amounts, unless otherwise provided herein, shall be paid in
accordance with the terms of this Agreement to the Executive's devisee, legatee
or other designee, or, if there be no such designee, to the Executive's estate.
5. Term. This Agreement shall terminate, except to the
extent that any obligation of the Company hereunder remains unpaid, upon the
termination of the Executive's employment with the Company on account of death,
Disability, Retirement or Cause or by the Executive other than for Good Reason.
6. Notice. Notices and all other communications provided
for in this Agreement shall be in writing and shall be deemed to have been duly
given when delivered by hand or mailed by United States registered mail, return
receipt requested, postage prepaid, as follows:
If to the Company:
Ecogen Inc.
0000 Xxxxx Xxxxxxxxx Xxxx
Xxxxxxxxx, Xxxxxxxxxxxx 00000
Attention:
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Chief Executive Officer
If to the Executive:
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or such other address as either party may have furnished to the other in
writing in accordance herewith, except that
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notices of change of address shall be effective only upon receipt.
7. Validity. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, which shall remain in full force and
effect.
8. Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original but all of
which together shall constitute one and the same instrument.
9. Legal Fees and Expenses. The Company shall pay all legal
fees and expenses that the Executive may incur as a result of the Company's
contesting the validity, enforceability or the Executive's interpretation of,
or determinations under, this Agreement.
10. General. No provision of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge is agreed to
in writing signed by the Executive and the Company. No waiver by either party
hereto at any time of any breach by the other party hereto of, or compliance
with, any condition or provision of 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 at 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 that are not set forth
expressly in this Agreement. This Agreement shall be governed by and construed
in accordance with the laws of the Commonwealth of Pennsylvania.
11. Integration. This Agreement shall replace the provisions
of any severance provisions of any employment agreement or change of control
severance agreement, in each case which pre-dates this agreement, providing for
severance compensation and other benefits following termination following, or
resulting from, a change of control of the Company, and the parties hereto
agree that all such provisions are hereby terminated and discharged.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first above written.
ECOGEN INC.
By
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Name:
Title:
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Name:
Title:
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