Exhibit 10.4
PATHOGENESIS CORPORATION
Employee Agreement
In consideration of my employment by PathoGenesis Corporation or any of its
subsidiaries and affiliates (the "Company"), any opportunities for advancement
or reassignment which the Company may from time to time offer me, the
compensation paid to me in connection with such employment and any capital stock
of the Company and/or stock options which have been or may be granted to me by
the Company, I agree as follows:
1. Definitions
For purposes of this Agreement the term:
(a) "Invention" includes any machine, article of manufacture, biological
material, method, discovery, process, use, device, apparatus, system,
chemical compound, formulation, composition of matter, design or
configuration of any kind, or any improvement thereon (including all data,
records and other materials related thereto), whether patentable or
unpatentable.
(b) "Proprietary Information" means all information concerning the Company
except that which is generally known publicly, or information entrusted to
the Company by third parties. This includes information which may relate,
for example, to Inventions, research, development, manufacturing,
purchasing, accounting, marketing or selling. The information may be
contained in material such as drawings, data, specifications, reports,
customer lists, compilations or computer programs, or may be in the nature
of unwritten knowledge, know-how or trade secrets.
2. Ownership and Protection of Proprietary Information
All Proprietary Information which I conceive or develop, either alone or
with others, during the term of my employment, and all notes, memoranda,
reports, drawings, blueprints, manuals, materials, data and other records
relating thereto which shall come into my possession during the term of my
employment, shall be the exclusive property of the Company. I will preserve
in confidence and will not disclose or use, either during or after the term
of my employment, any Proprietary Information known to me as a result of my
employment except as required in my work for the Company or as authorized
in writing by the Company. Upon termination of my employment or upon
request, I will deliver to the Company all Proprietary Information and
materials related thereto in my possession.
3. Covenant Not to Compete, Disclose or Solicit
During the term of my employment and for 12 months thereafter, I will not:
(a) for my benefit or the benefit of others, engage or assist others to
engage in the same or similar activity that I was performing for the
Company relating to any product similar to a product offered or being
developed by the Company, or engage in any activity which could reasonably
be anticipated to require or expected to result in the use or disclosure of
any Proprietary Information known to me as a result of my employment with
the Company; or (b) directly or indirectly solicit, induce or in any
manner influence any person who is, or shall be, employed by the Company,
to leave such employment for the purpose of engaging in a business, or
being employed by or associated with any person or entity.
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4. Inventions
(a) Any Invention which I conceive, develop or first actually reduce to
practice, either alone or with others during the term of my employment
shall be the exclusive property of the Company. I will promptly and fully
disclose to the Company any such Invention. During my employment and
thereafter, upon request, I will execute all papers in a timely manner and
to all acts necessary to apply for and secure patents on the Inventions in
the United States and foreign countries, and I will execute all papers and
do any and all acts necessary to assign and transfer to the Company or any
person or party or entity designated by the Company, the whole right, title
and interest to the Invention and any applications for patents in the
United States and foreign countries, and I will do all things necessary to
sustain and maintain such applications, patents and assignments. The
Company will pay all reasonable expenses related to such activities.
(b) I hereby represent and warrant that except as set forth on the attached
list of Inventions, patent applications and patents made or conceived by me
prior to my employment with the Company which are subject to prior
agreements and which I desire to exclude from this Agreement, I have no
other employment arrangements, and have made no undertakings which would
restrict or impair my performance of this Agreement, except as set forth in
the Employment Agreement dated July 1, 1996. If no such list is attached, I
hereby represent and warrant that there are no such Inventions, patent
applications or patents.
(c) In accordance with Company's policy and State of Washington law, this
Agreement does not apply to, and I have no obligation to assign to the
Company, any invention for which no Company trade secrets, and no
equipment, supplies, or facilities of the Company were used, and which was
developed entirely on my own time, unless: (i) the invention relates
directly to the Company's own business; (ii) the invention relates to
Company's existing or demonstrably anticipated research or development
work; or (iii) the invention results from my work for the Company.
5. Copyrights
The Company shall own the copyrights in all writings and other works
prepared by me during my employment with the Company that may be
copyrighted and that are related to the present or planned business of the
Company.
6. Miscellaneous
(a) The obligations of this Agreement shall continue beyond the termination of
employment and shall be binding on me and my heirs, assigns and legal
representatives. This Agreement is for the benefit of the Company, its
successors and assigns, and is not conditioned on employment for any period
of time or compensation therefor.
(b) If any provision or term of this Agreement is found by any court of
competent jurisdiction to be unenforceable, the remaining terms and
provisions of this Agreement shall remain in full force and effect as if
such unenforceable provision or term had never been a part hereof.
(c) This Agreement shall be governed by and construed in accordance with the
laws of the state of Washington.
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DATE: July 1, 1996
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/s/Xxxx X. Xxxxxxxxx
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Xxxx X. Xxxxxxxxx
PATHOGENESIS CORPORATION
By /s/Xxxxxx X. Xxxxx
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Its Pres. and CEO
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EMPLOYMENT AGREEMENT
THIS AGREEMENT is entered into on 11/11/96 by and between Xxxx X. Xxxxxxxxx
("Xxxxxxxxx") and PathoGenesis Corporation, a Delaware corporation (the
"Company"), with an effective date of July 1, 1996 (the "Effective Date").
WHEREAS, the Company desires to employ Xxxxxxxxx and Xxxxxxxxx desires to
be so employed;
WHEREAS, the Company and Xxxxxxxxx desire to set forth in writing the terms
of their agreement with respect to Xxxxxxxxx'x employment;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants contained herein, the parties agree as follows:
1. Employment. The Company hereby employs Xxxxxxxxx and Xxxxxxxxx hereby
accepts employment on a full-time basis upon the terms and conditions set forth
in this Agreement.
2. Term. Xxxxxxxxx'x employment hereunder will commence on the Effective
Date and will continue until June 30, 2000, except as provided under this
Agreement. Thereafter, Xxxxxxxxx'x employment will be automatically renewed for
successive quarterly terms, unless written notice of termination is given by
either party to the other at least sixty days before the expiration of the then
current term.
3. Duties. Xxxxxxxxx will perform such duties as may be determined and
assigned to him from time to time by the Board and/or officer(s) of the Company
to whom he reports, and will be given such powers and authority as may be needed
to carry out those duties. If Xxxxxxxxx shall be designated as a member of any
board or committee of the Company or to any other office of the Company or any
of its subsidiaries or affiliates, he agrees to serve in such capacity or
capacities without additional compensation. Xxxxxxxxx agrees to devote all of
his working time and best efforts to the performance of his duties as an
employee of the Company. Xxxxxxxxx agrees that while he is employed by the
Company, he will not engage in any other business activities or pursuits,
whether on his own behalf or on behalf of any other person, firm or corporation,
except that Xxxxxxxxx may participate in the operation of Certified
Manufacturing Corporation ("CMC") until December 31, 1996 to the extent
necessary to wind up the operation of CMC, it being agreed that PathoGenesis'
affairs must receive priority and that Xxxxxxxxx'x participation in the
operations of CMC shall not adversely interfere with Xxxxxxxxx'x obligations to
the Company.
4. Compensation. The Company will pay Xxxxxxxxx an annual base salary of
$190,000 for the year commencing July 1, 1996, which amount may be increased by
the Board of Directors for each subsequent year of this employment with an
annual review date consistent with that of other senior executives of the
Company. Xxxxxxxxx'x annual base salary will be payable in equal installments
not less frequently than monthly in accordance with the policy of the Company in
effect during the term of his employment. Xxxxxxxxx will be eligible to receive
an annual discretionary bonus of up to 25% of the annual base salary paid or
payable to him during each calendar year of his employment. The amount of each
annual bonus, if any, will be determined by
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the Board in its sole discretion; and the Board may take into account such
factors as it may determine in its sole discretion including, but not limited to
the performance of Xxxxxxxxx and of the Company during the calendar year. The
Company has granted Xxxxxxxxx an Incentive Stock Option, under the Company's
1992 Stock Option Plan, to purchase 40,000 shares of the Company's common stock
at an exercise price determined by the Company at the time of grant. A copy of
the plan is attached as Exhibit A.
5. Travel Expenses. Xxxxxxxxx acknowledges and agrees that his position
is expected to require travel, including both domestic and international travel.
The Company will reimburse Xxxxxxxxx for travel, entertainment and other out-of-
pocket expenses reasonably incurred by him in the performance of his duties
under this Agreement upon timely presentation to and approval by the Company of
appropriate vouchers or receipts.
6. Benefits. During the term of his employment, Xxxxxxxxx will be
eligible for all of the Company's employee benefits that are generally made
available to all employees of the Company in accordance with the terms of the
Company's employee benefit plans and programs.
7. Termination of Employment.
(a) Death. Xxxxxxxxx'x employment hereunder shall terminate upon his
death.
(b) Disability. If during his employment by the Company Xxxxxxxxx becomes
physically or mentally disabled, whether totally or partially, so that Xxxxxxxxx
is unable to perform his services hereunder with reasonable accommodation as
defined under the Americans with Disabilities Act for an aggregate of 180 days
during any 270 day period, the Company, by written notice to Xxxxxxxxx may
terminate Xxxxxxxxx'x employment hereunder. Upon such termination, Xxxxxxxxx
shall be entitled to receive compensation earned prior to the date of such
notice and, other than as set forth in this sentence, Xxxxxxxxx shall have no
right to receive any compensation or benefit hereunder on or after a notice of
termination is given pursuant to this paragraph 7(b) other than pursuant to the
Company's disability insurance policies. Nothing contained in this paragraph
7(b) shall be deemed to extend the term of Xxxxxxxxx'x employment under this
Agreement. Notwithstanding the foregoing, in the event at any time Xxxxxxxxx is
receiving benefit payments under disability insurance policies paid for by the
Company, then amounts otherwise due Xxxxxxxxx under this Agreement shall be
reduced by the amounts so received by Xxxxxxxxx under such policies.
(c) Termination for Cause. In addition to any other rights or remedies
available to the Company, the Company may terminate Xxxxxxxxx'x employment
hereunder for Cause. For purpose of this Agreement, the term "Cause" means (i)
any failure or refusal of Xxxxxxxxx to adequately perform employment duties and
obligations hereunder as reasonably determined by the Company which is not cured
within thirty days after written notice from the Company, of the ways in which
Xxxxxxxxx'x job performance is unsatisfactory, (ii) any material breach by
Xxxxxxxxx of the other provisions of this Agreement as reasonably determined by
the Company which is not cured within thirty days after written notice from the
Company, (iii) any conduct constituting a crime involving dishonesty or moral
turpitude or any conduct which is materially injurious to the Company as
reasonably determined by the Company, or (iv) any other reason that would
constitute cause under Washington state law.
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(d) Other Remedies. Notwithstanding the Company's right to terminate
Xxxxxxxxx'x employment for Cause, the Company may, in addition, pursue other
remedies in law or equity in the event of any breach of this Agreement by
Xxxxxxxxx.
8. Restrictive Covenants. Xxxxxxxxx acknowledges and agrees that he has
executed and delivered to the Company an Employee Agreement dated July 1, 1996,
a copy of which is attached as Exhibit B, which is and shall remain in full
force and effect in accordance with its terms.
9. Indemnification. The Company will indemnify Xxxxxxxxx consistent with
the Company's indemnification policies applicable to all officers of the
Company; provided however that in no event shall the Company indemnify Xxxxxxxxx
for willful misconduct, fraud or gross negligence.
(a) No Prior Agreements. Xxxxxxxxx represents and warrants that he is not
bound by any agreement or any other existing or previous business relationship
or in any other way which conflicts with, or may prevent or otherwise conflict
with, the full performance of his obligations and duties under this Agreement.
10. Notices. Any notice under this Agreement must be in writing and will
be deemed to have been given when personally delivered or mailed by first-class
or express mail to the recipient at the following address (or such other address
as shall be specified by prior written notice):
To the Company:
PathoGenesis Corporation
000 Xxxxxxx Xxxxxx Xxxx, Xxxxx 000
Xxxxxxx, XX 00000
Attention: Chief Executive Officer
Chief Financial Officer
To Xxxx X. Xxxxxxxxx:
Xxxx X. Xxxxxxxxx
0 Xxxx Xxxx
Xxxxxxxxxx, XX 00000
11. Severability. Whenever possible, each provision of this Agreement will
be interpreted in such manner as to be effective and valid under applicable law.
If any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable law in any jurisdiction, such
invalidity, illegality or unenforceability will not affect any other provision
or the interpretation of this Agreement in any other jurisdiction.
12. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the state of Washington, without regard to the law
of conflicts.
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13. Successors and Assigns. The rights and services and duties to be
performed by Xxxxxxxxx hereunder are personal and may not be assigned or
delegated in any way. This Agreement shall be binding upon and inure to the
benefit of the Company, its successors and assigns, and Xxxxxxxxx, his heirs and
legal representatives. Without limiting the generality of the foregoing, the
Company shall have the right to assign this Agreement to any subsidiary or
affiliate of the Company.
14. Complete Agreement. This Agreement along with the Employee Agreement
constitutes the entire agreement between the parties concerning the subject
matter hereof.
15. Waiver. Failure by either party to insist upon strict adherence to any
one or more of the provisions of this Agreement on one or more occasions shall
not be construed as a waiver, nor shall it deprive that party of the right to
require strict compliance thereafter.
16. Survival. The obligations set forth in paragraphs 8, 9, 9(a) and 10,
and to the extent applicable, 11, 12, 13, 14, 15, 16, 17, and 18, shall survive
termination of this Agreement.
17. Amendments. No amendment hereto, or waivers or releases of obligations
or liabilities hereunder or under the Employee Agreement, shall be effective
unless agreed to in writing, signed by the parties hereto.
18. Withholding. The Company may deduct and withhold from the payments to
be made to Xxxxxxxxx hereunder any amounts required to be deducted and withheld
by the Company for Xxxxxxxxx under the provision of any statute, law, regulation
or ordinance now or hereafter enacted and advances, debts or other financial
obligations owed by Xxxxxxxxx to the Company. In addition, in the event that the
Company reasonably determines that it is required to make any payments of
withholding taxes as a result of Xxxxxxxxx'x receipt of any other compensation
or benefits pursuant to the terms of this Agreement, the Company may, as a
condition to such receipt, require that Xxxxxxxxx provide the Company with an
amount of cash sufficient to enable the Company to pay such withholding taxes.
19. Reference to the Board of Directors. Whenever any reference to or
power of the Company or the Board of Directors is provided or contemplated in
this Agreement, such reference or power shall mean that of the Board of
Directors of the Company and/or its designee(s).
IN WITNESS WHEREOF, the parties have executed this Agreement effective as
of the date above written.
PathoGenesis Corporation
By: /s/ Xxxxxx X. Xxxxx
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Its: Pres. and CEO
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/s/ Xxxx X. Xxxxxxxxx
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Xxxx X. Xxxxxxxxx
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