Exhibit 10.8
EMPLOYMENT AGREEMENT
Agreement, dated as of July 1, 1998, by and between IMX PHARMACEUTICALS,
INC., a Utah corporation, having its principal place of business at 0000
Xxxxxxxxx Xxxxxxxxx, Xxxxx 000, Xxxx Xxxxx, Xxxxxxx 00000 (the "Corporation"),
and XXXXXXX X. XXXXXXX, residing at 0000 Xxxxxxxxx Xxxxxxxxx, Xxxxx 000, Xxxx
Xxxxx, Xxxxxxx 00000 (the "Executive").
W I T N E S S E T H:
WHEREAS, the Corporation desires to employ Executive as an executive
officer, and Executive is willing to accept such employment, all subject to the
terms and conditions set forth herein:
NOW, THEREFORE, in consideration of the premises and of the mutual
agreement set forth herein, the parties hereto agree as follows:
1. Employment and Term. Subject to the terms and conditions hereof, the
Corporation hereby employs Executive, and Executive hereby accepts employment by
the Corporation, for a period of three years commencing the date first written
above (the "Term"). This Agreement shall supersede that Employment Agreement
between the Corporation and the Executive dated as of January 21, 1996 in its
entirety.
2. Duties. Executive shall serve the Corporation as its President, Chief
Executive Officer and Chairman of the Board of Directors. Executive shall
perform such duties as are incidental to the offices he holds and as may, from
time to time, be assigned to him by the Board of Directors of the Corporation.
Executive agrees that the performance of his duties hereunder shall be his
principal business. He may engage in other business activities, as long as such
activities do not compete with the Corporation.
3. Compensation.
(a) As base compensation for the services to be rendered by
Executive hereunder, the Corporation agrees to pay to Executive an annual base
salary in the amount of $225,000.00 (the "Base Salary"), which Base Salary shall
be retroactive to January 1, 1998, and which such salary shall be paid in equal,
bi-weekly installments for so long as Executive is employed by the Corporation.
(b) The Base Salary shall be adjusted annually on or near each
anniversary of this Agreement, to reflect an increase, if any in the cost of
living for the previously 12-month period as measured by the change in the
Consumer Price Index published by the U.S. Department of Labor.
(c) The Corporation may, in its discretion, award the Executive
annual bonuses in an amount up to 100% of his Base Salary. In determining
whether the Executive has
earned a bonus, and if so, the amount of the bonus, the Corporation shall
consider the following factors: (i) Executive's ability and his performance;
(ii) whether the Corporation's equity interest in the limited liability company
formed with Medicis Partners, Incorporated ("Medicis") has been acquired
pursuant to Section 9.1 of the Limited Liability Company Agreement dated as of
June 18, 1998 at a Sales Multiple of two or greater; and (iii) whether the
Corporation has finalized two new income-producing projects per year. A project
shall be deemed to be "finalized" when it is sold to Medicis pursuant to the
terms of the Joint Venture Agreement with Medicis, or if the new product is
otherwise successfully brought to market by the Corporation.
4. Benefits. The Corporation shall provide Executive with the following
benefits:
(a) He shall be entitled to reimbursement for all normal and
reasonable travel, entertainment and other expenses necessarily incurred by him
in the performance of his obligations hereunder. The Corporation shall reimburse
Executive for such expenses upon presentation to the Corporation, within a
reasonable time after such expenses are incurred, of an itemized account of such
expenses, together with such vouchers or receipts for individual expense items
as the Corporation may from time to time require under its established policies
and procedures.
(b) He shall be entitled to participate in, or benefit from, in
accordance with the eligibility and other provisions thereof, such medical
insurance, pension, retirement, life insurance, bonus, profit-sharing, stock
option, stock purchase or other fringe benefit plans or policies as the
Corporation may make available to, or have in effect for, its executive
personnel from time to time.
(c) He shall be entitled to four weeks of vacation per year.
(d) He shall receive an allowance of $600 per month towards his
provision and maintenance of an automobile, plus $400 per month for related car
expenses.
(e) The Corporation shall obtain a "key-man" life insurance policy
on Executive's life in an amount of at least $1,000,000 (the "Policy"), which
Policy will name the Corporation as beneficiary. The Corporation shall pay the
cost of the Policy premiums.
(f) In addition, subject to Executive's insurability, the
Corporation agrees to obtain an additional life insurance policy covering the
Executive's life in an amount which will not exceed a premium amount of $25,000
for any year or the Term, and with the Executive having sole discretion in his
choice of beneficiaries. The Corporation will pay all premiums for additional
policy
5. Option to Renew. The Corporation shall have the option to renew this
Agreement for an additional term of two years upon the same terms and conditions
herein. If the Corporation elects not to renew the Agreement, the Executive
shall be entitled to receive at the end of the Term an amount equal to the Base
Salary for the third year of the Term, plus the annual cash value of all other
benefits provided to Executive hereunder in the third year. The
2
payments provided for herein shall be payable in full at the time of expiration
of the Term of this Agreement.
6. Termination on Disability or Death.
(a) In the event that the Executive, due to physical or mental
disability or incapacity, is unable to substantially perform his duties
hereunder for a period of six successive months, the Corporation or the
Executive shall have the right to terminate this Agreement and Executive's
employment hereunder upon 30-days' prior written notice. In the event that the
Executive shall be able to and shall recommence rendering services and
performing all of his duties hereunder within such 30-day notice period, such
notice shall be vitiated. The Executive's employment shall terminate immediately
upon his death.
(b) Upon termination of the Executive's employment by reason of his
death or disability as aforesaid, the Executive, or in the case of the
Executive's death, the Executive's personal representatives, shall be entitled
to receive all base compensation earned or accrued to the date of such
termination and not theretofore paid, less any benefits paid to Executive by
reason of such disability.
(c) In the event of the termination of this Agreement for any reason
other than death, the Executive shall have the right to purchase, and the
Corporation shall assign to the Executive, any insurance policy maintained by
the Corporation on the life of the Executive then in effect, for a price equal
to the net cash surrender value thereof at the time of such termination.
7. Termination for Certain Causes. In the event of the (i) willful and
material misconduct of the Executive in the performance of his duties hereunder,
(ii) willful and material breach of any provision of Sections 9 or 10, or (iii)
conviction of the Executive for any felony under federal or state law, this
Agreement and the Executive's employment hereunder may be terminated by the
Corporation without prior notice.
8. Change of Control. In order to protect the Executive against the
possible consequences and uncertainties of a Change of Control of the
Corporation (as hereinafter defined)
(a) If, during the term of this Agreement, the Executive's
employment is terminated by the Corporation at any time subsequent to a Change
of Control other than for the causes set forth in Paragraph 7, then in such
event, the Corporation shall pay the Executive all amounts due to Executive
pursuant to this Agreement, for the entire term of this Agreement. The base
salary of the Executive in effect at the time of termination pursuant to this
Paragraph 8(a) shall remain in effect for the remaining term of this Agreement.
All benefits provided to Executive pursuant to this Agreement shall continue to
be provided to Executive for the entire term of this Agreement.
(b) For purposes of this Paragraph 8, in the event, following a
Change of Control, the Executive shall resign from his employment with the
Corporation within thirty (30) calendar days after he has obtained actual
knowledge of any significant and material change or proposed change in his
nature of duties, including, without limitation, removal from
3
the position of Chief Executive Officer, in each instance without his prior
consent, such resignation shall be deemed to be a termination of employment by
the Corporation for purposes of Paragraph 8(a) of this Agreement.
(c) As used in this Paragraph 8, a "Change of Control" shall be
deemed to have occurred if (i) any "person" or "group of persons" (as such terms
are used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as
amended (the "1934 Act"), becomes the "beneficial owner" (as defined in Rule
13d-3 promulgated under the 1934 Act), directly or indirectly, of securities of
the Corporation representing more than fifty percent (50%) of the Corporation's
then outstanding securities having the right to vote on the election of
directors or (ii) if directors constituting a majority of the Board of Directors
are elected to the Board of Directors without the recommendation or approval of
the incumbent Board of Directors.
9. Confidentiality.
(a) Executive understands and hereby acknowledges that as a result
of his employment with the Corporation, he will necessarily become informed of,
and have access to, certain valuable and confidential information of the
Corporation and any of its subsidiaries, joint ventures and affiliates,
including, without limitation, inventions, trade secrets, technical information,
know-how, plans, specifications, identity of customers and suppliers, and that
such information, even though it may be developed or otherwise acquired by
Executive, is the exclusive property of the Corporation to be held by he
Executive in trust and solely for the Corporation's benefit. Accordingly, the
Executive hereby agrees that he shall not, at any time, either during or
subsequent to his employment hereunder, use, reveal, report, publish, transfer
or otherwise disclose to any person, corporation or other entity, any of the
Corporation's confidential information without the prior written consent of the
Corporation, except to responsible officers and employees of the Corporation and
other responsible persons who are in contractual or fiduciary relationship with
the Corporation or who have a need for such information for purposes in the
interest of the Corporation, and except for such information for purposes in the
interest of the Corporation, and except for such information which legally and
legitimately is or becomes of general public knowledge from authorized sources
other than Executive.
(b) Upon the termination of his employment with the Corporation for
any reason whatsoever, the Executive shall promptly deliver to the Corporation
all drawings, manuals, letters, notes, notebooks, reports and copies thereof,
and all other materials, including, without limitation, those of a secret and
confidential nature, relating to the Corporation's business which are in
Executive's possession or control.
10. Non-Competition. Executive agrees that, during the term of this
Agreement and for a period of two years after the termination for any cause of
his employment with the Corporation, he shall not, anywhere in the United States
of America or elsewhere in the world (or in such small area or for such lesser
period as may be determined by a court of competent jurisdiction to be a
reasonable limitation on the competitive activity of Executive), directly or
indirectly:
4
(i) engage in a competitive line of business to the business carried
on by the Corporation, either for his own account or with or for anyone else;
(ii) solicit or attempt to solicit business of any customers of the
Corporation for products or services the same or similar to those offered, sold,
produced or under development by the Corporation;
(iii) otherwise divert or attempt to divert from the Corporation any
business whatsoever;
(iv) solicit or attempt to solicit for any business endeavor any
employee of the Corporation;
(v) interfere with any business relationship between the Corporation
and any other person; or
(vi) render any services as an officer, director, employee, partner,
consultant or otherwise to, or have any interest as a stockholder, partner,
lender or otherwise in, any person which is so engaged.
Notwithstanding anything to the contrary contained in this Section 10, the
provisions hereof shall not prevent the Executive from purchasing or owning up
to 5% of the voting securities of any corporation, the stock of which is
publicly traded.
11. Remedies. Because the Corporation does not have an adequate remedy at
law to protect its business from Executive's competition or to protect its
interests in its trade secrets, privileged, proprietary or confidential
information and similar commercial assets, the Corporation shall be entitled to
injunctive relief, in addition to such other remedies and relief that would, in
the event of a breach of the provisions of Sections 8 or 9, be available to the
Corporation. In the event of such a breach, in addition to any other remedies,
the Corporation shall be entitled to receive from the Executive payment of, or
reimbursement for, its reasonable attorneys' fees and disbursements incurred in
enforcing any such provision.
12. Entire Agreement. This Agreement sets forth the entire understanding
of the parties and merges and supersedes any prior or contemporaneous agreements
between the parties pertaining to the subject matter hereof. This Agreement may
not be changed or terminated orally, and no change, termination or attempted
waiver of any of the provisions hereof shall be binding unless in writing and
signed by the party against whom the same is sought to be enforced; provided,
however, that the Executive's compensation may be increased at any time by the
Corporation without in any way affecting any of the other terms and conditions
of this Agreement, which in all other respects shall remain in full force and
effect. Failure of a party to enforce one or more of the provisions of this
Agreement or to require at any time performance of any of the obligations hereof
shall not be construed to be a waiver of such provisions by such party nor to in
any way affect the validity of this Agreement of such party's right thereafter
to
5
enforce any provision of this Agreement, nor to preclude such party from taking
any other action at any time which it would legally be entitled to take.
13. Successors and Assigns. Neither party shall have the right to assign
this personal Agreement, or any rights or obligations hereunder, without the
consent of the other party; provided, however, that upon the sale of all or
substantially all of the assets, business and goodwill of the Corporation to
another corporation, or upon the merger or consolidation of the Corporation with
another corporation, this Agreement shall inure to the benefit of, and be
binding upon, both Executive and the corporation purchasing such assets,
business and goodwill, or surviving such merger or consolidation, as the case
may be, in the same manner and to the same extent as though such other
corporation were the Corporation. Subject to the foregoing, this Agreement shall
inure to the benefit of, and bind, the parties hereto and their legal
representatives, heirs, successors and assigns.
14. Additional Acts. Executive and the Corporation each agrees that he or
it shall, as often as requested to do so, execute, acknowledge and deliver and
file, or cause to be executed, acknowledged and delivered and filed, any and all
further instruments, agreements or documents as may be necessary or expedient in
order to consummate the transactions provided for in this Agreement and do any
and all further acts and things as may be necessary or expedient in order to
carry out the purpose and intent of this Agreement.
15. Communications. All notices, requests, demands and other
communications under this Agreement shall be in writing and shall be deemed to
have been given at the time when mailed in any United States post office
enclosed in a registered or certified postage prepaid envelope and addressed to
the addresses set forth at the beginning of this Agreement, or to such other
address as any party may specify by notice to the other party; provided,
however, that any notice of change of address shall be effective only upon
receipt.
16. Construction. The headings of the paragraphs of this Agreement have
been inserted for convenience of reference only and shall in no way restrict or
otherwise affect the construction of the terms or provisions hereof. References
in this Agreement to Sections are to the sections of this Agreement.
17. Counterparts. This Agreement may be executed in multiple counterparts,
each of which shall be deemed to be an original and all of which together shall
be deemed to be one and the same instrument.
18. Severability. If any provision of this Agreement is held to be invalid
or unenforceable by a court or tribunal of competent jurisdiction, such
invalidity or unenforceability shall not affect the validity and enforceability
of the other provisions of this Agreement and the provision held to be invalid
or unenforceable shall be carried out as nearly as possible according to its
original terms and intent to eliminate such invalidity or unenforceability.
19. Governing Law. This Agreement is made and executed and shall be
governed by the laws of the State of Florida (excluding rules relating to
conflict of laws).
6
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
as of the date first set forth above.
IMX PHARMACEUTICALS, INC.
By:
-----------------------------------
XXXXX XXXXX, Chairman of the
Compensation Committee
--------------------------------------
XXXXXXX X. XXXXXXX, Executive
7
