EMPLOYMENT AGREEMENT
EXHIBIT 10.10
THIS EMPLOYMENT AGREEMENT (“Agreement”), is made as of this 1st day of September, 2006, by and
between IMPAX LABORATORIES, INC. , a Delaware corporation, with offices located at 000 Xxx Xxxxxxx
Xxxxxxxxx, Xxxxxxxx, XX 00000, its successors and assigns (hereinafter collectively referred to as
“Company”), and XXXXX X. XXXX , an individual residing at 000 Xxxxxxxxx Xxx, Xxxxxxxxxxxx, XX 00000
(“Employee”).
BACKGROUND
WHEREAS, Employee is currently employed by the Company as Executive Vice President, Commercial
Operations; and
WHEREAS, the Company wishes to reward Employee by modifying his “at-will” employment to
employment for a fixed term, and Employee desires to continue to be employed by the Company, all
upon the terms and conditions set forth in this Agreement.
NOW, THEREFORE , in consideration of the facts, mutual promises, and covenants contained
herein and intending to be legally bound hereby, the parties hereto agree as follows:
1. Employment. The Company hereby reaffirms its employment of
Employee and Employee hereby accepts continued employment by the
Company, for the period and upon the terms and conditions set forth
in this Agreement, subject to earlier termination pursuant to
Section 5 below.
2. Office and Duties.
(a) During the term of this Agreement, Employee shall
serve as Executive Vice President, Commercial Operations of
the Company, with overall responsibility for Corporate
Business Development, and the Generic Sales/Marketing and
Branded Sales/Marketing operations of the Company, shall
report directly to the President of the Company Xxxxx Xxx
(“President”), and be subject to the supervision, control and
direction of the President or as otherwise directed by the
Board of Directors of the Company (“Board”).
(b) In his capacity as Executive Vice President,
Commercial Operations, Employee shall have such authority,
perform such duties, discharge such responsibilities and
render such services as are customary to, and consistent with
his position, subject to the authority and direction of the
President, and shall perform such additional duties and
responsibilities as may be from time to time assigned to him
by the President, CEO or the Board, so long as such
additional duties and responsibilities are consistent with
those customarily performed by an executive of a comparable
size public company.
(c) Employee shall render his services diligently,
faithfully and to the best of his ability, and shall devote
all of his working time, energy, skill and best efforts to
the performance of his duties hereunder, in a manner that
will further the business and interests of the Company.
Employee shall also conduct himself and the business of the
Company in good faith and in accordance with the highest
standards of compliance with all laws and regulations
applicable in all jurisdictions in which the Company does
business.
(d) During the term of this Agreement, Employee shall not
be engaged in any business activity which, in the reasonable
judgment of the President, CEO or Board, conflicts with
Employee’s duties hereunder, whether or not such activity is
pursued for pecuniary advantage.
(e) Employee shall comply in all material respects with
all Company policies, and directives or policies set by the
Board, including, without limitation, policies regarding
ethics, integrity and personal conduct.
(f) During the term of this Agreement, Employee’s
principal place of employment shall be at the Company’s
facilities located at 000 Xxx Xxxxxxx Xxxxxxxxx, Xxxxxxxx,
Xxxxxxxxxxxx 00000 or 0000 Xxxxxx Xxx., Xxxxxxxxxxxx,
Xxxxxxxxxxxx (the “Place of Employment”). The Company shall
not change Employee’s Place of Employment to a location that
is more than twenty-five (25) miles from the Place of
Employment without Employee’s consent.
3. Term. This Agreement shall be for a term of three (3)
years (“Initial Term”) commencing on the date first mentioned above
(“Effective Date”) and, if not previously terminated in accordance
with the terms of this Agreement, ending three (3) years later. The
Initial Term shall be automatically extended on the third
anniversary date of the commencement of this Agreement (“Renewal
Date”) for a period of one (1) year unless either party shall give
written notice of non-renewal to the other party at least sixty
(60) days prior to the Renewal Date, in which event this Agreement
shall terminate at the end of the Initial Term. Subject to the
termination provisions contained herein, if this Agreement is
renewed on the Renewal Date, it will automatically be renewed on
the first anniversary date of the Renewal Date and each subsequent
year (the “Annual Renewal Date”) for a period ending one (1) year
from each Annual Renewal Date (“Renewal Period”), unless either
party gives written notice of non-renewal to the other party at
least sixty (60) days prior to the Annual Renewal Date, in which
case this Agreement will terminate on the Annual Renewal Date
immediately following such notice.
4. Compensation.
(a) Base Salary. In consideration of the services
rendered by Employee to the Company during the term hereof,
Employee shall receive a base salary based on an annualized
rate of Two Hundred Ninety-Five Thousand and 00/100 Dollars
($295,000.00) through January 31, 2007, payable in equal
periodic installments in accordance with the Company’s
regular payroll practices in effect from time to time. For
the period from February 1, 2007 through January 31, 2008,
Employee shall receive an annual base salary of Three Hundred
Thirty-Five Thousand and 00/100 Dollars ($335,000.00) and
beginning on February 1, 2008 and ending on the expiration of
the Initial Term, an annual base salary of Three Hundred
Ninety Five Thousand and 00/100 Dollars ($395,000.00),
payable in equal periodic installments in accordance with the
Company’s regular payroll practices in effect from time to
time (“Base Salary”). Thereafter, Employee’s Base Salary
shall be reviewed annually by the CEO, President, the Board
and/or a committee of the Board which has been delegated
responsibility for employee compensation matters (such
committee to be referred to herein as the “Compensation
Committee”) in accordance with the compensation policies and
guidelines of the Company, and may be modified either up or
down as a result of such review at the sole discretion of the
Board and/or the Compensation Committee.
2 of 14
(b) Bonus Plans/Incentive Compensation Programs. In
addition to Base Salary, during the Term, Employee shall be
eligible to participate in any bonus plans or incentive
compensation programs as may be in effect from time to time,
at a level consistent with his position and with the
Company’s then current policies and practices (“Bonus”). The
target for Employee’s bonus shall be set at seventy-five
percent (75%) of his Base Salary.
(c) Stock Bonus. In accordance with the Company’s 2002
Equity Incentive Plan (“Plan”), upon execution of this
Agreement, Employee will be granted a restricted stock bonus
award of Thirty Thousand (30,000) shares of the Company’s
Common Stock (“First Restricted Share Grant”) and options to
purchase Thirty Thousand (30,000) shares of Common Stock
(“First Stock Option Grant”). One-seventh of the First
Restricted Share Grant and one-fourth of the First Stock
Option Grant will vest on each anniversary date of the
Agreement thereafter over a seven-year and four-year period,
respectively. On the second anniversary of this Agreement,
Employee will be granted a second restricted stock bonus
award of Thirty Thousand (30,000) shares of Common Stock
(“Second Restricted Share Grant”) and options to purchase
Thirty Thousand (30,000) shares of Common Stock (“Second
Stock Option Grant”). One seventh of the Second Restricted
Share Grant and one-fourth of the Second Stock Option Grant
will vest on each subsequent anniversary date of the
Agreement thereafter over a seven-year and four-year period,
respectively. The First Restricted Share Grant and Second
Restricted Share Grant are collectively referred to
hereinafter as “Restricted Shares”, and the First Stock
Option Grant and Second Stock Option Grant are collectively
referred to hereinafter as “Stock Options”. In order to
enable Employee to satisfy the minimum withholding tax
obligations with respect to the vesting of the Restricted
Shares, the Company shall withhold from the Restricted Shares
that vest each year a number of shares having a fair market
value (as defined in the Plan) equal to the amount required
to be withheld.
(i) As the Company may not issue the Restricted
Shares or Stock Options without prior approval of the
Company’s Shareholders, the pricing of the Stock
Options and the issuance of the Restricted Shares and
Stock Options will be deferred until shareholder
approval is received. Prior to the expiration,
termination or Change in Control of this agreement, if
for any reason Shareholder approval is not received;
the Employee shall nevertheless be entitled to the
economic benefits, as reasonably determined by the
Compensation Committee, of such Restricted Shares and
Stock Options. The exercise price of the Stock Options
included in the First Stock Option Grant will be the
fair market value of the Company’s Common Stock on the
date of such Shareholder approval. The exercise price
of the Stock Options included in the Second Stock
Option Grant will be the fair market value of the
Common Stock on the date of grant unless Shareholder
approval shall not have been obtained by that date, in
which case it will be the fair market value on the date
of Shareholder approval. To the extent the fair market
price of the Common Stock on the date of issuance is
higher than that on the date of grant of the Stock
Options, the Company will credit the amount of such
excess to Employee upon, and to the extent of,
Employee’s exercise of such Stock Options. Employee
understands and agrees that at the time of execution of
this Agreement, the Restricted Shares and the Common
Stock underlying the Stock Options are not registered
under the Securities Act of 1933 and, therefore, such
Restricted Shares and Stock Options cannot be publicly
traded until such time as such shares are the subject
of an effective registration statement.
3 of 14
(ii) Should Employee’s employment be terminated by
the Company without “Cause” or by Employee for “Good
Reason”, or in the event of the death or disability of
Employee, all of the unvested Restricted Shares and
Stock Options shall be accelerated and become fully
vested. In addition, if Employee voluntarily terminates
his employment for other than “Good Reason” within
eighteen (18) months of a change in Employee’s direct
reporting from Xxxxx Xxx to another Company officer,
all of the unvested Restricted Shares and Stock
Options, both granted and not yet granted, shall be
accelerated and become fully vested. If, however,
Employee is terminated for “Cause” or employee
voluntarily terminates his employment for any reason
other than “Good Reason” or change in direct report
from Xxxxx Xxx, all remaining unvested Restricted
Shares and Stock Options hereunder shall be forfeited.
(d) Benefits. During his employment hereunder, Employee
also shall be entitled to participate in all fringe benefits,
if any, as may be in effect from time to time which are
generally available to the Company’s senior executive
officers, and such other fringe benefits as the Board and/or
Compensation Committee shall deem appropriate, subject to
eligibility requirements thereof (collectively, the
“Benefits”). In no event shall the Benefits be less than the
Benefits provided by the Company to Employee on the date
hereof.
(e) Vacation. During this employment hereunder,
Employee shall be entitled to the number of paid vacation
days in each calendar year as determined by the Company from
time to time for its senior executive officers. Vacation days
which are not used during any calendar year may not be
accrued or carried-over to the next year, nor shall Employee
be entitled to compensation for unused vacation days. In no
event shall the number of vacation days be less than the
number provided by the Company to Employee on the date
hereof.
(f) Business Expenses. During his employment hereunder,
the Company shall pay or reimburse Employee for all
reasonable expenses incurred or paid by Employee in the
performance of Employee’s duties hereunder, upon timely
presentation of expense statements or vouchers and such other
information as the Company may reasonably require and in
accordance with the generally applicable policies and
practices of the Company as they may be modified from time to
time.
(g) Withholding. All payments made pursuant to this
Agreement shall be subject to such withholding taxes as may
be required by any applicable law.
4 of 14
5. Termination. This Agreement shall continue until the end
of the Initial Term or any Renewal Period, unless terminated
earlier by the Company or Employee as provided herein. If this
Agreement is terminated prior to the expiration of the Initial Term
or any Renewal Period by the Company or Employee, the provisions
contained in Section 6, “Payments Upon Termination”, shall apply.
(a) Termination by Company for Cause. The Company shall
have the right to terminate this Agreement at any time for
“Cause”. For purposes of this Agreement, the term “Cause”
shall mean the following:
(i) Employee commits fraud or theft against the
Company or any of its subsidiaries, affiliates, joint
ventures and related organizations (collectively
referred to as “Affiliates”), or is indicted, convicted
of, or pleads guilty or nolo contendere to, a felony or
misdemeanor; or
(ii) In carrying out his duties hereunder, the
Employee engages in conduct that constitutes gross
neglect or willful misconduct that results, in either
case, in material economic harm to the Company or its
Affiliates; or
(iii) Employee materially breaches any provision of
this Agreement (including but not limited to the
restrictive covenants contained in Section 7 below) or
breaches any fiduciary duty or duty of loyalty owed to
the Company or its Affiliates; or
(iv) Employee engages in conduct, which in the sole
discretion of the Company, tends to bring the Company
or its Affiliates into public disgrace or disrepute; or
(v) Employee neglects or refuses to perform duties
or responsibilities as directed by the President, CEO
or the Board which are consistent with Section 2(b), or
violates any direction of any lawful rule, policy or
regulation established by the President, the CEO or the
Board; or
(vi) Employee commits any acts or omissions
resulting in or intended to result in direct personal
gain to the Employee at the expense of the Company or
its Affiliates; or
(vii) Employee compromises or otherwise discloses
trade secrets or other confidential and proprietary
information of the Company or its Affiliates.
“Cause” shall not include a bona fide disagreement over a corporate policy, so long as the
Employee does not willfully violate on a continuing basis specific written directions from the
President, CEO or the Board, which directions are consistent with the provisions of this Agreement.
Action or inaction by Employee shall not be considered “willful” unless done or omitted by him
intentionally and without his reasonable belief that his action or inaction was in the best
interests of the Company or its Affiliates, and shall not include failure to act by reason of total
or partial incapacity due to physical or mental illness.
(b) Termination by Company upon the Death or Disability
of Employee. Company shall have the right to terminate this
Agreement at any time upon the Death or Disability of
Employee. The term, “Disability”, as used herein, means any
physical or mental illness, disability or incapacity which
prevents Employee from performing the essential functions of
his job, with or without reasonable accommodations, hereunder
for a period of not less than one hundred fifty (150)
consecutive days or for an aggregate of one hundred eighty
(180) days during any period of twelve (12) consecutive
months. During any period of Disability, Employee agrees to
submit to reasonable medical examinations upon the reasonable
request, and at the expense, of the Company.
5 of 14
(c) Termination By Company Without Cause. The Company shall have the right to terminate this Agreement at any time
without “Cause” and/or without the occurrence of Employee’s Death or Disability upon thirty (30) days written notice to
Employee.
(d) Termination By Employee For Good Reason. Employee shall have the right to terminate his Agreement at any time
during his employment with the Company for “Good Reason” upon thirty (30) days prior written notice to the President, CEO and
the Company’s Board. For purposes of this Agreement, “Good Reason” shall mean any of the following:
(i) the assignment to Employee by the Company of any duties inconsistent with Employee’s status with the Company; or
(ii) the relocation of Employee to a Company office located more than twenty-five (25) miles from Employee’s Place
of Employment; or
(iii) any material breach by the Company of a material term or provision contained in this Agreement, which breach
is not cured within thirty (30) days following the receipt by the President, CEO and the Board of written notice of
such breach; or
(iv) there is a “Change in Control” of the Company (as hereinafter defined).
(e) Definition of Change in Control . For purposes of this Agreement, a “Change in Control of Company” means any of the
events described in the following subsections (i) through (vii):
(i) The occurrence of any event that would, if known to the Company’s management, be required to be reported by the
Company under Item 5.01(a) of Form 8-K pursuant to the Securities Exchange Act of 1934 (the “Exchange Act”); or
(ii) The acquisition or receipt, in any manner, by any person (as defined for purposes of the Exchange Act) or any
group of persons acting in concert, of direct or indirect beneficial ownership (as defined for purposes of the Exchange
Act) of fifty-one percent or more of the combined voting securities ordinarily having the right to vote for the
election of directors of the Company; provided that the following shall not constitute a Change in Control: (a) any
acquisition directly from the Company; (b) any acquisition by the Company or any of its affiliates; or (c) any
acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any of its
affiliates; or
6 of 14
(iii) A change in the constituency of the Board with the
result that individuals (the “Incumbent Directors”) who are
members of the Board as of the Effective Date cease for any
reason to constitute at least a majority of the Board; provided
that any individual who is elected to the Board after the
Effective Date and whose nomination for election was
unanimously approved by the Incumbent Directors shall be
considered an Incumbent Director beginning on the date of his
or her election to the Board; or
(iv) Consummation of a merger, consolidation or
reorganization involving the Company, unless such merger,
consolidation or reorganization results in the voting
securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity
or parent thereof) more than fifty-one percent of the total
voting power represented by the voting securities of the
Company or such surviving entity or parent thereof outstanding
immediately after such merger, consolidation or reorganization;
or
(v) A complete liquidation or dissolution of the Company; or
(vi) A sale, exchange or other disposition or transfer of
all or substantially all of the Company’s business or assets,
other than pursuant to a spin-off or comparable transaction in
which the transferee is controlled by the Company or its
existing stockholders immediately prior to such transfer;
(vii) Any event that would constitute a “Change in Control”
pursuant to the Impax Laboratories, Inc. Non-Qualified Deferred
Compensation Plan.
(f) Termination by Employee for Other than Good Reason. If
Employee shall desire to terminate his employment hereunder for other
than Good Reason, he shall first give the Company not less than
thirty (30) days prior written notice of termination. Upon a
termination of Employee’s employment with Company under this Section
5(f), the effective date of termination shall be the date set forth
in employee’s resignation notice (assuming such date is in compliance
with the notice provisions of this Section 5(f)) or an earlier date,
as determined by the Company, in its sole discretion, after Company’s
receipt of such notice, but not earlier than the date on which
Company learned of Employee’s decision to terminate his employment
for other than Good Reason.
(g) Notice of Termination. Any termination, except for death,
pursuant to this Section 5 shall be communicated by a Notice of
Termination. For purposes of this Agreement, a “Notice of
Termination” shall mean a written notice which shall indicate those
specific termination provisions in this Agreement relied upon and
which sets forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of the Employee’s
employment under the provisions so indicated. The Notice of
Termination shall also set forth Employee’s employment is terminated
and be delivered in accordance with the terms of this Agreement.
Notwithstanding anything to the contrary set forth herein, the provisions of Sections 7 and 8
shall survive the termination of Employee’s employment hereunder for any reason, and shall remain
in full force and effect thereafter.
7 of 14
6. Payments Upon Termination.
(a) Termination for Cause. In the event Employee’s
employment hereunder is terminated for Cause, all of
Employee’s rights to his Base Salary, Benefits and Bonus, if
any, shall immediately terminate as of the date of such
termination, except that Employee shall be entitled to, and
the Company shall pay to Employee, any earned and unpaid
portion of his Base Salary and accrued Benefits up to the
date of termination, less all deductions or offsets for
amounts owed by Employee to the Company. The Company shall
have no further obligations to Employee under the Agreement.
(b) Termination Due to Death or Disability. In the
event Employee’s employment hereunder is terminated due to
his Death or Disability, all of Employee’s rights to his Base
Salary, Benefits and Bonus, if any, shall immediately
terminate as of the date of such termination, except that
Employee (or, in the event that Employee’s employment
hereunder is terminated due to Employee’s death, Employee’s
heirs, personal representative or estate) shall be entitled
to, and the Company shall pay, any earned and unpaid portion
of his Base Salary and accrued Benefits up to the date of
termination less all deductions or offsets for amounts owed
by Employee to the Company. The Company shall have no further
obligations to Employee under the Agreement other than as
referenced in Section 4(c) relating to the accelerated
vesting of Restricted Shares and Stock Options.
(c) Termination By Company Without Cause or By Employee
For Good Reason. If the Company terminates Employee’s
employment other than for Cause or the occurrence of
Employee’s death or Disability, or if Employee terminates his
employment for Good Reason, the Company shall pay to Employee
as severance a lump sum payment equal to the greater of: (i)
one (1) year of Employee’s Base Salary in effect upon
termination plus the average of Employee’s Bonus over the
past two (2) years, or (ii) Base Salary in effect upon
termination for the remainder of the Initial Term (“Severance
Payment”), provided Employee is not in breach of this
Agreement, and he executes, and does not revoke, a General
Release of all claims relating to his employment and
termination from employment in a form provided by the Company
(“General Release”). Such lump sum Severance Payment shall be
made to Employee within 15 days after Employee executes the
General Release, provided he does not revoke the General
Release. Employee understands that should he fail or refuse
to execute the General Release provided by the Company, or
revoke such General Release, he shall not be entitled to the
Severance Payment under this section. The Company shall have
no further obligations to Employee under the Agreement other
than as referenced in Section 4(c) relating to the
accelerated vesting of Restricted Shares and Stock Options.
(d) Termination By Employee For Other Than Good Reason.
In the event Employee terminates his employment for other
than Good Reason, all of Employee’s rights to his Base
Salary, Benefits and Bonus, if any, shall immediately
terminate as of the date of termination, except that Employee
shall be entitled to any earned and unpaid portion of his
Base Salary and accrued Benefits up to the date of
termination. The Company shall have no further obligations to
Employee under the Agreement other than as referenced in
Section 4(c) relating to the accelerated vesting of
Restricted Shares and Stock Options.
8 of 14
7. Restrictive Covenants.
(a) Non-Solicitation. During the Initial Term and any
Renewal Period, and for a period of the greater of one (1)
year or the remainder of the Initial Term after this
Agreement is terminated for any reason, voluntary or
involuntary, Employee will not, directly or indirectly, for
his own account or for the benefit of any natural person,
corporation, partnership, trust, estate, joint venture, sole
proprietorship, association, cooperative or other entity
(“Person”):
(i) solicit, service, contact, or aid in the
solicitation or servicing of any Person or business
entity, which is or was a customer, prospective
customer, contractor, subcontractor, vendor or supplier
of the Company or its Affiliates (as defined in Section
5(a)(i) above) within three (3) years prior to
Employee’s termination (“Company Customers”), for the
purpose of : (a) inducing Company Customers to cancel,
transfer or cease doing business in whole or in part
with Company or its Affiliates or (b) inducing Company
Customers to buy from any Person other than the Company
any product sold by the Company. For purposes of this
Agreement, the term “Business of the Company” shall
mean the development, manufacturing and marketing of
prescription pharmaceutical products, and any other
business the Company is actually engaged or planning to
be engaged in during Employee’s employment
(ii) solicit, aid in solicitation of, induce,
contact for the purpose of, encourage or in any way
cause any employee of Company or its Affiliates to
leave the employ of Company or its Affiliates, or
interfere with such employee’s relationship with
Company or its Affiliates.
(b) Non-Disclosure. Other than in furtherance of the
Business of the Company in the ordinary course in his
capacity as an employee hereunder, Employee will not, at any
time, except with the express prior written consent of the
Board, directly or indirectly, disclose, communicate or
divulge to any Person or entity, or use for the benefit of
any Person or entity, any secret, confidential or proprietary
knowledge or information with respect to the conduct or
details of the Business of the Company including, but not
limited to, customer lists, accounts and information,
prospective customer, contractor, subcontractor and vendor
lists and information, product research and development, drug
formulations, information relating to planned or contemplated
ANDAs, NDAs, Paragraph 4 filings, methods of operation,
pricing, costs, sales, sales strategies and methods,
marketing, marketing strategies and methods, know-how,
policies, financial information, financial condition,
business strategies and plans and other information of the
Company or its Affiliates which is not generally available to
the public and which has been developed or acquired by the
Company or its Affiliates with considerable effort and
expense (“Confidential Information”). Upon the expiration or
termination of Employee’s employment under this Agreement,
Employee shall immediately deliver to the Company all
Confidential Information, memoranda, books, papers, letters,
and other data (whether in written or electronic form), and
all copies of same, which were made by Employee or otherwise
came into his possession or under his control at any time
prior to the expiration or termination of his employment
under this Agreement, and which in any way relate to the
Business of the Company as conducted or as planned to be
conducted by the Company or its Affiliates on the date of the
expiration or termination.
9 of 14
(c) Intellectual Property. Employee will promptly
communicate to the Company, in writing when requested, all
software, designs, techniques, concepts, methods and ideas,
other technical information, marketing strategies and other
ideas and creations pertaining to the Business of the Company
which are conceived or developed by Employee alone, or with
others, at any time (during or after business hours) while
Employee is employed by the Company or its Affiliates.
Employee acknowledges that all of those ideas and creations
are inventions and works for hire, and will be the Company’s
exclusive property. Employee will sign any documents which
the Company deems necessary to confirm its ownership of those
ideas and creations, and Employee will cooperate with the
Company in order to allow the Company to take full advantage
of those ideas and creations.
(d) Non-Disparagement. Employee will not, at any time,
publish or communicate disparaging or derogatory statements
or opinions about the Company or its Affiliates, including
but not limited to, disparaging or derogatory statements or
opinions about the Company’s or its Affiliates’ management,
products or services, to any third party. It shall not be a
breach of this section for Employee to testify truthfully in
any judicial or administrative or other governmental
proceeding or to make statements or allegations in legal
filings that are based on Employee’s reasonable belief and
are not made in bad faith.
(e) Enforcement. Employee acknowledges that the
covenants and agreements of this Section 7 (“Covenants”)
herein are of a special and unique character, which give them
peculiar value, the loss of which cannot be reasonably or
adequately compensated for in an action at law. Employee
further acknowledges that any breach or threat of breach by
him of any of the Covenants will result in irreparable injury
to the Company for which money damages could not be adequate
to compensate the Company. Therefore, in the event of any
such breach or threatened breach, the Company shall be
entitled, in addition to all other rights and remedies which
the Company may have at law or in equity, to have an
injunction issued by any competent court enjoining and
restraining Employee and/or all other Persons involved
therein from committing a breach or continuing such breach.
The remedies granted to the Company in this Agreement are
cumulative and are in addition to remedies otherwise
available to the Company at law or in equity. The Covenants
contained in this Section 7 are independent of any other
provision of this Agreement, and the existence of any claim
or cause of action which Employee or any such other Person
may have against the Company shall not constitute a defense
or bar to the enforcement of any of the Covenants. If the
Company is obliged to resort to litigation to enforce any of
the Covenants which has a fixed term, then such term shall be
extended for a period of time equal to the period during
which a material breach of such Covenant was occurring,
beginning on the date of a final court order (without further
right of appeal) holding that such a material breach
occurred, or, if later, the last day of the original fixed
term of such Covenant.
(f) Acknowledgements. Employee expressly acknowledges
that the Covenants are a material part of the consideration
bargained for by the Company, and, without the agreement of
Employee to be bound by the Covenants, the Company would not
have agreed to enter into this Agreement. Employee further
acknowledges and agrees that the Business of the Company and
its services are highly competitive and that the Covenants
contained in this Section 7 are reasonable and necessary to
protect the Company’s legitimate business interests and
Confidential Information, and are material conditions to
Employee’s employment and continued employment with the
Company. Employee also acknowledges that the Company has
invested significant time, effort, resources and expense in
training its employees and agrees that the restrictions
contained in this paragraph are reasonable and necessary to
protect the Company’s investment and legitimate business
interests, and to preserve an undisrupted workplace.
10 of 14
(g) Scope. If any portion of any Covenant or its application is
construed to be invalid, illegal or unenforceable, then the remaining
portions and their application shall not be affected thereby, and
shall be enforceable without regard thereto. If any of the Covenants
is determined to be unenforceable because of its scope, duration,
area or similar factor, then the court or other trier of fact making
such determination shall modify, reduce or limit such scope,
duration, area or other factor, and enforce such Covenant to the
extent it believes is lawful and appropriate.
(h) Indemnification. Employee shall indemnify, defend and hold
harmless the Company in respect of all liabilities, charges, damages,
losses, expenses, fees, and costs of any nature (including reasonable
attorney’s fees and costs of litigation) that result from a failure
by Employee to fully perform or comply with any Covenant contained in
this Section 7.
8. Miscellaneous.
(a) Indulgences, Etc. Neither the failure, nor any delay, on the
part of either party to exercise any right, remedy, power or
privilege under this Agreement shall operate as a waiver thereof, nor
shall any single or partial exercise of any right, remedy, power or
privilege preclude any other or further exercise of the same, or of
any other right, remedy, power or privilege, nor shall any waiver of
any right, remedy, power or privilege with respect to any occurrence
be construed as a waiver of such right, remedy, power or privilege
with respect to any other occurrence. No waiver shall be effective
unless it is in writing and is signed by the party asserted to have
granted such waiver.
(b) Controlling Law; Consent to Arbitration; Service of Process.
(i) This Agreement and all questions relating to its
validity, interpretation, performance and enforcement
(including, without limitation, provisions concerning
limitations of actions), shall be governed by and construed in
accordance with the laws of the Commonwealth of Pennsylvania
(notwithstanding any conflict-of-laws doctrines of such state
or other jurisdiction to the contrary), and without the aid of
any canon, custom or rule of law requiring construction against
the draftsman.
(ii) Except to the extent provided for in Section 7 above
(relating to injunctive relief and other equitable remedies),
the Company and Employee agree that any claim, dispute or
controversy arising under or in connection with this Agreement,
or otherwise in connection with Employee’s employment by the
Company or termination of his employment (including, without
limitation, any such claim, dispute or controversy arising
under any federal, state or local statute, regulation or
ordinance or any of the Company’s employee benefit plans,
policies or programs) shall be resolved solely and exclusively
by binding, confidential, arbitration. The arbitration shall be
held in Philadelphia, Pennsylvania (or at such other location
as shall be mutually agreed by the parties). The arbitration
shall be conducted in accordance with the National Rules for
the Resolution of Employment Disputes (the “Rules”) of the
American Arbitration Association (“the AAA”) in effect at the
time of the arbitration, except that the arbitrator shall be
selected by alternatively striking from a list of five
arbitrators supplied by the AAA. All fees and expenses of the
arbitration, including a transcript if either requests, shall
be borne equally by the parties, however, all costs for the
services of the arbitrator shall be borne solely by the
Company. Each party is responsible for the fees and expenses of
its own attorneys, experts, witnesses, and preparation and
presentation of proofs and post-hearing briefs (unless the
party prevails on a claim for which attorney’s fees are
recoverable under law). In rendering a decision, the arbitrator
shall apply all legal principles and standards that would
govern if the dispute were being heard in court. This includes
the availability of all remedies that the parties could obtain
in court. In addition, all statutes of limitation and defenses
that would be applicable in court, will apply to the
arbitration proceeding. The decision of the arbitrator shall be
set forth in writing, and be binding and conclusive on all
parties. Any action to enforce or vacate the arbitrator’s award
shall be governed by the Federal Arbitration Act, if
applicable, and otherwise by applicable state law. If either
the Company or Employee improperly pursues any claim, dispute
or controversy against the other in a proceeding other than the
arbitration provided for herein, the responding party shall be
entitled to dismissal or injunctive relief regarding such
action.
11 of 14
(c) Notices . All notices, requests,
demands and other communications required
or permitted under this Agreement shall
be in writing and shall be deemed to have
been duly given, made and received only
when delivered (personally, by courier
service such as Federal Express, or by
other messenger) or when deposited in the
United States mails, registered or
certified mail, postage prepaid, return
receipt requested, addressed as set forth
below:
| (i) | If to Employee: Xxxxx X. Xxxx 000 Xxxxxxxxx Xxx Xxxxxxxxxxxx, XX 00000 |
||
| (ii) | If to Company: Impax Laboratories, Inc. 00000 Xxxxxxxx Xxxxxx Xxxxxxx, XX 00000 Attention: Xxxxx Xxx, President |
12 of 14
In addition, notice by mail shall be by air mail if posted outside of the continental United
States.
Any party may alter the addresses to which communications or copies are to be sent by giving
notice of such change of address in conformity with the provisions of this Section for the giving
of notice.
(d) Assignment of Agreement. The rights and obligations
of both parties under this Agreement shall inure to the
benefit of and shall be binding upon their heirs, successors
and assigns. The Company may assign or otherwise transfer its
rights under this Agreement, including but not limited to all
Covenants contained in Section 7 above, to any successor or
affiliated business or corporation whether by sale of stock,
merger, consolidation, sale of assets or otherwise. This
Agreement may not, however, be assigned by Employee to a
third party, nor may Employee delegate his duties under this
Agreement.
(e) Insurance Coverage and Indemnification. To the
extent the Company has in place a directors’ and officers’
liability insurance policy (or policies), Employee shall be
provided with coverage that is no less favorable to him in
any respect (including, without limitation, with respect to
scope, exclusions, amounts, and deductibles) than the
coverage then being provided to any other present or former
senior executive or director of the Company. In addition, to
the extent not inconsistent with the Company’s Charter and/or
By-Laws, the Company will defend and indemnify Employee
against, and advance to Employee reasonable expenses incurred
or reasonably anticipated to be incurred, including
attorneys’ and accountants’ fees, for or in connection with
any proceeding or claim against Employee, whether
individually or in combination with any other person or
entity, relating in any manner to Employee’s employment as an
employee or officer of the Company, to the fullest extent
permitted by applicable law, provided Employee acted within
the scope of his employment with the Company.
(f) Provisions Separable. The provisions of this
Agreement are independent of and separable from each other,
and no provision shall be affected or rendered invalid or
unenforceable by virtue of the fact that for any reason any
other or others of them may be invalid or unenforceable in
whole or in part.
(g) Gender, Etc. Words used herein, regardless of the
number and gender specifically used, shall be deemed and
construed to include any other number, singular or plural,
and any other gender, masculine, feminine or neuter, as the
context indicates is appropriate.
(h) Entire Agreement. This Agreement contains the
entire understanding among the parties hereto with respect to
the subject matter hereof, and supersedes all prior and
contemporaneous agreements and understandings between the
parties, inducements or conditions, express or implied, oral
or written, except as herein contained. The express terms
hereof control and supersede any course of performance and/or
usage of the trade inconsistent with any of the terms hereof.
This Agreement may not be modified or amended other than by
an agreement in writing.
13 of 14
IN WITNESS WHEREOF, the
parties have executed and
delivered this Agreement,
intending to be legally bound
hereby, as of the date first
above written.
| IMPAX LABORATORIES, INC. |
||||
| By: | ||||
| Name: | ||||
| Title: | ||||
XXXXX X. XXXX /s/ Xxxxx X. Xxxx |
||||
14 of 14
