EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement"), made this 14th day of July,
1997, by and between ANTIVIRALS INC., an Oregon corporation, with its
principlal office at 0 XX Xxxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxxx, XX 00000
("Company"), and XXXXXXX XXXXXXX, PH.D. 0000 Xxxxxx Xx., Xxxxxxx, XX 00000
("Employee").
RECITALS:
A. Employee, through his education and career as a distinguished
researcher, possesses knowledge and skills that are highly desirable to the
Company.
B. The Company possesses technology which may benefit significantly
from the knowledge and skills of the Employee.
C. The Company desires to employ Employee, subject to appropriate
confidentiality and non-competition clauses contained herein, to leverage its
technology with Employee's knowledge and skills to the mutual benefit of the
Company, the Employee, and to the benefit of the Company's shareholders.
AGREEMENT:
NOW, THEREFORE, in consideration of the mutual benefits contained
herein, the sufficiency of which the parties acknowledge, the parties hereby
agree as follows:
1. EMPLOYMENT TERM. The term of employment ("Term") shall commence on
October 1, 1997 and shall continue until terminated in accordance with
Section 12.
2. DUTIES. Employee shall be responsible to perform such duties as
assigned to him from time to time by the Board of Directors of the Company
("Board"). Employee shall be employed by the Company and shall devote his
best efforts to the service of the Company throughout the Term. Employee
shall devote at least for (40) hours per week to the affairs of the Company.
Employee and Company acknowledge and agree that (i) Employee may hold certain
offices within certain entities as set forth on Exhibit A to this Agreement,
(ii) Employee's devotion of reasonable amounts of time in such capacities, so
long as it does not interfere with his performance of services hereunder,
shall not conflict with the terms of this Agreement, and (iii) Exhibit A may
be amended from time to time by agreement of the parties.
3. COMPENSATION. During the Term the Company shall compensate
Employee with an annual salary of $135,000, payable in accordance with
Company's payroll practices in effect from time to time, and less amounts
required to be withheld under applicable law and requested to be withheld by
Employee. Employee's annual salary shall be subject to review on an annual
basis. The Company may but shall not be required to pay bonus compensation
to Employee. Except as otherwise provided in this Agreement, the base salary
shall be prorated for any period of service less than a full month.
4. EXPENSES. The Company will reimburse Employee for all expenses
reasonably incurred by him in discharging his duties for the Company,
conditioned upon Employee's submission of written documentation in support of
claimed reimbursement of such expenses, and consistent with the Company's
expense reimbursement policies in effect from time to time.
5. BENEFITS. Subject to eligibility requirements, Employee shall be
entitled to participate in such benefits plans and programs as adopted by the
Company from time to time.
6. CONFIDENTIALITY.
(a) In the course of his employment with the Company, it is
anticipated that Employee may acquire knowledge (both orally and in writing)
regarding confidential affairs of the Company and confidential or proprietary
information including: (a) matters of a technical nature, such as know-how,
inventions, processes, products, designs, chemicals, compounds, materials,
drawings, concepts, formulas, trade secrets, secret processes or machines,
inventions or research projects; (b) matters of a business nature, such as
information about costs, profits, pricing policies, markets, sales,
suppliers, customers, plans for future development, plans for future
products, marketing plans or strategies; and (c) other information of a
similar nature which is not generally disclosed by the Company to the public,
referred to collectively hereafter as "Confidential Information."
"Confidential Information" shall not include information generally available
to the public. Employee agrees that during the term of this Agreement and
thereafter, he (i) will keep secret and retain in the strictest confidence
all Confidential Information, (ii) not disclose Confidential Information to
anyone except employees of the Company authorized to receive it and third
parties to whom such disclosure is specifically authorized, and (iii) not use
any Confidential Information for any purpose other than performance of
services under this Agreement without prior written permission from the
Company.
(b) If Employee is served with any subpoena or other compulsory
judicial or administrative process calling for production or disclosure of
Confidential Information or if Employee is otherwise required by law or
regulation to disclose Confidential Information, Employee will immediately,
and prior to production or disclosure, notify the Company and provide it with
such information as may be necessary in order that the Company may take such
action as it deems necessary to protect its interest.
(c) The provisions of this paragraph 6 shall survive termination
of this Agreement.
7. NONCOMPETITION.
(a) Employee agrees that during the Term and for a period of two
(2) years following termination of employment with the Company for any
reason, he will not directly or indirectly engage in any activity directed
toward the development of any uncharged sequence-specific nucleic
acid-binding agents or any nucleic acid purification and concentration or
detection system using uncharged sequence-specific nucleic acid-binding
agents.
(b) Employee agrees that during the Term and for a period of two
(2) years following termination of employment with the Company for any
reason, he will not directly or indirectly engage in any activity directed
towards the development of drug delivery systems related to the "molecular
engine" as defined in US patent application Serial No. 60/016,347 and
60/028,609 or in any other patents or patent applications filed or
Contemplated at any time during the Term. Patents
or patent applications "Contemplated" are those included, recorded or
discussed in the notebooks of researchers employed by or performing services
on behalf of the Company.
(c) For a period of two (2) years following termination of
employment with the Company for any reason, except with the express written
consent of the Company, Employee agrees to refrain from directly or
indirectly recruiting, hiring or assisting anyone else to hire, or otherwise
counseling to discontinue employment with the Company, any person then
employed by the Company or its subsidiaries or affiliates.
(d) The provisions of this paragraph 7 shall survive termination
of this Agreement and the term of employment.
8. COVERED WORK.
(a) All right, title and interest to any Covered Work that
Employee makes or conceives (whether alone or with others) while employed by
the Company, belong to the Company. This Agreement operates as an actual
assignment of all rights in Covered Work to the Company. "Covered Work"
means products and Inventions that relate to the actual or anticipated
business of the Company or any of its subsidiaries or affiliates, or that
result from or are suggested by a task assigned to Employee or work performed
by Employee on behalf of the Company or any of its subsidiaries or
affiliates, or that were developed in whole or in part on the Company time or
using the Company's equipment, supplies or facilities. "Inventions" mean
ideas, improvements, designs, computer software, technologies, techniques,
processes, products, chemicals, compounds, materials, concepts, drawings,
authored works or discoveries, whether or not patentable or copyrightable, as
well as other newly discovered or newly applied information or concepts.
Attached hereto as Exhibit B is a description of any product or Invention in
which Employee had or has any right, title or interest which is not included
within the definition of "Covered Work".
(b) Employee shall promptly reveal all information relating to
Covered Work and Confidential Information to an appropriate officer of the
Company and shall cooperate with the Company, and execute such documents as
may be necessary, in the event that the Company desires to seek copyright,
patent or trademark protection thereafter relating to same.
(c) In the event that the Company requests that Employee assist in
efforts to defend any legal claims to patents or other right, the Company
agrees to reimburse Employee for any reasonable expenses Employee may incur
in connection with such assistance. This obligation to reimburse shall
survive termination of this Agreement and the term of employment.
(d) The provisions of this paragraph 8 shall survive termination
of this Agreement and the term of employment.
9. RETURN OF INVENTIONS, PRODUCTS AND DOCUMENTS. Employee
acknowledges and agrees that all Inventions, all products of the Company and
all originals and copies of records, reports, documents, lists, drawings,
memoranda, notes, proposals, contracts and other documentation related to the
business of the Company or containing any information described in this
paragraph shall be the sole and exclusive property of the Company and shall
be returned to the Company immediately upon the termination of Employee's
employment with the Company or upon the written request of the Company.
10. INJUNCTION. Employee agrees that it would be difficult to measure
damages to the Company from any breach by Employee of paragraph 6, 7, 8
and/or 9 of this Agreement, and that
monetary damages would be an inadequate remedy for any such breach.
Accordingly, Employee agrees that if Employee shall breach paragraph 6, 7, 8
and/or 9 of this Agreement, the Company shall be entitled, in addition to all
other remedies it may have at law or in equity, to an injunction or other
appropriate orders to restrain any such breach without showing or proving any
actual damage sustained by the Company.
11. OBLIGATIONS TO OTHERS. Except for items fully disclosed in writing
to the Company, Employee represents and warrants to the Company that (i)
Employee's employment by the Company does not violate any agreement with any
prior employer or other person or entity, and (ii) Employee is not subject to
any existing confidentiality or noncompetition agreement or obligation, or
any agreement relating to the assignment of Inventions except as has been
fully disclosed in writing to the Company.
12. TERMINATION.
(a) Employee may voluntarily terminate his employment with the
Company upon giving the Company sixty (60) days' written notice.
(b) The Company may terminate Employee's employment without Cause
(as defined below) upon giving Employee thirty (30) days written notice of
termination.
(c) Employee's employment with the Company shall terminate upon
the occurrence of any one of the following:
(1) Employee's death;
(2) The effective date of a notice sent to Employee stating
the Board's determination made in good faith and after consultation with a
qualified physician selected by the Board, that Employee is incapable of
performing his duties under this Agreement, with or without reasonable
accommodation, because of a physical or mental incapacity that has prevented
Employee from performing such full-time duties for a period of ninety (90)
consecutive calendar days and the determination that such incapacity is
likely to continue for a least another ninety (90) such days; and
(3) The effective date of a notice sent to Employee
terminating Employee's employment for Cause.
(d) "Cause" means the occurrence of one or more of the following
events:
(1) Employee's willful and repeated failure or refusal to
comply in any material respect with the reasonable and lawful policies,
standards or regulations from time to time established by the Company, or to
perform his duties in accordance with this Agreement after notice to Employee
of such failure; and
(2) Employee engages in criminal conduct or engages in
conduct with respect to the Company that is dishonest, fraudulent or
materially detrimental to the reputation, character or standing of the
Company.
13. TERMINATION COMPENSATION.
(a) Upon Employee's voluntary termination of employment (other
than voluntary termination after a Change of Control (as defined below)), or
termination of Employee's employment for Cause, the Company shall pay to
Employee all compensation due to the date of termination, but shall have no
further obligation to Employee hereunder in respect of any period following
termination.
(b) Upon the death of Employee, the Company shall pay to
Employee's estate or such other party who shall be legally entitled thereto,
all compensation due to the date of death, and an additional amount equal to
compensation at the rate set forth in this Agreement from the date of death
to the final day of the month following the month in which the death occurs.
(c) Upon termination of Employee's employment by the Company other
than for Cause, or upon Employee's voluntary termination of employment after
a Change of Control, the Company shall pay to Employee an amount equal to
twelve (12) months' compensation calculated with reference to Employee's then
current annual compensation (exclusive of bonuses), which amount shall be due
and payable at termination.
(d) Amounts payable under this Section shall be net of amounts
required to be withheld under applicable law and amounts requested to be
withheld by Employee.
(e) Upon Termination of Employee's employment by the Company other
than for Cause, all outstanding options granted to Employee pursuant to the
Company's 1992 Stock Incentive Plan, which vest with the passage of time (and
are not performance related) shall be immediately fully vested.
(f) As used herein, "Change of Control" means the occurrence of
any one of the following events: (i) any Person becomes the beneficial owner
of twenty-five percent (25%) or more of the total number of voting shares of
the Company; (ii) any Person (other than the Persons named as proxies
solicited on behalf of the Board of Directors of the Company) holds revocable
or irrevocable proxies representing twenty-five percent (25%) or more of the
total number of voting shares of the Company; (iii) any Person has commenced
a tender or exchange offer, or entered into an agreement or received an
option, to acquire beneficial ownership of twenty-five percent (25%) or more
of the total number of voting shares of the Company; and (iv) as the result
of, or in connection with, any cash tender or exchange offer, merger, or
other business combination, sale of assets, or any combination of the
foregoing transactions, the persons who were directors of the Company before
such transactions shall cease to constitute at least two-thirds (2/3) of the
Board of Directors of the Company or any successor entity.
14. NOTICE. Unless otherwise provided herein, any notice, request,
certificate or instrument required or permitted under this Agreement shall be
in writing and shall be deemed "given" upon personal delivery to the party to
be notified or three business days after deposit with the United States
Postal Service, by registered or certified mail, addressed to the party to
receive notice at the address set forth above, postage prepaid. Either party
may change its address by notice to the other party given in the manner set
forth in this Section.
15. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the parties and contains all the agreements between them with respect
to the subject matter hereof. It also supersedes any and all other
agreements or contracts, either oral or written, between the parties with
respect to the subject matter hereof.
16. MODIFICATION. Except as otherwise specifically provided, the terms
and conditions of this Agreement may be amended at any time by mutual
agreement of the parties, provided that before any amendment shall be valid
or effective, it shall have been reduced to writing and signed by an
authorized representative of the Company and Employee.
17. NO WAIVER. The failure of any party hereto exercise any right,
power or remedy provided under this Agreement or otherwise available in
respect hereof at law or in equity, or to insist upon compliance by any other
party hereto with its obligations, shall not be a waiver by such party of its
right to exercise any such or other right, power or remedy or to demand
compliance.
18. SEVERABILITY. In the event that any paragraph or provision of this
Agreement shall be held to be illegal or unenforceable, such paragraph or
provision shall be severed from this Agreement and the entire Agreement shall
not fail as a result, but shall otherwise remain in full force and effect.
19. ASSIGNMENT. This Agreement shall be binding upon and inure to the
benefit of the Company and its successors and assigns, and shall be binding
upon Employee, his administrators, executors, legatees, and heirs. In that
this Agreement is a personal services contract, it shall not be assigned by
Employee.
20. DISPUTE RESOLUTION. Except as otherwise provided in Section 10,
the Company and Employee agree that any dispute between Employee and the
Company or its officers, directors, employees, or agents in their individual
or Company capacity of this Agreement, shall be submitted to a mediator for
nonbinding, confidential mediation. If the matter cannot be resolved with
the aid of the mediator, the Company and Employee mutually agree to
arbitration of the dispute. The arbitration shall be in accordance with the
then-current Employment Dispute Resolution Rules of the American Arbitration
Association ("AAA") before an arbitrator who is licensed to practice law in
the State of Oregon. The arbitration shall take place in or near Portland,
Oregon. Employee and the Company will share the cost of the arbitration
equally, but each will bear their own costs and legal fees associated with
the arbitration. However, if any party prevails on a statutory claim which
affords the prevailing party attorneys' fees, or if there is a written
agreement providing for attorneys' fees, the arbitrator may award reasonable
attorneys' fees.
The Company and Employee agree that the procedures outlined in this
provision are the exclusive method of dispute resolution.
21. ATTORNEYS' FEES. In the event suit or action is instituted
pursuant to Section 10 of this Agreement, the prevailing party in such
proceeding, including any appeals thereon, shall be awarded reasonable
attorneys' fees and costs.
22. APPLICABLE LAW. This Agreement shall be construed and enforced
under and in accordance with the laws of the State of Oregon.
23. COUNTERPARTS. This Agreement may be signed in two counterparts,
each of which shall be deemed an original and both of which shall together
constitute one agreement.
IN WITNESS WHEREOF, Antivirals Inc. has caused this Agreement to be
signed by its duly authorized representative, and Employee has hereunder set
his name as of the date of this Agreement.
COMPANY: ANTIVIRALS INC.
By: /s/ XXXX X. XXXXXXX
---------------------------------
Xxxx X. Xxxxxxx
EMPLOYEE: /s/ XXXXXXX XXXXXXX, PH.D.
---------------------------------
XXXXXXX XXXXXXX, PH.D.
EXHIBIT A
LIST OF OFFICES HELD
SCHEDULE A (to Employment Agreement)
EXHIBIT B
INVENTIONS EXCLUDED FROM COVERED WORKS
