EXHIBIT 10(h)
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EMPLOYMENT AGREEMENT
Employment Agreement effective as of June 1, 1997 (the "Effective Date")
between VIROLOGIX CORPORATION, a Delaware corporation (with its successors and
assigns, referred to as the "Corporation"), and Xxxxxxxxx X. Song, Ph.D.
(referred to as "Song").
Preliminary Statement
The Corporation desires to employ Song, and Song wishes to be employed by
the Corporation, as Director of Viral Research of the Corporation upon the terms
and subject to the conditions set forth in this Agreement. The Corporation and
Song also wish to enter into the other agreements set forth in this Agreement,
all of which are related to Song's employment under this Agreement.
Agreement
Song and the Corporation therefore agree as follows:
1. Employment for Term. The Corporation hereby employs Song and Song
hereby accepts employment with the Corporation for the period beginning on the
date of this Agreement and ending on the second anniversary of the Effective
Date (the "Initial Term"), or upon the earlier termination of the Initial Term
pursuant to Section 7. This Agreement shall be automatically renewed for an
additional two-year period (the "Renewal Term"; together with the Initial Term,
the "Term") unless either party notifies the other in writing of its intention
not to so renew this Agreement no less than 60 days prior to the expiration of
the Initial Term. The end of the Term for any reason shall end Song's employment
under this Agreement, but shall not terminate Song's or the Corporation's other
agreements in this Agreement.
2. Position and Duties. During the Term, Song shall serve as the Director
of Viral Research of the Corporation. During the Term, Song shall devote all of
her business time and best efforts to her duties as an employee of the
Corporation, provided, however, Song will be permitted to hold the position of
Visiting Scientist at University College Dublin, Belfield, Xxxxxx 0, Xxxxxxx.
3. Place of Performance. In connection with rendering employment services
to the Corporation, Song shall be based in Dublin, Ireland.
4. Compensation.
(a) Base Salary. The Corporation shall pay Song a base salary,
beginning on the first day of the Term and ending on the last day of the Term,
of not less than $60,000 per annum, payable in the United States at least
monthly on the Corporation's regular pay cycle for professional employees.
(b) Stock Options. Pursuant to the Corporation's stock option plan,
the Corporation shall grant to Song 5,000 options to purchase 5,000 shares of
the Corporation's Common Stock at an exercise price of $6.00. The options shall
vest on a pro rata basis on the first and second anniversaries of this
Agreement.
(c) Other and Additional Compensation. Section establishes the
minimum compensation during the Term and shall not preclude the Board from
awarding Song a higher salary or any bonuses or stock options in the discretion
of the Board during the Term at any time.
5. Employee Benefits. During the Term, Song shall be entitled to the
employee benefits, including vacation, health and other insurance benefits made
available by the Corporation to any other employee of the Corporation.
6. Expenses. The Corporation shall reimburse Song for actual out-of-
pocket expenses incurred by her in the performance of her services for the
Corporation upon the receipt of appropriate documentation of such expenses.
7. Termination.
(a) General. The Term shall end immediately upon Song's death. The
Term may also end for Cause or Disability, as defined in Section 7.
(b) Notice of Termination. Promptly after it ends the Term, the
Corporation shall give Song notice of the termination, including a statement of
whether the termination was for Cause or Disability (as defined in Section and
7(b) below). The Corporation's failure to give notice under this Section shall
not, however, affect the validity of the Corporation's termination of the Term.
8. Severance Benefits.
(a) "Cause" Defined. "Cause" means (i) willful malfeasance or
willful misconduct by Song in connection with her employment; (ii) Song's gross
negligence in performing any of her duties under this Agreement; (iii) Song's
conviction of, or entry of a plea of guilty to, or entry of a plea of nolo
contendere with respect to, any crime other than a traffic violation or
infraction which is a misdemeanor; (iv) Song's material breach of any written
policy applicable to all employees adopted by the Corporation; or (v) material
breach by Song of any of her agreements in this Agreement.
(b) Disability Defined. "Disability" shall mean Song's incapacity
due to physical or mental illness that results in her being unable to
substantially perform her duties hereunder for six consecutive months (or for
six months out of any nine month period). During a period of Disability, Song
shall continue to receive her base salary hereunder, provided that if the
Corporation provides Song with disability insurance coverage, payments of Song's
base salary shall be reduced by the amount of any disability insurance payments
received by Song due to such coverage. The Corporation shall give Song written
notice of termination which shall take effect thirty (30) days after the date it
is sent to Song unless Song shall have returned to the performance of her duties
hereunder during such thirty (30) day period (whereupon such notice shall become
void).
(c) Termination. If the Corporation ends the Term for Cause or
Disability, or if Song resigns as an employee of the Corporation, or if Song
dies, then the Corporation shall have no obligation to pay Song any amount,
whether for salary, benefits, bonuses, or other compensation or expense
reimbursements of any kind, accruing after the end of the Term, and such rights
shall, except as otherwise required by law, be forfeited immediately upon the
end of the Term.
9. Confidentiality, Ownership, and Covenants.
(a) "Corporation Information" and "Inventions" Defined. "Corporation
Information" means all information, knowledge or data of or pertaining to (i)
the Corporation, its employees and all work undertaken on behalf of the
Corporation, and (ii) any other person, firm, corporation or business
organization with which the Corporation may do business during the Term, that is
not in the public domain (and whether relating to methods, processes,
techniques, discoveries, pricing, marketing or any other matters). "Inventions"
collectively refers to any and all inventions, trade secrets, ideas, processes,
formulas, source and object codes, data, programs, other works of authorship,
know-how, improvements, research, discoveries, developments, designs, and
techniques regarding any of the foregoing.
(b) Confidentiality. (i) Song hereby recognizes that the value of
all trade secrets and other proprietary data and all other information of the
Corporation not in the public domain disclosed by the Corporation in the
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course of her employment with the Corporation is attributable substantially to
the fact that such confidential information is maintained by the Corporation in
strict confidentiality and secrecy and would be unavailable to others without
the expenditure of substantial time, effort or money. Song therefore, except as
provided in the next two sentences, covenants and agrees that all Corporation
Information shall be kept secret and confidential at all times during and after
the end of the Term and shall not be used or divulged by her outside the scope
of her employment as contemplated by this Agreement, except as the Corporation
may otherwise expressly authorize by action of the Board. In the event that Song
is requested in a judicial, administrative or governmental proceeding to
disclose any of the Corporation Information, Song will promptly so notify the
Corporation so that the Corporation may seek a protective order or other
appropriate remedy and/or waive compliance with this Agreement. If disclosure of
any of the Corporation Information is required, Song may furnish the material so
required to be furnished, but Song will furnish only that portion of the
Corporation Information that legally is required.
(ii) Song also hereby agrees to keep the terms of this Agreement
confidential.
(c) Ownership. Song hereby assigns to the Corporation all of Song's
right (including patent rights, copyrights, trade secret rights, and all other
rights throughout the world), title and interest in and to Inventions, whether
or not patentable or registrable under copyright or similar statutes, made or
conceived or reduced to practice or learned by Song, either alone or jointly
with others, during the course of the performance of services for the
Corporation. Song shall also assign to, or as directed by, the Corporation, all
of Song's right, title and interest in and to any and all Inventions, the full
title to which is required to be in the United States government by a contract
between the Corporation and the United States government or any of its agencies.
The Corporation shall have all right, title and interest in all research and
work product produced by Song as an employee of the Corporation, including, but
not limited to, all research materials and lab books. The provisions of Sections
8(a), 8(b) and this Section 8(c) are not intended to supersede or limit the
effect of any prior confidentiality or proprietary rights agreements previously
executed by Song.
(d) Non-Competition Period Defined. "Non-Competition Period" means
the period beginning at the end of the Term and ending one (1) year after the
end of the Term.
(e) Covenants Regarding the Term and Non-Competition Period. Song
acknowledges and agrees that her services pursuant to this Agreement are unique
and extraordinary; that the Corporation will be dependent upon Song for the
research and development of antibiotics, vaccines and anti-infectives; and that
she will have access to and control of confidential information of the
Corporation. Song further acknowledges that the business of the Corporation is
national in scope and cannot be confined to any particular geographic area of
the United States. For the foregoing reasons and to induce the Corporation to
enter this Agreement, Song covenants and agrees that during the Term and the
Non-Competition Period Song shall not unless with written consent of the
Corporation:
(i) engage in the business of research and development of the Core
Technology, as defined in the License and Research Support Agreement
between the Corporation and The Rockefeller University, or any other
products or processes in which the Corporation is engaged in during the
Term or in any other business conducted by the Corporation during the Term
(collectively the "Prohibited Activity") in the United States or elsewhere
for her own account;
(ii) become interested in any individual, corporation, partnership or
other business entity (a "Person") engaged in any Prohibited Activity in
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the United States, directly or indirectly, as an individual, partner,
shareholder, officer, director, principal, agent, employee, trustee,
consultant or in any other relationship or capacity; provided, however,
that Song may own directly or indirectly, solely as an investment,
securities of any Person which are traded on any national securities
exchange if Song (x) is not a controlling person of, or a member of a
group which controls, such person or (y) does not, directly or indirectly,
own 5% or more of any class of securities of such person;
(iii) directly or indirectly hire, engage or retain any person which at
any time during the Term or Non-Competition Period was a supplier, client
or customer of the Corporation, or directly or indirectly solicit, entice
or induce any such person to become, a supplier, client or customer of any
other person engaged in any Prohibited Activity; or
(iv) directly or indirectly hire, employ or retain any person who
at any time was an employee of the Corporation or directly or
indirectly solicit, entice, induce or encourage any such person to
become employed by any other person.
(f) Remedies. Song hereby acknowledges that the covenants and
agreements contained in Section 8 are reasonable and valid in all respects and
that the Corporation is entering into this Agreement, inter alia, on such
acknowledgment. If Song breaches, or threatens to commit a breach, of any of the
Restrictive Covenants, the Corporation shall have the following rights and
remedies, each of which rights and remedies shall be independent of the other
and severally enforceable, and all of which rights and remedies shall be in
addition to, and not in lieu of, any other rights and remedies available to the
Corporation under law or in equity: (i) the right and remedy to have the
Restrictive Covenants specifically enforced by any court having equity
jurisdiction, it being acknowledged and agreed that any such breach or
threatened breach will cause irreparable injury to the Corporation and that
money damages will not provide an adequate remedy to the Corporation; (ii) the
right and remedy to require Song to account for and pay over to the Corporation
all compensation, profits, monies, accruals, increments or other benefits
(collectively, "Benefits") derived or received by Song as the result of any
transactions constituting a breach of any of the Restrictive Covenants, and Song
shall account for and pay over such Benefits to the Corporation; (iii) if any
court determines that any of the Restrictive Covenants, or any part thereof, is
invalid or unenforceable, the remainder of the Restrictive Covenants shall not
thereby be affected and shall be given full effect, without regard to the
invalid portions; and (iv) if any court construes any of the Restrictive
Covenants, or any part thereof, to be unenforceable because of the duration of
such provision or the area covered thereby, such court shall have the power to
reduce the duration or area of such provision and, in its reduced form, such
provision shall then be enforceable and shall be enforced.
(g) Jurisdiction. The parties intend to and hereby confer
jurisdiction to enforce the Restrictive Covenants upon the courts of any
jurisdiction within the geographical scope of such Covenants. If the courts of
any one or more such jurisdictions hold the Restrictive Covenants wholly
unenforceable by reason of the breadth of such scope or otherwise, it is the
intention of the parties that such determination not bar or in any way affect
the Corporation's right to the relief provided above in the courts of any other
jurisdiction, within the geographical scope of such Covenants, as to breaches of
such Covenants in such other respective jurisdictions such Covenants as they
relate to each jurisdiction being, for this purpose, severable into diverse and
independent covenants.
10. Successors and Assigns.
(a) Song. This Agreement is a personal contract, and the rights and
interests that the Agreement accords to Song may not be sold, transferred,
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assigned, pledged, encumbered, or hypothecated by her. All rights and benefits
of Song shall be for the sole personal benefit of Song, and no other person
shall acquire any right, title or interest under this Agreement by reason of any
sale, assignment, transfer, claim or judgment or bankruptcy proceedings against
Song. Except as so provided, this Agreement shall inure to the benefit of and be
binding upon Song and her personal representatives, distributees and legatees.
(b) The Corporation. This Agreement shall be binding upon the
Corporation and inure to the benefit of the Corporation and of its successors
and assigns, including (but not limited to) any corporation that may acquire all
or substantially all of the Corporation's assets or business or into or with
which the Corporation may be consolidated or merged. This Agreement shall
continue in full force and effect in the event that the Corporation sells all or
substantially all of its assets, merges or consolidates, otherwise combines or
affiliates with another business, dissolves and liquidates, or otherwise sells
or disposes of substantially all of its assets. The Corporation's obligations
under this Agreement shall cease, however, if the successor to, the purchaser or
acquiror either of the Corporation or of all or substantially all of its assets,
or the entity with which the Corporation has affiliated, shall assume in writing
the Corporation's obligations under this Agreement (and deliver an executed copy
of such assumption to Song), in which case such successor or purchaser, but not
the Corporation, shall thereafter be the only party obligated to perform the
obligations that remain to be performed on the part of the Corporation under
this Agreement.
11. Entire Agreement. This Agreement represents the entire agreement
between the parties concerning Song's employment with the Corporation and
supersedes all prior negotiations, discussions, understandings and agreements,
whether written or oral, between Song and the Corporation relating to the
subject matter of this Agreement.
12. Amendment or Modification, Waiver. No provision of this Agreement may
be amended or waived unless such amendment or waiver is agreed to in writing
signed by Song and by a duly authorized officer of the Corporation. No waiver by
any party to this Agreement of any breach by another party of any condition or
provision of this Agreement to be performed by such other party shall be deemed
a waiver of a similar or dissimilar condition or provision at the same time, any
prior time or any subsequent time.
13. Notices. Any notice to be given under this Agreement shall be in
writing and delivered personally or sent by overnight courier or registered or
certified mail, postage prepaid, return receipt requested, addressed to the
party concerned at the address indicated below, or to such other address of
which such party subsequently may give notice in writing:
If to Song: Xxxxxxxxx X. Song, Ph.D.
00000 Xxxxx Xxx Xxxxx
(000) 000-0000
If to the Corporation: Virologix Corporation
000 Xxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xx. Xxxxxx X. Xxxxxx
with a copy to: Xxxxxxxxx & Zivian
000 Xxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxx, Esq.
Any notice delivered personally or by overnight courier shall be deemed given on
the date delivered and any notice sent by registered or certified mail,
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postage prepaid, return receipt requested, shall be deemed given on the date
mailed.
14. Severability. If any provision of this Agreement or the application of
any such provision to any party or circumstances shall be determined by any
court of competent jurisdiction to be invalid and unenforceable to any extent,
the remainder of this Agreement or the application of such provision to such
person or circumstances other than those to which it is so determined to be
invalid and unenforceable shall not be affected, and each provision of this
Agreement shall be validated and shall be enforced to the fullest extent
permitted by law. If for any reason any provision of this Agreement containing
restrictions is held to cover an area or to be for a length of time that is
unreasonable or in any other way is construed to be too broad or to any extent
invalid, such provision shall not be determined to be entirely null, void and of
no effect; instead, it is the intention and desire of both the Corporation and
Song that, to the extent that the provision is or would be valid or enforceable
under applicable law, any court of competent jurisdiction shall construe and
interpret or reform this Agreement to provide for a restriction having the
maximum enforceable area, time period and such other constraints or conditions
(although not greater than those contained currently contained in this
Agreement) as shall be valid and enforceable under the applicable law.
15. Survivorship. The respective rights and obligations of the parties
hereunder shall survive any termination of this Agreement to the extent
necessary to the intended preservation of such rights and obligations.
16. Headings. All descriptive headings of sections and paragraphs in this
Agreement are intended solely for convenience of reference, and no provision of
this Agreement is to be construed by reference to the heading of any section or
paragraph.
17. Withholding Taxes. All salary, benefits, reimbursements and any other
payments to Song under this Agreement shall be subject to all applicable payroll
and withholding taxes and deductions required by any law, rule or regulation of
and federal, state or local authority.
18. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together constitute one and same instrument.
19. Applicable Law: Jurisdiction. The laws of the State of New York shall
govern the interpretation, validity and performance of the terms of this
Agreement, without reference to rules relating to conflicts of law. Any suit,
action or proceeding against Song with respect to this Agreement, or any
judgment entered by any court in respect thereof, may be brought in any court of
competent jurisdiction in the State of New York, as the Corporation may elect in
its sole discretion, and Song hereby submits to the nonexclusive jurisdiction of
such courts for the purpose of any such suit, action, proceeding or judgment.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.
VIROLOGIX CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------
Xxxxxx X. Xxxxxx, Ph.D.,
Executive Vice President
/s/ Xxxxxxxxx X. Song
-------------------------------
Xxxxxxxxx X. Song, Ph.D.
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