Exhibit No. 10.73
EMPLOYMENT AGREEMENT
Employment Agreement dated as of January 15, 1997 between
Seragen, Inc. (the "Company"), having an office at 00 Xxxxx Xxxxxx, Xxxxxxxxx,
Xxxxxxxxxxxxx 00000, and Xxxxxxxxx Xxxx ("Xxxx"), residing at 000 Xxxx
Xxxxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000.
Unless otherwise specifically provided, all capitalized terms
are defined in Section 5.
1. Term of Employment.
Subject to the terms and conditions of this Agreement, the
Company hereby employs Chen, and Chen hereby accepts employment by the Company,
commencing on January 15, 1997 (the "Effective Date") and continuing until the
date Chen is terminated or otherwise resigns pursuant to Section 4 of this
Agreement, except that any rights or obligations arising before such date
(including the right to future severance payments) shall remain in full force
and effect after such date.
2. Duties.
(a) General. Effective as of the Effective Date, Chen is hereby engaged
to serve as Vice President of Business Development of the Company. Chen shall
report solely to the Chief Executive Officer of the Company, shall perform such
executive duties as may be assigned to her from time to time by the Company's
Chief Executive Officer and shall possess such other titles, without additional
compensation, as may be assigned or granted to her from time to time by the
Company's Chief Executive Officer or Board of Directors. If such additional
titles involve significant additional responsibilities, Chen and the Company
shall negotiate in good faith to determine any additional compensation that
shall be paid to Chen. Except as provided in Section 2(b)(i) hereof, Chen agrees
to devote her full business time, energy and skill to the Company's affairs and
shall at all times act with due regard to the best interests of the Company.
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(b) Outside Commitments. Chen represents and agrees that (i) except for
service on the Baltimore City Judicial Nominating Commission, which involves no
more than an average of six (6) days of work per year, she is not currently
employed by, nor does she sit on the Board of Directors of, any other company or
institution; and (ii) during her employment by the Company, except as provided
in (i) above, she shall not accept employment by or serve as a consultant to,
any company or other institution except with the prior consent of the Chief
Executive Officer or Board of Directors of the Company.
3. Compensation and Other Benefits. For all services to be rendered by Chen and
all covenants undertaken by her pursuant to this Agreement, the Company shall
pay and Chen shall accept the compensation set forth in this Section 3.
(a) Salary. The Company shall pay Chen a salary at the rate of One
Hundred Seventy-Five Thousand Dollars ($175,000) per annum during the term of
her employment hereunder, payable in accordance with the Company's normal
payroll practices for its senior management. The Company may, at any time, in
the discretion of its Board of Directors increase, but not decrease, Chen's base
salary based upon merit as a result of positive reviews of Chen's performance by
the Chief Executive Officer.
(b) Stock Options. The Company shall xxxxx Xxxx stock options (the
"Options") under the Seragen, Inc. 1992 Long Term Incentive Plan (the "Plan") to
purchase sufficient shares of the Company's common stock, par value $.01 per
share ("Common Stock"), to equal 2.0% of the then outstanding Common Stock,
measured on a Fully Diluted Basis (as the term is defined in Section 5), at the
Fair Market Value (as defined in the Plan) per share of Common Stock on the date
of grant. To the extent permitted by federal income tax law, options issued to
Chen under the Plan shall be "incentive stock options" (as defined in Section
422 of the Internal Revenue Code (the "Code")). The Options shall be evidenced
by a Stock Option Agreement (the "Option Agreement") setting forth the terms and
conditions applicable to the Options.
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(i) Vesting. The Option Agreement shall provide that:
(1) the Options shall vest, i.e., become
exercisable as follows: (A) 1/48 of the Options, multiplied by the number of
calendar months or partial calendar months that have elapsed from November 11,
1996 until the date of grant of the Options, shall vest immediately upon the
grant of Options and (B) 1/48 of the Options shall vest on the first day of each
calendar month thereafter, so that Chen shall be fully (100%) vested on October
1, 2000;
(2) upon the termination by the Company of Chen's
employment without Just Cause or Chen's termination for Good Reason (as the
terms are defined in Section 5), in place of the vesting schedule provided in
Section 3(b)(i)(1) above, the number of Options that shall vest as of the date
of such termination shall be equal to the sum of (A) 25% of the Options and (B)
3.125% of the Options, multiplied by the number of calendar months or partial
calendar months that have elapsed from November 11, 1996 until the date of such
termination; and
(3) upon the a Change in Ownership (as the term is
defined in Section 5), in place of the vesting schedule provided in Section
3(b)(i)(1) above, the Options shall become fully (100%) vested.
(ii) General Provisions.
(1) The Options shall, to the extent vested, be fully
exercisable until the tenth (10th) anniversary of the date of grant, except that
the Options will expire 15 days after a termination of employment with Just
Cause. To the extent that any Options that are "incentive stock options" are not
exercised before the expiration of the exercise periods that apply for purposes
of Section 422 of the Code, such Options will remain outstanding for the
remainder of their term but will thereafter be treated as non-qualified stock
options.
(2) The Options shall be exercisable in accordance with
the terms of the Plan, including the right to pay the option exercise price in
whole or in part by surrendering shares
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of Common Stock or Restricted Stock (as such term is defined in the Plan) held
by Chen for at least six months prior to the exercise date with an aggregate
Fair Market Value equal to the option exercise price or in accordance with a
cashless exercise program established with a securities brokerage firm and
approved by the Company, and shall provide that stock certificates to be issued
upon exercise of vested Options shall be issued outright and free of escrow no
later than three (3) days after the date of exercise.
(3) Stock certificates issued pursuant to the exercise
of an Option shall include only such legends as are required to comply with
federal or state securities law or regulations.
(4) The Options shall include all rights and benefits
under the Plan, including Section 11 (relating to accelerated vesting on a
Change in Control), and the Company shall not terminate any Option issued to
Chen upon a Change in Control (as defined in the Plan) without Chen's written
approval.
(5) In the event that the Company grants options or
other equity interests to management, employees, directors or consultants, or
the Company sells shares of its Common Stock or any equity securities or
securities convertible or exchangeable into any equity securities of the
Company, as part of a plan or series of plans of financing, or the number of
shares of Common Stock outstanding on a Fully Diluted Basis increases as a
result of a change in the conversion ratio of any class of securities
convertible or exchangeable into any equity securities of the Company, the
Company shall xxxxx Xxxx additional stock options under the Plan covering that
number of shares of Common Stock necessary to cause Chen's proportionate
holdings of the outstanding Common Stock on a Fully Diluted Basis, immediately
after the grant or sale of such options, shares or other equity interests to
equal her proportionate holdings of the outstanding Common Stock, on a Fully
Diluted Basis, immediately prior to the grant or sale of
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such options, shares or other equity interests (the "Dilution Options"), but not
to exceed two percent (2%) of the Common Stock on a Fully Diluted Basis.
Dilution Options will be granted on the last day of the calendar
quarter during which such grant or sale of options, shares or other equity
interests is completed, based on the number of shares of Common Stock
outstanding on a Fully Diluted Basis on the last day of such calendar quarter,
except that, in the case of any target Equity Financing (as the term is defined
in Section 5) from which the Company receives proceeds of at least Ten Million
($10,000,000) Dollars, the Dilution Options will be granted immediately upon the
consummation of such Target Equity Financing. Dilution Options will have an
exercise price equal to the fair market value per share of Common Stock on the
date of grant of such Dilution Options, and will otherwise be subject to the
same terms and conditions, and will vest and remain exercisable on the same
terms, as are set forth in Section 3(b) for all other Options granted to Chen.
Chen's right to receive Dilution Options pursuant to this subsection
3(b)(ii)(5) will terminate after the Company has received cumulative proceeds
(since the date of execution of this Agreement) of at least Twenty Million
($20,000,000) Dollars from one or more Target Equity Financings.
(6) The Company shall, on or before July 1, 1997, at
its own expense register under the Securities Act of 1933 the maximum aggregate
number of shares issuable under the Plan on a Registration Statement on Form S-8
and use its best efforts to maintain the effectiveness of such Registration
Statement for as long as any of the Options or Dilution Options remain
outstanding.
(c) Commuting and Living Expense Reimbursement. The Company shall,
within ten (10) days of receipt of reasonable substantiation, reimburse Chen for
(i) all reasonable costs incurred by her in connection with obtaining lodging
accommodations in the vicinity of the Company's principal office in order to
carry out her duties and responsibilities under this
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Agreement and weekly travel between such location and her family residence
located in Baltimore, Maryland, plus (ii) any federal, state or local income or
payroll taxes incurred by Chen with respect to payments made under this Section
3(c), including this subsection 3(c)(ii), so that Chen shall be made whole on an
after tax basis.
(d) Vacation and Employee Benefits. Chen shall be entitled to paid
vacations in accordance with the policies of the Company from time to time in
effect, subject to a minimum of four (4) weeks per year, and shall be eligible
to participate in any pension, profit sharing or similar plan and any health,
hospitalization, medical, accident, disability, sick leave, supplementary income
benefit, life insurance or other similar benefit plan or program of the Company
now existing or hereafter established and available to the Company's employees
generally or to key employees as a group to the extent her age, health, and
other qualifications make her eligible to participate. Furthermore, Chen shall
be entitled to such additional benefits as may be granted to her from time to
time by the Chief Executive Officer or the Board of Directors of the Company.
(e) Severance. Upon the termination of Chen's employment for any
reason, the Company shall pay Chen for up to four (4) weeks of any unused
accrued vacation time, together with all salary and other benefits accrued
through the date of termination. If either Chen shall voluntarily terminate her
employment for Good Reason (as defined in Section 5) or Chen's employment
hereunder is terminated by the Company without Just Cause (as defined in Section
5), the Company shall provide Chen with the following severance benefits:
(i) upon the date of such termination the Company shall pay Chen,
as termination and severance pay, in a lump sum, an amount equal to twelve (12)
months' salary based on her then salary rate; and
(ii) upon the date of such termination the Company shall pay Chen,
in a lump sum, the amount of any remaining obligations under any lease for local
lodging, up to a maximum of one year; and
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(iii) the Company will continue to provide Chen and her family with
the same group health plan benefits coverage provided to them prior to Chen's
termination for the maximum period set forth in the continuation coverage
requirements under "COBRA", and the Company will provide such coverage without
cost or charge of any nature to Chen or any member of her family, other than any
applicable deductible or co-payment, for such maximum period, but in no event
for a period longer than twelve (12) months following the date of Chen's
termination.
(f) Death or Disability. If Chen's employment is terminated by death
or disability, the Company shall pay to Chen's estate or to Chen, as the case
may be, the balance of her accrued and unpaid salary through the date of such
termination and unreimbursed expenses and her unused accrued vacation time (up
to four (4) weeks). For the purposes of this section, the word "disability"
shall have the same meaning as in the Company's then-applicable long-term
disability policy that would qualify Chen for full benefits under the policy.
(g) Employment. All compensation payable and other benefits provided
under this Section 3 shall be subject to customary withholding for income,
F.I.C.A. and other employment taxes. The value of stock issued pursuant to the
exercise of an Option or Dilution Option shall be measured solely in accordance
with IRS rules and regulations.
(h) Asset Value Realization Bonus. The Company and its shareholders
presently intend to develop the business of the Company over the long term
through the efforts of Chen and the other employees of the Company, which
efforts are intended to result in a substantial increase in the value of the
Common Stock and of the Options granted to Chen under Section 3(b) above. If,
however, a Change in Ownership of the Company (as the term is defined in Section
5) is Effected (as hereinafter defined) during the term of Chen's employment
with the Company or at any time before the first anniversary of Chen's
termination of employment, then the Company shall pay Chen a bonus (the "Asset
Value Realization Bonus") equal to two percent (2%) of the Net
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Proceeds (as hereinafter defined) for any acquisition that is part of the Change
in Ownership, which amount shall be reduced (but not below zero) by the Option
Stock Gain (as hereinafter defined) recognized by Chen as a result of the sale
by her of Common Stock acquired upon the exercise of Options or Dilution Options
granted to her under Section 3(b) above. The Company shall pay the Asset Value
Realization Bonus, or any increase in the Asset Value Realization Bonus, on or
before the closing of any acquisition that is part of a Change in Ownership. If
any part of the Net Proceeds is payable after closing (the "Deferred Payments"),
however, then the Company may defer the payment of the part of the Asset Value
Realization Bonus allocable to the Deferred Payments until receipt of the
Deferred Payments, provided the payor of the Deferred Payments has agreed in
writing to pay directly to Chen the Asset Value Realization Bonus allocable to
the Deferred Payments as and when such Deferred Payments are made to the Company
or its shareholders. "Net Proceeds" shall mean the total cash plus any property
received directly or indirectly by the Company or its shareholders in kind with
respect to all acquisitions constituting the Change in Ownership, reduced by all
investment banking fees, brokerage fees, appraisal fees, and other professional
expenses directly attributable to the acquisitions. A transaction shall be
"Effected" by a certain date if it is consummated by that date or is the subject
matter of an agreement or memorandum of intent executed by that date and
subsequently consummated. "Option Stock Gain" shall mean the difference between
the net proceeds from Chen's sale of Common Stock and the net cost to Chen to
exercise the Options and Dilution Options for such stock on the assumption that
Chen has, in fact, exercised all vested options and sold all Common Stock
received on such exercise as of the date of the Change in Ownership; Chen shall
for this purpose be deemed to have sold all Common Stock that (i) she owns at
the time of the Change of Ownership or could then own if she exercised all
vested options, (ii) she is permitted to sell, and (iii) in the event of a
merger or sale of securities, she has received an offer to purchase, and is
permitted to sell, on the same terms and conditions as those of the transactions
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that constitute the Change in Ownership. Chen's right to receive an Asset Value
Realization Bonus under this Section 3(h) shall terminate (i) upon a
restructuring that eliminates the liquidation preferences of all preferred stock
and other equity securities of the Company senior to the Common Stock (including
the Class A Common Stock expected to be issued in 1997) or (ii) if all shares of
preferred stock and other equity securities senior to the Common Stock
(including the Class A Common Stock expected to be issued in 1997) cease to be
outstanding, as a result of, their conversion into Common Stock or for any other
reason.
4. Termination of Employment.
(a) Termination by Company. The Company may terminate Chen's employment
hereunder at any time without Just Cause, effective upon not less than thirty
(30) days' prior written notice. The Company may terminate Chen's employment
hereunder with Just Cause immediately without notice. If the termination is for
Just Cause, the Company shall provide Chen as soon as practicable with a written
explanation of the facts on which the termination is based. For the purposes of
this Agreement, the Company shall be deemed to have terminated Chen without Just
Cause if (i) Chen shall have notified the Company in writing that she has Good
Reason (as defined in Section 5) to terminate employment with the Company, (ii)
the Company shall not have eliminated such Good Reason within thirty (30) days
of such notice, and (iii) Chen shall have given notice of termination of her
employment more than thirty (30) days after delivery of such notice of Good
Reason and less than sixty (60) days after delivery of such notice of Good
Reason.
(b) Termination by Chen. Chen may terminate her employment hereunder at any
time upon not less than thirty (30) days' prior written notice. Upon Chen's
voluntary termination of employment without Good Reason pursuant to this Section
4(b), Chen shall not be entitled to the severance benefits described in Section
3(e) above.
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(c) Disability. If Chen shall incur a disability, the Company may terminate
Chen's employment upon not less than thirty (30) days' prior written notice.
Upon such termination, Chen shall be entitled to receive from the Company only
those payments set forth in Section 3(f) hereof. For the purposes of this
section, the word "disability" shall have the same meaning as in the Company's
then-applicable long-term disability policy that would qualify Chen for full
benefits under the policy.
5. Definitions.
(a) Just Cause. For the purposes of this Agreement, "Just Cause" shall mean:
(i) the commission by Chen of an act of, or omission of an act that
would constitute, willful and material malfeasance or gross negligence in the
performance of her duties on behalf of the Company;
(ii) the commission by Chen of a willful act of material fraud in the
performance of her duties on behalf of the Company;
(iii) the conviction of Chen for commission of a felony; or
(iv) the breach by Chen of any material term of this Agreement or the
continuing willful failure of Chen to perform her material duties to the Company
(other than any such failure resulting from Chen's incapacity due to physical or
mental illness) after written notice thereof (specifying the particulars thereof
in reasonable detail) and a reasonable opportunity to be heard and cure such
breach or failure are given to Chen by the Chief Executive Officer of the
Company or the Board of Directors of the Company. No notice, however, shall be
due for a breach or failure to perform that cannot be cured or for any act
described in clauses (i), (ii) or (iii) above.
For purposes of this Section 5(a), no act, or failure to act, on Chen's part
shall be considered "willful" unless done, or omitted to be done, by her not in
good faith and without reasonable belief that her action or omission was in the
best interests of the Company.
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(b) Good Reason. For the purposes of this Agreement, "Good Reason" shall
mean:
(i) the Company shall have materially breached its obligations under
this Agreement (including any substantial change in Chen's duties or
responsibilities), and such breach is not cured within twenty (20) days of
Chen's sending a written notice of such breach;
(ii) the Company shall have incurred a Change in Ownership;
(iii) the Company shall have incurred a Change in Control;
(iv) the Company shall be Insolvent;
(v) the Company shall have acted in bad faith to cause Chen to resign
from the Company;
(vi) the Options shall not have been granted within six (6) months of
the date of execution of this Agreement; or
(vii) the Dilution Options shall not have been granted within the time
period set forth in Section 3(b).
Good Reason shall not arise in any situation in which Chen shall have given
written consent to the act or failure to act of the Company.
(c) Insolvency. For the purposes of this Agreement, the Company shall be
"Insolvent" if
(i) it commences any case, proceeding or other action (A) under the
Federal Bankruptcy Code seeking to have an order for relief entered with respect
to it, or seeking to adjudicate it a bankrupt or insolvent, or seeking
reorganization, arrangement, adjustment, liquidation, dissolution, composition
or other relief with respect to it or its debts, or (B) seeking appointment of a
receiver, trustee, custodian or other similar official for it or for all or any
substantial part of its property, or the Company shall make a general assignment
for the benefit of its creditors, or
(ii) there shall be commenced against the Company any case, proceeding or
other action of a nature referred to in Section 5(c)(i) above, which case,
proceeding or other action
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results in the entry of an order for relief from which no stay has been granted
within sixty (60) days, or
(iii) for a period in excess of sixty (60) days, the Company shall
generally not, or shall be unable to, pay its debts as they become due or shall
admit in writing its inability to pay its debts.
(d) Change in Ownership. For purposes of this Agreement, a "Change in
Ownership" of the Company shall mean (i) the acquisition by any "person" or
group of "persons" (as defined in Section 13(d)(3) of the Securities Exchange
Act of 1934 ("Exchange Act")), whether by way of merger, sale of assets, stock
purchase, tender offer or otherwise, of (A) all or substantially all of the
equity securities of the Company or (B) all or substantially all of the
operating assets of the Company and its subsidiaries taken as a whole, or (ii)
the sale or out-licensing after the date hereof of the majority (in value) of
the technology assets of the Company and its subsidiaries taken as a whole,
which shall not include the sale of the Company's manufacturing and clinical
operations facilities to Boston University or Boston University's designated
affiliate.
(e) Change in Control. For purposes of this Agreement, a "Change in Control"
of the Company shall have the same meaning as provided in Section 11(b) of the
Plan as in effect on the date hereof.
(f) Fully Diluted Basis. For purposes of this Agreement, "Fully Diluted Basis"
shall mean that all shares of Common Stock issuable upon exercise of options
outstanding under the Plan or any other stock option plan (including the Options
and Dilution Options granted to Chen pursuant to this Agreement) and all shares
of Common Stock issuable on exercise of all other outstanding options, warrants,
conversion rights or other rights issued by the Company to acquire equity
securities shall be deemed to be outstanding.
(g) Target Equity Financing. Target Equity Financing shall mean the sale or
issuance of stock of the Company or of debt securities of the Company with
conversion rights, other than
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(i) stock or debt securities sold or issued to a shareholder and/or affiliated
investment entities who as of the Effective Date collectively own at least 1% of
the Common Stock as measured on a Fully Diluted Basis or (ii) stock issued as a
result of the exercise of options presently outstanding or issued pursuant to
the Plan.
6. Confidentiality.
(a) Chen acknowledges that during the course of her employment with the
Company she will have access to and may obtain, develop or learn of Confidential
Information (as defined below).
(b) Chen agrees that while employed by the Company and thereafter she shall
hold such Confidential Information in strictest confidence and that, except
pursuant to her employment with the Company, she shall not at any time, during
or after the conclusion of her employment with the Company, or in any manner,
either directly or indirectly, use (for her own benefit or otherwise), divulge,
disclose or communicate to any unauthorized person, firm or corporation in any
manner whatsoever any Confidential Information.
(c) Under this Agreement, the term "Confidential Information" shall include
but not be limited to any of the following information relating to the Company
learned by Chen during or as a result of her employment or prior consulting
engagement with the Company:
(i) information relating to the products, product development
activities, research, technical and/or scientific know-how, plans, projects,
processes or manner of operations;
(ii) computer databases, software programs and information relating to
the nature of the hardware or software and how said hardware and software are
used in combination or alone;
(iii) methods of selling, pricing and business operations in general as
well as specific;
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(iv) the identity of customers, market research information and any
other information in any form relating to such customers and their relationships
or dealings with the Company or any subsidiary or affiliate thereof;
(v) any trade secret or confidential information of or concerning any
customers, affiliates or business relations; and
(vi) any other trade secret or information of a confidential or
proprietary nature.
(d) While an employee of the Company, Chen shall use, divulge, disclose or
communicate Confidential Information only in the scope of her employment with
the Company. Chen shall not at any time after the termination of her employment
with the Company, for whatever reason, use, divulge, disclose, or communicate
for any purpose any Confidential Information.
(e) Chen will not make or use any notes or memoranda relating to any
Confidential Information except for the benefit of the Company, and will, at the
Company's request, return each original and every copy of any and all notes,
memoranda, correspondence, diagrams or other records, in written or other form,
that she may at any time have within her possession or control that contain any
Confidential Information.
(f) Notwithstanding the above, this Section 6 shall not apply to any matter
which is now or becomes part of the public domain, other than through Chen's
improper act or omission, was known to Chen prior to the commencement of her
employment or any prior consulting arrangements with the Company or is disclosed
to Chen by a third party which did not obtain the information, directly or
indirectly, under an obligation of confidence to the Company. Further, this
agreement shall not apply to information which Chen is required to disclose by
enforceable legal process.
7. Non-Competition.
Chen acknowledges and recognizes the highly competitive nature of the
business conducted by the Company. Accordingly, Chen agrees that, in
consideration of the premises
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contained herein, she shall not, for her own benefit or for the benefit of any
other person or entity, while employed by the Company and for a one-year period
thereafter:
(a) become an employer, officer, director, owner, employee, partner,
consultant or other participant in any entity, or assist any person, which
competes with or which is about to compete with the Company in the business of
developing, manufacturing, marketing or selling pharmaceutical products based
upon diphtheria fusion toxins or any other technology owned by the Company
before Chen's termination (a "Competitive Business"); or
(b) own any interest in any entity which engages, or is about to engage in a
Competitive Business; provided, however, that Chen shall have the right to
acquire as a passive investor an equity interest of not more than one percent
(1%) of the issued and outstanding shares of any publicly traded corporation's
stock.
8. Company Right to Inventions. Chen shall promptly disclose, grant and assign
to the Company for its sole use and benefit any and all inventions,
improvements, technical information and suggestions relating in any way to
diphtheria fusion toxins or other technology created by the Company, which she
may develop or acquire while employed by the Company (whether or not during
usual working hours), together with all patent applications, letters patent,
copyrights and reissues thereof that may at any time be granted for or upon any
such invention, improvement or technical information. In connection therewith:
(a) Chen shall without charge, but at the expense of the Company, promptly
at all times hereafter execute and deliver such applications, assignments,
descriptions and other instruments as may be reasonably necessary or proper in
the reasonable opinion of the Company to vest title to any such inventions,
improvements, technical information, patent applications, patents, copyrights or
reissues thereof in the Company and to enable it to obtain and maintain the
entire right and title thereto throughout the world; and
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(b) Chen shall render to the Company at its expense (including a reasonable
payment for the time involved in case she is not then in its employ) all such
assistance as it may reasonably require in the prosecution of applications for
said patents, copyrights or reissues thereof, in the prosecution or defense of
interferences which may be declared involving any of said applications, patents
or copyrights and in any litigation in which the Company may be involved
relating to any such patents, inventions, improvements or technical information.
9. Breach. In the event of breach by Chen of any provision of Sections 6, 7 and
8 hereof, the remedy at law will be deemed inadequate, and the Company will be
entitled, in addition to any other remedies available by law, to appropriate
injunctive and other relief. Should any provision hereof be adjudged to any
extent invalid by any competent tribunal, such provision will be deemed modified
to the extent necessary to make it enforceable.
10. Indemnity. To the extent permitted by law, the Company shall indemnify Chen
and hold her harmless for all acts or decisions made by her in good faith while
performing services for the Company or any designee of the Company and shall pay
or reimburse Chen all expenses as and when incurred, including attorneys' fees,
actually and necessarily incurred by Chen in connection with the defense of any
action, suit or proceeding to which Chen may be made a party by reason of her
performing services hereunder and in connection with any related appeal
including the cost of court settlements. The Company shall also use its best
efforts to obtain coverage for her under any insurance policy obtained during
the term of this Agreement covering the other officers and directors of the
Company against lawsuits.
11. Notices. All notices, requests, demands and other communications provided
for by this Agreement shall be in writing and shall be deemed to have been given
when sent by facsimile or when mailed at any general or branch United States
Post Office enclosed in a certified postpaid envelope and addressed to the
address of the respective party stated below or to such changed address as the
party may have fixed by notice:
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To the Company: Seragen, Inc.
00 Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Chief Executive Officer
Fax No.: (000) 000-0000
To Chen: Xx. Xxxxxxxxx Xxxx
000 Xxxx Xxxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Fax No.: (000) 000-0000
12. Legal Fees. The Company shall pay Chen's reasonable legal fees
incurred with respect to the preparation of this Agreement and other documents
related to her employment by the Company.
13. Miscellaneous.
(a) Construction. This Agreement shall be construed, interpreted and
governed by the laws of the State of Delaware without regard to the principles
of conflicts of laws.
(b) Binding Agreement; Assignability. This Agreement shall be binding
upon and inure to the benefit of Chen, her legal representatives, heirs and
distributees, and the Company, its successors and assigns; provided, however,
that because this Agreement is a personal service contract, Chen shall not
assign any of her employment duties or obligations hereunder and any purported
assignment shall be null and void ab initio.
(c) Previous Agreements. This Agreement supersedes all other
agreements between the Company and Chen relating to Chen's employment by the
Company.
(d) Entire Agreement. This Agreement constitutes the entire agreement
of the parties with respect to its subject matter, and no waiver, modification
or change of any of its provisions shall be valid unless in writing and signed
by the party against whom such claimed waiver, modification or change is sought
to be enforced.
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(e) Waiver. The waiver of any breach of any duty, term or condition of
this Agreement shall not be deemed to constitute a waiver of any preceding or
succeeding breach of the same or of any other duty, term or condition of this
Agreement.
(f) Headings. The headings of the sections and subsections of this
Agreement are inserted for convenience only and shall not be deemed to
constitute a part hereof or to affect the meaning thereof.
(g) Survival. The provisions of Sections 6, 7, 8 and 10 shall survive
termination of this Agreement.
(h) Representations and Warranties of Chen. Chen represents and
warrants that her performance of all of the terms of this Agreement and as an
employee of the Company does not and will not breach any consulting, employment,
non-compete or other agreement to keep in confidence proprietary information,
knowledge, or data acquired by her in confidence or in trust from a third party
prior to her employment with the Company.
(i) Representations and Warranties of Company.
(i) The Company is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware and is duly
qualified to do business in the Commonwealth of Massachusetts and has full power
and authority to operate its businesses as now operated and to perform this
Employment Agreement in accordance with its terms.
(ii) The execution and delivery of this Employment Agreement to
Chen and the carrying out of the provisions hereof have been duly authorized by
the Board of Directors of the Company.
(iii) This Employment Agreement shall be, when duly executed and
delivered, a legal and binding obligation of the Company, enforceable in
accordance with its terms.
(iv) Neither the execution nor delivery of this Employment
Agreement, nor the compliance with its terms, shall constitute a violation or
breach of the Certificate of
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Incorporation, as amended to date, or of the by-laws, as currently in effect, of
the Company or of any agreement between the Company and any other party.
(j) Capitalized Terms. All capitalized terms shall have the meanings
provided in Section 5 unless provided elsewhere.
(k) Arbitration. Except as provided in Paragraph 9 above, any claim or
controversy arising out of or relating to this Agreement or the breach thereof
shall be settled by arbitration in accordance with the laws of the Commonwealth
of Massachusetts. Such arbitration shall be conducted in the City of Boston in
accordance with the rules then-existing of the American Arbitration Association
for commercial disputes. In any such arbitration each party shall have the right
to demand (i) a written statement setting forth, for each cause of action, a
detailed statement of the facts on which it is based and a description of how
the amount demanded was calculated; and (2) to demand inspection and copying of
relevant documents and things in the possession or control of any of the other
parties, prior to the arbitration hearing. The arbitrator shall have authority
to order compliance with, and shall otherwise supervise, such demands for
written statements and/or for pre-hearing inspection and copying. Judgment upon
the award rendered by the arbitrators may be entered in any court having
jurisdiction thereof.
IN WITNESS WHEREOF, the parties have executed this Agreement effective
as of the day and year first above written.
SERAGEN, INC.
By:_________________________
(L.S.)
XXXXXXXXX XXXX
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