Exhibit 10.32
NONCOMPETITION AND NONSOLICITATION AGREEMENT
THIS NONCOMPETITION AND NONSOLICITATION AGREEMENT (this "Agreement") is
entered into as of ______, 2001 by and among Endorex Corporation, a Delaware
corporation located at 00000 Xxxxxxx Xxxxx, Xxxxx X, Xxxx Xxxxxx, XX 00000 (the
"Company"), and Xxxxx X. Xxxxxx, an individual with an address at 000 Xxxxx
Xxxxx Xxxxx Xxxxx Drive, Apartment 3501, Xxxxx Xxxxx, Xxxxxxx 00000 ("Officer")
and, for purposes of Section 1.4 of this Agreement only, Corporate Technology
Development, Inc. ("CTD"). In consideration of the mutual covenants contained
herein, the parties hereto agree as follows:
RECITALS
A. The Company, Roadrunner Acquisition, Inc., a Delaware
corporation and a wholly-owned subsidiary of the Company ("Merger Sub"), and
CTD, have entered into an Agreement and Plan of Merger and Reorganization, dated
as of _____________, 2001 (the "Merger Agreement"), which provides for, upon the
terms and subject to the conditions set forth therein, a business combination
between the Company and CTD by means of a merger of Merger Sub with and into CTD
(the "Merger"), with CTD thereby becoming a wholly-owned subsidiary of the
Company.
B. Officer is an officer, director and security holder of CTD
and will receive substantial consideration in the Merger, including receipt of
shares of, and options exercisable for, common stock of the Company in exchange
for shares of, and options exercisable for, capital stock of CTD.
C. Officer's employment by, or other association with, a
competitor to the Company would substantially benefit that competitor and would
correspondingly harm the Company and reduce the value received by the Company in
the Merger.
D. Parent and Merger Sub are willing to enter into the Merger
Agreement only upon the condition that the Officer enter into this Agreement.
E. In order to induce Parent and Merger Sub to enter into the
Merger Agreement, Officer is willing to enter into this agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements herein contained, and intending to be legally bound
hereby, the parties hereto hereby agree as follows:
1. CONFIDENTIALITY AND INVENTIONS
1.1. Officer agrees that Officer will not, directly or indirectly,
use or disclose to any person, firm or corporation, any
confidential information, trade secrets, technical data and
know-how of the Company, including but not limited to
information relating to customer lists, customer contact
information, marketing materials,
pricing information, financial information, employee
information, business practices, any other information of
the Company not generally known to the public, or the
products, research, development, processes, methods and
equipment of the Company and its subsidiaries, including
CTD and its subsidiaries ("Proprietary Information"),
without the prior written consent of the Company.
Proprietary Information does not, however, include
information that is or becomes generally available in the
pharmaceuticals industry other than by breach of this
Agreement by Officer.
1.2. Officer agrees that any and all inventions, discoveries,
improvements, processes, compounds, or formulae
(collectively "Inventions"), whether or not patentable or
registerable under patent, copyright, or similar statutes,
that were made, conceived, discovered or acquired by
Officer, solely or jointly with others, in the course of
performing services for or acting as an employee or officer
of the Company, CTD or any of their subsidiaries, or which
result from the use of premises owned, leased, or
contracted by CTD, the Company or any of their subsidiaries
and which may be used or useful in or relate to the
business of the Company and its subsidiaries, including CTD
and its subsidiaries, shall be the property of the Company.
Officer hereby assigns to the Company all of Officer's
right, title and interest in and to any such Inventions,
including, without limitation, all Inventions discovered or
acquired by Officer during or in connection with his
employment by CTD or any of its subsidiaries. Without
limiting the foregoing, Officer further acknowledges that
all original works of authorship by Officer, whether
created alone or jointly with others, which are protectable
by copyright, are "works made for hire" within the meaning
of the United States Copyright Act, 17 U.S.C. Section 101,
as amended, and the copyright of which shall be owned
solely, completely and exclusively by the Company. If any
Invention is considered to be work not included in the
categories of work covered by the United States Copyright
Act, 17 U.S.C. Section 101, as amended, such work is hereby
assigned or transferred completely and exclusively to the
Company. Any assignment of copyright hereunder includes all
rights of paternity, integrity, disclosure and withdrawal
and any other rights that may be known as or referred to as
"moral rights" (collectively "Moral Rights"). To the extent
such Moral Rights cannot be assigned under applicable law
and to the extent the following is allowed by the laws in
the various countries where Moral Rights exist, Officer
hereby waives such Moral Rights and consents to any action
of the Company that would violate such Moral Rights in the
absence of such consent. Officer agrees to confirm any such
waivers and consents from time to time as may be reasonably
requested by the Company.
1.3. Officer shall, as requested by the Company at any time and
from time to time, execute and deliver to the Company any
instruments deemed necessary by the Company to effect
disclosure and assignment of the Inventions to it or to
persons designated by it and shall cooperate with the Company
as may be reasonably required with regard to, and shall
execute and deliver to the Company, any patent, copyright or
trademark applications (United States or foreign) and renewals
with respect thereto, including any other instruments deemed
necessary by the
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Company for the prosecution of such patent,
copyright or trademark application or the acquisition of
letters patent. Officer's obligation to assist the Company in
obtaining and enforcing patents, copyrights or trademarks for
such Inventions in any and all countries shall continue beyond
the termination of this Agreement, but the Company shall
compensate Officer at a rate of two hundred and fifty dollars
($250) per hour after such termination for time actually spent
at the Company's request on such assistance. In the event the
Company is unable, after reasonable effort, to secure the
signature of Officer on any document or documents needed to
apply for or prosecute any patent, copyright or to other right
or protection relating to an Invention, whether because of
physical or mental incapacity or for any other reason
whatsoever, Officer hereby irrevocably designates and appoints
the Company and its duly authorized agents as agent and
attorney-in-fact, to act for and on behalf of Officer to
execute and file any such application or applications and to
do all other lawfully permitted acts to further prosecution
and issuance of patents, copyrights or other similar
protection thereon with the same legal force and effect as if
executed by Officer
1.4. The parties hereto hereby agree and acknowledge that the
Employment Agreement by and among Officer and CTD, dated as of
December 14, 1998 (the "CTD Employment Agreement") is
terminated as of the date hereof and Officer hereby
specifically waives the provisions and the rights set forth in
Sections 3 and 7 of the CTD Employment Agreement, including,
but not limited to, any payments related to termination of
Officer's employment with CTD, bonuses, milestone payments or
carried interest in licenses, technologies or acquisitions by
CTD or any subsidiaries of CTD. Officer hereby resigns from
any and all positions held by Officer within CTD or any
subsidiaries of CTD and acknowledges and agrees that other
than as provided in Section 1.6(h) of the Merger Agreement, no
obligations or amounts are owed to Officer (whether in cash,
equity or otherwise) under the CTD Employment Agreement or
pursuant to any other agreement, understanding or arrangement
under which CTD or any subsidiaries of CTD would be so
obligated.
2. RESTRICTIVE COVENANTS
2.1. For a period of one (1) year from the date hereof, Officer
will not, directly or indirectly, (i) engage in; (ii) have any
interest in any person, firm, or corporation (except an
interest that is less than five percent (5%) of the
outstanding stock of a publicly traded corporation) that
engages in; or (iii) perform any services for any person,
firm, or corporation that engages in the development, research
relating to, manufacture, processing, marketing, distribution,
or sale of (a) orally delivered corticosteroids for the
treatment of Graft Versus Host Disease, Crohns Disease,
ulcerative colitis, or any other related gastrointestinal
disorder(s), (b) orally delivered solutions of Azathioprine,
or analogs thereof for the supression of the immune system or
any part thereof, including the uses that as of the date
hereof are approved by the U.S. Food and Drug Administration,
(c) imidazole-like compounds or analogs thereof for the
treatment of dry eye syndrome or blepharitis, (d) the Allergan
BoTox(R) program, (e) polymer based drug delivery
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technologies for the rapid dissolution into suspension of
normal and controlled release drugs in tablet form,
including the UM Technology, (f) oral and nasal delivery of
proteins, or peptides utilizing lipid-based,
liposomal-based or polymer-based technologies, (g) delivery
of iron chelating compound(s) via an ambulatory,
subcutaneous, micro-injection pump device, or (h) muramyl
dipeptide immunomodulators for treatment of cancers or
infectious diseases.
2.2. For a period of one (1) year from the date hereof, Officer
will not, directly or indirectly, solicit business from any of
the clients or customers of the Company or any of its
subsidiaries, including CTD and its subsidiaries.
2.3. For a period of one (1) year from the date hereof, Officer
will not, directly or indirectly, employ, solicit for
employment, or advise or recommend to any other person that
they employ or solicit for employment, any employee of the
Company or any of its subsidiaries.
2.4. Officer represents that his experience and capabilities are
such that the provisions of this Section 2 will not prevent
him from earning a livelihood.
2.5. On condition that he otherwise complies with the terms of this
Agreement, including without limitation the restrictive
covenants contained within this Section 2, the Officer may at
any time contact and do business with any person or entity
that the Officer had dealings with in his capacity as an
employee of CTD.
3. NO CONFLICT WITH OR BREACH OF OTHER AGREEMENTS.
3.1. Officer hereby represents, warrants and covenants that (a)
Officer is not party to any agreement, contract, arrangement
or understanding that prohibits or purports to prohibit
Officer from entering into this Agreement and performing
duties hereunder, and (b) the execution, delivery and
performance by Officer of this Agreement will not constitute a
breach of or default under any agreement, contract,
arrangement or understanding to which Officer is a party or
which is or purports to be binding upon Officer.
4. MISCELLANEOUS
4.1. This Agreement shall be binding upon and for the benefit of
the parties hereto and their respective heirs, executors,
administrators, successors, devisees and assigns; provided,
however, that Officer may not assign rights or delegate duties
under this Agreement without the prior written consent of the
Company and that any attempt by Officer to do so without such
consent shall be void.
4.2. This Agreement contains the entire understanding and agreement
of the parties with respect to the relationship between the
Company and Officer (other than as a security holder and board
member of the Company), and it may not be altered, amended,
modified or otherwise changed in any respect whatsoever except
by a writing duly executed by the parties hereto.
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4.3. This document may be executed in any number of counterparts,
each of which shall be deemed to be an original and shall
fully bind each party who has executed it, but all such
counterparts together shall constitute one and the same
agreement.
4.4. No failure or delay on the part of any party hereto in
exercising any right, power or remedy hereunder shall operate
as a waiver thereof. The Company shall have the right to
enforce this Agreement and any of its provisions by
injunction, specific performance or other equitable relief,
without bond and without prejudice to any other rights and
remedies that the Company may have for the breach of this
Agreement.
4.5. The parties agree that it is not their intention for this
Agreement to violate any public policy or statutory or common
law. The parties intend that the provisions of this Agreement
be enforced to the fullest extent permissible under the laws
and public policies in the jurisdiction in which enforcement
is sought. The parties intend that the noncompetition and
nonsolicitation provisions contained in Section 2 be construed
as a series of separate covenants by Officer. Accordingly, to
the extent that any provisions hereunder shall be adjudicated
to be invalid or unenforceable in any jurisdiction in which
they apply, such provisions and such provisions only shall be
deemed amended or reformed to the minimum extent necessary in
order for the provisions to be valid and enforceable.
4.6. This Agreement shall be construed and enforced pursuant to the
laws of the State of Illinois, without giving effect to
conflict of law principals.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
Endorex Corporation:
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Name: Xxxxxxx X. Xxxxx
Title: President
Officer:
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Xxxxx X. Xxxxxx
IN WITNESS WHEREOF, CTD has executed this Agreement for the purposes of
Section 1.4 hereof as of the day and year first above written.
Corporate Technology
Development, Inc.:
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Name:
Title:
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