EXHIBIT 10.19
EMPLOYMENT AGREEMENT
This agreement ("Agreement") dated as of the 1st day of
January, 2000, between Columbia Laboratories Inc. ("Columbia") a corporation
organized and existing under and by virtue of the laws of the State of Delaware,
having its principal place of business at 0000 XX 000xx Xxxxxx, Xxxxxxxx,
Xxxxxxx 00000 (hereinafter referred to as the "Company"), and Xxxxx X.
Xxxxxxxxxxx, who resides at 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
(hereinafter referred to as "Employee").
W I T N E S E T H:
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WHEREAS, the Company is and will be engaged in the
development, testing, registration, manufacturing, licensing, marketing, and
selling of pharmaceutical products; and
WHEREAS, the employee, by reason of his knowledge, skill and
ability is uniquely qualified to aid the Company in the development, testing,
registration, manufacturing, licensing, marketing, and selling of pharmaceutical
products; and
WHEREAS, the Company is desirous of employing the Employee to
provide assistance to the Company in the development, testing, registration,
manufacturing, licensing, marketing, and selling of pharmaceutical products and
the Employee is desirous of being employed by the Company to assist it in the
development, testing, registration, manufacturing, licensing, marketing, and
selling of pharmaceutical products; and
WHEREAS, the Company and Employee desire to enter into this
Agreement so that the rights, duties, benefits and obligations of each in
respect of the employment of the Employee for and by the Company will be fully
set forth under the terms and conditions stated herein upon the execution
hereof; and
WHEREAS, the Compensation and Stock Option Committee of the
Board of Directors of the Company have approved the employment of the Employee
upon the terms and conditions set forth herein by a resolution issued by it, and
have authorized the execution and delivery of this Agreement.
NOW, therefore, in consideration of the mutual promises
contained herein, the payment of Ten ($10.00) dollars by each party to the
other, the receipt of which is hereby duly acknowledged, and for other good and
valuable consideration, the Company and Employee agree as follows:
1. EMPLOYMENT
The Company hereby employs the Employee in an
executive capacity, specifically as "President." The Employee hereby accepts
such employment and agrees to perform the services and duties specified herein.
2. TERM
(a) The term of this Agreement ("Term") shall be for
a period of Two (2) years from the date hereof, unless sooner terminated in
accordance with the terms and conditions set forth herein.
(b) Upon the mutual agreement of the Employee and the
Company, the Term may be extended for an additional period of years, either upon
the terms and conditions set forth herein, or upon any other terms and
conditions as may be mutually agreed in writing between the Employee and the
Company. The foregoing
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notwithstanding, this Agreement shall terminate as provided for in Article 2(a),
and there shall not be any automatic renewal or other similar extension of the
Term.
3. DISABILITY
If, during the Term, the Employee shall become unable
to perform his duties as provided for herein by reason of illness or injury, for
a consecutive period of One Hundred and Eighty (180) days, the Company may, on
Thirty (30) days written notice to the Employee, terminate the officership held
by Employee. In the event of such termination, then Employee shall remain an
employee of the Company and receive Seventy (70%) percent of his compensation
and all of his fringe benefits as is set forth below in this Agreement at
paragraphs "6" and "8" respectively.
4. TERMINATION FOR CAUSE
This Agreement may be immediately terminated by the
Company for "cause" at any time, upon written notice to the Employee, after
which all obligations of the Company to the Employee shall thereupon cease. For
the purposes of this Agreement, the term "cause" when used with reference to the
termination of this Agreement, shall mean only any or all of the following:
(a) Employee's absence from, or his failure to
perform the duties of his employment, for any reason other than sickness or
injury, at substantially all times during a period of Ninety (90) consecutive
days;
(b) Failure on the part of the Employee to (i) follow
material instructions or policy of the Board of Directors given or adopted in
good faith, or (ii) carry out an agreed policy or course of action as determined
by (a) the Board of Directors or (b) a committee of the Board of Directors, any
or all of which is or may be to the detriment of the Company; or
(c) Willful misconduct, gross negligence or
indictable criminal conduct against the Company, by the Employee in connection
with the performance of the duties of his employment.
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5. DUTIES
(a) The Employee shall perform the following duties
in connection with his employment, all of which shall be subject to the
paramount directions of the Board of Directors:
(i) To serve as "President" of the Company;
and
(ii) To assist the Company in its business
affairs and scientific dealings relating to the development, testing,
registration, manufacturing, licensing, marketing, and selling of pharmaceutical
products, as well as in the Company's dealings with other companies, its
regulatory affairs, banking and other financial institutions and other groups
and institutions; and
(iii) To undertake such specific
assignments, consistent with his office and position, as may be given to him
from time to time by the Board of Directors; and
(iv) To continue to serve as a director of
the Company, and then as, if and when so re-elected to continue to serve as a
director of the Company, and also if so elected, to serve as a director of any
subsidiary or affiliate of the Company.
(b) Employee shall devote his best efforts and skills
to the affairs of the Company, and to the performance of the duties set forth in
this Article 5, on a substantially full-time basis. The Employee shall not
participate in any outside business activity that will either (i) interfere
with, or (ii) be a conflict of interest with the performance of the Employee's
duties, activities and employment pursuant to this Agreement. The foregoing
notwithstanding, the Employee has disclosed to the Company his other outside
business interests ("Outside Business Interests") which are listed on Schedule
"1" hereto and the Company with this full knowledge has consented to the
Employee's continuance thereof. Moreover, the Company agrees to permit the
Employee to involve himself in other similar Outside Business Interests, on
condition that they similarly be disclosed and are added to Schedule "1" prior
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to their being commenced. The Employee may also invest his assets and devote
such reasonable time as is necessary to do so, so as to manage, protect and
support the profitability of those invested assets.
6. COMPENSATION
(a) Base Salary
The Employee shall receive for the discharge
of his duties and activities on behalf of the Company as provided for herein, an
annual salary ("Base Salary") of Two Hundred Thousand ($200,000.00) dollars,
which shall be paid by the Company to the Employee in equal and regular
installments not less frequently than monthly, in accordance with the Company's
policy for payment of executive salaries.
(b) Bonus
The Employee shall receive those benefits
accorded to executive employees pursuant to the Company's Incentive Compensation
Plan now in effect, or from any subsequent similar plan as shall be made
available to senior executives of the Company.
(c) Compensation Options
The Employee may receive compensation
options to purchase $.01 par value per share common stock of the Company
("Common"), together with those compensation options granted to other senior
management, if it is determined to be warranted by the Board of Directors.
7. OPTIONS AND WARRANTS
The Employee from time to time shall be granted as
additional compensation stock options ("Options's") and/or warrants ("Warrants")
to purchase shares of the Company's Common ("Grant"). The Grant of the Options's
shall be made pursuant to the Company's 1988 Stock Option Plan, as may be
amended from time to time ("Plan"). The Company shall enter into an Option
agreement for the issuance of the Options's, which Option agreement shall be
subject to the terms and conditions contained in the Plan. All Options's and/or
Warrants
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received by Employee will be exercisable at a price equal to the fair market
value of the Company's Common on the date of the Grant.
8. FRINGE BENEFITS
In addition to the Base Compensation set forth in
Article 6 above, the Employee shall be entitled to receive the following
benefits:
(a) Any benefits under group hospitalization, health,
dental care or sick leave plan, life or other insurance or death benefit plan,
travel or accident insurance, or contingent compensation plan, or any other
present or future plan, including any qualified retirement plan, for which any
executives are or shall become eligible. In the event the Employee is not
eligible for health benefits as described above, by reason of age, location or
otherwise the Employee shall be provided equivalent benefits determined at the
election of the Company. The Employee shall be eligible to receive the foregoing
benefits during the five (5) years period following the termination of his
employment under this Agreement; and
(b) An annual vacation of either or a combination of
(i) up to Four (4) consecutive weeks or (ii) up to any Thirty (30) days
("Vacation Period"), at such time or times as shall be approved by the Company,
and which approval shall not be unreasonably refused. Full compensation shall be
paid during any Vacation Period. Any portion of any Vacation Period not used
within any year shall be accrued and will accumulate, and may be used by the
Employee at any time during his employment in accordance with the provisions of
this Article 8. In the event that the Employee has not used all of his accrued
and accumulated vacation time at the termination of his employment, then the
employee may then elect to have his accrued and accumulated Vacation Period time
converted to annual Base Salary, pro rata at the then prevailing Base Salary,
regardless of when the unused vacation time accrued; and
(c) The Employee may incur and shall be reimbursed
for reasonable expenses which are related to the Company's business, including
expenses for entertainment, travel and similar items ("Approved Reimbursable
Expenses"). All such reimbursement of Approved Reimbursable Expenses shall be
made within Thirty (30) days of receipt by the Company from the Employee of an
itemized account and if necessary proper substantiation of Approved Reimbursable
Expenses. In order to facilitate the payment of the Approved
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Reimbursable Expenses, the Company shall furnish the Employee with Company
acquired credit cards as may be available to all other executive officers of the
Company; and
(d) The Employee shall be given a private office with
secretarial help and any and all reasonable facilities and services, at a
location where the Company maintains offices, so as to be suitable with his
position as President, and so as to assist in the performance of his duties and
activities.
(e) The Employee shall be given an automobile
allowance or automobile lease plan to the extent of $7,500.00 per annum, paid in
Twelve equal monthly installments, to be used to defray acquisition expense for
a luxury automobile, and insurance and maintenance expenses for the automobile.
9. DISCLOSURE OF INFORMATION AND NON-COMPETITION
(a) The Employee recognizes and acknowledges that
during the course of his employment he will have access to certain confidential
information of the Company and that such information constitutes valuable,
special and unique property of the Company. During the term of this Agreement
and following termination of his employment hereunder, the Employee will not
disclose information, including any trade secrets or confidential information of
the Company obtained during the course of his employment with the Company,
except such information as may have become part of the public domain through no
fault of the Employee, which public domain determination shall only be made by
the Company in a written acknowledgment made at the request of the Employee,
before the Employee may be free to disclose any such claimed public domain
information.
(b) During the term of this Agreement, and for Two
(2) years thereafter, the Employee will not, directly or indirectly, engage in
any business enterprise or activity, which is competitive with the business of
the Company either as an employee, consultant, partner, shareholder, or in any
other capacity. For the purposes of this covenant not to compete, a competing
business enterprise will be deemed competitive only if such business enterprise
(i) conducts research, develops and/or tests products (the "Development")
similar to the products the Company then has under Development, or (ii) offers
for sale in any market in which the Company has significant sales, one or more
products for which the major claimed usage or usages overlap materially with the
product or products of the Company in existence at the time of termination of
Employee's employment. Further, the Employee
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agrees that he will not either during or within Two (2) years subsequent to the
termination of his employment, disturb, entice, hire or in any other manner
attempt to persuade any employee, dealer, supplier or customer of the Company to
discontinue its business relationship with the Company.
(c) The Employee and the Company acknowledge that it
would be very difficult or impossible to measure the damages resulting from a
breach of this Article 9, and that any such breach would cause immediate and
irreparable harm. Therefore, in consequence of the foregoing, the Employee
hereby agrees that any breach or threatened breach by him of any provision of
this Article 9 shall entitle the Company, in addition to any other legal
remedies available to it, to obtain from any Court of competent jurisdiction a
temporary and permanent injunction in order to enjoin such breach or threatened
breach, without the necessity on the part of the Company, in any application for
such injunctive relief to show immediate and irreparable harm, which would be a
requirement of such an application absent this covenant waiving those
requirements. The Employee also covenants that the service of any papers to
commence any legal proceedings including proceedings to obtain injunctive
relief, may be done by utilizing Federal Express in lieu of any other form of
personal delivery of the process or orders of the Court and upon doing so the
service and notice provisions for the commencement of legal proceedings shall be
satisfied.
10. DEATH DURING EMPLOYMENT
If the Employee dies during the term of his
employment, the Company shall pay to his estate compensation which would
otherwise be payable to the Employee for the shorter of (i) Two (2) years from
the date of his death, or (ii) through to the termination date of this
Agreement. Said sums shall be paid in accordance with written directions given
by the Employee to the Company, or lacking any such directions then to the
surviving spouse of the Employee, or if there is no surviving
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spouse, then to his surviving children in equal shares, or if there are none,
then to his estate.
11. PATENTS AND PROPRIETARY RIGHTS
During the Term of employment all work product
emanating directly and/or indirectly from the Employees duties and activities
effected on behalf of the Company ("Work Product"), shall be exclusively owned
by the Company. In the event that any such Work Product is the subject of an
application for patent, copyright, trade xxxx or similar proprietary protection
("Application"), then regardless of the name of the person or entity submitting
the Application, the Employee hereby acknowledges the Company's exclusive rights
in and to the Application for proprietary protection. In the event that the
Application results in the issuance of the requested proprietary protection,
e.g. a patent, then the Employee hereby acknowledges the Company's exclusive
ownership therein, and the employee will execute any documents necessary to give
effect and implement this ownership, including but not limited to an assignment
of the Application and/or the issued proprietary protection.
12. NOTICES
Any notice required or permitted to be given under
this Agreement shall be sufficient if in writing and actually delivered, or if
sent either by Federal Express, or postage prepaid, by certified mail, return
receipt requested, with a copy by ordinary mail, to the addresses below:
As to Company: 0000 XX 000xx Xxxxxx
Xxxxxxxx, Xxxxxxx 00000
As to Employee: 000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
or to such other address as either party shall designate by written notice to
the other.
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13. ASSIGNMENT
The rights and obligations of the Company under this
Agreement shall inure to the benefit of and shall be binding upon the successors
and assigns of the Company. The Employee acknowledges that the services to be
rendered by him are unique and personal, and accordingly, he may not assign any
of his rights, duties, obligations or benefits under this Agreement.
14. ENTIRE AGREEMENT
This Agreement contains the entire agreement and
understanding of the Company and the Employee with respect to the subject matter
hereof, and shall incorporate, merge and supersede all prior agreements and
understandings had between the Company and the Employee, either oral or written,
if any. No modification, change or amendment to this Agreement, shall be binding
upon the Company or the Employee unless the same is in writing, and signed by
the party against whom enforcement of the modification, change or amendment is
sought to be enforced.
15. MISCELLANEOUS
(a) This Agreement and the implementation of it shall
be subject to and governed by the laws of the State of Florida, and any legal
proceedings relating to (i) the interpretation or enforcement of any of the
provisions of this Agreement, or (ii) any dispute relating to the employment
relationship created by the Agreement, shall only be brought in the Circuit
Court of the State of Florida, in and for the County of Dade.
(b) The Article headings contained herein are for
reference purposes only and shall not in any way affect the meaning or the
interpretation of this Agreement.
(c) The failure of any provision of this Agreement
shall in no manner affect the right to enforce the remainder of this Agreement,
and the waiver by either The Company or the Employee of any breach of
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any provision of this Agreement shall not be construed to be a waiver by the
Company or the Employee of any succeeding breach of such provision or a waiver
by such party of any breach of any other provision of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement on March 8, 2000.
EMPLOYEE:
Witness:
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/s/ Xxxxx X. Xxxxxxxxxxx
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Xxxxx X. Xxxxxxxxxxx
COMPANY:
COLUMBIA LABORATORIES, INC.
Witness:
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/s/ Xxxxxxx X. Xxxxxxx
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By:
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