Exhibit 10.3
RETIREMENT, SEPARATION AND RELEASE AGREEMENT
This Retirement, Separation and Release Agreement (the "Agreement") is entered
into by and between MGI PHARMA, INC. (the "Company") and Xxxxx X. Xxxx (the
"Employee").
A. The Company and the Employee have agreed that the Employee shall retire,
and resign as an officer of the Company and from any other position which he may
hold by virtue of or in connection with his employment by the Company.
B. The purpose of this Retirement, Separation and Release Agreement is to
set forth the terms and conditions under which the Company and the Employee will
terminate their employment relationship.
Accordingly, in consideration of the mutual covenants and promises contained
herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, Employee and the Company agree as
follows:
1. Resignation. Employee hereby resigns as an employee and officer of the
Company, and from any other position which he may hold by virtue of or in
connection with his employment by the Company, effective as of August 31, 1999.
2. Termination Benefits.
(a) Subject to the terms and conditions of this Agreement, including
the release set forth in Section 9(a) and the noncompete agreement set
forth in Section 6, the Company will pay to Employee twenty-four (24)
installments at Employee's current semi-monthly rate of base pay ($8,125),
with the first such payment being made on the Company's regular payroll on
September 15, 1999 and subsequent payments on each such payroll date
thereafter. Employee acknowledges that no payments are due under Section
2(a) if Employee rescinds this Agreement as provided in Section 10(b). If
Employee dies prior to having received all such payments, any remaining
payments will be made to Employee's estate.
(b) Subject to the terms and conditions of this Agreement, including
the releases set forth in Sections 9(a) and (b), and the noncompete
agreement set forth in Section 6, the Company will pay to Employee $37,500
on September 30, 1999, and $37,500 on January 31, 2000. Employee
acknowledges that no payments are due under Section 2(b) if Employee
rescinds this Agreement as provided in Section 10(b) , or rescinds the
Release referred to in Section 9(b) as provided in Section 10(c).
(c) Subject to the terms and conditions of this Agreement, including
the release set forth in Section 9(a), the Company will pay outplacement
fees and expenses, for a maximum of twelve (12) months following the date
of this
Agreement, to an outplacement services firm selected by the Company. During
the period the Company is making such payments, it will be entitled to
receive reports from said firm about Employee's efforts to obtain new
employment. If Employee rescinds this Agreement pursuant to Section 10(b),
the Company will not be obligated to make any payments specified in this
paragraph.
(d) If Employee timely elects continued coverage under the Company's
group medical plan, group dental plan and group life insurance plan
pursuant to Section 4980B of the Internal Revenue Code of 1986, as amended,
in accordance with ordinary plan practices, Employee may continue his COBRA
coverage until his eligibility therefor ends at the full premium cost
thereof.
3. Accrued Vacation. As of the effective date of the resignation provided
in Section 1, the Company shall pay Employee for unused vacation accrued prior
thereto.
4. Other Benefits. Employee is a participant in various employee benefit
plans sponsored by the Company. Other than as set forth herein, the payment of
benefits, including the amounts and the timing thereof, will be governed by the
terms of the employee benefit plans, and nothing in this Agreement shall limit
any rights Employee may otherwise have as a former employee under the employee
benefit plans as provided therein.
(a) Stock Option and Limited Stock Appreciation Rights Agreements. As a
participant in various Company stock option plans, and provided that
the Compensation Committee of the Board of Directors approves a
recommendation to affirmatively determine that the Employee's
termination of employment with the Company constitutes a "retirement"
within the meaning of applicable sections of stock option agreements,
Employee shall have the right to exercise options according to the
rights specified in applicable stock option and limited stock
appreciation rights agreements that contain these extended rights to
exercise options after "retirement".
(b) Split Dollar Life Insurance. As a participant in life insurance
policies under the Company's Split Dollar Life Insurance programs,
Employee will continue to be listed as the owner of applicable
policies. The Company will make no further premium payments or
contributions to these policies. The Employee agrees to maintain the
existing secured interest of the Company in these policies such that
the Company will be repaid all premium payments made by the Company at
such time that the policies pay out either the cash value or the death
benefit.
5. Return of Information and Assets. Employee will return to the Company
all originals and all copies of the Company's records, correspondence and
documents, and all other property and assets of the Company, created or obtained
by Employee as a result of or in the course of or in connection with his
employment with the Company which are in his possession or control, whether
confidential or not.
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6. Competitive Activities. Employee agrees that from the effective date of
this Agreement and continuing through the one-year period he is to receive
severance payments pursuant to Section 2(a), he will not alone or in any
capacity with any firm,
(a) disrupt, damage, impair or interfere with the business of the
Company whether by way of interfering with or disrupting the Company's
present or future relationship with any employee, customer or vendor; or
(b) without the prior written consent of the Company, employ or
attempt to employ any of the Company's then employees on behalf of any
other entity.
For purposes of Sections 6(a) through (b), inclusive, the term "Company"
shall include the Company, any direct or indirect subsidiary of the Company, and
any other affiliated corporation or entity of any of the foregoing.
In the event of a breach of this Section 6 by Employee, the obligation of
the Company to make the payments provided for in Section 2(a) and (b) shall
immediately cease and Employee shall forfeit all rights to receive such
payments. Before ceasing these payments, the Company shall provide Employee with
fifteen (15) days notice of the breach to permit Employee the opportunity to
explain his actions and cure any breach.
The provisions of this Section 6 are for purposes of this Agreement and are
not limited by the provisions of the preexisting Termination Agreement Section
4(d).
7. Confidential Information. Employee shall not directly or indirectly
disclose or use at any time before or after the effective date of this Agreement
any technology, trade secrets, know-how or other information, knowledge or data
owned, possessed or utilized by the Company or to which Employee had access in
connection with his employment and which the Company deems confidential or
proprietary or which Employee has reason to believe is confidential or
proprietary unless Employee shall first have obtained the written consent of the
Company. The foregoing obligation of confidentiality shall not apply to any
information, knowledge or data the entirety of which is now published or
subsequently becomes generally publicly known, other than as a direct or
indirect result of the breach of this Agreement by Employee or a breach of a
confidentiality obligation owed to the Company by another.
8. No Other Benefits. Employee agrees and understands that he is entitled
to no other benefits than those enumerated in this Agreement. The Employee also
understands that payments made pursuant to this Agreement may be subject to
withholding of applicable income and other employment-related taxes and consents
to the Company's right to withhold from such payments.
9. Settlement and Release.
(a) Employee hereby fully and completely releases and waives and
forever discharges the Company from any and all claims, complaints, causes
of action or
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demands of whatever kind, known or unknown, suspected or unsuspected, which
exist or may exist as of the effective date of this Agreement arising out
of any actions, conduct, decisions, behavior, or events occurring prior to
the execution of this Agreement, including without limitation any and all
claims, complaints, causes of action or demands relating in any way to the
terms, conditions and circumstances of Employee's employment, the
resignation by Employee as an officer of the Company and other capacities
in which he served at the request of the Company, or Employee's ownership
of shares of common stock of the Company or options or other rights to
purchase shares of such common stock, whether based on state or federal
statutory or common law claims for employment discrimination (including
age, sex and disability discrimination), wrongful discharge, breach of
contract, negligence or other breach of duty, fraud, negligent or
intentional misrepresentation, negligent or intentional infliction of
emotional distress, defamation, promissory estoppel, breach of express or
implied promise, breach of public policy, failure to pay wages or other
benefits, or any other theory, whether legal or equitable. Employee makes
this release on behalf of himself, his estate and his heirs, personal
representatives, administrators, executors, successors and assigns, and his
release of the Company extends to its successors, subsidiaries, assigns,
insurers and affiliates and all past and present directors, officers,
employees and agents of such persons and companies.
(b) Employee hereby agrees to sign and deliver to Company at the end
of the work day on the effective date of resignation specified in Section 1
a Release in the same language as that used in Section 9 (a) above. The
"effective date" of this Agreement shall be the first working day following
the expiration of the twenty-one (21) day rescission period associated with
the first release set forth in Section 9(a), provided Employee does not
exercise his right of rescission.
10. Miscellaneous.
(a) Employee hereby acknowledges having the opportunity to take
twenty-one (21) days to consider the terms of this Agreement before
signing, that he fully understands and accepts the terms of this Agreement,
that his signature is freely, voluntarily and knowingly given, and that he
has been provided a full opportunity to review and reflect on the terms of
the Agreement and to obtain the advice of legal counsel of choice, which
advice the Company has encouraged him to obtain.
(b) After executing this Agreement, Employee understands that he may
rescind this Agreement by delivering written notice of such rescission
within twenty-one (21) days of the date appearing next to his signature. To
be effective, such rescission notice must be delivered to the Company,
Suite 300E, Opus Center, 0000 Xxxx Xxxx Xxxx, Xxxxxxxxxx, Xxxxxxxxx
00000-0000, Attention: Vice President, Human Resources. Employee
understands that this Agreement will not become effective until the end of
such twenty-one (21)-day period and
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only if Employee does not rescind this Agreement.
(c) After executing the Release set pursuant to Section 9 (b),
Employee understands that he may rescind this Release by delivering written
notice of such rescission within fifteen (15) days of the date appearing
next to his signature. To be effective, such rescission notice must be
delivered to the Company, Suite 300E, Opus Center, 0000 Xxxx Xxxx Xxxx,
Xxxxxxxxxx, Xxxxxxxxx 00000-0000, Attention: Vice President, Human
Resources. Employee understands that this Release will not become effective
until the end of such fifteen (15)-day period and only if Employee does not
rescind this Agreement.
(d) This Agreement is confidential. Neither the Company nor Employee
will reveal the terms of the Agreement except as may be necessary to effect
its terms or as required by law, court order or valid legal proceedings.
Employee may also disclose the terms to his immediate family, legal
counsel, investment advisor or banks, and accountant or tax advisor. The
Company may also disclose the terms to its officers and directors, outside
auditors, tax advisors and legal counsel. Both parties shall also be
permitted to disclose the non-competition provisions of this Agreement.
(e) This Agreement constitutes the entire agreement between the
parties; provided, it does not disturb the Termination Agreement regarding
a "Change of Control". No modification, amendment or change of any kind to
this Agreement shall be effective unless it is in writing and signed by
both parties.
(f) The laws of the State of Minnesota will govern the validity,
construction and performance of this Agreement, without regard to the
conflict of law provisions of any other jurisdictions. Any legal proceeding
related to this Agreement will be brought in an appropriate Minnesota
court, and both parties hereby consent to the exclusive jurisdiction of
that court for this purpose.
(g) Whenever possible, each provision of this Agreement will be
interpreted so that it is valid under the applicable law. If any provision
of this Agreement is to any extent invalid under the applicable law, that
provision will still be effective to the extent it remains valid. The
remainder of this Agreement will also continue to be valid, and the entire
Agreement will continue to be valid in other jurisdictions.
(h) Nothing in this Agreement is intended to be, and nothing will be
deemed to be, an admission of liability by the Company or Employee that
either of them has violated any state or federal statute, local ordinance
or principle of common law, or that either party has engaged in any
wrongdoing.
(i) The parties hereto agree that the rights granted by this Agreement
are both unique and special and the parties contemplate that enforcement of
this
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Agreement may be had by recourse to the equitable remedies available in
courts of appropriate jurisdiction in addition to any other remedies which
may be or become available at law.
IN WITNESS WHEREOF, the parties have duly executed this Agreement on the dates
set forth below to be effective as of the date set forth in the first paragraph
on the first page of this Agreement.
Dated: June 23, 1999 MGI PHARMA, INC.
By: /s/ Xxxxxxx Xxxxxxx
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Its: President and Chief Executive Officer
Dated: June 23, 1999 /s/ Xxxxx X. Xxxx
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Xxxxx X. Xxxx
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