Exhibit 10.13
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
This AMENDED AND RESTATED EMPLOYMENT AGREEMENT (the "Agreement")
entered into as of February 20, 2004, by and between Animas Corporation, a
Delaware corporation (the "Company"), and Xxxxxxxxx X. Xxxxxxxx (the
"Executive").
WHEREAS, the Company and the Executive entered into that certain
Employment Agreement dated January 1, 2002 and now wish to amend certain terms
of and restate that Agreement upon the terms and conditions set forth herein.
NOW, THEREFORE, the parties hereto, intending to be legally bound,
hereby agree as follows:
1. Employment
1.1. Position. The Company hereby agrees to continue to
employ the Executive as its President and Chief Executive Officer and the
Executive hereby accepts such employment and agrees to perform her duties and
responsibilities, in accordance with the following terms, conditions and
provisions.
1.2. Employment Term. The term of the Executive's employment
under this Agreement shall commence on the date the Company's registration
statement on a Form S-1 is declared effective by the Securities and Exchange
Commission (the "Effective Date") and shall continue in effect through January
1, 2005 (the "Expiration Date"); provided, however, commencing on January 1,
2005 and on each January 1 thereafter, the Expiration Date shall automatically
be extended one additional year unless, not later than September 30 prior to
such January 1, either party shall give written notice to the other party that
the Expiration Date shall cease to be so extended (the "Original Term").
Notwithstanding the foregoing sentence, if a Change in Control occurs prior to
January 1, 2005, the term of the Executive's employment shall expire no earlier
than the second anniversary of the first day of the month following the month in
which the Change of Control occurs (the "Change of Control Term"), unless
terminated prior thereto in accordance with the applicable provision of Section
5. Notwithstanding any other provision of this Agreement to the contrary, this
Agreement shall immediately become null and void if the Effective Date does not
occur on or prior to June 30, 2004. Collectively the Original Term and the
Change of Control Term shall be referred to herein as the "Employment Term."
1.3. Duties and Responsibilities. The Executive shall serve
as the Company's President and Chief Executive Officer and in such other senior
positions, if any, to which she may be elected by the Board of Directors of the
Company (the "Board") during the Employment Term. During the Employment Term,
the Executive shall perform all duties and accept all responsibilities incident
to, and not inconsistent with, such positions.
1.4. Extent of Service. During the Employment Term, the
Executive agrees to use her best efforts to carry out her duties and
responsibilities under Section 1.3 hereof and, consistent with the other
provisions of this Agreement, to devote substantially all of her business time,
attention, and energy thereto, except to the extent required by the Executive's
outside board memberships and civic or charitable activities held on the date of
this Agreement.
The Executive agrees not to become engaged in any additional business, civic or
charitable activity that, in the Board's reasonable judgment, is likely to
interfere materially with her ability to discharge her duties and
responsibilities to the Company.
1.5. Base Salary. For all the services rendered by the
Executive hereunder, the Company shall pay the Executive a base salary at the
annual rate of $285,000 plus an automobile allowance of $1,100 per calendar
month ("Base Salary"), payable in installments at such times as the Company
customarily pays its other senior level officers (but in any event no less often
than monthly). The Executive's Base Salary shall be reviewed and may be
appropriately adjusted by the Board pursuant to its normal performance review
policies for senior level officers.
1.6. Retirement and Benefit Coverages. The Executive shall be
eligible to participate in any pension plans, retirement plans and any health,
life, accident, general liability, directors and officers liability, or
disability insurance, sick leave or other benefit plans or programs made
available to other senior level officers of the Company as long as they are kept
in force by the Company ("Plans") and provided the Executive meets the
eligibility requirements and other terms, conditions and restrictions of the
respective Plans. In addition, the Executive shall be entitled to holiday,
vacation and sick leave in accordance with the Company's vacation, holiday and
pay for time not worked policies, as well as any other perquisites provided by
the Company to its senior level officers.
1.7. Stock Options/Stock Awards/Benefits. In the event that
(i) the Executive's employment is terminated by the Company or a successor
entity pursuant to Section 5.2, (ii) the Executive resigns from the Company
pursuant to Section 5.3 or (iii) if the Executive's employment is terminated
during the six month period before or the twelve month period following a Change
of Control as defined in Section 6, then one hundred percent (100%) of any stock
option, restricted stock or other stock awards granted the Executive that have
not yet become exercisable or vested shall automatically accelerate and become
fully exercisable or vested on the effective date of such event and the
Executive shall become entitled to the payments set forth in Sections 5.2 or
5.3, as applicable. In addition, if a Change of Control (other than a Change of
Control within the meaning of Section 6.3(c) or Section 6.3(d) of this
Agreement) is consummated prior to December 31, 2006, then, (a) to the extent
that an option award that has been issued to Executive is subject to a vesting
and/or unexercisability period that extends longer than twenty-four (24) months
from such date, then that portion of the entire option award that is then
unvested and/or unexercisable and that would have become vested and/or
exercisable in the final twenty-four (24) months of such vesting and/or
unexercisability period shall become vested and immediately exercisable on the
date of a Change of Control and (b) to the extent that an option award that has
been issued to the Executive is subject to a vesting and/or unexercisability
period that is shorter then twenty-four (24) months from such date, then all of
the option award shall become vested and immediately exercisable on the date of
a Change of Control. Subject to the discretion of the Board, the Executive shall
be eligible to receive additional grants of stock options from time to time in
the future, on such terms and subject to such conditions as the Board shall
determine as of the date of any such grant.
1.8. Life Insurance. During the Employment Term, the Company
shall maintain, under an arrangement satisfactory to the Company $3,000,000 of
life insurance on the
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life of the Executive if available at reasonable commercial rates as determined
by the Board or if not available, for such lower amount as agreed to by the
Company and the Executive. The Executive shall have the right to designate the
beneficiary of such insurance policy. The Company may maintain term life
insurance, whole life insurance or such other form of insurance as it deems
appropriate.
1.9. Incentive Programs. The Executive shall be entitled to
participate in any short-term or long-term incentive compensation programs
established by the Company for its senior level officers generally ("Incentive
Programs"). Payments under such Incentive Programs shall depend upon achievement
of certain business and individual performance targets specified and approved by
the Board; provided, however, that the Executive's "target opportunity" under
any such Incentive Program shall not be less than the highest level of target
opportunity of any other senior level Officer.
2. Confidential Information. The Executive acknowledges that, by
reason of her employment by and service to the Company before and during the
Employment Term, she has had and will continue to have access to certain
confidential and proprietary information relating to the Company's business,
which may include, but is not limited to, trade secrets as defined by
Pennsylvania Law, customer information, supplier information, cost and pricing
information, marketing and sales techniques, strategies and programs,
proprietary computer programs and software and financial information
(collectively referred to as "Confidential Information"). The Executive
acknowledges that such Confidential Information is a valuable and unique asset
of the Company and the Executive covenants that she will not at any time during
the Employment Term use any Confidential Information or divulge or disclose any
Confidential Information to any person, firm or corporation except in connection
with the Executive's good faith belief as to the proper performance of her
duties for the Company. The Executive also covenants that, for a period of three
(3) years after the termination of her employment, directly or indirectly, she
will not use any Confidential Information for any purpose or divulge or disclose
any Confidential Information to any person, firm or corporation, unless such
information is in the public domain through no fault of the Executive.
Notwithstanding the foregoing, if the Executive is required to disclose
Confidential Information by a court of law, by any governmental agency having
supervisory authority over the business of the Company or over the Executive or
by any administrative or legislative body (including a committee thereof) that
the Executive reasonably believes has apparent jurisdiction to order her to
divulge, disclose or make accessible such information, the Executive shall
inform the Company in writing promptly of such required disclosure and shall not
disclose any Confidential Information until steps taken by the Company to
preclude such disclosure have been ineffective or the Company authorizes
disclosure.
3. Non-Competition; Non-Solicitation.
3.1. Non-Competition. The Executive agrees that:
(a) During the Employment Term and for a period of two
(2) years thereafter, or, if longer, for the period during which the Executive
receives payments from the Company under Section 5.2, the Executive will not,
except with the prior written consent of the Board, directly or indirectly own,
manage, operate, join, control, finance or participate in the ownership,
management, operation, control or financing of, or be connected as an officer,
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director, employee, partner, principal, agent, representative, consultant or
otherwise with, or use or permit her name to be used in connection with, any
business or enterprise that is engaged in a geographic area in which the Company
or any of its affiliates is operating or has documented plans to operate,
provided the Executive has knowledge of those plans, either during the
Employment Term or on the date the Executive's employment terminates, as
applicable, (whether or not such business is physically located within those
areas) (the "Geographic Area"), in any business that is directly competitive to
a business maintained by the Company or any of its affiliates or to a business
that the Company or any of its affiliates has documented plans to maintain,
provided that the Executive has knowledge of those plans, either during the
Employment Term or on the date the Executive's employment terminates, as
applicable ("Competing Business"). It is recognized by the Executive that the
business of the Company and its affiliates operates throughout the Geographic
Area and that the Executive is involved in such business throughout the
Geographic Area, and therefore, that more limited geographical limitations on
this non-competition covenant are not appropriate.
(b) The foregoing restrictions shall not be construed
to prohibit the ownership by the Executive of less than five percent (5%) of any
class of securities of any corporation that is engaged in any of the foregoing
businesses having a class of securities registered pursuant to the Securities
Exchange Act of 1934 (the "Exchange Act"), provided that such ownership
represents a passive investment and that neither the Executive nor any group of
persons including the Executive in any way, either directly or indirectly,
manages or exercises control of any such corporation, guarantees any of its
financial obligations, otherwise takes any part in its business, other than
exercising her rights as a shareholder, or seeks to do any of the foregoing.
3.2. Non-Solicitation. The Executive further covenants and
agrees that, during the Employment Term and for the period of two (2) years
thereafter, or, if longer, for the period during which the Executive receives
payments from the Company under Section 5.2, the Executive will not, without the
prior written consent of the Company, personally solicit for a Competing
Business any customer that was a customer of the Company or any of its
affiliates during the Employment Term or on the date on which the Executive's
employment terminates or any person who is a managerial or higher level employee
of the Company at the date the Executive's employment terminates. The foregoing
covenant of the Executive shall not apply to any person after twelve months have
elapsed subsequent to the date on which such person's employment by the Company
has terminated.
4. Equitable Relief.
4.1. The Executive acknowledges and agrees that (i) the
restrictions contained in Sections 2 and 3 are reasonable and necessary to
protect and preserve the legitimate interest, properties, goodwill and business
of the Company, (ii) the Company would not have entered into this Agreement in
the absence of such restrictions and (iii) the Company will suffer irreparable
injury if the Executive breaches any of the provisions set forth in Sections 2
and 3. The Executive represents and acknowledges that (i) she has been advised
by the Company to consult her own legal counsel in respect of this Agreement,
and (ii) she has had full opportunity, prior to execution of this Agreement, to
review thoroughly this Agreement with her counsel.
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4.2. The Executive further acknowledges and agrees that
a breach of any of the restrictions in Sections 2 and 3 cannot be adequately
compensated by monetary damages. The Executive agrees that the Company shall be
entitled to seek preliminary injunctive relief, without the necessity of proving
actual damages. In the event that any of the provisions of Sections 2 or 3
hereof should ever be adjudicated to exceed the time, geographic, service, or
other limitations permitted by applicable law in any jurisdiction, it is the
intention of the parties that the provision shall be amended to the extent of
the maximum time, geographic, service, or other limitations permitted by
applicable law, that such amendment shall apply only within the jurisdiction of
the court that made such adjudication and that the provision otherwise be
enforced to the maximum extent permitted by law.
4.3. The Executive irrevocably and unconditionally (i)
agrees that any suit, action or other legal proceeding arising out of this
Agreement, including, without limitation, any action commenced by the Company
for preliminary and permanent injunctive relief and other equitable relief, may
be brought in the United States District Court for the Eastern District of
Pennsylvania, or if such court does not have jurisdiction or will not accept
jurisdiction, in any court of general jurisdiction in Xxxxxxx County,
Pennsylvania, (ii) consents to the non-exclusive jurisdiction of either such
court in any such suit, action or proceeding, and (iii) waives any objection
that the Executive may have to the laying of venue of any such suit, action or
proceeding in either such court. The Executive also irrevocably and
unconditionally consents to the service of any process, pleadings, notices or
other papers at the address set forth in the notice provisions of Section 12
hereof.
5. Termination.
5.1. The Employment Term shall terminate upon the occurrence
of any one of the following events:
(a) Disability. The Company may terminate the
Employment Term in compliance with applicable law, if the Executive is unable
substantially to perform the essential duties and responsibilities hereunder to
the full extent required by the Board by reason of mental or physical illness,
injury or any other cause for six consecutive months, or for more than nine
months in the aggregate during any period of twelve consecutive calendar months
(a "Disability"); provided, however, that the Company shall continue to pay the
Executive her Base Salary during such six month or twelve consecutive calendar
month period. At the date of such termination the Company shall prepare and
execute a release substantially in the form attached hereto as Annex 1, (the
"Release"), and present the Release for execution to the Executive, or the
Executive's representative should she lack capacity to execute the Release. Upon
execution of the Release by the Executive, or her personal representative, as
the case may be, the Executive shall be entitled to receive all payments and
benefits to the same extent and at the same time as specified in Section 5.2(b),
offset by any amounts the Executive receives under any long- term disability
program maintained by the Company. Otherwise, in the event of Disability, the
Company shall have no further liability or obligation to the Executive under
this Agreement except as set forth in the Release. In the event of any dispute
under this Section 5.1(a) and to the extent determined by the Board to be
job-related and consistent with business necessity, the Executive shall submit
to a physical examination by a licensed physician experienced in
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disability examination selected by the Board and approved by the Executive, such
approval not to be unreasonably withheld.
(b) Death. The Employment Term shall terminate on the
date of the Executive's death. In such event, the Company shall pay to the
Executive's executors, legal representatives or administrators, as applicable,
an amount equal to the installment of her Base Salary set forth in Section 1.5
hereof for the full month in which she dies, and all unreimbursed expenses and
unused vacation time. If the Executive dies while an employee of the Company,
the designated beneficiary, or if no such beneficiary has been designated, the
Executive's estate, shall be entitled to receive (i) the proceeds of the life
insurance policy described in Section 1.8 and (ii) a payment from the Company of
any other benefits in accordance with the terms of any Plan and Incentive
Programs of the Company, on the basis that the death of the Executive is
equivalent to termination without cause. Otherwise, the Company shall have no
further liability or obligation under this Agreement to her executors, legal
representatives, administrators, heirs or assigns or any other person claiming
under or through her.
(c) Cause. The Company may terminate the Employment
Term at any time for "Cause" upon 30 days' written notice to the Executive, in
which event all payments under this Agreement shall cease, except for (i) Base
Salary to the extent already earned and a payment equal to any unreimbursed
expenses and unused vacation, which shall be paid in a single lump sum on the
day the Employment Term terminates, and (ii) any other benefits in accordance
with the terms of any applicable Plans and Incentive Programs of the Company.
For purposes of this Agreement, the Executive's employment may be terminated for
"cause" if (i) the Executive is convicted of a felony (ii) in the reasonable
determination of the Board, the Executive has committed an intentional act of
fraud, embezzlement, or theft in connection with the Executive's duties in the
course of her employment with the Company, (iii) in the reasonable determination
of the Board, the Executive has engaged in gross negligence in the course of her
employment with the Company that is materially harmful to the business of the
Company, or (iv) the Executive intentionally breached her obligations under this
Agreement, including inattention to or neglect of duties and shall not have
remedied such breach within 30 days after receiving written notice from the
Board specifying the details thereof and the act or failure to act by the
Executive is materially harmful to the business of the Company. For purposes of
this Agreement, an act or omission on the part of the Executive shall be deemed
"intentional" or "gross negligence" only if it was done by the Executive in bad
faith, not merely an error in judgment, and without reasonable belief that the
act or omission was in the best interest of the Company. In the event the
Executive disputes the existence of Cause in connection with a termination of
employment, no termination for Cause shall be effective in the absence of an
affirmative vote by the three fourths of the full Board (disregarding any
director who must abstain).
5.2. Termination Without Cause.
(a) The Company may terminate the Executive without
Cause, at any time, from the position in which she is employed hereunder (on
which date the Employment Term shall be deemed to have ended) upon not less than
30 days prior written notice to the Executive; provided, however, that,
commencing on the date of such notice, the
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Executive shall be under no obligation to render any additional services to the
Company and shall be allowed to seek other employment. Upon such termination,
except as provided in Section 5.2(b) below, the Executive shall be entitled to
receive, as liquidated damages for the failure of the Company to continue to
employ the Executive (i) Base Salary to the extent already earned and a payment
equal to any unused vacation, unreimbursed expenses, which shall be paid in a
single lump sum on the day the Employment Term ends, and (ii) any other benefits
in accordance with the terms of any Plans and Incentive Programs of the Company.
(b) Notwithstanding the foregoing, upon such
termination, the Company shall prepare and execute the Release and present the
Release to the Executive for execution. Upon the Executive's execution of the
Release and her agreement to be bound by the terms of and not rescind the
Release, she shall be entitled to receive, commencing on the eighth day
following execution of the Release, in lieu of the Company's obligations
described in Subsection (a) of this Section, which the Executive agrees to
waive, as liquidated damages for the failure of the Company to continue to
employ the Executive, (i) continuation for eighteen months of the Executive's
current Base Salary in accordance with Section 1.5 (without regard to the
Executive's removal), (ii) any other amounts earned, vested, or owing but not
yet paid under Section 1.5 through 1.9 above, (iii) a pro-rata portion of any
Incentive Programs to the extent that such amount would have been earned in
accordance with the terms of such Incentive Programs specified in Section 1.9
above for the then current fiscal year of the Company, without regard to a
requirement, if any, set forth in Incentive Programs of employment with the
Company at date of payment under such Incentive Programs (iv) a payment equal to
any unused vacation and unreimbursed expenses, (v) any other benefits in
accordance with the terms of any Plans and Incentive Programs of the Company
without regard to a requirement, if any, set forth in Plans or Incentive
Programs of employment with the Company at date of payment under such Plans or
Incentive Programs, and (vi) to the extent not provided in (E) directly above,
health insurance for the Executive and eligible family members and disability
insurance for the Executive, for a period of eighteen (18) months from the date
of termination pursuant to Section 5.2(a), each with coverage and at a cost
identical to that provided the Executive immediately prior to such termination.
Notwithstanding the foregoing, if the Company determines that it is unable to
provide the benefit set forth in (iv) or (v) above, the Company shall satisfy
its obligation under this Agreement through a cash payment of the amount
necessary to provide the benefit and the amount necessary to pay any federal,
state or local tax on such cash payment. Upon Termination Without Cause, the
Company shall have no liability or obligation to the Executive except as set
forth in Section 5.4 and in the Release.
5.3. Constructive Termination Without Cause.
(a) Resignation by the Executive for good reason
("Constructive Termination without Cause") shall mean a termination of the
Executive's employment at her initiative following the occurrence, without the
Executive's written consent, of(i) a material diminution in the Executive's
duties, responsibilities, authority or status, or a failure of the Executive to
have a position reporting directly to the Board, (ii) a reduction in any amount
of the Executive's Base Salary, (iii) the assignment to the Executive of duties
or responsibilities that are materially inconsistent with the duties,
responsibilities, authority, or status of her position as defined in Section 1.3
above or which materially impair the Executive's ability to function in her then
current position, (iv) the Executive's removal as a member of the
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Board, or (v) a failure of the Company to comply with any of the material terms
of this Agreement; provided, however, that a termination of the Executive's
employment shall not constitute a Constructive Termination without Cause if the
Company's action is in response to actions taken by the Executive that
constitute Cause (as defined in Section 5.1(c) above).
(b) In the event of a Constructive Termination Without
Cause, the Company shall prepare and execute the Release and present the Release
to the Executive for execution. Upon the Executive's execution of the Release
and agreement to be bound by and not rescind the terms of the Release, she shall
be entitled to receive all amounts and benefits to the same extent and at the
same time as specified in Section 5.2(b). In the event the Executive refuses to
execute and agree to be bound by the terms of the Release (or revokes the
Release), she shall receive only the amounts and benefits to the same extent and
at the same time as specified in Section 5.2(a).
(c) Prior to resigning under this Section, the
Executive shall give written notice to the Board and offer a 30-day period for
the Company to cure. If no cure has been effected by the end of the applicable
cure period, the Executive may resign immediately. The Company may not terminate
the Executive pursuant to Section 5.1(c) or 5.2 subsequent to the date of the
written notice provided pursuant to this Section 5.3(c).
5.4. Voluntary Termination. The Executive may voluntarily
terminate the Employment Term upon 30 days' prior written notice for any reason.
In such event, the Executive shall be entitled only to (i) Base Salary to the
extent already earned and a payment equal to any unused vacation, and
unreimbursed expense which shall be paid in a single lump sum on the day the
Employment Term terminates, and (ii) any other benefits in accordance with the
terms of any Plans and Incentive Programs of the Company. A voluntary
termination under this Section 5.4 shall not be deemed a breach of this
Agreement.
5.5. Termination at End of Employment Term. Notwithstanding
Section 5.4, if the Executive's employment with the Company is terminated or not
renewed at the end of an Employment Term by the Company, the Company shall
prepare and execute the Release and present the Release to the Executive for
execution. Upon execution of the Release by the Executive, the Company shall pay
to the Executive as severance compensation the amounts described in Section
5.2(b), but with the Executive's Base Salary to continue under Section 5.2(b)(i)
for one year after termination of employment. The payments under this Section
5.5 shall be made in lieu of the payments described in Section 5.4, which the
Executive hereby agrees to waive. In the event the Executive refuses to execute
and agree to be bound by the terms of the Release (or revokes the Release), the
Executive shall receive only amounts and benefits specified in Section 5.4.
6. Change of Control.
6.1. If a Change of Control (as defined in 6.3 below) occurs
during the Employment Term, any payment or distribution by the Company to or for
the benefit of the Executive pursuant to the terms of this Agreement or
otherwise shall be subject to the provisions of subsection 6.2 below.
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6.2. Notwithstanding anything in this Agreement to the
contrary, if it shall be determined that any payment or distribution by the
Company to or for the benefit of the Executive pursuant to the terms of this
Agreement or otherwise (a "Payment") would constitute an "excess parachute
payment" within the meaning of Section 280G of the Internal Revenue Code of
1986, as amended (the "Code"), and that it would be economically advantageous to
the Executive to reduce the Payment to avoid or reduce the taxation of excess
parachute payments under Section 4999 of the Code, the aggregate present value
of the amounts payable or distributable to or for the benefit of the Executive
pursuant to this Agreement (such payments or distributions pursuant to this
Agreement are hereinafter referred to as "Agreement Payments") shall be reduced
(but not below zero) to the Reduced Amount. The "Reduced Amount" shall be an
amount expressed in present value that maximizes the aggregate present value of
Agreement Payments without causing any Payment to be subject to taxation under
Section 4999 of the Code. For purposes of this Section 6, present value shall be
determined in accordance with Section 280G(d)(4) of the Code. The calculations
under this Section 6.2 shall be made as follows:
(a) All determinations to be made under this Section
6.2 shall be made by the Company's independent public accounting firm as in
effect immediately prior to the Change of Control (the "Accounting Firm"), which
firm shall provide its determinations and any supporting calculations to the
Company and Chief Executive Officer within 10 days of the event that gives rise
to the "excess parachute payment." Any such determination by the Accounting Firm
shall be binding upon the Company and the Executive. The Executive shall in her
sole discretion determine which and how much of the Agreement Payments shall be
eliminated or reduced consistent with the requirements of this Section 6.2.
Within five days after the Executive's determination, the Company shall pay (or
cause to be paid) or distribute (or cause to be distributed) to or for the
benefit of the Executive such amounts as are then due to the Executive under
this Agreement. As a result of the uncertainty in the application of Section
280G of the Code at the time of the initial determination by the Accounting Firm
hereunder, it is possible that Agreement Payments will have been made by the
Company that should not have been made ("Overpayment") or that additional
Agreement Payments that have not been made by the Company could have been made
("Underpayment"), in each case, consistent with the calculations required to be
made hereunder. Within two years after the event that gives rise to the "excess
parachute payment," the Accounting Firm shall review the determination made by
it pursuant to the preceding paragraph. If the Accounting Firm determines that
an Overpayment has been made, any such Overpayment shall be promptly repaid by
the Executive to the Company; provided, however, that no amount shall be
repayable by the Executive to the Company if and to the extent such repayment
would not reduce the amount which is subject to taxation under Section 4999 of
the Code. In the event that the Accounting Firm determines that an Underpayment
has occurred, any such Underpayment shall be promptly paid by the Company to or
for the benefit of the Executive.
(b) All of the fees and expenses of the Accounting
Firm in performing the determinations referred to in subsection (a) above shall
be borne solely by the Company. The Company agrees to indemnify and hold
harmless the Accounting Firm from any and all claims, damages and expenses
resulting from or relating to its determinations pursuant to subsections (a)
above, except for claims, damages or expenses resulting from the gross
negligence or willful misconduct of the Accounting Firm.
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(c) The limitations of this Section 6.2 shall only
apply if payments under this Agreement are subject to Section 280G at the time
of the Change of Control. If payments under this Agreement would not be subject
to Section 280G if the shareholders of the Company approved the payments, the
Company shall use its commercially reasonable efforts to procure the necessary
shareholder approval of the payments in a timely manner. If the shareholders
approve the payments so that Section 280G does not apply, the Company shall make
payments under this Agreement without regard to this Section 6.2.
6.3. A "Change of Control" shall be deemed to have occurred
if the event set forth in any one of the following paragraphs shall have
occurred:
(a) Any "person" (as such term is used in Sections
13(d) and 14(d) of the Exchange Act other than a person who is a shareholder of
the Company as of the effective date of this Agreement) is or becomes a
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of the Company representing more than 50% of the
combined voting power of the then outstanding securities of the Company, as
determined by the Board of Directors of the Company or
(b) The closing of a merger, consolidation or other
form of business combination of the Company, or any direct or indirect
subsidiary of the Company, with another corporation and the shareholders of the
Company, immediately prior to such transaction, will not beneficially own,
immediately after such transaction, shares of the Company or the surviving
entity or any parent thereof, entitling the shareholders of the Company to vote
more than 50% of all shares of the Company, or the surviving entity or any
parent thereof which would be entitled in the election of directors (without
consideration of the rights of any class of stock to elect directors by a
separate class vote),
(c) The sale or other disposition of all or
substantially all of the assets of the Company, or
(d) A liquidation or dissolution of the Company.
(e) Individuals who are Continuing Directors cease to
constitute a majority of the members of the Board. "Continuing Directors" for
this purpose being the members of the Board on the date of adoption of this
Agreement, provided that any person becoming a member of the Board subsequent to
such date whose election or nomination for election was supported by two-thirds
of the Directors who then comprised the Continuing Directors shall be considered
to be a Continuing Director.
7. Survivorship. The respective rights and obligations of the
parties hereunder shall survive any termination of the Executive's employment
and the Employment Term to the extent necessary to the intended preservation of
such rights and obligations.
8. Settlement of Disputes; Arbitration; Expenses. All claims by
the Executive for benefits under this Agreement shall be directed to and
determined by the Board and shall be in writing. Any denial by the Board of a
claim for benefits under this Agreement shall be delivered to the Executive in
writing and shall set forth the specific reasons for the denial and the specific
provisions of this Agreement relied upon. The Board shall afford a reasonable
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opportunity for a review of the decision denying a claim and shall further allow
to appeal to the Board a decision of the Board within sixty (60) days after
notification by the Board that the Executive's claim has been denied. Any
further dispute under the provisions of this Agreement (other than a dispute in
which the primary relief sought is an equitable remedy such as an injunction)
shall be settled by arbitration in the City of Philadelphia, Pennsylvania in
accordance with the National Rules for the Resolution of Employment Disputes
then in effect of the American Arbitration Association, before a panel of three
arbitrators, two of whom shall be selected by the Company and the Executive,
respectively, and the third of whom shall be selected by the other two
arbitrators. Any award entered by the arbitrators shall be final, binding and
nonappealable and judgment may be entered thereon by either party in accordance
with applicable law in any court of competent jurisdiction. This arbitration
provision shall be specifically enforceable. The arbitrators shall have no
authority to modify any provision of this Agreement or to award a remedy for a
dispute involving this Agreement other than a benefit specifically provided
under or by virtue of the Agreement. If the Executive prevails on any material
issue which is the subject of such arbitration or lawsuit, the Company shall be
responsible for all of the fees of the American Arbitration Association and the
arbitrators and any expenses relating to the conduct of the arbitration as well
as the Executive's reasonable legal fees and expenses. The arbitrators shall, in
any other event, determine who shall pay the Executive's legal fees and
expenses.
9. No Attachment. Except as required by law, no right to receive
payments under this Agreement shall be subject to anticipation, commutation,
alienation, sale, assignment, encumbrance, charge, pledge, or hypothecation or
to execution, attachment, levy, or similar process or assignment by operation of
law, and any attempt, voluntary or involuntary, to effect any such action shall
be null, void and of no effect; provided, however, that nothing in this Section
shall preclude the assumption of such rights by executors, administrators or
other legal representatives of the Executive or her estate and their assigning
any rights hereunder to the person or persons entitled thereto.
10. Source of Payment. All payments provided for under this
Agreement shall be paid in cash from the general funds of the Company. The
Company shall not be required to establish a special or separate fund or other
segregation of assets to assure such payments, and, if the Company shall make
any investments to aid it in meeting its obligations hereunder, the Executive
shall have no right, title or interest whatever in or to any such investments
except as may otherwise be expressly provided in a separate written instrument
relating to such investments. Nothing contained in this Agreement, and no action
taken pursuant to its provisions, shall create or be construed to create a trust
of any kind, or a fiduciary relationship, between the Company and the Executive
or any other person. To the extent that any person acquires a right to receive
payments from the Company hereunder, such right, without prejudice to rights
which employees may have, shall be no greater than the right of an unsecured
creditor of the Company.
11. Notices. All notices and other communications required or
permitted hereunder or necessary or convenient in connection herewith shall be
in writing and shall be deemed to have been given when hand delivered or mailed
by registered or certified mail, as follows (provided that notice of change of
address shall be deemed given only when received):
If to the Company, to:
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Animas Corporation
000 Xxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
If to the Executive, to the address on file with the Company:
or to such other names or addresses as the Company or the Executive, as the case
may be, shall designate by notice to each other person entitled to receive
notices in the manner specified in this Section.
12. Contents of Agreement; Amendment and Assignment.
12.1. This Agreement supersedes all prior agreements and sets
forth the entire understanding between the parties hereto with respect to the
employment of the Executive by the Company (including, without limitation, that
certain Employment Agreement by and between the Company and Executive dated
January 1, 2002) and cannot be changed, modified, extended or terminated except
as provided herein or upon written amendment approved by the Company and
executed on its behalf by a duly authorized officer and by the Executive. This
Agreement does not amend or modify the provisions of any Plans or Incentive
Programs in which the Executive participates or is eligible to participate
except as set forth in Sections 1.7 and 5.2(b)(iii) and (v) hereof.
12.2. All of the terms and provisions of this Agreement shall
be binding upon and inure to the benefit of and be enforceable by the respective
heirs, executors, administrators, legal representatives, successors and assigns
of the parties hereto, except that the duties and responsibilities of the
Executive hereunder are of a personal nature and shall not be assignable or
delegatable in whole or in part by the Executive. The Company shall require any
successor (whether direct or indirect, by purchase, merger, consolidation,
reorganization or otherwise) to all or substantially all of the business or
assets of the Company, by agreement in form and substance satisfactory to the
Executive, expressly to assume and agree to perform this Agreement in the same
manner and to the extent the Company would be required to perform if no such
succession had taken place.
13. Severability. If any provision of this Agreement or
application thereof to anyone or under any circumstances is adjudicated to be
invalid or unenforceable in any jurisdiction, such invalidity or unenforceabiity
shall not affect any other provision or application of this Agreement which can
be given effect without the invalid or unenforceable provision or application
and shall not invalidate or render unenforceable such provision or application
in any other jurisdiction. If any provision is held void, invalid or
unenforceable with respect to particular circumstances, it shall nevertheless
remain in full force and effect in all other circumstances.
14. Remedies Cumulative; No Waiver. No remedy conferred upon a
party by this Agreement is intended to be exclusive of any other remedy, and
each and every such remedy shall be cumulative and shall be in addition to any
other remedy given hereunder or now or hereafter existing at law or in equity.
No delay or omission by a party in exercising any right,
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remedy or power hereunder or existing at law or in equity shall be construed as
a waiver thereof, and any such right, remedy or power may be exercised by such
party from time to time and as often as may be deemed expedient or necessary by
such party in its sole discretion.
15. Beneficiaries/References. The Executive shall be entitled, to
the extent permitted under any applicable law, to select and change a
beneficiary or beneficiaries to receive any compensation or benefit payable
hereunder following the Executive's death by giving the Company written notice
thereof. In the event of the Executive's death or a judicial determination of
her incompetence, references in this Agreement to the Executive shall be deemed,
where appropriate, to refer to her beneficiary, estate or other legal
16. Miscellaneous. All section headings used in this Agreement are
for convenience only. This Agreement may be executed in counterparts, each of
which is an original. It shall not be necessary in making proof of this
Agreement or any counterpart hereof to produce or account for any of the other
counterparts.
17. Withholding. The Company may withhold from any payments under
this Agreement all federal, state and local taxes as the Company is required to
withhold pursuant to any law or governmental rule or regulation. The Executive
shall bear all expense of, and be solely responsible for, all federal, state and
local taxes due with respect to any payment received hereunder except as
otherwise provided with respect to her restricted stock award.
18. Governing Law. This Agreement shall be governed by and
interpreted under the laws of the Commonwealth of Pennsylvania without giving
effect to any conflict of laws provisions.
IN WITNESS WHEREOF, the undersigned, intending to be legally bound,
have executed this Agreement as of the date first above written.
ANIMAS CORPORATION
By: /s/ Xxxxxxx X. Xxxxx
-----------------------------------
Xxxxxxxxx X. Xxxxxxxx
By: /s/ Xxxxxxxxx X. Xxxxxxxx
-----------------------------------
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