EXHIBIT 10.20.2
EMPLOYMENT AGREEMENT
This Employment Agreement made as of the 19th day of November, 1996
BY AND BETWEEN:
XXXXXXX PHARMACEUTICAL CORPORATION, a New Jersey Corporation with
offices located at Meridian Center II, 4 Industrial Way West, Eatontown, New
Jersey (hereinafter referred to as "Employer")
AND
Xxxxx X. Xxxxxxx, residing at 00 Xxxxxxx Xxxx, Xxxx Xxxx, Xxx Xxxxxx
00000 (hereinafter referred to as "Employee"):
W I T N E S S E T H:
WHEREAS, Employee has been employed as Vice President, by Employer and
has made and is expected to continue to make material contributions to the
growth and development of Employer; and
WHEREAS, Employer deems it to be in Employer's best interest to assure
Employee continuous employment by Employer; and
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WHEREAS, it is in the best interest of the Employer that Employee remain
focused on the business of the Company in the event of a change of control of
Employer; and
WHEREAS, Employer deems it to be in Employer's best interests to
encourage Employee to remain employed by Employer during a period of uncertainty
concerning ownership of Employer; and
WHEREAS, Employee is willing to continue, and is desirous of continuing,
in the employment of Employer;
NOW THEREFORE, in consideration of the mutual agreements contained
herein and intending to be legally bound, the parties hereto hereby agree as
follows:
ARTICLE 1. CAPACITY AND DUTIES
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1.01 EMPLOYMENT, ACCEPTANCE OF EMPLOYMENT.
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Employer hereby employs Employee and Employee hereby accepts employment by
Employer subject to all the terms and conditions hereafter set forth.
1.02 CAPACITY.
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Employee shall serve as Vice President and Treasurer.
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1.03 DUTIES.
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During the term of this Agreement, Employee shall devote his full attention
and his best efforts to the performance of the customary duties of Vice
President and Treasurer.
ARTICLE 2. TERM OF EMPLOYMENT; TERMINATION
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2.01 TERM.
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Unless earlier terminated as hereafter provided, the term of this Agreement
shall commence on the date first above written (the "Effective Date") and shall
continue through November 19, 1998, and thereafter may be automatically renewed
for successive one (1) year periods on each anniversary of the Effective Date
only upon the mutual agreement of Employer and Employee.
2.02 TERMINATION AFTER CHANGE OF CONTROL.
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In the event of a Change in Control (as hereinafter defined) of Employer,
Employer shall have the right to terminate this Agreement by giving written
notice to Employee specifying the intention to terminate this Agreement and the
effective date for such termination. For purposes of this Article 2, "Change of
Control" shall mean either (i) a merger or consolidation of Employer into
another corporation or a merger of another corporation with or into the
Employer; or (ii) a sale by Employer of substantially all of its assets, which,
in the case of either (i) or (ii) above, results in the shareholders of Employer
(as they existed immediately prior to the effectiveness of the merger,
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consolidation or sale) owning less than fifty percent (50%) of the surviving
entity or new corporation or entity that has acquired substantially all of the
Employer's assets after the effectiveness thereof; or (iii) a reorganization of
Employer which results in either Employer becoming a subsidiary of another
corporation or employer not being the surviving entity (other than a merger or
consolidation (a) with a wholly-owned subsidiary of the Employer; (b) to effect
a change in domicile; or (c) of the Employer into another corporation that does
not result in the shareholders of Employer, as they existed immediately prior to
the effectiveness of such merger or consolidation, owning less than fifty
percent (50%) of the surviving corporation); or (iv) the acquisition by any
person, entity or group of persons or entities acting in concert, of fifty
percent (50%) or more of Employer's then issued and outstanding voting
securities, whether acquired in one transaction or a series of transactions.
2.03 COMPENSATION ON TERMINATION AFTER CHANGE OF CONTROL.
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In the event of any termination of this Agreement by Employer pursuant to
Section 2.02 hereof, Employee shall be entitled to receive, and Employer shall
be obligated to pay, the compensation set forth in Section 3.01 (a) at the
annual rate which Employee is receiving on the date of termination of this
Agreement for a period of two (2) years following the termination date.
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ARTICLE 3. COMPENSATION
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3.01(A) COMPENSATION.
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During the term of this Agreement or any extension thereof, and after
termination of this Agreement as provided in Section 2.02, as compensation for
services to the Employer pursuant to this Agreement, the Employer shall pay to
Employee a minimum base salary of One Hundred Seventy Five Thousand
($175,000) per year and the Board of Directors of Employer may, in its sole
discretion from time to time, increase said base salary to be paid to Employee
as provided in this Article 3 or provide additional compensation to Employee,
including but not limited to incentive compensation based upon the earnings or
performance of Employer or otherwise, in order to recognize and fairly
compensate Employee for the value of his services to Employer.
In addition, Employee shall be entitled to receive all vacation and other
fringe benefits provided by Employer to its employees and officers, including
insurance benefits, which may be established by the Board of Directors of
Employer from time to time. In addition, Employer may provide such other
additional or incentive compensation, benefits or perquisites as its Board of
Directors may from time to time authorize.
3.01(B) INCENTIVE COMPENSATION
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Employer may adopt and maintain a "Management Incentive Compensation Plan."
Should such a plan be adopted by Employer, at all times during the term of this
Agreement, Employee shall be
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designated by Employer as a participant in such plan. In the event that, at any
time during the term of this Agreement, Employer shall rescind, discontinue,
amend or revise such plan, then Employer shall include Employee in any revised
or amended Incentive Plan or substituted plan and Employee shall be entitled to
receive incentive compensation comparable to that offered to other members of
Employer's senior level management thereunder.
3.02 STOCK OPTION PLANS.
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If during the term of this Agreement, Employee's employment is terminated and
such election by Employee is permitted under any stock option plan(s) applicable
to Employee, Employee, or his personal representatives or heirs, shall have the
right during a period of seven (7) months following the Termination Date to
exercise all options previously granted to Employee under all Stock Option Plans
adopted and maintained by Employer as to all or any part of the shares covered
thereby, including shares as to which such options would not otherwise then be
exercisable.
ARTICLE 4 CERTAIN COVENANTS
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4.01 NON-COMPETITION.
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During the term of employment hereunder and, in the event of termination of
this Agreement, for two (2) years thereafter, Employee shall not accept
employment with any employer in direct competition with, nor engage in any
activities in direct competition with, the business of Employer. This Section
4.01
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shall not be applicable to any period after a termination of employment if such
termination was effected by Employer. In addition, this Section 4.01 shall not
prevent Employee from acquiring, as a passive investor, up to 5% of the equity
of a competing enterprise.
ARTICLE 5. MISCELLANEOUS
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5.01 ASSIGNMENT.
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This Agreement shall not be assignable by Employee and shall be assignable
and required to be assigned, by Employer, only to a person, firm or corporation
which may become a successor in interest (by purchase of all or substantially
all of the assets of Employer, merger or otherwise) to Employer ("Successor")
and this Agreement shall be fully binding upon, and the assumed obligation of,
such Successor.
5.02 EMPLOYEE'S ATTORNEY FEES.
-------------------------
In the event that Employee is required to institute legal proceedings against
Employer to enforce this Agreement or any term or provision thereof ("Employee's
Suit") and the Employee's Suit results in a judgment in favor of Employee
against Employer, then Employer hereby agrees that Employer shall pay, either
directly or by reimbursement to Employee, all legal fees and costs incurred by
Employee in the prosecution of Employee's Suit.
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5.03 ENTIRE AGREEMENT.
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This writing represents the entire understanding of the parties and
supersedes any and all other understandings between the parties regarding the
subject matter hereof whether oral or written. This Agreement may not be
altered nor amended in any way except by an agreement in writing signed by both
Employer and Employee.
5.04 BINDING EFFECT.
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Subject to Section 5.01, this Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors, assigns,
heirs, executors and administrators. Any paragraph, sentence, phrase or other
provision of this Agreement which is or becomes in conflict with any applicable
statute, rule or other law shall be deemed, if possible, to be modified or
altered to conform thereto or, if not possible, to be omitted herefrom. If any
provision of this Agreement shall be or become illegal or unenforceable in whole
or in part for any reason whatsoever, the remaining provisions shall
nevertheless be deemed valid, binding and subsisting.
5.05 GOVERNING LAW.
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This Agreement has been negotiated and executed within the State of New
Jersey, and the validity, interpretation and enforcement of this Agreement shall
be governed by the laws of the State of New Jersey.
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5.06 HEADINGS.
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The headings of Sections in this Agreement are for convenience only and form
no part of this Agreement and shall not affect its interpretation.
5.07 NOTICE.
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Notices authorized or required to be sent pursuant to this Agreement shall be
in writing and sent postage prepaid, by United States Certified or Registered
Mail, return receipt requested, directed to the other party at its address as
may be designated by notice from time to time. Notice shall be deemed given on
the date the envelope in which such notice is enclosed, as provided above, is
deposited for mailing in a United States mailbox or post office.
5.08 PAYMENT OF TAXES.
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To the extent that any excise taxes become payable by Employee by virtue of
any payments made or benefits conferred by Employer hereunder, Employer shall be
liable to pay or reimburse Employee for any such taxes or to make any
adjustments hereunder.
5.09 WAIVER OF BREACH.
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The waiver of either party of a breach of any provision of this Agreement
shall not operate nor be construed as a waiver of any subsequent breach thereof
or of any other provision of this Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
XXXXXXX PHARMACEUTICAL CORPORATION
By:/s/Xxxxxx X. Xxxxxxxx
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Xxxxxx X. Xxxxxxxx
Chairman
/s/Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx
Employee
