CLEVELAND BIOLABS, INC. EMPLOYMENT AGREEMENT
CLEVELAND
BIOLABS, INC.
THIS
EMPLOYMENT AGREEMENT (the “Agreement”),
made
as of this 1st day of June, 2005, is entered into by Cleveland Biolabs,
Inc., a Delaware corporation with its principal place of business at
00000 Xxxxx Xxx., Xxxxx 00, Xxxxxxxxx, XX 00000 (and together
with its subsidiaries, affiliates, successors or assigns the “Company”),
and
Xx. Xxxxxx Fort, (the “Executive”).
PRELIMINARY
RECITALS
A. The
Company, among other things, is engaged in the business of conducting research
and development of new pharmaceuticals in the field of cancer treatment and
that
provide protection for cells against harmful radiation (the “Business”).
B. The
Company and Executive desire to formally state the terms of employment with
the
Company in this Agreement as Vice-President
of Drug Development as
described and incorporated in this agreement as Exhibit E (Job
Description).
NOW,
THEREFORE,
in
consideration of the premises, the mutual covenants of the parties hereinafter
set forth and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto hereby agree as
follows:
1. Employment.
1.1 Engagement;
Duties and Powers.
The
Company agrees to employ Executive, and Executive agrees to accept employment
with the Company, as Vice-President
of Drug Development
for the
Term and in accordance with the terms and conditions of this Agreement. During
the Term, Executive shall serve as the Company’s Vice-President
of Drug Development
and
shall have such responsibilities, duties and authorities, and shall render
such
services of an executive and administrative character or act in such other
capacity for the Company and its affiliates, as Chief Executive Officer shall
from time to time lawfully direct. Executive shall perform the duties and carry
out the responsibilities assigned to him (outlined
in Exhibit _E_),
to the
best of his ability, in a trustworthy, businesslike and efficient manner for
the
purpose of advancing the business of the Company. Executive acknowledges that
his duties and responsibilities hereunder will require his full business time
and effort and agrees that, during the Term, he will not engage in any other
business activity or have any business pursuits or interests which materially
interfere or conflict with the performance of his duties hereunder. Executive
may accept positions on grant panels, boards of Directors of other companies,
or
act as a consultant for compensation with the permission of the Board of
Directors of Cleveland Biolabs.
1.2 Term.
The
engagement of Executive under this Agreement shall begin on the date hereof
and
shall continue through and until December 31, 2008 (the “Initial
Period”)
unless
extended as provided in this Section 1.2.
Thereafter, the term of this Agreement shall automatically renew and extend
for
additional consecutive one-year periods (“Renewal
Periods”)
unless
one of the parties shall deliver a written notice of termination to the other
party at least sixty (60) days prior to the expiration of the Initial Period
or
any Renewal Period. The Initial Period through the then current Renewal Period,
if any, is hereinafter referred to as the “Term.”
Notwithstanding anything to the contrary contained herein, the Term is subject
to termination pursuant to Section 1.3.
1.3 Termination.
(a) If
Executive dies during the Term, this Agreement shall automatically terminate
on
the date of Executive’s death.
(b) The
Company may terminate Executive’s employment hereunder upon written notice to
Executive at any time (i) due to the Permanent Disability of Executive as
determined in Section 1.3(d)
or
(ii) for Cause or without Cause, for any or no reason. Such termination
shall be effective 60 days after the date of service of such notice pursuant
to
Section 14.6.
For
purposes of this Agreement, “Cause”
means
the occurrence of any of the following events, as determined in the reasonable
good faith judgment of CEO or the Board of Directors of Cleveland
Biolabs:
(i) the
failure of Executive to perform his duties hereunder which continues for thirty
(30) days after CEO or the Board has given written notice to Executive,
specifying in reasonable detail the manner in which Executive has failed to
perform such duties or comply with such directions;
(ii) the
determination by CEO or the Board of Directors of Cleveland Biolabs in the
exercise of its reasonable judgment that Executive has committed an act or
acts
constituting (a) a felony, (b) dishonesty or disloyalty with respect
to the Company or (c) fraud (in the case of felony or fraud, the judgment
by the Board of Directors of Cleveland Biolabs will be rendered only after
the
Executive has been found guilty of the offense in a court of law with competent
and legal jurisdiction. In the case of accusations of dishonesty or disloyalty,
judgment by the Board of Directors of Cleveland Biolabs will be rendered only
after review by independent arbitration as described in Section 13
of this
agreement);
(iii) the
determination by CEO or the Board of Directors of Cleveland Biolabs in the
exercise of its reasonable judgment that Executive has committed an act, or
has
failed to take action, which act or failure to take action (a) adversely
affects the Company’s business or reputation or (b) indicates alcohol abuse
or drug use by Executive that adversely affects his performance of the essential
job functions hereunder;
(iv) the
breach, non-performance or non-observance of any of the terms of this Agreement
(other than as described in clause (i) above) or any other agreement to
which Executive and the Company are parties, by Executive, if such breach,
non-performance or non-observance shall continue beyond a period of
ten (10) business days immediately after written notice thereof by the
Chief Executive Officer (CEO) of the Company to Executive; or
(v) notwithstanding
clause (iv)
above, any breach of the Restrictive Covenants.
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(c) Executive
may terminate and resign from his Employment hereunder upon not less than sixty
(60) days prior written notice to the Company.
(d) Determination
of Permanent Disability: Executive shall be deemed to have a “Permanent
Disability”
for
purposes of this Agreement if he suffers a physical or mental illness, injury
or
infirmity that prevents him from performing, with or without reasonable
accommodations, his essential job functions under this Agreement, for a total
period of 120 days in any 360-day period. The determination of permanent
disability by the Board of Directors of Cleveland Biolabs shall be based on
written documentation provided by the Executive’s personal
physician.
2. Compensation
and Benefits.
2.1 Base
Salary.
As
consideration for the services of Executive hereunder, the Company shall pay
Executive an annual base salary of $199,000 (the “Base
Salary”),
payable in accordance with the Company’s customary payroll practices as in
effect from time to time. Notwithstanding the foregoing, during the period
beginning on and including January 1, 2006 and for each year during the
Term thereafter, the Board of Directors of Cleveland BioLabs, in its sole
discretion, may elect to cause the Company to increase the Executive’s Base
Salary by an amount to be determined by the Board in its sole judgment based
upon Executive’s and the Company’s performance and the achievement of the other
goals and objectives approved by the Board for such year. Cost of living
adjustment (as defined by U.S. government Bureau of Labor Statistics, Urban
Wage
Earners & Clerical Workers, CPI Chicago All Items, 1982-1984=00),
will be provided at the end of each calendar year of the initial contact period
(3 years) regardless of other salary adjustment decisions of the
Company.
2.2 Discretionary
Bonus.
Following the end of each fiscal year the CEO, in its sole discretion, may
elect
to cause the Company to award to Executive a bonus up to 15% (the “Discretionary
Bonus”)
of the
Executive’s then current base salary. A metrics for the bonus will be developed
in the first 3 months of employment based upon Executive’s and the Company’s
performance. Such Discretionary Bonus shall be payable as determined by the
CEO
and only if Executive is employed by the Company as of the date such
Discretionary Bonus is paid.
2.3 Incentive
Stock.
A
Restricted Stock Agreement will be executed between Cleveland BioLabs and
Executive granting approximately 2% of the outstanding shares (or options)
of
the company at the time of employment (190,000 units) with 0.5% vesting upon
execution of the Restricted Stock Agreement and the remainder vesting at 1-year
intervals over a 3-year period. The Restricted Stock Agreement is incorporated
herein to this Employment Agreement by reference.
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2.4 Compensation
After Termination.
(a) If
Executive is terminated by the Company for Cause or resigns, then the Company
shall have no further obligations hereunder or otherwise with respect to
Executive’s employment hereunder from and after the date of said termination
(except payment of the Base Salary and other amounts owed to Executive for
reimbursable business expenses accrued through the date of said termination),
and the Company shall continue to have all other rights available hereunder
(including, without limitation, all rights under the Restrictive Covenants
at
law or in equity).
(b) If
Executive is terminated by the Company without Cause, Executive shall be
entitled to receive as severance pay an amount equal to the Base Salary that
would otherwise have been payable if Executive continued his employment
hereunder, for
a 4-month period.
Such
severance pay will be paid in a lump sum payment within 30 days after
termination of employment with Company. In addition, health and life insurance
benefits of the Executive will continue for 1 year period. The Company shall
have no other obligations hereunder or otherwise with respect to Executive’s
employment from and after the termination date, and the Company shall continue
to have all other rights available hereunder (including, without limitation,
all
rights under the Restrictive Covenants at law or in equity).
(c) If
Executive is terminated due to Permanent Disability or death, Executive or
Executive’s estate, as the case may be, shall be entitled to receive as
severance pay an amount equal to the Base Salary that would otherwise have
been
payable if Executive continued his employment hereunder for the period that
otherwise would be remaining in the Term (without any further adjustment as
described in Section 2.1),
payable in accordance with the Company’s payroll policies. Notwithstanding the
foregoing, in the event Executive is Permanently Disabled or dies as a result
of
or in the conduct of his employment activities hereunder, then Executive or
Executive’s estate, as the case may be, shall be entitled to receive severance
pay in an amount equal to the Base Salary that would otherwise have been payable
if Executive continued his employment hereunder (without any further adjustment
as described in Section 2.1)
for a
period of not less than eighteen (18) months, payable in accordance with the
Company’s payroll policies. The Company shall have no other obligations
hereunder or otherwise with respect to Executive’s employment from and after the
termination date, and the Company shall continue to have all other rights
available hereunder (including, without limitation, all rights under the
Restrictive Covenants at law or in equity).
(d) Profit
Sharing, Pension and Salary Deferral Benefits.
It is
understood by the parties to this Agreement that, during the Term, Executive
shall be entitled to participate in or accrue benefits under any pension, salary
deferral or profit sharing plan now existing or hereafter created for employees
of the Company upon terms and conditions equivalent to those which the Company
may provide for other key management employees (VP rank and
higher).
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2.5 Fringe
Benefits and Expenses During the Term.
(a) Executive
shall be eligible to participate in any benefit plans maintained by the Company
for its key management employees from time to time, including, without
limitation, group life, disability and medical insurance in accordance with
such
plans as from time to time in effect and applicable to key management employees
of the Company.
(b) Executive
shall be entitled to three weeks paid vacation per year for the first year,
and
four weeks paid vacation per year thereafter, earned pro rata during his
employment, to be taken at such times as may be approved by the Chief Executive
Officer. Such approval will not be unreasonably withheld or delayed. The maximum
vacation pay that may accrue is four weeks (“Vacation
Cap”).
When
Executive accrues four weeks of vacation, no further vacation will accrue until
he uses vacation time and reduces the accrued vacation time below the vacation
cap. He will then accrue vacation time until the vacation cap of four weeks
is
reached.
(c) The
Company shall provide Executive sick days on substantially the same terms as
offered to other key management employees.
(d) The
Company shall reimburse Executive for all ordinary, necessary and reasonable
travel and other business expenses incurred by him in connection with the
performance of his duties hereunder. Such reimbursement shall be made upon
presentation of itemized expense statements and such other supporting
documentation as the Company may reasonably require.
2.6 Taxes,
etc.
All
compensation payable to Executive hereunder is stated in gross amount and shall
be subject to all applicable withholding taxes, other normal payroll and any
other amounts required by law to be withheld.
3. Confidentiality.
3.1 Company
Information.
Executive agrees at all times during the term of my employment and thereafter,
to hold in strictest confidence, and not to use, except for the benefit of
the
Company, or to disclose to any person, firm or corporation without written
authorization of the CEO any Confidential Information of the Company, except
under a non-disclosure agreement duly authorized and executed. Executive
understands that “Confidential Information” means any non-public information
that relates to the actual or anticipated business or research and development
of the Company, technical data, trade secrets or know-how, including, but not
limited to, research, product plans or other information regarding Company’s
products or services and markets therefore, customer lists and customers
software, developments, inventions, processes, formulas, technology, designs,
drawings, engineering, hardware configuration information, marketing, finances
or other business information. Executive further understands that Confidential
Information does not include any of the foregoing items which have become
publicly known and made generally available through no wrongful act of mine
or
of others who were under confidentiality obligations as to the item or items
involved or improvements or new versions thereof.
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3.2 Former
Employer Information.
Executive agrees that be will not, during my employment with the Company,
improperly use or disclose any proprietary information or trade secrets of
any
former or concurrent employer or other person or entity and that Executive
will
not bring onto the premises of the Company any unpublished document or
proprietary information belonging to any such employer, person or entity unless
consented to in writing by such employer, person or entity.
3.3 Third
Party Information.
Executive recognizes that the Company has received and in the future will
receive from third parties their confidential or proprietary information subject
to a duty on the Company’s part to maintain the confidentiality of such
information and to use it only for certain limited purposes. Executive agrees
to
hold all such confidential or proprietary information in the strictest
confidence and not to disclose it to any person, firm or corporation or to
use
it except as necessary in carrying out my work for the Company consistent with
the Company’s agreement with such third party.
4. Inventions.
4.1 Inventions
Retained and Licensed.
Executive has attached hereto, as Exhibit A,
a list
describing all inventions, original works of authorship, developments,
improvements, and trade secrets which were made prior to his employment with
the
Company (collectively referred to as “Prior
Inventions”),
which
belong to Executive, which relate to the Company’s proposed business, products
or research and development, and which are not assigned to the Company
hereunder; or, if no such list is attached, Executive represents that there
are
no such Prior Inventions. If in the course of Executive’s employment with the
Company, Executive incorporates into a Company product, process or service
a
Prior Invention owned by Executive or in which Executive has an interest,
Executive hereby grants to the Company a nonexclusive, royalty-free, fully
paid-up, irrevocable, perpetual, worldwide license to make, have made, modify,
use and sell such Prior Invention as part of or in connection with such product,
process or service, and to practice any method related thereto.
4.2 Assignment
of Inventions.
Executive agrees that he will promptly make full written disclosure to the
Company, will hold in trust for the sole right and benefit of the Company,
and
hereby assign to the Company, or its designee, all my right, title, and interest
in and to any and all inventions, original works of authorship, developments,
concepts, improvements, designs, discoveries, ideas, trademarks or trade
secrets, whether or not patentable or registrable under copyright or similar
laws, which relate to the field of the Company stated in Preliminary
Recital A and which Executive may solely or jointly conceive or develop or
reduce to practice, or cause to be conceived or developed or reduced to
practice, during the period of time Executive is in the employ of the Company
(collectively referred to as “Inventions”).
Executive further acknowledges that all original works of authorship which
are
made by me (solely or jointly with others) within the scope of and during the
period of my employment with the Company and which are protectible by copyright
are “works made for hire,” as that term is defined in the United States
Copyright Act. Executive understands and agrees that the decision whether or
not
to commercialize or market any invention developed by me solely or jointly
with
others is within the Company’s sole discretion and for the Company’s sole
benefit and that no royalty will be due to him as a result of the Company’s
efforts to commercialize or market any such invention.
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4.3 Inventions
Assigned to the United States.
Executive agrees to assign to the United States government all my right, title,
and interest in and to any and all Inventions required by Section 4.2
above
whenever such full title is required to be in the United States by a contract
between the Company and the United States or any of its agencies.
4.4 Maintenance
of Records.
Executive agrees to keep and maintain adequate and current written records
of
all Inventions made by me (solely or jointly with others) during the term and
as
part the normal duties of my employment with the Company. The records will
be in
the form of notes, sketches, drawings, and any other format that may be
specified by the Company. The records will be available to and remain the sole
property of the Company at all times.
4.5 Patent
and Copyright Registrations.
Executive agrees to assist the Company, or its designee, at the Company’s
expense, in every proper way to secure the Company’s rights in the above
mentioned (Section 4.2)
Inventions and any copyrights, patents, mask work rights or other intellectual
property rights relating thereto in any and all countries, including the
disclosure to the Company of all pertinent information and data with respect
thereto, the execution of all applications, specifications, oaths, assignments
and all other instruments which the Company shall deem necessary in order to
apply for and obtain such rights and in order to assign and convey to the
Company, its successors, assigns, and nominees the sole and exclusive rights,
title and interest in and to such Inventions, and any copyrights, patents,
mask
work rights or other intellectual property rights relating thereto. Executive
further agree that my obligation to execute or cause to be executed, when it
is
in my power to do so, any such instrument or papers shall continue after the
termination of this Agreement. If the Company is unable because of my mental
or
physical incapacity or for any other reason to secure my signature to apply
for
or to pursue any application for any United States or foreign patents or
copyright registrations covering inventions or original works of authorship
assigned to the Company as above, then Executive hereby irrevocably designates
and appoints the Company and its duly authorized officers and agents as his
agent and attorney in fact, to act for and in his behalf and stead to execute
and file any such applications and to do all other lawfully permitted acts
to
further the prosecution and issuance of letters patent or copyright
registrations thereon with the same legal force and effect as if executed by
him.
5. Conflicting
Employment.
Executive agrees that, during the term of his employment with the Company,
Executive will not engage in any other employment, occupation or consulting
directly related to the business in which the Company is now involved or becomes
involved during the term of my employment, nor will Executive engage in any
other activities that conflict with my obligations to the Company, unless
written consent is given by the Board of Directors of the Company.
6. Returning
Company Documents.
Executive agrees that, at the time of leaving the employ of the Company, he
will
deliver to the Company (and will not keep in his possession, recreate or deliver
to anyone else) any and all devices, records, data, notes, reports, proposals,
lists, correspondence, specifications, drawings, blueprints, sketches,
materials, equipment, other documents or property, or reproductions of any
aforementioned items developed by Executive pursuant to his employment with
the
Company or otherwise belonging to the Company, its successors or assigns,
including, without limitation, those records maintained pursuant to
paragraph 4.4. In the event of the termination of Executive’s employment,
Executive agrees to sign and deliver the ‘Termination
Certification”
attached hereto as Exhibit B.
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7. Notification
of New Employer.
In the
event that Executive leaves the employ of the Company, Executive hereby grants
consent to notification by the Company to my new employer about my rights and
obligations under this Agreement.
8. Solicitation
of Employees
Executive agrees that for a period of twelve (12) months immediately following
the termination of my relationship with the Company for any reason, whether
with
or without cause, Executive shall not either directly or indirectly solicit,
induce, recruit or encourage any of the Company’s employees to leave their
employment, or take away such employees, or attempt to solicit, induce, recruit,
encourage or take away employees of the Company, either for myself or for any
other person or entity.
9. Non-Competition.
Executive agrees that during the period of employment and for a period of
two (2) year immediately following the termination of his relationship with
the Company for any reason, whether with or without cause, Executive shall
not
directly or indirectly own, manage, operate, consult or to be employed in a
business substantially similar to or competitive with, the present business
of
the Company and its successors and assigns or such other business activity
in
which the Company and its successors and assigns may substantially engage during
the term of employment (bio-defense and anti-cancer drug development employing
concepts of apoptosis).
10. Conflict
of Interest Guidelines.
Executive agrees to diligently adhere to the Conflict of Interest Guidelines
attached as Exhibit C
hereto.
11. Representations.
Executive agrees to execute any proper oath or verify any proper document
required to carry out the terms of this Agreement. Executive represents that
his
performance of all the terms of this Agreement will not breach any agreement
to
keep in confidence proprietary information acquired by Executive in confidence
or in trust prior to Executive’s employment by the Company. Executive hereby
represents and warrants that Executive has not entered into, and Executive
will
not enter into, any oral or written agreement in conflict herewith.
12. Policy
Manual.
Executive agrees that he is responsible for knowing the contents of the
Company’s Policy Manual (when developed), the contents of which may be modified
or eliminated at any time.
13. Arbitration
and Equitable Relief.
13.1 Arbitration.
IN
CONSIDERATION OF EXECUTIVE EMPLOYMENT WITH THE COMPANY, ITS PROMISE TO ARBITRATE
ALL EMPLOYMENT-RELATED DISPUTES AND EXECUTIVE RECEIPT OF THE COMPENSATION,
PAY
RAISES, AND OTHER BENEFITS PAID TO EXECUTIVE BY THE COMPANY, AT PRESENT AND
IN
THE FUTURE, EXECUTIVE AGREES THAT ANY AND ALL CONTROVERSIES, CLAIMS OR DISPUTES
WITH ANYONE (INCLUDING THE COMPANY AND ANY EMPLOYEE, OFFICER, DIRECTOR,
SHAREHOLDER OR BENEFIT PLAN OF THE COMPANY IN THEIR CAPACITY AS SUCH OR
OTHERWISE) ARISING OUT OF, RELATING TO, OR RESULTING FROM EXECUTIVE EMPLOYMENT
WITH THE COMPANY OR THE TERMINATION OF EXECUTIVE EMPLOYMENT WITH THE COMPANY,
INCLUDING ANY BREACH OF THIS AGREEMENT, SHALL BE SUBJECT TO ARBITRATION UNDER
THE RULES OF THE AMERICAN ARBITRATION ASSOCIATION. DISPUTES WHICH EXECUTIVE
AGREES TO ARBITRATE, AND THEREBY AGREES TO WAIVE ANY RIGHT TO A TRIAL BY JURY,
INCLUDE ANY STATUTORY CLAIMS UNDER STATE OR FEDERAL LAW, INCLUDING, BUT NOT
LIMITED TO, CLAIMS UNDER TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, THE
AMERICANS WITH DISABILITIES ACT OF 1990, THE AGE DISCRIMINATION IN EMPLOYMENT
ACT OF 1967 OR THE OLDER WORKERS BENEFIT PROTECTION ACT. EXECUTIVE FURTHER
UNDERSTANDS THAT THIS AGREEMENT TO ARBITRATE ALSO APPLIES TO ANY DISPUTES THAT
THE COMPANY MAY HAVE WITH EXECUTIVE.
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13.2 Procedure.
EXECUTIVE AGREES THAT ANY ARBITRATION WILL BE ADMINISTERED BY THE AMERICAN
ARBITRATION ASSOCIATION (“AAA”)
AND
THAT THE NEUTRAL ARBITRATOR WILL BE SELECTED IN A MANNER CONSISTENT WITH ITS
NATIONAL RULES FOR THE RESOLUTION OF EMPLOYMENT DISPUTES. EXECUTIVE AGREES
THAT
THE ARBITRATOR SHALL HAVE THE POWER TO DECIDE ANY MOTIONS BROUGHT BY ANY PARTY
TO THE ARBITRATION, INCLUDING MOTIONS FOR SUMMARY JUDGMENT AND/OR ADJUDICATION
AND MOTIONS TO DISMISS AND DEMURRERS, PRIOR TO ANY ARBITRATION HEARING.
EXECUTIVE ALSO AGREES THAT THE ARBITRATOR SHALL HAVE THE POWER TO AWARD ANY
REMEDIES, INCLUDING ATTORNEYS’ FEES AND COSTS, AVAILABLE UNDER APPLICABLE LAW.
EXECUTIVE UNDERSTANDS THE COMPANY WILL PAY FOR ANY ADMINISTRATIVE OR HEARING
FEES CHARGED BY THE ARBITRATOR OR AAA EXCEPT THAT EXECUTIVE SHALL PAY THE FIRST
$125.00 OF ANY FILING FEES ASSOCIATED WITH ANY ARBITRATION EXECUTIVE INITIATES.
EXECUTIVE AGREES THAT THE ARBITRATOR SHALL ADMINISTER AND CONDUCT ANY
ARBITRATION IN A MANNER CONSISTENT WITH THE AAA’S RULES AND THAT TO THE EXTENT
THAT THE AAA’S NATIONAL RULES FOR THE RESOLUTION OF EMPLOYMENT DISPUTES CONFLICT
WITH THE RULES, THE RULES SHALL TAKE PRECEDENCE. EXECUTIVE AGREES THAT THE
DECISION OF THE ARBITRATOR SHALL BE IN WRITING.
13.3 Remedy.
If
after both parties have executed reasonable, good faith efforts to reach
agreement through the arbitration process, either party concludes that the
outcome is not acceptable, further remedy may then be pursued via the court
system.
13.4 Availability
of Injunctive Relief.
IN
ADDITION TO THE RIGHT UNDER THE RULES TO PETITION THE COURT FOR PROVISIONAL
RELIEF, EXECUTIVE AGREES THAT ANY PARTY MAY ALSO PETITION THE COURT FOR
INJUNCTIVE RELIEF WHERE EITHER PARTY ALLEGES OR CLAIMS A VIOLATION OF THIS
EMPLOYMENT AGREEMENT BETWEEN EXECUTIVE AND THE COMPANY OR ANY OTHER AGREEMENT
REGARDING TRADE SECRETS, CONFIDENTIAL INFORMATION OR NONSOLICITATION. EXECUTIVE
UNDERSTANDS THAT ANY BREACH OR THREATENED BREACH OF SUCH AN AGREEMENT WILL
CAUSE
IRREPARABLE INJURY AND THAT MONEY DAMAGES WILL NOT PROVIDE AN ADEQUATE REMEDY
THEREFOR AND BOTH PARTIES HEREBY CONSENT TO THE ISSUANCE OF AN INJUNCTION.
IN
THE EVENT EITHER PARTY SEEKS INJUNCTIVE RELIEF, THE PREVAILING PARTY SHALL
BE
ENTITLED TO RECOVER REASONABLE COSTS AND ATTORNEYS FEES.
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13.5 Administrative
Relief.
EXECUTIVE UNDERSTANDS THAT THIS AGREEMENT DOES NOT PROHIBIT HIM FROM PURSUING
AN
ADMINISTRATIVE CLAIM WITH A LOCAL, STATE OR FEDERAL ADMINISTRATIVE BODY SUCH
AS
THE DEPARTMENT OF FAIR EMPLOYMENT AND HOUSING, THE EQUAL EMPLOYMENT OPPORTUNITY
COMMISSION OR THE WORKERS’ COMPENSATION BOARD.
13.6 Voluntary
Nature of Agreement.
EXECUTIVE ACKNOWLEDGES AND AGREES THAT HE IS EXECUTING THIS AGREEMENT
VOLUNTARILY AND WITHOUT ANY DURESS OR UNDUE INFLUENCE BY THE COMPANY OR ANYONE
ELSE. EXECUTIVE FURTHER ACKNOWLEDGES AND AGREES THAT HE HAS CAREFULLY READ
THIS
AGREEMENT AND THAT HE HAS ASKED ANY QUESTIONS NEEDED FOR HIM TO UNDERSTAND
THE
TERMS, CONSEQUENCES AND BINDING EFFECT OF THIS AGREEMENT AND FULLY UNDERSTAND
IT, FINALLY, EXECUTIVE AGREES THAT HE HAS BEEN PROVIDED AN OPPORTUNITY TO SEEK
THE ADVICE OF AN ATTORNEY OF HIS CHOICE BEFORE SIGNING THIS
AGREEMENT.
14. Miscellaneous.
14.1 Income
Tax Treatment.
Executive and the Company acknowledge that it is the intention of the Company
to
deduct all amounts paid under Section 2
hereof
as ordinary and necessary business expenses for income tax purposes. Executive
agrees and represents that he will treat all amounts paid hereunder as ordinary
income (except for expense reimbursement) for income tax purposes.
14.2 Assignment.
Executive may not assign any of his rights or obligations hereunder without
the
written consent of the Company. Except as otherwise expressly provided herein,
all covenants and agreements contained in this Agreement by or on behalf of
any
of the parties hereto shall bind and inure to the benefit of the respective
successors and assigns of the parties hereto whether so expressed or
not.
14.3 Severability.
Whenever possible, each provision of this Agreement shall be interpreted in
such
manner as to be effective and valid under applicable law, but if any provision
of this Agreement is held to be prohibited by or invalid under applicable law,
such provision shall be ineffective only to the extent of such prohibition
or
invalidity without invalidating the remainder of this Agreement.
14.4 Counterparts.
This
Agreement may be executed in multiple counterparts, each of which shall be
deemed an original, but all of which taken together shall constitute one and
the
same Agreement.
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14.5 Descriptive
Headings; Interpretation.
The
descriptive headings in this Agreement are inserted for convenience of reference
only and are not intended to be part of or to affect the meaning or
interpretation of this Agreement. The use of the word “including” in this
Agreement shall be by way of example rather than by limitation.
14.6 Notices.
All
notices, demands or other communications to be given or delivered under or
by
reason of the provisions of this Agreement shall be in writing and shall be
deemed to have been duly given if (i) delivered personally to the
recipient, (ii) sent to the recipient by reputable express courier service
(charges prepaid) or mailed to the recipient by certified or registered mail,
return receipt requested and postage prepaid, or (iii) transmitted by
telecopy to the recipient with a confirmation copy to follow the next day to
be
delivered by overnight carrier. Such notices, demands and other communications
shall be sent to the addresses indicated below:
To
the Company:
|
Cleveland
BioLabs, Inc.
|
_________________________________ |
_________________________________ |
Attention: Chief
Executive Officer
|
Facsimile: _____________________ |
with
a copy to:
|
Xxxxxx
Xxxxxx Xxxxx Xxxxxxxx LLP
|
000 Xxxx Xxxxxx Xxxxxx |
Xxxxxxx. XX 00000-0000 |
Attention: Xxxx X. Xxxxxxx, Esq. |
Facsimile: (000) 000-0000 |
To
Executive:
|
Farrel Fort |
x000 Xxxxx Xx. |
Xxxxxxxxxxxx, XX 00000 |
Facsimile: _____________________ |
with
a copy to:
|
Xxxxxxxx
& Xxxxx
|
0000 Xxxxx Xxxxxxx Xxxxxx |
Xxxx Xxxxxx, XX 00000 |
Attention: Xxxx Xxxxxxxx |
Facsimile:
(000)
000-0000
|
or
to
such other address or to the attention of such other person as the recipient
party shall have specified by prior written notice to the sending party. Date
of
service of such notice shall be (w) the date such notice is personally
delivered, (x) three days after the date of mailing if sent by certified or
registered mail, (y) one day after the date of delivery to the overnight
courier if sent by overnight courier or (z) the next business day after the
date of transmittal by telecopy.
14.7 Preamble;
Preliminary Recitals.
The
Preliminary Recitals set forth in the Preamble hereto are hereby incorporated
and made part of this Agreement.
14.8 Entire
Agreement.
Except
as otherwise expressly set forth herein, this Agreement, including
Exhibits A, B, C, D, and E and the Restricted Stock Agreement mentioned in
Section 2.3.
sets
forth the entire understanding of the parties, and supersedes and preempts
all
prior oral or written understandings and agreements with respect to the subject
matter hereof.
11
14.9 Governing
Law.
This
Agreement shall be construed and enforced in accordance with, and all questions
concerning the construction, validity, interpretation and performance of this
Agreement shall be governed by, the laws of the State of Ohio without giving
effect to provisions thereof regarding conflict of laws.
14.10 No
Strict Construction.
The
language used in this Agreement will be deemed to be the language chosen by
the
parties hereto to express their mutual intent, and no rule of strict
construction will be applied against any party hereto.
14.11 Amendment
and Waivers.
Any
provisions of the Agreement may be amended or waived only with the prior written
consent of the Company and Executive.
12
Date: June 1, 2005 |
|
||
/s/ Xxxxxx X. Fort | |||
Signature
|
|||
Xxxxxx
X. Fort, Ph.D.,
MBA, DABT
Name
of Executive (typed or printed)
|
CLEVELAND
BIOLABS, INC.
|
|||
/s/ Xxxxxxx Xxxxxxxx | |||
By: Xxxxxxx
Xxxxxxxx
|
|||
Its: CEO
|
13
Exhibit
A
LIST
OF PRIOR INVENTIONS
AND
ORIGINAL WORKS OF AUTHORSHIP
Title
|
Date
|
Identifying
Number
or
Brief Description
|
||
__X_ No
inventions or improvements
____ Additional
Sheets Attached
Signature
of Executive: /s/
Xxxxxx X. Fort
Print
Name of Executive: Xxxxxx
X. Fort
Date:
June
1, 2005
Exhibit
A-1
Exhibit
B
CLEVELAND
BIOLABS, INC.
TERMINATION
CERTIFICATION
This
is
to certify that the undersigned does not have in my possession, nor have I
failed to return, any devices, records, data, notes, reports, proposals, lists,
correspondence, specifications, drawings, blueprints, sketches, materials,
equipment, other documents or property, or reproductions of any aforementioned
items belonging to Cleveland BioLabs, Inc., its subsidiaries, affiliates,
successors or assigns (together, the “Company”).
I
further
certify that I have complied with all the terms of the Company’s Employment
Agreement signed by me, including the reporting of any inventions and original
works of authorship (as defined therein), conceived or made by me (solely or
jointly with others) covered by that agreement.
I
further
agree that, in compliance with the Employment Agreement, I will preserve as
confidential all trade secrets, confidential knowledge, data or other
proprietary information relating to products, processes, know-how, designs,
formulas, developmental or experimental work, computer programs, data bases,
other original works of authorship, customer lists, business plans, financial
information or other subject matter pertaining to any business of the Company
or
any of its employees, clients, consultants or licensees.
I
further
agree that for twelve (12) months from this date, I will not solicit, induce,
recruit or encourage any of the Company’s employees to leave their
employment.
I
further
agree that for twelve (12) months from this date I will not directly or
indirectly own, manage, operate, consult or to be employed in a business
substantially similar to, or competitive with, the present business of the
Company and its successors and assigns or such other business activity in which
the Company and its successors and assigns may substantially engage during
the
term of employment.
Date:
__________________
(Employee’
Signature)___________________
_______________________________
(Type/Print
Employee’s Name)
Exhibit
B-1
Exhibit
C
CLEVELAND
BIOLABS, INC.
CONFLICT
OF INTEREST GUIDELINES
It
is the
policy of Cleveland BioLabs, Inc. to conduct its affairs in strict compliance
with the letter and spirit of the law and to adhere to the highest principles
of
business ethics. Accordingly, all officers, employees and independent
contractors must avoid activities which are in conflict, or give the appearance
of being in conflict, with these principles and with the interests of the
Company. The following are potentially compromising situations which must be
avoided. Any exceptions must be reported to the President and written approval
for continuation must be obtained.
1. Revealing
confidential information to outsiders or misusing confidential information.
Unauthorized divulging of information is a violation of this policy whether
or
not for personal gain and whether or not harm to the Company is intended. (The
Employment Agreement elaborates on this principle and is a binding
agreement.)
2. Accepting
or offering substantial gifts, excessive entertainment, favors or payments
which
may be deemed to constitute undue influence or otherwise be improper or
embarrassing to the Company.
3. Participating
in civic or professional organizations that might involve divulging confidential
information of the Company.
4. Initiating
or approving personnel actions affecting reward or punishment of employees
or
applicants where there is a family relationship or is or appears to be a
personal or social involvement.
5. Initiating
or approving any form of personal or social harassment of
employees.
6.
Investing
or holding outside directorship in suppliers, customers, or competing companies,
including financial speculations, where such investment or directorship might
influence in any manner a decision or course of action of the
Company.
7. Borrowing
from or lending to employees, customers or suppliers.
8. Acquiring
real estate of interest to the Company.
9. Improperly
using or disclosing to the Company any proprietary information or trade secrets
of any former or concurrent employer or other person or entity with whom
obligations of confidentiality exist.
10. Unlawfully
discussing prices, costs, customers, sales or markets with competing companies
or their employees.
11. Making
any unlawful agreement with distributors with respect to prices.
Exhibit
C-1
12. Improperly
using or authorizing the use of any inventions which are the subject of patent
claims of any other person or entity.
13. Engaging
in any conduct which is not in the best interest of the Company.
Each
officer, employee and independent contractor must take every necessary action
to
ensure compliance with these guidelines and to bring problem areas to the
attention of higher management for review. Violations of this conflict of
interest policy may result in discharge without warning.
Exhibit
C-2
Exhibit
D
CLEVELAND
BIOLABS, INC.
TRAVEL
ARRANGEMENTS
It
is
understood that primary work location of Dr. Fort is Chicago and he will conduct
his duties staying there most of the time.
It
is
expected that he will be visiting CBL Cleveland location approximately 3
days each 2 weeks. The company will be responsible for transportation, housing
expenses and health insurance during this time.
Attending
various professional conferences is a part of Dr. Fort’s job responsibilities
which will be supported by adequate travel budget.
Exhibit
D-1
Exhibit
E
Cleveland
BioLabs, Inc.
Job
Description
V.P.
Drug Development
Scope:
All
development activities for declared drug candidates intended to meet regulatory,
scientific and commercial requirements for regulatory approval and launch of
new
or improved therapeutics. Specifically, this includes the following functional
responsibilities:
·
|
Preclinical
safety assessment
|
·
|
Formulation
development
|
·
|
Manufacturing
and controls required for drug development and
approval
|
·
|
Clinical
research
|
·
|
Regulatory
affairs
|
This
position also participates in business development and corporate promotional
activities in collaboration with the executive office.
Accountability:
This
position reports to the CEO and is responsible for achieving drug development
milestones for declared drug candidates. Successful milestones will include
critical go/no-go decision points, regulatory submissions and approvals, and
scientific integrity of the data supporting these milestones.
Implementation:
The
above milestones will be achieved utilizing external capacity resources
including licensing partners and collaborators. External resources will be
managed by internal personnel with appropriate expertise. As required by various
drug development projects, the V.P. Drug Development will hire and lead small
expert teams in the above functional areas.
Exhibit
E-1