Exhibit 10(i)
[PharmaKinetics Letterhead appears here]
February 7, 2002
Xx. Xxxxxxx X. Xxxxxxx
0000 Xxxxxxx Xxx Xxxxx
Xxxxxxxx Xxxx, XX 00000
Dear Xxxx:
PharmaKinetics Laboratories, Inc. is pleased to provide to you this severance
agreement in consideration of the services you render to the Company from and
after the date of this Agreement, which the Board of Directors believes are
important to the future growth and prosperity of the Company.
The terms of the agreement follow:
If you are terminated other than for "Just Cause" - hereinafter defined -
at any time during a two (2) year period after a "Significant Transaction"
or a "Change of Board Composition" - each, hereinafter defined - you will
be entitled to a continuance of your annual base salary for six (6) months
from the date of termination. You will also be granted immediate and
accelerated vesting of all stock options (ISOs, NQSOs, and performance
shares). In the event you wish to defer the exercise of these options
beyond the statutory three (3) month period you will have the ability at
your sole discretion to extend the exercise period from no more than
thirty-six (36) months from the date of termination. It is mutually agreed
and understood that the consequences of an extension beyond the three (3)
month period carries ramifications regarding the tax treatment of the
option and the status of the stock provided to you upon exercise (i.e. if
the exercise takes place beyond the three (3) month period the options are
no longer ISOs, the stock may be unregistered and its sale may be subject
to restrictions). Nothing in this agreement shall be deemed to alter the
"at will" nature of your employment by the Company.
"Just Cause" to be defined as a good faith determination by the Company's
Board of personal dishonesty, breach of fiduciary duty involving personal
profit, willful failure to perform stated duties, willful violation of any
law rule or regulation (other than traffic violation or similar offenses).
Xxxxxxx X. Xxxxxxx
February 7, 2002
Page 2
A "Significant Transaction" is defined as any of: (a) the sale of a block
of stock representing greater than 50% or more of the combined voting power
of the Company's then outstanding securities; (b) upon the first purchase
of the Company's common stock pursuant to a tender or exchange offer; and
(c) upon the approval by the Company's shareholders of (i) a merger with or
into another corporation, (ii) a sale or disposition of all or
substantially all of the Company's assets or (iii) a plan of liquidation or
dissolution of the Company.
"Change of Board Composition" means any change in the composition of the
Board of Directors of the Company in connection with any transaction in
which stock of the Company is sold by the Company, such that a majority of
the non-employee directors of the Company at the time of the stock sale
transaction no longer constitute a majority.
I am pleased we have been able to work this out to everyone's satisfaction. If
the foregoing is acceptable to you please sign below and return this agreement
to me.
Sincerely,
/s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx
Chairman of the
Compensation Committee
cc: Xxxxxx X. Xxxxxx
Xx. Xxxxx Xxxxx
Xxxxxx Xxxxxxx
Xxxxx Xxxxxxxx
Accepted and agreed this 7 day of February 2002
/s/ Xxxxxxx X. Xxxxxxx
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Xxxxxxx X. Xxxxxxx
