Exhibit 99.1
EXECUTION COPY
AMENDMENT TO EMPLOYMENT AGREEMENT
THIS AMENDMENT TO EMPLOYMENT AGREEMENT, dated as of this 3rd day of
December, 2004, by and among ELAN PHARMACEUTICALS, INC., a Delaware corporation
(the "Employer"), and ELAN CORPORATION, PLC, an Irish public limited company
(the "Parent", together with the Employer, the "Company") and G. XXXXX XXXXXX
(the "Executive").
W I T N E S S E T H:
WHEREAS, the Executive has provided services as Chief Executive Officer of
the Parent pursuant to an Employment Agreement dated January 7, 2003 (the
"Agreement"); and
WHEREAS, the Executive is willing to continue to serve as the Chief
Executive Officer of the Parent and the Employer desires to retain the Executive
in such capacity on the terms and conditions set forth in the Agreement as
modified herein; and
WHEREAS, the Agreement provided for certain rights and obligations in the
event of an involuntary termination; and
WHEREAS, the parties desire to modify the rights and obligations of the
parties in the event of involuntary termination and to add contractual
provisions relating to indemnity and the award of costs in the event of a
dispute;
NOW, THEREFORE, in consideration of the promises and the mutual covenants
herein contained, the parties hereto hereby agree that the Agreement shall be
amended as follows:
Effective midnight on December 31, 2004, subpart (b) (ii) of Section 4 of
the Agreement shall be deleted and the following subpart (b) (ii) of Section 4
shall be substituted in its place:
4. TERMINATION OF EMPLOYMENT.
(b) Involuntary Termination.
(ii) In the event of the Executive's Involuntary Termination, the
Executive shall continue to participate on the same terms and conditions as
are in effect immediately prior to such termination or resignation in the
Employer's health and medical plans provided to the Executive pursuant to
Section 3(f) above at the time of such Involuntary Termination until the
end of the Severance Period, or until the Executive obtains other
employment, whichever occurs first. Anything herein to the contrary
notwithstanding, the Employer shall have no obligation to continue to
maintain during the Continuation Period any plan, program or level of
benefits solely as a result of this Agreement. Furthermore, the Executive
shall receive a lump-sum cash payment in the amount of $50,000.00 to cover
extra costs due to tax return preparation, estate counseling, and
miscellaneous expenses. Executive shall also be entitled to obtain career
transition assistance from a career transition assistance firm selected and
paid for by the Company.
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Executive must begin the available career transition assistance program
within sixty (60) days following the Involuntary Termination. Said
transition assistance shall include the use of an office and the services
of a full time secretary suitable for the Executive, as agreed to by the
Company, for a reasonable period of time not to exceed three (3) years.
It is furthermore agreed that effective midnight on December 31, 2004,
subparts (c) (i) and (iii) of Section 4 of the Agreement shall be deleted and
the following subparts (c) (i) and (iii) of Section 4 shall be substituted in
their place:
(c) Involuntary Termination in Connection with Certain Changes in
Control.
(i) If, during the Term of this Agreement, the Parent undergoes a
"Change in Control" (as defined below), and either (x) the Executive's
employment is thereafter terminated under circumstances that would
constitute an Involuntary Termination or (y) the Executive undergoes an
Involuntary Termination and within 90 days of the Involuntary Termination,
the Parent executes a definitive agreement to enter into a transaction the
consummation of which would result in a "Change in Control" and such
transaction is actually consummated prior to the end of the Term of this
Agreement, then the Executive shall receive, conditioned upon his execution
of a customary release of all claims against the Company and its affiliates
in a form prescribed by the Company, the Accrued Obligations, as well as
Severance Payments in the amount of Executive's Salary and target bonus for
a period of three (3) years following the Involuntary Termination (the
"Change in Control Severance Period"). In addition, the Executive shall be
entitled to continuation of benefits in accordance with the terms set forth
in Section 4(b)(ii), above, except that Executive's entitlement to
continued participation in the Employer's health and medical plans as
specified in Section 4(b)(ii) shall last until the end of the Change in
Control Severance Period, or until the Executive obtains other employment,
whichever occurs first. Lastly, all of the Executive's then-outstanding
options shall be immediately vested and remain outstanding for two years
following the Involuntary Termination.
(iii) In the event of the Executive's death subsequent to his
Involuntary Termination following a Change in Control, but prior to the end
of the Change in Control Severance Period, the balance of the Severance
Payments shall continue to be paid in periodic installments to the
Executive's Beneficiary (as hereinafter defined) for the balance of the
Change in Control Severance Period; provided, however, that the Employer,
in its sole discretion, may at any time pay such Beneficiary the then
remaining Severance Payments in a cash lump sum.
It is furthermore agreed that effective midnight on December 31, 2004,
Section 7 of the Agreement shall be deleted and the following Section 7 shall be
substituted in its place:
7. INDEMNIFICATION. The Company shall furnish the Executive with
coverage under the Company's customary director and officer indemnification
arrangements, in accordance with the Company's charter documents and its
D&O insurance policies, as in effect from time to time. The Company agrees
that it will provide Executive with legal representation of Company's
choosing and at Company's expense for the defense of any civil claim or
lawsuit brought by a third party alleging that Executive is liable for acts
or omissions occurring in direct consequence of the discharge of his duties
under this
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Agreement. Company also agrees to indemnify Executive and hold him harmless
for all acts or decisions made by him in good faith while performing
services for the Company to the full extent permitted by applicable law.
The Company shall not be obligated to indemnify Executive for any final
judgments entered as the result of the Executive's willful violation of
others' rights or safety, for any punitive damage award, or for damages or
penalties arising from violations of criminal law. Executive shall fully
cooperate with the Company and attorneys in defending all claims and
lawsuits brought against the Company or the Executive.
It is furthermore agreed that effective midnight on December 31, 2004,
Section 9 of the Agreement, entitled "GENERAL PROVISIONS", shall be renumbered
as Section 10, and the following Section 9 shall be inserted:
9. ATTORNEYS' FEES AND COSTS. In the event that any action or other
proceeding is instituted to enforce any right or obligation under this
Agreement, the prevailing party shall be entitled to receive, in addition
to any other relief granted, the costs of enforcement of this Agreement,
including reasonable attorneys' fees and court costs.
It is furthermore agreed that this Amendment may be executed by the parties
hereto in counterparts, each of which shall be deemed an original, but both such
counterparts shall together constitute one and the same document.
IN WITNESS WHEREOF, the parties have executed this Amendment effective as
of the day and year first written above.
ELAN PHARMACEUTICALS, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
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Name: Xxxxxxx X. Xxxxxxx
Title: Vice President and Secretary
ELAN CORPORATION PLC
By: /s/ Xxxx Xxxxxx
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Name: Xxxx Xxxxxx
Title: Secretary
EXECUTIVE
/s/ G. Xxxxx Xxxxxx
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G. XXXXX XXXXXX
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