EXHIBIT 10.50
Execution Version
SECOND AMENDED AND RESTATED EMPLOYMENT AGREEMENT
THIS AMENDED AND RESTATED AGREEMENT (the "Agreement"), effective as of
February 13, 2003, is made by and between DELTAGEN, INC., a Delaware corporation
(hereinafter the "Company"), and XXXXXXX XXXXXXX (hereinafter "Executive").
RECITALS
WHEREAS, the Company and Executive entered into that certain Employment
Agreement, effective as of September 4, 2000, wherein certain terms and
conditions of Executive's employment were set forth (the "Original Agreement");
WHEREAS, the Company and Executive entered into that certain Amended and
Restated Employment Agreement, effective as of November 22, 2002, wherein
certain terms and conditions of Executive's employment were set forth (the
"First Amended and Restated Agreement");
WHEREAS, the Company and Executive wish to amend the First Amended and
Restated Agreement by amending and restating it by means of this Agreement; and
WHEREAS, the Company and Executive wish to set forth herein the terms and
conditions under which Executive will continue to be employed by the Company.
NOW, THEREFORE, the Company and Executive, in consideration of the mutual
promises set forth herein, agree as follows:
ARTICLE I.
TERM OF AGREEMENT
A. Commencement Date. The terms of this Agreement shall govern Executive's
employment with the Company from February 13, 2003 ("Commencement Date") and
this Agreement shall expire on December 31, 2004, unless terminated earlier
pursuant to Article 6.
B. Renewal. The term of this Agreement shall be automatically renewed for
successive, additional one (1) year terms unless either party delivers written
notice to the other at least ninety (90) days prior to the expiration date of
this Agreement of an intention to terminate this Agreement or to renew it for a
term of less than (1) year.
ARTICLE II.
EMPLOYMENT DUTIES
A. Title/Responsibilities. Executive hereby accepts employment with the
Company pursuant to the terms and conditions hereof. Executive agrees to serve
the Company in the position of member of the Office of the Chairman and (the
"OC") and to also serve in the position of Chief Financial Officer. Executive
shall have the powers and duties commensurate
with such positions, including but not limited to, hiring personnel necessary
(in the judgment of the Board of Directors) to carry out the responsibilities
for such position.
B. Full Time Attention. Executive shall devote his best efforts and his
full business time and attention to the performance of the services customarily
incident to such office and to such other services as the Board may reasonably
request, provided that Executive may also serve on the Boards of Directors of a
limited number of other companies with the prior written consent of the Board.
C. Other Activities. Except upon the prior written consent of the Board of
Directors, Executive shall not during the period of employment engage, directly
or indirectly, in any other business activity (whether or not pursued for
pecuniary advantage) that is or may be competitive with, or that might place him
in a competing position to that of the Company or any other corporation or
entity that directly or indirectly controls, is controlled by, or is under
common control with the Company (an "Affiliated Company"), provided that
Executive may own less than two percent of the outstanding securities of any
such publicly traded competing corporation.
ARTICLE III.
COMPENSATION
A. Base Salary. Executive shall receive a Base Salary at an annual rate of
fifty thousand dollars ($50,000), payable in accordance with the Company's
customary payroll practices until March 31, 2003. Beginning April 1, 2003,
Executive shall receive a base salary of four hundred thousand dollars
($400,000) while serving in OC (as increased from time to time, the "OC Base")
or three hundred forty thousand ($340,000) if serving solely as Chief Financial
Officer (as increased from time to time, the "CFO Base"). The Company's Board of
Directors shall provide Executive with annual performance reviews, and,
thereafter, Executive shall be entitled to such Base Salary as the Board of
Directors may from time to time establish in its sole discretion, but not less
than the amounts indicated herein
B. Annual Bonus. Beginning in 2003, Executive shall be eligible for an
annual bonus of 50% of the OC Base while serving as the OC and 40% of the CFO
Base while serving solely as Chief Financial Officer as determined by the Board
of Directors in its sole discretion. Annual bonus amounts shall be prorated to
take into account the length of service a given year as OC and the length of
service a given year solely as Chief Financial Officer.
C. Retention Bonuses. Executive may be granted retention bonuses as deemed
appropriate by the Compensation Committee of the Board of Directors of the
Company.
D. Accelerated Vesting of Options. If the Company enters into a transaction
which is a Change in Control Transaction, then one hundred percent (100%) of all
options held by Executive as of the date of completion of the Change in Control
Transaction shall become fully vested and exercisable and the restrictions
related to one-hundred (100%) of any grants of restricted stock shall terminate.
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E. Withholdings. All compensation and benefits to Executive hereunder shall
be subject to all federal, state, local and other withholdings and similar taxes
and payments required by applicable law.
F. Option Exchange. Upon tender by Executive of the options to purchase up
to 752,000 shares of Company common stock held by Executive as of the date
hereof and execution of a restricted stock agreement relating thereto, each
tendered option shall be exchanged for 0.7 shares of restricted Company common
stock (for an aggregate of 526,400 restricted shares of Company common stock if
all options are tendered). Fifty percent (50%) of the shares of restricted stock
issued in respect of the deemed vested portion of an option as of the date of
the exchange will vest on March 1, 2003, an additional twenty-five percent (25%)
of such shares will vest on July 1, 2003 and the remaining twenty-five percent
(25%) of such shares will vest on January 1, 2004. The shares of restricted
stock issued in respect of the portion of an option not deemed vested as of the
date of the exchange will vest in four (4) equal installments on the following
dates: January 1, 2004, July 1, 2004, January 1, 2005 and July 1, 2005.
ARTICLE IV.
EXPENSE ALLOWANCES AND FRINGE BENEFITS
A. Vacation. Executive shall be entitled to a minimum of three (3) weeks of
annual paid vacation during the term of this Agreement.
B. Benefits. During the term of this Agreement, the Company shall also
provide Executive with the usual health insurance benefits it generally provides
to its other senior management employees, other than life insurance (which shall
be paid directly by Executive). As Executive becomes eligible in accordance with
criteria to be adopted by the Company, the Company shall provide Executive with
the right to participate in and to receive benefits from accident, disability,
medical, pension, bonus, stock, profit-sharing and savings plans and similar
benefits made available generally to employees of the Company as such plans and
benefits may be adopted by the Company, provided that Executive shall during the
term of this Agreement be entitled to receive at a minimum standard medical and
dental benefits similar to those typically afforded to a member of OC or Chief
Financial Officer, as the case may be, in similar sized biotechnology companies,
excluding life insurance. The amount and extent of benefits to which Executive
is entitled shall be governed by the specific benefit plan as it may be amended
from time to time.
C. Business Expense Reimbursement. During the term of this Agreement,
Executive shall be entitled to receive proper reimbursement for all reasonable
out-of-pocket expenses incurred by him (in accordance with the policies and
procedures established by the Company for its senior executive officers) in
performing services hereunder, provided Executive properly accounts therefor.
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ARTICLE V.
CONFIDENTIALITY
A. Proprietary Information. Executive represents and warrants that he has
executed and delivered to the Company the Company's standard Proprietary
Information and Inventions Agreement in form acceptable to the Company's
counsel.
B. Return of Property. All documents, records, apparatus, equipment and
other physical property which is furnished to or obtained by Executive in the
course of his employment with the Company shall be and remain the sole property
of the Company. Executive agrees that, upon the termination of his employment,
he shall return all such property (whether or not it pertains to Proprietary
Information as defined in the Proprietary Information and Inventions Agreement),
and agrees not to make or retain copies, reproductions or summaries of any such
property.
ARTICLE VI.
TERMINATION
A. By Death. The period of employment shall terminate automatically upon
the death of Executive. In such event, the Company shall pay to Executive's
beneficiaries or his estate, as the case may be, any accrued Base Salary, any
bonus compensation to the extent earned, any vested deferred compensation (other
than pension plan or profit-sharing plan benefits which will be paid in
accordance with the applicable plan), any benefits under any plans of the
Company in which Executive is a participant to the full extent of Executive's
rights under such plans, any accrued vacation pay and any appropriate business
expenses incurred by Executive in connection with his duties hereunder, all to
the date of termination (collectively "Accrued Compensation"), but no other
compensation or reimbursement of any kind, including, without limitation,
severance compensation, and thereafter, the Company's obligations hereunder
shall terminate.
B. By Disability. If Executive is prevented from properly performing his
duties hereunder by reason of any physical or mental incapacity for a period of
more than 180 days in the aggregate in any 365-day period, then, to the extent
permitted by law, the Company may terminate the employment on the 180th day of
such incapacity. In such event, the Company shall pay to Executive all Accrued
Compensation, and shall continue to pay to Executive the Base Salary until such
time as Executive shall become entitled to receive disability insurance payments
under the disability insurance policy maintained by the Company.
C. By Company for Cause. The Company may terminate Executive's employment
for Cause (as defined below) without liability at any time with or without
advance notice to Executive. The Company shall pay Executive all Accrued
Compensation, but no other compensation or reimbursement of any kind, including
without limitation, severance compensation, and thereafter the Company's
obligations hereunder shall terminate. Termination shall be for "Cause" in the
event of the occurrence of any of the following: (a) any intentional action or
intentional failure to act by Executive which was performed in bad faith and to
the material detriment of the Company; (b) Executive intentionally refuses or
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intentionally fails to act in accordance with any lawful and proper direction or
order of the Board; (c) Executive willfully and habitually neglects the duties
of employment; or (d) Executive is convicted of a felony crime involving moral
turpitude, provided that in the event that any of the foregoing events is
capable of being cured, the Company shall provide written notice to Executive
describing the nature of such event and Executive shall thereafter have five (5)
business days to cure such event.
D. At Will. At any time, the Company may terminate Executive's employment
without liability other than as set forth below, for any reason not specified in
Section 6.C above, by giving thirty (30) days advance written notice to
Executive. If the Company elects to terminate Executive pursuant to this Section
6.D, the Company shall pay to Executive all Accrued Compensation and shall
continue to pay to Executive as provided herein Executive's Salary for twelve
(12) months from the date of such termination as severance compensation unless,
upon the date of such termination Executive has been serving solely in the
capacity of Chief Financial Officer for more than 90 days in which case the
Company shall pay to Executive all Accrued Compensation and shall continue to
pay to Executive as provided herein Executive's Salary for nine (9) months from
the date of such termination as severance compensation. Upon payment of the
severance benefits described herein, all obligations of the Company (or its
successor) shall terminate. If employment terminates, whether voluntarily or
involuntarily, prior to April 1, 2003, payment of any unused vacation shall be
paid based on a base salary of $400,000.
During the period when such severance compensation is being paid to
Executive, Executive shall not (i) engage, directly or indirectly, in any other
business activity that is competitive with, or that places him in a competing
position to that of the Company or any Affiliated Company (provided that
Executive may own less than two percent (2%) of the outstanding securities of
any publicly traded corporation), or (ii) hire, solicit, or attempt to hire on
behalf of himself or any other party any employee or exclusive consultant of the
Company. If the Company terminates this Agreement or the employment of Executive
with the Company other than pursuant to Section 6.A, 6.B or 6.C, then this
Section 6.D shall apply.
E. Constructive Termination. In the event:
(i) the Company materially reduces the powers and duties of
employment of Executive resulting in a decrease in Base Salary or in the
responsibilities of Executive which are inconsistent with Executive acting
as a member of OC;
(ii) the Company materially reduces the powers and duties of
employment of Executive resulting in a decrease in Base Salary or in the
responsibilities of Executive which are inconsistent with Executive acting
as Chief Financial Officer of the Company; or
(iii) the Company consummates a transaction which results in a
Change in Control,
such action shall be deemed to be a termination of employment of Executive
without cause pursuant to Section 6.D' provided, however, that upon the
commencement of employment of a permanent Chief Executive Officer, clause (i)
shall no longer be applicable. Moreover, following a Change in Control, if
Executive is offered the position of chief financial officer or
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chief executive officer in an entity that is subject to the reporting
requirements of the Securities Exchange Act of 1934, as amended, and Executive
is not required to relocate his principal place of business by more than 40
miles from its location immediately prior to the Change in Control, then clause
(iii) shall no longer be applicable.
F. Change in Control. For purposes of this Agreement, a "Change in Control"
shall have occurred if at any time during the term of Executive's employment
hereunder, any of the following events shall occur:
1. The consummation of a merger or consolidation of the Company with or
into another entity or any other corporate reorganization, if more than 50% of
the combined voting power of the continuing or surviving entity's securities
outstanding immediately after such merger, consolidation or other reorganization
is owned by persons who were not stockholders of the Company immediately prior
to such merger, consolidation or other reorganization; or
2. Any "person" (as such term is used in Section 13(d) and Section 14 of
the Exchange Act) by the acquisition of securities is or becomes the beneficial
owner, directly or indirectly, of securities of the Company representing 50% or
more of the combined voting power of the Company's then outstanding securities
ordinarily (and apart from rights accruing under special circumstances) having
the right to vote at elections of directors (the "Base Capital Stock") except
that any change in the relative beneficial ownership of the Company's securities
resulting solely from a reduction in the aggregate number of outstanding shares
of Base Capital Stock, and any decrease thereafter in such person's ownership of
securities shall be disregarded until such person increases in any manner,
directly or indirectly, such person's beneficial ownership of any securities of
the Company. Thus, for example, any person who owns less than 50% of the
Company's outstanding shares, shall cause a Change in Control to occur as of any
subsequent date if such person then acquires an additional interest in the
Company which, when added to the person's previous holdings, causes the person
to hold more than 50% of the Company's outstanding shares.
The term "Change in Control" shall not include a transaction, the sole
purpose of which is to change the state of the Company's incorporation.
ARTICLE VII.
GENERAL PROVISIONS
A. Governing Law. The validity, interpretation, construction and
performance of this Agreement and the rights of the parties thereunder shall be
interpreted and enforced under California law without reference to principles of
conflicts of laws. The parties expressly agree that inasmuch as the Company's
headquarters and principal place of business are located in California, it is
appropriate that California law govern this Agreement.
B. Assignment; Successors; Binding Agreement.
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1. Executive may not assign, pledge or encumber his interest in this
Agreement or any part thereof.
2. The Company will require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of the
business and/or assets of the Company, operation of law or by agreement in form
and substance reasonably satisfactory to Executive, to assume and agree to
perform this Agreement in the same manner and to the same extent that the
Company would be required to perform it if no such succession had taken place.
3. This Agreement shall inure to the benefit of and be enforceable by
Executive's personal or legal representatives, executors, administrators,
successors, heirs, distributee, devisees and legatees. If Executive should die
while any amount is at such time payable to him hereunder, all such amounts,
unless otherwise provided herein, shall be paid in accordance with the terms of
this Agreement to Executive's devisee, legates or other designee or, if there be
no such designee, to his estate.
C. No Waiver of Breach. The waiver by any party of the breach of any
provision of this Agreement shall not be deemed to be a waiver of any subsequent
breach.
D. Notice. For the purposes of this Agreement, notices and all other
communications provided for in this Agreement shall be in writing and shall be
deemed to have been duly given when delivered or mailed by certified or
registered mail, return receipt requested, postage prepaid, addressed to the
respective addresses set forth below or to such other address as either party
may have furnished to the other in writing in accordance herewith, except that
notice of change of address shall be effective only upon receipt.
To the Company: Deltagen, Inc.
000 Xxx Xxxx
Xxxxxxx Xxxx, XX 00000
To Executive: Xxxxxxx Xxxxxxx
c/o Deltagen, Inc.
000 Xxx Xxxx
Xxxxxxx Xxxx, XX 00000
E. Modification; Waiver; Entire Agreement. Except as set forth in Section
6.F. with respect to the term "Change in Control," no provisions of this
Agreement may be modified, waived or discharged unless such waiver, modification
or discharge is agreed to in writing signed by Executive and such officer as may
be specifically designated by the Board of the Company. No waiver by either
party hereto at any time of any breach by the other party of, or compliance
with, any condition or provision of this Agreement to be performed by such other
party shall be deemed a waiver of similar or dissimilar provisions or conditions
at the same or any prior or subsequent time. No agreements or representations,
oral or otherwise, express or implied, with respect to the subject matter hereof
have been made by either party which are not expressly set forth in this
Agreement.
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F. Validity. The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement, which shall remain in full force and effect.
G. Controlling Document. In case of conflict between any of the terms and
conditions of this Agreement and any prior employment or option agreement
between the Company and Executive, the terms and conditions of this Agreement
shall control.
H. Executive Acknowledgment. Executive acknowledges (a) that he has
consulted with or has had the opportunity to consult with independent counsel of
his own choice concerning this Agreement, and has been advised to do so by the
Company, and (b) that he has read and understands the Agreement, is fully aware
of its legal effect, and has entered into it freely based on his own judgment.
I. Remedies.
1. Injunctive Relief. The parties agree that the services to be rendered by
Executive hereunder are of a unique nature and that in the event of any breach
or threatened breach of any of the covenants contained herein, the damage or
imminent damage to the value and the goodwill of the Company's business will be
irreparable and extremely difficult to estimate, making any remedy at law or in
damages inadequate. Accordingly, the parties agree that the Company shall be
entitled to injunctive relief against Executive in the event of any breach or
threatened breach of any such provisions by Executive, in addition to any other
relief (including damages) available to the Company under this Agreement or
under law.
2. Exclusive. Both parties agree that the remedy specified in Section 7.I.1
above is not exclusive of any other remedy for the breach by Executive of the
terms hereof.
J. Counterparts. This Agreement may be executed in one or more
counterparts, all of which taken together shall constitute one and the same
Agreement.
Executed by the parties as of the day and year first above written.
DELTAGEN, INC.
______________________________________
By: Xxxx Xxxxx
Title: Chief Scientific Officer
EXECUTIVE:
______________________________________
Xxxxxxx Xxxxxxx
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