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EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (hereinafter the "Agreement"),
effective this 1st day of January, 1998 by and between PPD Pharmaco, Inc., a
Texas corporation with its principal office at 0000 Xxxxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxx, Xxxxx Xxxxxxxx 00000 (hereinafter "PPD Pharmaco"), and
Xxxx X. Xxxxx (hereinafter "Employee").
RECITALS:
A. Employee desires employment upon the terms and conditions
herein stated.
B. PPD Pharmaco desires to employ Employee upon the terms and
conditions herein stated.
C. Employee and PPD Pharmaco desire to embody in writing the
terms and conditions of such employment in this Agreement.
NOW, THEREFORE, in consideration of the mutual promises,
covenants and considerations contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereby agree as follows:
1. Employment. PPD Pharmaco hereby employs Employee and
Employee hereby accepts such employment on a full time basis as Senior Vice
President-Business Development upon the terms and conditions hereinafter set
forth.
2. Term. The term of this Agreement shall be for one year,
beginning January 1, 1998, and ending December 31, 1998 unless sooner terminated
as provided herein. Thereafter, this Agreement shall be automatically renewed
for successive one-year terms upon the terms and conditions herein set forth
except for (a) salary adjustments as provided for in paragraph 9 below and (b)
new bonus plans as provided in paragraph 3 below, unless either party gives
notice as herein provided to the other of said party's intent not renew this
Agreement not less than 60 days prior to the expiration of the one-year term
then in effect.
3. Salary. For all services rendered by Employee under this
Agreement, PPD Pharmaco shall pay Employee an annual base salary of $180,000 for
the initial one-year term hereof. In addition, during the initial one-year term
of this Agreement Employee shall be entitled to a Quarterly Bonus if the
Businesses (as hereinafter defined) attain a certain level of Authorizations for
the applicable quarter, as set forth in Appendix I attached. Each Quarterly
Bonus to which Employee is entitled shall be paid within thirty (30) days after
its determination. A new bonus plan shall be
agreed upon by Employee and PPD Pharmaco for each one-year renewal term of this
agreement.
4. Duties. Employee shall have overall responsibility for
business development of (a) the Company and all of its subsidiaries (except
Pharmaco Investments, Inc.), (b) Pharmaco International Ltd. and (c) Leicester
Clinical Research Centre Ltd. (collectively, the "Businesses"). Employee's
duties shall include but not be limited to supervision of the Businesses' sales
and bids and contracts divisions. Employee shall carry out his duties and
responsibilities under the general supervision of Chief Operating Officer of
Pharmaceutical Product Development, Inc. ("PPD"). Employee shall undertake such
travel as may be required to perform the duties prescribed herein. During the
term of this Agreement, Employee shall devote substantially all of his working
time, attention and energies to the business of PPD Pharmaco.
5. Working Facilities. PPD Pharmaco shall furnish Employee
with office space, equipment, technical, secretarial and clerical assistance and
such other facilities, services, support and supplies as may be reasonably
needed to perform the duties herein prescribed in an efficient and professional
manner, including a car phone, home personal computer, printer and fax machine.
6. Non-Compete. During the term of this Agreement, Employee
hereby agrees that he shall not (a) become an officer, employee, director,
agent, representative, member, associate or consultant of or to a corporation,
partnership or other business entity or person, (b) directly or indirectly
acquire a proprietary interest in a corporation, partnership or other business
entity or person, or (c) directly or indirectly own any stock in a corporation
(other than a publicly traded corporation of which Employee owns less than five
percent (5%) of the outstanding stock) which is engaged in the business of
managing clinical research programs for pharmaceutical and medical products or
in any other business which is developed by PPD Pharmaco during the term of this
Agreement anywhere in the United States (whether or not such business is
physically located within the United States). The parties agree that the
business and operations of PPD Pharmaco are national in scope. For that reason,
the parties agree that a geographical limitation on the foregoing covenant is
not appropriate.
7. Termination. Notwithstanding any other provision of this
Agreement, PPD Pharmaco may terminate Employee's employment hereunder upon the
occurrence of any of the following events:
a. Death of Employee.
b. A determination by the Chief Executive Officer and
the President and Chief Operating Officer of PPD, acting in good faith but made
in their sole discretion, that Employee has failed to substantially perform his
duties under this Agreement.
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c. A determination by the Chief Executive Officer and
the President and Chief Operating Officer of PPD, acting in good faith but made
in their sole discretion, that Employee (i) has become physically or mentally
incapacitated and is unable to perform his duties under this Agreement as a
result of such disability, which inability continues for a period of sixty (60)
consecutive calendar days, (ii) has breached any of the material terms of this
Agreement, including failure to meet Quarterly Targets set forth in Appendix I
attached, (iii) has demonstrated gross negligence or willful misconduct in the
execution of his duties, or (iv) has been convicted of a felony.
8. Disclosure of Information. As a condition of employment
hereunder, Employee will execute as of the date of this Agreement that certain
Proprietary and Inventions Agreement attached hereto as Exhibit A and
incorporated herein by reference.
9. Benefits. During the term thereof, Employee shall be
entitled to participate in all benefits provided by PPD Pharmaco to its
employees generally, including but not limited to health insurance, disability
insurance and retirement plans, all of which are currently provided to employees
of PPD Pharmaco, subject to the eligibility requirements of any plan(s)
establishing same. Employee shall be subject to PPD Pharmaco's policies
applicable to other executive employees of PPD Pharmaco with respect to periodic
reviews and increases in salary, and shall be considered for and eligible to
participate in benefits, if any, provided generally by PPD Pharmaco to its
executive employees, including but not limited to issuance of stock options,
cash bonuses, etc., to the extent such bonuses, etc., are not otherwise provided
for herein in connection with Employee's duties and performance as an executive
employee. Employee shall be entitled to six weeks paid vacation during each
one-year term hereof.
10. Expenses. PPD Pharmaco shall pay all expenses of Employee
which are directly related to Employee's duties hereunder. In addition, PPD
Pharmaco will pay for a dining club membership, health club membership and
annual professional dues not to exceed $1,500 a year.
11. Remedies. In the event of Employee's actual or threatened
breach of the provisions of paragraph 6 of this Agreement, PPD Pharmaco shall be
entitled to a temporary restraining order and/or permanent injunction
restraining Employee from such breach. Nothing herein shall be construed as
preventing PPD Pharmaco from pursuing any other available remedies for such
breach or threatened breach, including recovery of damages from Employee and
from any corporation, partnership or other business entity or person with which
the Employee has entered or attempted to enter into a relationship.
12. Entire Agreement. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof and may
not be altered or amended except by agreement in writing signed by the parties.
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13. Waiver of Breach. Waiver by either party of a breach of
any provision of this Agreement by the other party shall not operate as a waiver
of any subsequent breach by the other party. No waiver shall be valid unless in
writing and signed by the party against whom the waiver is sought.
14. Severability. If any portion of this Agreement shall be
declared invalid by a court of competent jurisdiction, the remaining portion
shall continue in full force and effect as if this Agreement has been executed
with the invalid portion eliminated and this Agreement shall be so construed.
15. Benefit. This Agreement shall inure to the benefit of and
be binding upon PPD Pharmaco, its successors and assigns, and Employee, his
heirs, successors, assigns and personal representatives.
16. Applicable Law. This Agreement shall be governed by the
laws of the State of North Carolina.
17. Assignment. Neither party hereto may assign said party's
rights or obligations hereunder without the prior written consent of the other.
18. Notice. Any notice required or permitted hereunder shall
be delivered in person or mailed certified mail, return receipt requested, if to
PPD Pharmaco at PPD Pharmaco's principal office in Wilmington, North Carolina at
the address hereinabove set forth, and if to Employee at PPD Pharmaco's
principal office in Morrisville, North Carolina, or to his last known home
address, and shall be deemed received when actually received. Any notice from
Employee to PPD Pharmaco shall be addressed to the Chief Executive Officer and
to the President and Chief Operating Officer of PPD, with a copy to the General
Counsel of PPD. Either party hereto may change the notice address provided for
herein upon ten (10) days prior written notice to the other in the manner
prescribed herein.
19. Arbitration. Any dispute, controversy or claim arising out
of or relating to this Agreement, including but not limited to any breach of
this Agreement, or its existence, validity, interpretation, performance or
non-performance, or damages hereunder, including claims in tort, shall be
decided by a single neutral arbitrator in Wilmington, North Carolina in binding
arbitration pursuant to the commercial Arbitration Rules of the American
Arbitration Association then in effect. The parties to any such arbitration
shall be limited to the parties to this Agreement or any successor thereof. The
arbitration shall be conducted in accordance with the procedural laws of the
United States Federal Arbitration Act, as amended. The written decision of the
arbitrator shall be final and binding, and may be entered and enforced in any
court of competent jurisdiction and each party specifically acknowledges and
agrees to waive any right to a jury trial in any such forum. Each party to the
arbitration shall pay its fees and expenses, unless otherwise determined by the
arbitrator.
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20. Amendment; Modification. No amendment or modification of
this Agreement and no waiver by any party of the breach of any covenant
contained herein shall be binding unless executed in writing by party against
whom enforcement of such amendment, modification or waiver is sought.
21. Counterparts. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original and all of which taken
together shall constitute one and the same Agreement.
22. 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.
IN WITNESS WHEREOF, the parties have caused this Agreement to
be executed as of the date first hereinabove set forth.
PPD PHARMACO, INC.
By: /s/ Xxxx X. Xxxxxxxx
--------------------------------
Name: Xxxx X. Xxxxxxxx
-----------------------------
Title: Chief Executive Officer
----------------------------
/s/ Xxxx X. Xxxxx
-----------------------------(SEAL)
Xxxx X. Xxxxx
APPENDIX I
A. Definitions
"Authorizations" means that portion of the face amount of all client
contracts and amendments thereto, letters of intent and client verbal
commitments included in backlog for the Businessess in 1998. Authorizations
attained by the Businesses for each quarter shall be determined by PPD's Finance
Department, acting in good faith after consultation with appropriate senior
representatives of the Company's Global Business Development and Global
Operations divisions, but in its sole discretion.
"Quarterly Bonus" means the bonus to be paid to Employee based upon the
Quarterly Target attained by the Businesses for the applicable quarter.
"Quarterly Target" means the level of Authorizations attained by the
Businesses for the applicable quarter which entitles Employee to a Quarterly
Bonus.
B. Quarterly Bonus Schedule
1. Q1 '98 (January 1, 1998-March 31, 1998)
Quarterly Target(1) Quarterly Bonus
------------------- ---------------
At least 73,842 but less than 77,945 $ 6,250.00
At least 77,945 but less than 82,047 12,500.00
At least 82,047 but less than 86,149 18,750.00
At least 86,149 but less than 90,252 22,500.00
At least 90,252 but less than 94,354 25,000.00
At least 94,354 but less than 98,456 31,250.00
At least 98,456 but less than 102,559 37,500.00
102,559 or more 43,750.00
2. Q2 '98 (April 1, 1998-June 30, 1998)
Quarterly Target(1) Quarterly Bonus
------------------- ---------------
At least 80,332 but less than 84,795 $ 6,250.00
At least 84,795 but less than 89,258 12,500.00
At least 89,258 but less than 93,721 18,750.00
At least 93,721 but less than 98,184 22,500.00
At least 98,184 but less than 102,647 25,000.00
At least 102,647 but less than 107,110 31,250.00
At least 107,110 but less than 111,573 37,500.00
111,573 or more 43,750.00
3. Q3 '98 (July 1, 1998-September 30, 1998)
Quarterly Target(1) Quarterly Bonus
------------------- ---------------
At least 87,229 but less than 92,075 $ 6,250.00
At least 92,075 but less than 96,921 12,500.00
At least 96,921 but less than 101,767 18,750.00
At least 101,767 but less than 106,613 22,500.00
At least 106,613 but less than 111,459 25,000.00
At least 111,459 but less than 116,305 31,250.00
At least 116,305 but less than 121,151 37,500.00
121,151 or more 43,750.00
4. Q4 '98 (October 1, 1998-December 31, 1998)
Quarterly Target(1) Quarterly Bonus
------------------- ---------------
At least 94,657 but less than 99,915 $ 6,250.00
At least 99,915 but less than 105,174 12,500.00
At least 105,174 but less than 110,433 18,750.00
At least 110,433 but less than 115,691 22,500.00
At least 115,691 but less than 120,950 25,000.00
At least 120,950 but less than 126,209 31,250.00
At least 126,209 but less than 131,468 37,500.00
131,468 or more 43,750.00
(1) All Quarterly Target figures are expressed in thousands of dollars.
