EMPLOYMENT AGREEMENT
Exhibit 10.4
EMPLOYMENT AGREEMENT (“Agreement”), entered into as of January 1, 2010 (the “Effective Date”),
by and between Impax Laboratories, Inc., a Delaware corporation (the “Company”), and Xxxxxxx X.
Xxxxxx (the “Executive”).
WITNESSETH:
WHEREAS, the Executive possesses unique personal knowledge, experience and expertise
concerning the business and operations conducted by the Company;
WHEREAS, the Company desires to continue to employ the Executive, and the Executive desires to
continue to be employed by the Company, upon the terms and subject to the conditions set forth in
this Agreement; and
WHEREAS, effective as of the Effective Date, the Company and the Executive desire to enter
into this Agreement as to the terms and conditions of the Executive’s continued employment with the
Company.
NOW, THEREFORE, in consideration of the covenants and agreements hereinafter set forth and
other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
| 1. | EMPLOYMENT AND DUTIES |
1.1 Term of Employment. The Executive’s initial term of employment under this
Agreement shall commence on the Effective Date and shall continue until December 31, 2012 (the
“Initial Term”), unless further extended or earlier terminated as provided in this Agreement. This
Agreement will automatically be renewed for single one-year periods unless written notice of
non-renewal is provided by either party at least 90 days prior to the end of the Initial Term or
the successive one-year period then in effect or unless earlier terminated as provided in this
Agreement. Non-renewal of this Agreement after December 31, 2012 shall not be considered a
Termination of Employment under section 5, nor shall the expiration of this Agreement be considered
a Termination of Employment under section 5. The period of time between the Effective Date and the
termination of the Executive’s employment under this Agreement or the expiration of this Agreement,
whichever is earlier, shall be referred to herein as the “Term.”
1.2 General.
1.2.1 During the Term, the Executive shall have the title of President of the Company’s Impax
Pharmaceuticals Division and shall have general supervision of that Division and such other
authorities, duties and responsibilities as may from time to time be delegated to him by the Chief
Executive Officer of the Company. The Executive shall faithfully and diligently discharge his
duties hereunder and use his best efforts to implement the policies
established by the Board of Directors of the Company (the “Board”) from time to time. During
the Term, the Executive shall report to the Chief Executive Officer.
1.2.2 The Executive shall devote all of his business time, attention, knowledge and skills
faithfully, diligently and to the best of his ability, in furtherance of the business and
activities of the Company; provided, however, that nothing in this Agreement shall
preclude the Executive from devoting reasonable periods of time required for:
(i) serving as a director or member of a committee of up to two (2) organizations or
corporations that do not, in the good faith determination of the Board, compete with the Company or
otherwise create, or could create, in the good faith determination of the Board, a conflict of
interest with the business of the Company;
(ii) delivering lectures, fulfilling speaking engagements, and any writing or publication
relating to his area of expertise; provided, however, that any fees, royalties or
honorariums received therefrom shall be promptly turned over to the Company;
(iii) engaging in professional organization and program activities;
(iv) managing his personal passive investments and affairs; and
(v) participating in charitable or community affairs;
provided that such activities do not materially, individually or in the aggregate, interfere with
the due performance of his duties and responsibilities under this Agreement or create a conflict of
interest with the business of the Company, as determined in good faith by the Board.
1.2.3 The Executive shall obtain a comprehensive medical examination every two years during
the Term, and the Company shall reimburse the Executive the cost thereof to the extent not
reimbursed by health insurance.
1.3 Reimbursement of Expenses. During the Term, the Company shall pay the reasonable
expenses incurred by the Executive in the performance of his duties hereunder, including, without
limitation, those incurred in connection with business related travel or entertainment, or, if such
expenses are paid directly by the Executive, the Company shall promptly reimburse him for such
payments, provided that the Executive properly accounts for such expenses in accordance with the
Company’s business expense reimbursement policy. To the extent any such reimbursements (and any
other reimbursements of costs and expenses provided for herein) are includable in the Executive’s
gross income for Federal income tax purposes, all such reimbursements shall be made no later than
March 15 of the calendar year next following the calendar year in which the expenses to be
reimbursed are incurred.
| 2. | COMPENSATION |
2.1 Base Salary. During the Term, the Executive shall be entitled to receive a base
salary at the annual rate of $445,000, subject to increase or decrease, as determined by the Board
or its Compensation Committee from time to time in its discretion, payable in accordance with the
payroll practices of the Company (the “Base Salary”).
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2.2 Target Bonuses. In addition to Base Salary, during the Term the Executive shall
be eligible to receive an annual cash incentive bonus based upon a percentage of Base Salary and
attainment of goals established in writing by the Board or its Compensation Committee at the
beginning of each year (the “Target Bonus”) for each completed calendar year (subject to Section
5.4 hereof) of the Company. Such bonus shall be paid within 2-1/2 months following the end of the
calendar year to which it relates.
2.3 Options and Stock Awards. During the Term, the Executive shall be eligible to
receive grants of stock options and restricted stock in such amounts and subject to such terms as
determined by the Compensation Committee in its sole discretion.
2.4 Additional Compensation. During the Term, in addition to the foregoing, the
Executive shall be eligible to receive such other compensation as may from time to time be awarded
him by either the Board or the Compensation Committee in its sole discretion.
| 3. | PLACE OF PERFORMANCE |
In connection with his employment by the Company, the Executive shall be based at the
Company’s principal executive offices in Hayward, California.
| 4. | EMPLOYEE BENEFITS |
During the Term, the Executive shall continue to be entitled to vacation generally made
available to executive personnel of the Company and to participate in and have the benefit of all
group life, disability, hospital, surgical and major medical insurance plans and programs and other
employee benefit plans and programs as generally are made available to executive personnel of the
Company, as such benefit plans or programs may be amended or terminated in the sole discretion of
the Board and with the concurrence of the Compensation Committee, from time to time.
| 5. | TERMINATION OF EMPLOYMENT |
5.1 General. The Executive’s employment under this Agreement may be terminated
without any breach of this Agreement only on the following circumstances:
5.1.1 Death. The Executive’s employment under this Agreement shall terminate upon his
death.
5.1.2 Disability. If the Executive suffers a Disability (as defined below), the
Company may terminate the Executive’s employment under this Agreement upon 30 days prior written
notice; provided that the Executive has not returned to full time performance of his duties during
such 30-day period. For purposes of this Agreement, “Disability” shall mean the Executive’s
inability to perform his duties and responsibilities hereunder, with or without reasonable
accommodation, due to any physical or mental illness or incapacity, which condition either (i) has
continued for a period of 180 days (including weekends and holidays) in any consecutive 365-day
period, or (ii) is projected by the Board in good faith after consulting with a doctor selected by
the Company and consented to by the Executive (or, in the event of the Executive’s incapacity, his
legal representative), such consent not to be unreasonably withheld,
that the condition is likely to continue for a period of at least six consecutive months from
its commencement.
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5.1.3 Good Reason. The Executive may terminate his employment under this Agreement
for Good Reason (as defined below) at any time on or prior to the 60th day after the occurrence of
any of the Good Reason events set forth in the following sentence. For purposes of this Agreement,
“Good Reason” shall mean the occurrence of any of the following events without the Executive’s
consent and which is not cured by the Company upon written notice by the Executive, such notice to
have been provided by the Executive within 30 days of any such event having occurred:
(i) any action or inaction by the Company constituting a material breach of the Agreement by
the Company;
(ii) a material diminution of the authorities, duties or responsibilities of the Executive set
forth in Section 1.2 above (other than temporarily while the Executive is physically or mentally
incapacitated and unable to properly perform such duties, as determined by the Board in good
faith);
(iii) the loss of any of the titles of the Executive with the Company set forth in Section 1.2
above;
(iv) a material reduction by the Company in the Base Salary or in any of the percentages of
Base Salary payable as a Target Bonus, but, except in the case of a reduction following a Change in
Control (as defined below), not including (a) a reduction in Base Salary or in any of the
percentages of Base Salary payable as a Target Bonus which is consistent with the reduction in Base
Salary or in any of the percentages of Base Salary payable as a Target Bonus imposed on all senior
executives of the Company or (b) a reduction in Base Salary or in any of the percentages of Base
Salary payable as a Target Bonus based on the results of peer benchmark data obtained by the Board
and after approval of the Board;
(v) the relocation of the Executive to an office more than 50 miles from its current location;
(vi) the assignment to the Executive of duties or responsibilities that are materially
inconsistent with any of his duties and responsibilities set forth in Section 1.2 hereof;
(vii) a material change in the reporting structure set forth in Section 1.2.1 hereof; or
(viii) the failure of the Company to obtain the assumption in writing of its obligation to
perform this Agreement by any successor in connection with a sale or other disposition by the
Company of all or substantially all of the Company’s assets or businesses within 10 days after such
sale or other disposition.
5.1.4 Without Good Reason. The Executive may voluntarily terminate his employment
under this Agreement without Good Reason upon written notice by the Executive to
the Company at least 60 days prior to the effective date of such termination (which
termination the Company may, in its sole discretion, make effective earlier than the date set forth
in the Notice of Termination (as defined below)).
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5.1.5 Cause. The Company may terminate the Executive’s employment under this
Agreement at any time for Cause (as defined below). For purposes of this Agreement, termination
for “Cause” shall mean termination of the Executive’s employment because of the occurrence of any
of the following as determined in good faith by the Board:
(i) the willful and continued failure by the Executive to substantially perform his
obligations under this Agreement (other than any such failure resulting from the Executive’s
incapacity due to a Disability); provided, however, that the Company shall have
provided the Executive with a Notice of Termination specifying such failure and the Executive shall
have been afforded at least 15 days within which to cure same;
(ii) the indictment of the Executive for, or his conviction of or plea of guilty or nolo
contendere to, a felony or any other crime involving moral turpitude or dishonesty;
(iii) the Executive’s willful misconduct in the performance of his duties hereunder (including
theft, fraud, embezzlement, and securities law violations or violation of the Company’s Code of
Conduct or other written policies); or
(iv) the Executive’s willful misconduct other than in the performance of his duties for the
Company (including theft, fraud, embezzlement, and securities law violations) that is actually or
potentially materially injurious to the Company, monetarily or otherwise.
For purposes of this Section 5.1.5, no act or failure to act on the part of the Executive shall be
considered “willful,” unless done, or omitted to be done, without reasonable belief that his action
or omission was in, or not opposed to, the best interest of the Company (including its reputation).
Prior to any termination for Cause, the Company shall provide the Executive with a Notice of
Termination specifying the event constituting Cause and shall give the Executive the opportunity to
appear before the Board to present his views on the Cause event. If, after such hearing, the
majority of the full Board (excluding the Executive) does not support such termination, the Notice
of Termination shall be rescinded. After providing the notice in the foregoing sentence, the Board
may suspend the Executive with full pay and benefits until a final determination pursuant to this
Section has been made.
5.1.6 Without Cause. The Company may terminate the Executive’s employment under this
Agreement without Cause immediately upon written notice by the Company to the Executive, other than
for death or Disability.
5.2 Notice of Termination. Any termination of the Executive’s employment by the
Company or by the Executive (other than termination by reason of the Executive’s death) shall be
communicated by written Notice of Termination to the other party of this Agreement. For purposes
of this Agreement, a “Notice of Termination” shall mean a written notice which shall indicate the
specific termination provision in this Agreement relied upon and shall set forth in reasonable
detail the facts and circumstances claimed to provide the basis for such termination.
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5.3 Date of Termination. The “Date of Termination” shall mean (a) if the termination
is the result of the Executive’s death, the date of his death, (b) if the termination is pursuant
to Section 5.1.2 hereof, 30 days after the Notice of Termination is given (provided that the
Executive shall not have returned to the performance of his duties on a full-time basis during such
30-day period), (c) if the termination is pursuant to Section 5.1.5 or Section 5.1.3 hereof, the
date specified in the Notice of Termination after the expiration of any applicable cure period, (d)
if the termination is pursuant to Section 5.1.4 hereof, the date specified in the Notice of
Termination which shall be at least 60 days after the Notice of Termination is given, or such
earlier date as the Company shall determine in its sole discretion, and (e) if the termination is
pursuant to Section 5.1.6 hereof, the date on which the Notice of Termination is given.
5.4 Compensation Upon Termination.
5.4.1 Termination for Cause or without Good Reason. If the Executive’s employment
shall be terminated by the Company for Cause or by the Executive without Good Reason, the Executive
shall receive from the Company: (a) any earned but unpaid Base Salary through the Date of
Termination, paid in accordance with the Company’s standard payroll practices; (b) any Target Bonus
earned but unpaid for a prior fiscal year, paid in accordance with Section 2.2 (including payment
timing); (c) reimbursement for any unreimbursed expenses properly incurred and paid in accordance
with Section 1.3 through the Date of Termination; (d) payment for any accrued but unused vacation
time in accordance with Company policy; (e) all stock options and restricted stock previously
granted to the Executive that have vested in accordance with the terms of such grants; and (f) such
vested accrued benefits, and other payments, if any, as to which the Executive (and his eligible
dependents) may be entitled under, and in accordance with the terms and conditions of, the employee
benefit arrangements, plans and programs of the Company as of the Date of Termination, other than
any severance pay plan (such amounts and benefits set forth in clauses (a) though (f) being
referred to hereinafter as the “Amounts and Benefits”), and the Company shall have no further
obligation with respect to this Agreement other than as provided in Sections 8 and 9 hereof. Any
stock options and restricted stock previously granted to the Executive that have not vested in
accordance with the terms of their grants as of the Date of Termination shall be forfeited as of
the Date of Termination.
5.4.2 Termination without Cause or For Good Reason. If, prior to the expiration of
the Term, the Executive resigns from his employment hereunder for Good Reason or the Company
terminates the Executive’s employment hereunder without Cause (other than a termination by reason
of death or Disability), and Section 5.4.3 does not apply, then the Company shall pay or provide
the Executive the Amounts and Benefits and, subject to Section 5.4.8:
(i) Subject to Section 9.9.2, an amount equal to the sum of (x) the balance of the Base Salary
due under this Agreement or one and one half times the Base Salary as then in effect (without
taking into account any reduction therein that constitutes a basis for Good Reason), whichever is
the greater, plus (y) an amount equal to one and one half times the average of the Target Bonus the
Executive received from the Company for all fiscal years completed during the Term, with the
aggregate amount due paid in equal installments on the Company’s normal payroll dates for a period
of 12 months from the Date of Termination in accordance with the normal payroll practices of the Company, with each such payment deemed to
be a separate payment for the purposes of Code Section 409A (as defined below);
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(ii) in the event such resignation or termination occurs following the Company’s first fiscal
quarter of any year, a pro rata portion of the Executive’s Target Bonus for the fiscal year in
which the Executive’s termination occurs based on actual results for such year (determined by
multiplying the amount of such Target Bonus which would be due for the full fiscal year, as
determined in good faith by the Board, by a fraction, the numerator of which is the number of days
during the fiscal year of termination that the Executive is employed by the Company and the
denominator of which is 365), paid in accordance with Section 2.2 (including payment timing, “Pro
Rata Bonus”); and
(iii) the continuation of all benefits for 24 months from the Date of Termination.
In addition, subject to Section 5.4.8, the vesting of all unvested stock options and restricted
stock previously granted to the Executive shall be accelerated by 12 months, and any such stock
options, notwithstanding any provision to the contrary in the option or the plan pursuant to which
the option was granted, shall remain exercisable for a period of 12 months following the Date of
Termination.
5.4.3 Termination Following Change in Control. Anything contained herein to the
contrary notwithstanding, in the event the Executive resigns from his employment hereunder for Good
Reason or the Company terminates the Executive’s employment hereunder without Cause (other than a
termination by reason of death or Disability) within 60 days preceding or 12 months following a
Change in Control (as defined below), the Company shall pay or provide the Executive the Amounts
and Benefits and, subject to Section 5.4.8, a change-in-control payment as follows:
(i) subject to Section 9.9.2, an amount equal to the sum of (x) the balance of the Base Salary
due under this Agreement or two and one quarter times the Base Salary as then in effect (without
taking into account any reduction therein that constitutes a basis for Good Reason), whichever is
the greater, plus (y) an amount equal to two and one quarter times the average of the Target Bonus
the Executive received from the Company for all fiscal years completed during the Term, with the
aggregate amount due paid in equal installments on the Company’s normal payroll dates for a period
of 12 months from the Date of Termination in accordance with the normal payroll practices of the
Company, with each such payment deemed to be a separate payment for the purposes of Code Section
409A (as defined below);
(ii) in the event such resignation or termination occurs following the Company’s first fiscal
quarter of any year, a Pro Rata Bonus, paid in accordance with Section 2.2 (including payment
timing); and
(iii) the continuation of all benefits for 24 months from the Date of Termination.
In addition, subject to Section 5.4.8, the vesting of all unvested stock options and restricted
stock previously granted to the Executive shall be accelerated to the Date of Termination, and any
such stock options, notwithstanding any provision to the contrary in the option or the plan pursuant to
which the option was granted, shall remain exercisable for a period of 12 months following the Date
of Termination.
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5.4.4 For purposes of this Agreement, a “Change in Control” shall be deemed to occur upon any
of the following events, provided that such an event is a Change in Control Event within the
meaning of Code Section 409A (as defined below): (a) any “person” as such term is used in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (other than
the Company, any trustee or other fiduciary holding securities under any employee benefit plan of
the Company, or any company owned, directly or indirectly, by the stockholders of the Company in
substantially the same proportions as their ownership of the common stock), becoming the beneficial
owner (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of
the Company representing more than 50% of the combined voting power of the Company’s then
outstanding securities; (b) during any period of 12 consecutive months, the individuals who, at the
beginning of such period, constitute the Board, and any new director whose election by the Board or
nomination for election by the Company’s stockholders was approved by a vote of at least two-thirds
of the directors then still in office who either were directors at the beginning of the 12-month
period or whose election or nomination for election was previously so approved, cease for any
reason to constitute at least a majority of the Board; (c) a merger or consolidation of the Company
with any other corporation or other entity, other than a merger or consolidation that would result
in the voting securities of the Company outstanding immediately prior thereto (and held by persons
that are not affiliates of the acquirer) continuing to represent (either by remaining outstanding
or by being converted into voting securities of the surviving entity) more than 50% of the combined
voting power of the voting securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation; provided, however, that a merger or
consolidation effected to implement a recapitalization of the Company (or similar transaction) in
which no person (other than those covered by the exceptions in clause (a) of this Section 5.4.4)
acquires more than 50% of the combined voting power of the Company’s then outstanding securities
shall not constitute a Change in Control; or (d) the consummation of a sale or other disposition by
the Company of all or substantially all of the Company’s assets, including a liquidation, other
than the sale or other disposition of all or substantially all of the assets of the Company to a
person or persons who beneficially own, directly or indirectly, more than 50% of the combined
voting power of the outstanding voting securities of the Company immediately prior to the time of
the sale or other disposition.
5.4.5 Termination upon Death. In the event of the Executive’s death, the Company
shall pay or provide to the Executive’s estate: (i) the Amounts and Benefits and (ii) a Pro Rata
Bonus, in accordance with Section 2.2. In addition, (A) all of the then remaining unvested
restricted stock previously granted to the Executive shall immediately become vested on the Date of
Termination and shall be distributed to the Executive’s estate within 60 days of the Date of
Termination and (B) the portion of the unvested stock options previously granted to the Executive
that are scheduled to vest in the calendar year of the Executive’s death shall immediately become
vested on the certification of the Compensation Committee based on the achievement of the
performance goals for such year, calculated through the Date of Termination, and shall be
distributed to the Executive’s estate 60 days after the Date of Termination. After
giving effect to the foregoing, any portion of the stock options that remain unvested on the
certification following the Executive’s death shall be forfeited.
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5.4.6 Termination upon Disability. In the event the Company terminates the
Executive’s employment hereunder for reason of Disability, the Company shall pay or provide to the
Executive: (i) the Amounts and Benefits, (ii) a Pro Rata Bonus and (iii) medical benefits for six
months. In addition, subject to Section 5.4.8, (A) 50% of the unvested restricted stock previously
granted to the Executive shall immediately become vested on the Date of Termination and shall be
distributed to the Executive as provided in, and subject to, Sections 5.4.8 and 9.9.2 and (B) the
portion of the unvested stock options previously granted to the Executive that are scheduled to
vest in the calendar year the Date of Termination occurs shall immediately become vested on the
certification of the Compensation Committee based on the achievement of the performance goals for
such year, calculated through the Date of Termination, and shall be distributed to the Executive as
provided in, and subject to, Sections 5.4.8 and 9.9.2. After giving effect to the foregoing, any
portion of the restricted shares and stock options that remain unvested on the certification
following the Date of Termination shall be forfeited as of the Date of Termination.
5.4.7 No Mitigation or Offset. The Executive shall not be required to mitigate the
amount of any payment provided for in this Section 5.4 by seeking other employment or otherwise,
nor shall the amount of any payment provided for in this Section 5.4 be reduced by any compensation
earned by the Executive as the result of employment by another employer or business or by profits
earned by the Executive from any other source at any time before and after the Date of Termination.
5.4.8 Release. Notwithstanding any provision to the contrary in this Agreement, the
Company’s obligation to pay or provide the Executive with the payments and benefits under Sections
5.4.2 and 5.4.3 (other than the Amounts and Benefits), and any distributions with respect to the
restricted stock and stock options under Sections 5.4.2, 5.4.3 and 5.4.6, shall be conditioned on
the Executive’s execution and failure to revoke a waiver and general release in a form consistent
with Exhibit A hereto (subject to such changes as may be necessary at the time of execution in
order to make such release enforceable) (the “Release”). The Company shall provide the Release to
the Executive within seven days following the applicable Date of Termination. In order to receive
the payments and benefits under Sections 5.4.2 and 5.4.3 (other than the Amounts and Benefits) and
the distributions with respect to the restricted stock and stock options under Sections 5.4.2,
5.4.3 and 5.4.6, the Executive will be required to execute and deliver the Release within 21 days
after the date it is provided to him and not to revoke it within seven days following such
execution and delivery. Notwithstanding anything to the contrary contained herein, (i) all payments
delayed pursuant to this Section, except to the extent delayed pursuant to Section 9.9.2, shall be
paid to the Executive in a lump sum on the first Company payroll date on or following the 60th day
after the Date of Termination, and any remaining payments due under this Agreement shall be paid or
provided in accordance with the normal payment dates specified for them herein and (ii) all
distributions with respect to the restricted stock and stock options delayed pursuant to this
Section, except to the extent delayed pursuant to Section 9.9.2, shall be distributed to the
Executive on the 60th day after the Date of Termination.
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| 6. | INSURABILITY; RIGHT TO INSURE |
The Company shall have the right to maintain key man life insurance in its own name covering
the Executive’s life in an amount of up to $50,000,000.00. The Executive shall fully cooperate in
the procuring of such insurance, including submitting to any required medical examination and by
completing, executing and delivering such applications and other instrument in writing as may be
reasonably required by any insurance company to which application for insurance may be made by the
Company.
| 7. | CONFIDENTIALITY; NON-COMPETITION; NON-SOLICITATION; NON-DISPARAGEMENT; COOPERATION |
7.1 The Company and the Executive acknowledge that the services to be performed by the
Executive under this Agreement are unique and extraordinary and, as a result of such employment,
the Executive shall be in possession of Confidential Information (as defined below) relating to the
business practices of the Company and its subsidiaries and affiliates (collectively, the “Company
Group”). The term “Confidential Information” shall mean any and all information (oral and written)
relating to the Company Group, or any of their respective activities, or of the clients, customers
or business practices of the Company Group, other than such information which (i) is generally
available to the public or within the relevant trade or industry, other than as the result of
breach of the provisions of this Section 7.1, or (ii) the Executive is required to disclose under
any applicable laws, regulations or directives of any government agency, tribunal or authority
having jurisdiction in the matter or under subpoena or other process of law. The Executive shall
not, during the Term or at any time thereafter, except as may be required in the course of the
performance of his duties hereunder (including pursuant to Section 7.6 below) and except with
respect to any litigation or arbitration involving this Agreement, including the enforcement
hereof, directly or indirectly, use, communicate, disclose or disseminate to any person, firm or
corporation any Confidential Information acquired by the Executive during, or as a result of, his
employment with the Company, without the prior written consent of the Company. Without limiting
the foregoing, the Executive understands that Executive shall be prohibited from misappropriating
any trade secret of the Company Group or of the clients or customers of the Company Group acquired
by the Executive during, or as a result of, his employment with the Company, at any time during or
after the Term.
7.2 Upon the termination of the Executive’s employment for any reason all Company Group
property that is in the possession of the Executive, including all documents, records, drug
formulations, notebooks, equipment, price lists, specifications, programs, customer and prospective
customer lists and other materials that contain Confidential Information that are in the possession
of the Executive, including all copies thereof, shall be promptly returned to the Company.
Anything to the contrary herein notwithstanding, the Executive shall be entitled to retain (i)
papers and other materials of a personal nature, including photographs, correspondence, personal
diaries, calendars and rolodexes, personal files and phone books, (ii) information showing his
compensation or relating to reimbursement of expenses, (iii) information that he reasonably
believes may be needed for tax purposes and (iv) copies of plans, programs and agreements relating
to his employment, or termination thereof, with the Company.
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7.3 Except in the case of a Termination pursuant to Section 5.4.3 following a Change in
Control, the Executive hereby agrees that he shall not, during the Term and for a period of 12
months thereafter, directly or indirectly, engage or have an interest in, or render any services
to, any business (whether as owner, manager, operator, licensor, licensee, lender, partner,
stockholder, joint venturer, employee, consultant or otherwise) (such activities hereinafter
referred to collectively as “Engaging”) that competes directly with the Company. Notwithstanding
the foregoing, nothing herein shall prevent the Executive from (i) owning securities in a publicly
traded entity whose activities compete with those of the Company (or any member thereof), provided
that such securities holdings are not greater than five percent of the equity ownership in such
entity; (ii) Engaging in the business of the ownership and licensing (as licensor) of trademarks
and brands if the products or services carrying such trademarks and brands do not compete with the
products or services carrying the trademarks and brands owned and licensed (as licensor) by the
Company, or that the Company is actively planning to own or license (as licensor), on the Date of
Termination; or (iii) Engaging in an operating company (including ownership of securities of such
operating company’s holding company) with annual revenues not in excess of $10,000,000.
7.4 The Executive shall not, except in the furtherance of the Executive’s duties hereunder,
directly or indirectly, individually or on behalf of any other person, firm, corporation or other
entity, (i) during the Term (except in the good faith performance of his duties) and for a period
of 24 months thereafter, solicit, aid or induce any employee, representative or agent of the
Company to leave such employment or retention or to accept employment with or render services to or
with any other person, firm, corporation or other entity unaffiliated with the Company or hire or
retain any such employee, representative or agent, or take any action to materially assist or aid
any other person, firm, corporation or other entity in identifying, hiring or soliciting any such
employee, representative or agent, (ii) during the Term (except in the good faith performance of
his duties) and for a period of 12 months thereafter, solicit, aid or induce any customer of the
Company to purchase goods or services then sold by the Company from another person, firm,
corporation or other entity or assist or aid any other persons or entity in identifying or
soliciting any such customer or (iii) during the Term (except in the good faith performance of his
duties) and for a period of 24 months thereafter, interfere in any manner with the relationship of
the Company and any of its vendors. An employee, representative or agent shall be deemed covered
by this Section while so employed or retained by the Company and for six months thereafter.
Anything to the contrary herein notwithstanding, the following shall not be deemed a violation of
this Section 7.4: (a) the Executive’s solicitation of the Company’s customers and/or vendors in
connection with, and directly related to, his Engaging in a business that complies with Sections
7.3(ii) or (iii); (b) the Executive’s responding to an unsolicited request for an employment
reference regarding any former employee of the Company from such former employee, or from a third
party, by providing a reference setting forth his personal views about such former employee; or
(c) if an entity with which the Executive is associated hires or engages any employee of the
Company, if the Executive was not, directly or indirectly, involved in hiring or identifying such
person as a potential recruit or assisting in the recruitment of such employee. For purposes
hereof, the Executive shall be deemed to have been involved “indirectly” in soliciting, hiring or
identifying an employee only if the Executive (x) directs a third party to solicit or hire the
Employee, (y) identifies an employee to a third party as a potential recruit or (z) aids, assists
or participates with a third party in soliciting or hiring an employee.
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7.5 At no time during or within five years after the Term shall the Executive, directly or
indirectly, disparage the Company Group or any of the Company Group’s past or present employees,
directors, products or services. The Company shall advise its senior officers and the members of
the Board (while serving in such capacities) not to disparage the Executive during the period.
Notwithstanding the foregoing, nothing in this Section 7.5 shall prevent any person from making any
truthful statement to the extent (i) necessary to rebut any untrue public statements made about him
or her; (ii) necessary with respect to any litigation, arbitration or mediation involving this
Agreement and the enforcement thereof; (iii) required by law or by any court, arbitrator, mediator
or administrative or legislative body (including any committee thereof) with jurisdiction over such
person; or (iv) made as good faith competitive statements in the ordinary course of business.
7.6 Upon the receipt of reasonable notice from the Company (including the Company’s outside
counsel), the Executive shall, while employed by the Company and thereafter, respond and provide
information with regard to matters of which the Executive has knowledge as a result of the
Executive’s employment with the Company and will provide reasonable assistance to the Company Group
and its representatives in defense of any claims that may be made against the Company Group (or any
member thereof), and will provide reasonable assistance to the Company Group in the prosecution of
any claims that may be made by the Company Group (or any member thereof), to the extent that such
claims may relate to matters related to the Executive’s period of employment with the Company (or
any predecessors). Any request for such cooperation shall take into account the Executive’s
personal and business commitments. The Executive shall promptly inform the Company (to the extent
the Executive is legally permitted to do so) if the Executive is asked to assist in any
investigation of the Company Group (or any member thereof) or their actions, regardless of whether
a lawsuit or other proceeding has then been filed with respect to such investigation. If the
Executive is required to provide any services pursuant to this Section 7.6 following the Term, upon
presentation of appropriate documentation, the Company shall promptly reimburse the Executive for
reasonable out-of-pocket travel, lodging, communication and duplication expenses incurred in
connection with the performance of such services and in accordance with the Company’s expense
policy for its senior officers, and for reasonable legal fees to the extent the Board in good faith
believes that separate legal representation is reasonably required. The Executive’s entitlement to
reimbursement of such costs and expenses, including legal fees, pursuant to this Section 7.6, shall
in no way affect the Executive’s rights, if any, to be indemnified and/or advanced expenses in
accordance with the Company’s (or any of its subsidiaries’) corporate or other organizational
documents, any applicable insurance policy, and/or in accordance with this Agreement.
7.7 Without intending to limit the remedies available to the Company, the Executive
acknowledges that a breach of any of the covenants contained in this Section 7 may result in
material and irreparable injury to the Company, or its affiliates or subsidiaries, for which there
is no adequate remedy at law, that it will not be possible to measure damages for such injuries
precisely and that, in the event of such a breach or threat the Company shall be entitled to a
temporary restraining order and/or a preliminary or permanent injunction restraining the Executive
from engaging in activities prohibited by this Section 7 or such other relief as may be required
specifically to enforce any of the covenants in this Section 7. If for any reason it is held that
the restrictions under this Section 7 are not reasonable or that consideration therefor is
inadequate, such restrictions shall be interpreted or modified to include as much of the
duration and scope identified in this Section as will render such restrictions valid and
enforceable.
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7.8 In the event of any violation of the provisions of this Section 7, the Executive
acknowledges and agrees that: (a) the post-termination restrictions contained in this Section 7
shall be extended by a period of time equal to the period of such violation, it being the intention
of the parties hereto that the running of the applicable post-termination restriction period shall
be tolled during any period of such violation; (b) any severance payable which remains unpaid or
other benefits yet to be received under Section 5.4.2 or 5.4.3 shall be forfeited by the Executive;
and (c) any vested options not exercised as of the date of any violation of the provisions of this
Section 7 shall be forfeited.
| 8. | INDEMNIFICATION; DIRECTORS’ AND OFFICERS’ LIABILITY INSURANCE |
During the Term and thereafter, the Company shall indemnify and hold harmless the Executive
and his heirs and representatives as, and to the extent, provided in the Company’s by-laws. During
the Term and thereafter, the Company shall also cover Executive under the Company’s directors’ and
officers’ liability insurance on the same basis as it covers other senior executive officers and
directors of the Company.
| 9. | MISCELLANEOUS |
9.1 Notices. All notices or communications hereunder shall be in writing, addressed
as follows (or to such other address as either party may have furnished to the other in writing by
like notice):
| To the Company: | Impax Laboratories, Inc. 000 Xxx Xxxxxxx Xxxxxxxxx Xxxxxxxx, XX 00000 Attn: Chairman, Compensation Committee |
To the Executive, at the last address for the
Executive on the books of the Company.
All such notices shall be conclusively deemed to be received and shall be effective (i) if
sent by hand delivery, upon receipt, (ii) if sent by telecopy or facsimile transmission, upon
confirmation of receipt by the sender of such transmission, (iii) if sent by overnight courier, one
business day after being sent by overnight courier, or (iv) if sent by registered or certified
mail, postage prepaid, return receipt requested, on the fifth day after the day on which such
notice is mailed.
9.2 Severability. 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 will be ineffective to the
extent of such prohibition or invalidity, without invalidating the remainder of such provision or
the remaining provisions of this Agreement.
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9.3 Binding Effect; Benefits. Executive may not delegate his duties or assign his
rights hereunder. No rights or obligations of the Company under this Agreement may be assigned or
transferred by the Company other than pursuant to a merger or consolidation in which the Company is
not the continuing entity, or a sale, liquidation or other disposition of all or substantially all
of the assets of the Company, provided that the assignee or transferee is the successor to all or
substantially all of the assets or businesses of the Company and assumes the liabilities,
obligations and duties of the Company under this Agreement, either contractually or by operation of
law. The Company further agrees that, in the event of any disposition of its business and assets
described in the preceding sentence, it shall use its best efforts to cause such assignee or
transferee expressly to assume the liabilities, obligations and duties of the Company hereunder.
For the purposes of this Agreement, the term “Company” shall include the Company and, subject to
the foregoing, any of its successors and assigns. This Agreement shall inure to the benefit of,
and be binding upon, the parties hereto and their respective heirs, legal representatives,
successors and permitted assigns.
9.4 Modification of Termination Benefits. In the event that RiskMetrics Group or a
proxy advisory firm of similar stature recommends that stockholders do not vote in favor of the
election of any of the Company’s Directors because of any provision of sections 5 or 7 of this
Agreement, the Executive shall, upon request of the Company, enter into an amendment of this
Agreement modifying or eliminating such provision to the extent necessary to cause withdrawal of
such recommendation.
9.5 Entire Agreement. This Agreement, including the Exhibits hereto, represent the
entire agreement of the parties with respect to the subject matter hereof and shall supersede any
and all previous contracts, arrangements or understandings between the Company and the Executive.
This Agreement (including any of the Exhibits hereto) may be amended at any time by mutual written
agreement of the parties hereto. In the case of any conflict between any express term of this
Agreement and any statement contained in any plan, program, arrangement, employment manual,
memorandum or rule of general applicability of the Company, this Agreement shall control.
9.6 Withholding. The payment of any amount pursuant to this Agreement shall be
subject to applicable withholding and payroll taxes, and such other deductions as may be required
by applicable law.
9.7 Governing Law. This Agreement and the performance of the parties hereunder shall
be governed by the internal laws (and not the law of conflicts) of the State of Delaware.
9.8 Arbitration. Any dispute or controversy arising under or in connection with this
Agreement or the Executive’s employment with the Company, other than injunctive relief under
Section 7.7 hereof, shall be settled exclusively by arbitration, conducted before a single
arbitrator in San Francisco, California (applying Delaware law) in accordance with the Commercial
Arbitration Rules and Procedures of the American Arbitration Association then in effect. The
decision of the arbitrator will be final and binding upon the parties hereto. Judgment may be
entered on the arbitrator’s award in any court having jurisdiction. The parties acknowledge and
agree that in connection with any such arbitration and regardless of outcome (a) each party shall
pay all its own costs and expenses, including without limitation its own legal fees and expenses,
and (b) joint expenses shall be borne equally among the parties. EACH PARTY WAIVES RIGHT TO
TRIAL BY JURY.
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9.9 Section 409A of the Code.
9.9.1 It is intended that the provisions of this Agreement comply with Section 409A of the
Internal Revenue Code and the regulations and guidance promulgated thereunder (collectively “Code
Section 409A”), and all provisions of this Agreement shall be construed in a manner consistent with
the requirements for avoiding taxes or penalties under Code Section 409A. If any provision of this
Agreement (or of any award of compensation, including equity compensation or benefits) would cause
the Executive to incur any additional tax or interest under Code Section 409A, the Company shall,
upon the specific request of the Executive, use its reasonable business efforts to in good faith
reform such provision to comply with Code Section 409A; provided, that to the maximum extent
practicable, the original intent and economic benefit to the Executive and the Company of the
applicable provision shall be maintained, but the Company shall have no obligation to make any
changes that could create any additional economic cost or loss of benefit to the Company. The
Company shall timely use its reasonable business efforts to amend any plan or program in which the
Executive participates to bring it in compliance with Code Section 409A. Notwithstanding the
foregoing, the Company shall have no liability with regard to any failure to comply with Code
Section 409A so long as it has acted in good faith with regard to compliance therewith.
9.9.2 A termination of employment shall not be deemed to have occurred for purposes of any
provision of this Agreement providing for the payment of any amounts or benefits upon or following
a termination of employment unless such termination is also a “Separation from Service” within the
meaning of Code Section 409A and, for purposes of any such provision of this Agreement, references
to a “resignation,” “termination,” “termination of employment” or like terms shall mean Separation
from Service. If the Executive is deemed on the Date of Termination to be a “specified employee,”
within the meaning of that term under Section (a)(2)(B) of Code Section 409A (“Code Section
409(a)(2)(B)”)and using the identification methodology selected by the Company from time to time,
or if none, the default methodology, then with regard to any payment, the providing of any benefit
or any distribution of equity made subject to this Section 9.9.2, to the extent required to be
delayed in compliance with Code Section 409A(a)(2)(B), and any other payment, the provision of any
other benefit or any other distribution of equity that is required to be delayed in compliance with
Code Section 409A(a)(2)(B), such payment, benefit or distribution shall not be made or provided
prior to the earlier of (i) the expiration of the six-month period measured from the date of the
Executive’s Separation from Service or (ii) the date of the Executive’s death. On the first day of
the seventh month following the date of Executive’s Separation from Service or, if earlier, on the
date of his death, (x) all payments delayed pursuant to this Section 9.9.2 (whether they would have
otherwise been payable in a single sum or in installments in the absence of such delay) shall be
paid or reimbursed to the Executive in a lump sum, and any remaining payments and benefits due
under this Agreement shall be paid or provided in accordance with the normal payment dates
specified for them herein and (y) all distributions of equity delayed pursuant to this Section
9.9.2 shall be made to the Executive. In addition to the foregoing, to the extent required by Code
Section 409A(a)(2)(B), prior to the occurrence of both a Disability termination as provided in
Section 5.1.2 hereof and the Executive’s becoming “disabled” under Code Section 409A, the
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payment of any compensation to the Executive under this Agreement shall be suspended for a
period of six months commencing at such time that the Executive shall be deemed to have had a
Separation from Service because either (A) a sick leave ceases to be a bona fide sick leave of
absence, or (B) the permitted time period for a sick leave of absence expires (an “SFS
Disability”), without regard to whether such SFS Disability actually results in a Disability
termination. Promptly following the expiration of such six-month period, all compensation
suspended pursuant to the foregoing sentence (whether it would have otherwise been payable in a
single sum or in installments in the absence of such suspension) shall be paid or reimbursed to the
Executive in a lump sum. On any delayed payment date under this Section 9.9.2, there shall be paid
to the Executive or, if the Executive has died, to his estate, in a single cash lump sum together
with the payment of such delayed payment, interest on the aggregate amount of such delayed payment
at the Delayed Payment Interest Rate (as defined below) computed from the date on which such
delayed payment otherwise would have been made to the Executive until the date paid. For purposes
of the foregoing, the “Delayed Payment Interest Rate” shall mean the short term Applicable Federal
Rate as of the business day immediately preceding the payment date for the applicable delayed
payment.
9.9.3 With regard to any provision herein that provides for reimbursement of costs and
expenses or in-kind benefits, except as permitted by Code Section 409A, (i) the right to
reimbursement or in-kind benefits shall not be subject to liquidation or exchange for another
benefit, (ii) the amount of expenses eligible for reimbursement, or in-kind benefits, provided
during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind
benefits to be provided, in any other taxable year, provided that the foregoing clause (ii) shall
not be violated with regard to expenses reimbursed under any arrangement covered by Section 105(b)
of the Internal Revenue Code and the regulations and guidance promulgated thereunder solely because
such expenses are subject to a limit related to the period the arrangement is in effect and (iii)
such payments shall be made on or before the last day of the Executive’s taxable year following the
taxable year in which the expense was incurred.
9.10 Survivorship. Except as otherwise expressly set forth in this Agreement, upon
the expiration of the Term, the respective rights and obligations of the parties shall survive such
expiration to the extent necessary to carry out the intentions of the parties as embodied in this
Agreement. This Agreement shall continue in effect until there are no further rights or
obligations of the parties outstanding hereunder and shall not be terminated by either party
without the express prior written consent of both parties.
9.11 Counterparts. This Agreement may be executed in counterparts (including by
electronic transmission) which, when taken together, shall constitute one and the same agreement of
the parties.
9.12 Company Representations. The Company represents and warrants to the Executive
that (i) the execution, delivery and performance of this Agreement (and the agreements referred to
herein) by the Company has been fully and validly authorized by all necessary corporate action,
(ii) the officer signing this Agreement on behalf of the Company is duly authorized to do so, (iii)
the execution, delivery and performance of this Agreement does not violate any applicable law,
regulation, order, judgment or decree or any agreement, plan or corporate governance document to
which the Company is a party or by which it is bound and (iv)
upon execution and delivery of this Agreement by the Executive and the Company, it shall be a
valid and binding obligation of the Company enforceable against it in accordance with its terms,
except to the extent that enforceability may be limited by applicable bankruptcy, insolvency or
similar laws affecting the enforcement of creditors’ rights generally.
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IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed and the
Executive has hereunto set his hand, as of the Signing Date.
| Impax Laboratories, Inc. |
||||
| By: | /s/ Xxxxxx X. Xxxx | |||
| Name: | Xxxxxx X. Xxxx | |||
| Title: | Chairman, Compensation Committee | |||
| /s/ Xxxxxxx X. Xxxxxx | ||||
| Xxxxxxx X. Xxxxxx | ||||
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EXHIBIT A
Form of General Release and Waiver
This General Release and Waiver (this “Release”) is entered into effective as of
_______ __, 20__, by _______(the “Executive”) in favor of Impax Laboratories, Inc. (the
“Company”).
1. Confirmation of Termination. The Executive’s employment with the Company is
terminated as of _______, 20__(the “Termination Date”). Except as set forth in the Employment
Agreement (as defined below), the Executive acknowledges that the Termination Date is the
termination date of his employment for purposes of participation in and coverage under all benefit
plans and programs sponsored by or through the Company. The Executive acknowledges and agrees that
the Company shall not have any obligation to rehire the Executive, nor shall the Company have any
obligation to consider him for employment, after the Termination Date. The Executive agrees that
he will not seek employment with the Company at any time in the future.
2. Resignation. Effective as of the Termination Date, the Executive hereby resigns as
an officer and director of the Company and any of its affiliates and from any such positions held
with any other entities at the direction or request of the Company or any of its affiliates. The
Executive agrees to promptly execute and deliver such other documents as the Company shall
reasonably request to evidence such resignations. In addition, the Executive hereby agrees and
acknowledges that the Termination Date shall be date of his termination from all other offices,
positions, trusteeships, committee memberships and fiduciary capacities held with, or on behalf of,
the Company or any of its affiliates.
3. Termination Benefits. Upon the Executive’s execution and delivery of this Release
and failure to revoke it within the time specified in Section 10 below, then, subject to Section 9
below, the Executive will be entitled to the payments and benefits (subject to taxes and all
applicable withholding requirements) set forth under Section [5.4.2] [5.4.3] of the Employment
Agreement effective as of January 1, 2009 between the Company and the Executive (the “Employment
Agreement”) and the distribution with respect to the restricted stock and stock options set forth
under Section [5.4.2] [5.4.3] [5.4.6] of the Employment Agreement (the “Termination Benefits”).
Notwithstanding anything herein to the contrary, the Amounts and Benefits (as defined in the
Employment Agreement) shall not be subject to the Executive’s execution of this Release. The
Executive acknowledges and agrees that the Termination Benefits exceed any payment, benefit, or
other thing of value to which the Executive might otherwise be entitled under any policy, plan or
procedure of the Company and/or any agreement between the Executive and the Company, except as
provided above.
4. General Release and Waiver. In consideration of the Termination Benefits, and for
other good and valuable consideration, receipt of which is hereby acknowledged, the Executive for
himself and for his heirs, executors, administrators, trustees, legal representatives and assigns
(collectively, the “Releasors”), hereby releases, remises, and acquits the Company and its
affiliates and all of their respective past, present and future parent entities, subsidiaries,
divisions, affiliates and related business entities, any of their successors and assigns, assets,
A-1
employee benefit plans or funds, and any of their respective past and/or present directors,
officers, fiduciaries, agents, trustees, administrators, managers, supervisors, shareholders,
investors, employees, legal representatives, agents, counsel and assigns, whether acting on behalf
of the Company or its affiliates or, in their individual capacities (collectively, the “Releasees”
and each a “Releasee”) from any and all claims, known or unknown, which the Releasors have or may
have against any Releasee arising on or prior to the date of this Release and any and all liability
which any such Releasee may have to the Releasors, whether denominated claims, demands, causes of
action, obligations, damages or liabilities arising from any and all bases, however denominated,
including but not limited to (a) any claim under the Age Discrimination in Employment Act of 1967,
the Americans with Disabilities Act of 1990, the Family and Medical Leave Act of 1993, the Civil
Rights Act of 1964, the Civil Rights Act of 1991, Section 1981 of the Civil Rights Act of 1866, the
Equal Pay Act, the Immigration Reform and Control Act of 1986, the Employee Retirement Income
Security Act of 1974, (excluding claims for accrued, vested benefits under any employee benefit or
pension plan of the Company, subject to the terms and conditions of such plan and applicable law),
and the Xxxxxxxx-Xxxxx Act of 2002, all as amended; (b) any claim under the California Fair
Employment and Housing Act and any other provision of the California Labor Law, all as amended; (c)
any claim under any other Federal, state, or local law and any workers’ compensation or disability
claims under any such laws; and (d) any claim for attorneys’ fees, costs, disbursements and/or the
like. This Release includes, without limitation, any and all claims arising from or relating to
the Executive’s employment relationship with Company and his service relationship as an officer or
director of the Company or any of its affiliates, or as a result of the termination of such
relationships. The Executive further agrees that the Executive will not file or permit to be filed
on the Executive’s behalf any such claim. Notwithstanding the preceding sentence or any other
provision of this Release, this Release is not intended to interfere with the Executive’s right to
file a charge with the Equal Employment Opportunity Commission (“EEOC”) in connection with any
claim he believes he may have against any Releasee. However, by executing this Release, the
Executive hereby waives the right to recover in any proceeding the Executive may bring before the
EEOC or any state human rights commission or in any proceeding brought by the EEOC or any state
human rights commission on the Executive’s behalf. This Release is for any relief, no matter how
denominated, including, but not limited to, injunctive relief, wages, back pay, front pay,
compensatory damages, or punitive damages. This Release shall not apply to (i) the obligation of
the Company to provide the Executive with the Amounts and Benefits and the Termination Benefits and
any provision relating thereto under the Employment Agreement; (ii) the Executive’s rights to
indemnification from the Company or rights to be covered under any applicable insurance policy with
respect to any liability the Executive incurred or might incur as an employee, officer or director
of the Company including, without limitation, the Executive’s rights under Section 8 of the
Employment Agreement; or (iii) any right the Executive may have to obtain contribution as permitted
by law in the event of entry of judgment against the Executive as a result of any act or failure to
act for which the Executive, on the one hand, and Company or any other Releasee, on the other hand,
are jointly liable.
5. Continuing Covenants. The Executive acknowledges and agrees that he remains
subject to the provisions of Section 7 of the Employment Agreement which shall remain in full force
and effect for the periods set forth therein.
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6. No Admission. This Release does not constitute an admission of liability or
wrongdoing of any kind by the Company or any other Releasee. This Release is not intended, and
shall not be construed, as an admission that any Releasee has violated any federal, state or local
law (statutory or decisional), ordinance or regulation, breached any contract or committed any
wrong whatsoever against any Releasor.
7. Heirs and Assigns. The terms of this Release shall be binding upon and inure to
the benefit of the parties named herein and their respective successors and permitted assigns.
8. Miscellaneous. This Release will be construed and enforced in accordance with the
laws of the State of Delaware without regard to the principles of conflicts of law. If any
provision of this Release is held by a court of competent jurisdiction to be illegal, void or
unenforceable, such provision shall have no effect; however, the remaining provisions will be
enforced to the maximum extent possible. The parties acknowledge and agree that, except as
otherwise set forth herein, this Release constitutes the complete understanding between the parties
with regard to the matters set forth herein and, except as otherwise set forth herein, supersede
any and all agreements, understandings, and discussions, whether written or oral, between the
parties. No other promises or agreements are binding unless in writing and signed by each of the
parties after the Release Effective Date (as defined below). Should any provision of this Release
require interpretation or construction, it is agreed by the parties that the entity interpreting or
constructing this Release shall not apply a presumption against one party by reason of the rule of
construction that a document is to be construed more strictly against the party who prepared the
document.
9. Knowing and Voluntary Waiver. The Executive acknowledges that he: (a) has
carefully read this Release in its entirety; (b) has had an opportunity to consider it for at least
21 days; (c) is hereby advised by the Company in writing to consult with an attorney of his
choosing in connection with this Release; (d) fully understands the significance of all of the
terms and conditions of this Release and has discussed them with his independent legal counsel, or
had a reasonable opportunity to do so; (e) has had answered to his satisfaction any questions he
has asked with regard to the meaning and significance of any of the provisions of this Release and
has not relied on any statements or explanations made by any Releasee or their counsel; (f)
understands that he has seven days in which to revoke this Release (as described in Section 10)
after signing it and (g) is signing this Release voluntarily and of his own free will and agrees to
abide by all the terms and conditions contained herein.
10. Effective Time of Release. The Executive may accept this Release by signing it
and delivering it to the Company as provided in Section 9.1 of the Employment Agreement within 21
days of his receipt hereof. After executing this Release, the Executive will have seven days (the
“Revocation Period”) to revoke this Release by indicating his desire to do so in writing delivered
to the Company in accordance with Section 9.1 of the Employment Agreement by no later than 5:00
p.m. EST on the seventh day following the date on which he executes and delivers this Agreement.
The effective date of this Agreement shall be the eighth day after the Executive executes and
delivers this Agreement (the “Release Effective Date”). If the last day of the Revocation Period
falls on a Saturday, Sunday or holiday, the last day of the Revocation Period will be deemed to be
the next business day. If the Executive does not execute this Release or exercises his right to
revoke hereunder, he shall forfeit his right to receive any of the
Termination Benefits, and to the extent such Termination Benefits have already been provided,
the Executive agrees that he will immediately reimburse the Company for the amounts of such
payment.
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IN WITNESS WHEREOF, the Executive has duly executed this Release as of the date first set
forth above.
| EXECUTIVE: |
||||
| Name: | ||||
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