EXHIBIT 10.69
This EMPLOYMENT AGREEMENT, dated as of May 17, 2000, is entered into by and
between Cortex Pharmaceuticals, Inc. (the "Company"), and Xxxxx X. Xxxxxxx (the
"Executive").
WITNESSETH
WHEREAS, the Executive has considerable experience in management and business
development, and,
WHEREAS, the Company wishes to employ the Executive as its Senior Vice
President, Business Development, and the Executive wishes to be so employed by
The Company,
NOW, THEREFORE, the parties hereto, intending to be legally bound, hereby agree
as follows:
1. Engagement. The Company hereby employs the Executive as its Senior Vice
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President, Business Development, reporting to the President and Chief Executive
Officer and the Executive hereby accepts such employment, on the terms and
conditions hereinafter set forth.
2. Term. The term of this Agreement will begin on May 16, 2000 and shall
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continue thereafter for a one year period and shall be extended on each day for
one (1) day so that the remaining term hereof is always (1) year unless either
party elects to terminate this Agreement in accordance with its provisions.
3. Duties. During the term of this Agreement, the Executive shall serve as
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the Company's Vice President , Business Development, and shall have such duties
and responsibilities as are set forth in the Company's Bylaws and such other
executive responsibilities as may be assigned to him from time to time by the
Board of Directors. In particular and without limitation, Executive's duties
shall include using diligent efforts as appropriate to (i) develop relationships
with potential corporate partners for the development and commercialization of
the Company's technologies, (ii) assist the CEO in evaluating technologies that
may be licensed into the the Company (iii) assist the CEO and other executives
in the development of the Company's products through clinical trials and
regulatory approvals, and (iv) perform other duties as may be appropriate from
time to time. The Executive shall use his best efforts and shall act in good
faith in performing all duties reasonably required to be performed by him under
this Agreement.
4. Availability. Except as herein provided, the Executive shall devote his
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entire working time, attention and energies to the Company's business and during
the term of this Agreement shall not be engaged in any other business activity
without the prior written approval of the CEO. The Executive may engage in a
reasonable level of professional activities such as are typical for individuals
of a comparable professional stature.
5. Expenses. The Company shall reimburse the Executive, promptly upon
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presentation of itemized vouchers, for all ordinary and customary businesss
expenses, consistent with the Company's reimbursement policy, incurred by the
Executive in the performance of his duties.
6. Compensation. As compensation for the services to be rendered hereunder,
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the Company agrees as follows:
(a) to pay the Executive an annual salary of not less than $180,000 per annum,
subject to increase based on an annual review by the Compensation Committee
of the Board of Directors.
(b) To pay the Executive an annual bonus of from 15 to 50% of base annual
salary, based upon the level of performance of the Executive and/or the
Company as measured against mutually agreed-upon targets. The amount of
such bonus shall be determined annually be the Compensation Committee of
the Board of Directors.
(c) To allow the Executive to participate in such employee benefit programs as
are made available to management of the Company. In the event the Executive
elects not to participate in the Company's health and disability insurance
plan, the Company will contribute the equivalent value for the Executive
to purchase life insurance, selected by the Executive and naming a
beneficiary chosen by the Executive.
(d) To allow Executive to have four weeks of paid vacation each year during the
term of this Agreement.
The Executive acknowledges that salary and all other compensation payable under
this Agreement shall be subject to withholding for income and other applicable
taxes to the extent required by law.
7. Ownership of Material Information. The Executive is a named inventor or co-
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inventor of certain patents. Such patents are listed in Attachement 1. The
Executive has certain special knowledge and information that is described in
Attachment 2. The Executive retains all rights and benefits of the patents,
information and knowledge listed in Attachments 1 and 2. With these identified
exceptions, all right, title and interest of every kind and nature whatsoever in
and to discoveries, inventions and improvements, patents (and applications
therefore), copyrights, ideas, know how, creations or other proprietary rights
arising from or connected with the Executive's employment hereunder shall become
and remain the exclusive property of the Company, and Executive shall have no
interest therein. The Executive agrees to sign the standard proprietary rights
agreement that is required of all Company employees, provided, however, that in
the event of any conflict between such proprietary rights agreement and this
Agreement, the provisions of this Agreement shall govern.
8. Trade Secrets. The Executive covenants and agrees with the Company that he
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will not, during the term of this Agreement or thereafter, disclose to anyone
(except to the extent reasonably necessary for the Executive to perform his
duties hereunder or as
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may be required by law) any confidential information concerning the business or
affairs of the Company (or of any affiliate or subsidiary of the Company),
including but not limited to lists of customers, business plans, joint ventures,
financial or cost information, and confidential scientific and clinical
information (whether of the Company or entrusted to the Company by a third party
under a confidentiality agreement or understanding), which the Executive shall
have acquired in the course of or incident to the performance of his duties
pursuant to the terms of this Agreement. Nothing herein shall be construed as
prohibiting the Executive from disclosing to anyone any information which is, or
which becomes, available to the public (other than by reason of a violation by
the Executive of this Section 8) or which is a matter of general business
knowledge or experience.
9. Termination for Cause. The Company may terminate the employment of the
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Executive under this Agreement at any time for "Cause" ( as hereinafter defined)
upon not less than three day's notice to the Executive. As used herein, the term
"Cause" shall mean only: a) Executive's willful refusal or willful failure to
perform the duties properly assigned to him in accordance with the terms of this
Agreement or a material breach of Section 4 of this Agreement and such refusal,
failure or breach is detrimental to the interests of the Company, provided,
however, that the employment of the Executive shall not be terminated under this
clause (a) unless the Executive is given notice in writing that the conduct in
question constitutes grounds for termination under this Section 9 and the
Executive is allowed a reasonable period of time to remedy the refusal or
failure; b) Executive's commission of a felony or misdemeanor, which has a
material adverse effect on the Company; or (c) Executive's willful and material
breach of Section 8 of this Agreement. If the employment of the Executive under
this Agreement is terminated under Section 9, the Company shall give written
notice to the Executive specifying the cause of such action. Upon the
effectiveness of a termination of employment under this Section 9, the Company
shall be relieved of all further obligations under this Agreement.
Notwithstanding such termination of employment, the Executive shall continue to
be bound by the provisions of Sections 7 and 8.
10. Termination Without Cause or for Good Cause.
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(a) The Company may terminate the employment of the Executive under this
Agreement without cause at any time upon at least thirty (30) days' prior
written notice to the Executive. The Executive may terminate his employment
under this Agreement upon at least five (5) days' prior written notice to
the Company in the event of (i) material breach by the Company of any
representation, covenant or agreement contained in this Agreement, (ii) a
change in the Executive's title or a material reduction or alteration of
the duties of the Executive, (iii) a requirement that the Executive
relocate outside of Orange County, California, or (iv) a change in the
reporting relationship of the Executive. In the event of such a termination
by either the Company or the Executive under Section 10(a), the Company
shall pay to Executive termination pay equal to twelve months of then
current salary.
(b) If the employment of the Executive is terminated under paragraph (a), all
stock options then held by Executive shall immediately vest by one (1)
additional year.
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Executive acknowledges that this may produce a change in the tax status of
such options, and that the Company assumes no liability or obligation in
connection with any such change.
(c) Termination of employment under this Section 10 shall not terminate the
Executive's obligations under Sections 7 and 8.
(d) Nothing contained in this Agreement shall be construed to abrogate the
obligations of the Company to the Executive, or Executive's personal
representative or heirs, as the case may be, to make payment or provide any
other benefit that accrued prior to the termination of Executive's
employment.
11. Disability of the Executive. In the event that the Executive during this
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period while employed under this Agreement shall at any time become unable, due
to illness accident, injury or otherwise, to carry out his duties under this
Agreement for a period of at least three (3) consecutive months the Company may
terminate the employment of the Executive under this Agreement. In such event
the Company shall compensate the Executive in an amount equal to the difference
between any disability insurance proceeds and Executive's then current monthly
salary and other benefits for a period of one year. A termination of employment
under this Section 11 will not terminate the Executive's obligations under
Sections 7 and 8.
12. Voluntary Termination. The Executive may terminate his employment under
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this Agreement at any time by giving the Company thirty (30) days' written
notice, Termination of employment shall not terminate the Executive's
obligations under Sections 7 and 8.
13. Grant of Stock Options. As of the date hereof, the Company shall grant to
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the Executive: options to purchase 125,000 shares of common stock of the Company
with an exercise price equal. to fair market value of such date, with a ten-year
term, and with vesting in three parts (41,666 options, 41,666 options, and
41,667 options) over a three-year period commencing one year from the date
hereof. Executive's stock option position will be reviewed by the Stock Option
Committee of the Board of Directors from time to time, but in no event less than
annually, and increases in such stock option position may be awarded dependent
upon the performance of the Executive. To the maximum extent permissible, stock
options granted to the Executive shall be "incentive stock options" as defined
in Section. 422 of the Internal Revenue Code. The general terms and conditions
of stock option granted to the Executive shall be in accordance with the
stockholder-approved plans established for the granting of options, amended from
time to time.
14. Capacity. The Executive represents and warrants to a Company that he is not
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now under any obligation of a contractual nature or otherwise, to any person,
firm, corporation, association. or other entity that is inconsistent or in
conflict with this agreement or which would prevent, limit or impair in any way
the performance by him of his obligations hereunder. It is understood that the
Executive has interests as an owner/shareholder of Diversified Healthcare
Management LLC and Prodromics On-Line Inc. (also called Newco) that are not in
conflict with the above.
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15. Participation in Competitive Business. While the Executive is employed
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under this Agreement, the Executive shall not directly or indirectly either as
an employee, employer, consultant, agent, principal, partner, stockholder,
corporate consultant, officer, director or in any other individual or
representative capacity, engage or participate in any business that is in
competition in any manner whatsoever with the business of the Company without
the prior written. approval of the Company; provided however, that nothing
herein, shall preclude the Executive from owning less than one percent (1%) of
the outstanding capital stock of any company whose shares are traded on the New
York Stock Exchange, the American Stock Exchange or Nasdaq.
16. Waiver. No act, delay, omission or course of dealing on the part of
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any party hereto in exercising any right, power or remedy hereunder shall
operate as, or be construed as, a waiver thereof or otherwise prejudice such
party's rights, powers and remedies under this Agreement.
17. Notice. Any and all notices referred to herein shall be sufficient if
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furnished in writing and delivered by hand or by registered by certified mail,
return receipt requested, postage fully prepaid, to the respective parties at
the following addresses or such other address as either party may from time to
time designate in writing. Notices shall be effective when delivered.
To Executive: Xxxxx X. Xxxxxxx
00000 Xxxxxxxx Xxxxxxx
Xxxxxx, Xxxxxxxxxx 00000
To Company: Attn: Corporate Secretary
Cortex Pharmaceuticals, Inc.
00000 Xxxxxxxx Xxxxxxx
Xxxxxx, Xxxxxxxxxx 00000
18. Arbitration. All disputes arising under or in connection with this
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Agreement shall be submitted to arbitration in Orange County, CA, under the
rules of the American Arbitration Association, and the decision of the
arbitrator shall be final and binding. Judgment upon the award rendered may be
entered and enforced in any court having jurisdiction. In no case shall either
party be liable for the other party's court costs arbitrations costs or
attorneys' fees.
19. Assignability. The rights and obligations contained herein shall be binding
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on and inure to the benefit of the successors and assigns of the Company. The
Executive may not assign his rights or obligations hereunder without the prior
written consent of the Company.
20. Construction. This Agreement shall be governed by and construed in
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accordance with the laws of the state of California.
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21. Completeness. This Agreement sets forth all, and is intended by each party
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to be an integration of all, of the promises, agreements and understandings
between the parties hereto with respect to the subject matter hereof.
22. Counterparts. This Agreement may be executed in multiple counterparts each
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of which shall he deemed to be an original, and all of which together shall
constitute one agreement binding on the parties hereto.
23. Severability. Each provision of this Agreement shall be considered
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severable and if for any reason any provision that is not essential to the
effectuation of the basic purpose of the Agreement is determined to be invalid
or contrary to any existing or future law, such invalidity shall not impair the
operation of or affect those provisions of this Agreement that are valid.
24. Headings. Headings constrained in the agreement are inserted for reference
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and convenience only and in no way define, limit, extend or describe the scope
of this Agreement or the meaning or construction of any of the provisions
hereof.
25. Survival of Terms. If this Agreement is terminated for any reason,
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the provision of Sections 7 .d 8 shall survive and the Executive and the
Company, as the case may be, shall continue to be bound by the terms thereof to
the extent provided therein.
IN WITNESS HEREOF, the parties hereto have executed this Agreement
on the day and year first above written.
CORTEX PHARMACEUTICALS, INC.
By: /s/ Xxxxxxx X. Xxxxxx
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Its: President & CEO
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EXECUTIVE
/s/ Xxxxx X. Xxxxxxx
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Attachment 1: Job Description Vice President Business Development
Purpose/Objective
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To provide leadership, intellectual impetus and urgency to drive the strategy,
execution, and achievement of company objectives. To oversee the strategic
planning process and serve as business consultant and negotiator for in-
licensing, co-promotions, co-development, and new business development within
the pharmaceutical platform.
Key Responsibilities/Activities
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Direct strategic planning process.
Direct strategic, tactical, and financial analysis of external business
development opportunities and present recommendations to senior management.
Direct the efforts of the business research and information organization,
providing key information on company customer base, the pharmaceutical industry
and competitive performance.
Develop and maintain ongoing relationships with counterparts and senior
management of the pharmaceutical industry, company corporate staff and other
company business groups in order to facilitate prompt, high level consideration
of in-licensing and business development opportunities.
Act as business/scientific consultant and negotiator for all pharmaceutical
group organizations pursuing high priority external development projects.
Target pharmaceutical companies and initiate deals for commercializing core
products and gain reciprocal marketing rights for these companies' products in
the US.
Function as internal consultant to senior management on special projects.
Key Job Requirements
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Demonstrated ability and substantial experience in broad range of negotiations.
Demonstrated leadership, communication, teamwork, analytical, planning, and
organizational skills.
Ability to develop creative solutions to business problems.
Strong pharmaceutical business background and basic scientific knowledge.
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Attachment 2: Patent Rights, XX Xxxxxxx
PATENTS ISSUED:
Xxxxxxx, XX: U.S. Patent, "Treatment of Panic Disorder with Adinazolam," Patent
Number 4,510,153. (1995)
Xxxxxxx, XX: U.S. Patent, "Treatment of Panic Disorder with Alprazolam," Patent
Number 4,508,726. (1985)
Xxxxxxx, XX: U.S. Patent, "Treatment of Panic Disorder with Estazolam," Patent
Number 4,481,208. (1984)
Xxxxxxx, XX: U.S. Patent, "Process for Treating Panic Disorder," Patent Number
4,476,134. (1984)
Xxxxxxx, XX: U.S. Patent, "Treatment of the Blood-Brain Barrier with Ibuprofen,"
Patent Number 509,906. (1983)
ANTICIPATED PATENT FILING (May, 2000, work in progress)
Xxxxxxx, XX: U.S. Patent, "AMPAKINEs(R) for the Treatment of Panic Disorder"
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