EXHIBIT 10.24
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT, effective as of October 1, 1997, between Innovir
Laboratories, Inc., a Delaware corporation (the "Company"), and Xxxxxx X. Xxxxxx
(the "Employee"). VIMRX Pharmaceuticals, Inc. ("VIMRX"), a Delaware corporation
and the majority owner of the Company, is also a party to and guarantor of this
Agreement.
The Company desires to employ the Employee as President and CEO of the
Company and the Employee desires to accept such employment by the Company, on
the terms and subject to the conditions set forth in this Agreement.
NOW THEREFORE, in consideration of the mutual convenants and
obligations set forth in this Agreement, the Company and the Employee agree as
follows:
1. Employment. The Company hereby employs the Employee, and the
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Employee hereby accepts employment by the Company, upon the terms and conditions
hereinafter set forth.
2. Term. Subject to the provisions for earlier termination set forth
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in this Agreement, the employment of the Employee hereunder shall initially be
for the period commencing on October 1, 1997 (the "Effective Date") and ending
on the second anniversary thereof (the "Initial Term"). The term of this
Agreement shall automatically be extended annually on the anniversary date of
this Agreement for additional successive two-year periods (each a "Renewal
Term") unless either the Company or the Employee notifies the other party in
writing of its election not to extend this Agreement, such notice to be provided
on or prior to the date 60 days before commencement of any Renewal Term. The
Initial Term and any Renewal Term are referred to herein collectively as the
"Employment Period".
3. Duties.
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(a) The Employee shall be employed in an executive management
capacity as the President and CEO of the Company. The Employee shall perform
such duties and services, consistent with his position as the President and CEO
of the Company, as may be assigned to him from time to time by the Board of
Directors of the Company or its designee. In furtherance of the foregoing, the
Employee hereby agrees to perform well and faithfully the aforesaid duties and
responsibilities and the other reasonable duties and responsibilities consistent
with his position as the President and CEO of the Company assigned to him from
time to time by the Board of Directors of the Company or its designee.
(b) The Company shall use its best efforts to cause the Employee
to be elected to the Board of Directors and the Executive Committee of the Board
of Directors of the Company.
3. Time to be Devoted to Employment.
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(a) Except for reasonable vacations (consistent with Company
policies) and absences due to temporary illness, during the Employment Period
the Employee shall devote his full time and energy to the business of the
Company.
(b) During the Employment Period the Employee shall not be
engaged in any other business activity which, in the reasonable judgment of the
Company, conflicts with the duties of the Employee hereunder, whether or not
such activity is pursued for gain, profit or other pecuniary advantage.
4. Compensation; Benefits.
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(a) During the Initial Term, the Company shall pay to the
Employee an annual base salary (the "Base Salary") of not less than $162,000,
payable in such installments as is the policy of the Company with respect to the
employees of the Company at substantially the same employment level as the
Employee. Said Base Salary shall be reviewed at the conclusion of each fiscal
year and shall be subject to increase at the option and in the sole discretion
of the Board of Directors of the company, said increase shall be made effective
at the time that annual merit increases for other employees of the Company at
substantially the same employment level as the Employee shall be made effective.
(b) The Employee may also receive an annual cash bonus based on
the Company's achievement of performance objectives established by the Board of
Directors for each fiscal year. Such performance objectives, as adopted by the
Board form time to time, shall be incorporated by reference in this Agreement.
For the Initial Term, such bonus shall be an amount in the range of 0% to 50% of
the Base Salary, as determined by the Board of Directors in its sole discretion.
For subsequent years the bonus a amount shall be determined by the Board of
Directors in its sole discretion. Any such cash bonus shall be paid promptly
after the end of the fiscal year, at the time that cash bonuses for other
employees of the Company at substantially the same employment level as the
Employee shall be paid.
(c) During the Employment Period, the Employee shall be entitled
to such insurance and other fringe benefits, including medical, life and
disability insurance as are made available form time to time to the employees of
the Company at substantially the same employment level as the Employee.
5. Reimbursements; Other Expenses.
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(a) The Company shall reimburse the Employee, in accordance with
the practice from time to time for other officers of the Company, for all
reasonable and necessary traveling expenses, disbursements and other reasonable
and necessary incidental expenses incurred by him for or on behalf of the
Company on or after the Effective Date and in the performance of his duties
hereunder upon presentation by the Employee to the Company of appropriate
vouchers.
(b) If the Employee vacates his corporate apartment at 0000 Xxxx
Xxxxxx, #00X, Xxx Xxxx, Xxx Xxxx 00000 for any reason, the Company, VIMRX or the
acquiring entity of either or both will assume all responsibility for all
payments required for the balance of the apartment and furniture leases in
effect at that time.
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(c) If the Employee's position as President and CEO of Innovir
is terminated for any reason except for cause, the Company or VIMRX or the
acquiring entity of either or both will pay the Employee's moving expenses from
New York to Wilmington, Delaware if the Employee so requests.
(d) Upon initiation of employment, Innovir will pay the Employee
a signing bonus of $20,000.
(e) Upon completion of one year of employment, Employee will be
eligible for payment of a bonus based on his and the Company's performance
during the prior year, the amount of which is to be determined at the sole
discretion of the Company's Board of Directors, except that in no case will the
amount of the bonus in the first year of employment be less than $18,000 unless
during said first year of employment the Employee has been terminated for cause.
6. Involuntary Termination.
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(a) If the Employee is incapacitated or disabled by accident,
sickness or otherwise so as to render him mentally or physically incapable of
performing the services required to be performed by him under this Agreement for
a period of ninety (90) consecutive days or longer or for ninety (90) days
during any six (6) month period (such condition being herein referred to as
"Disability"), the company may, at that time or any time thereafter, at its
option, with the approval of a majority of the Board of Directors of the
Company, terminate the employment of the Employee under this Agreement
immediately upon giving him notice to that effect (such termination as well as a
termination under Section 7(b) hereof, being hereinafter called an "Involuntary
Termination"). until the Company shall have terminated the Employee's employment
hereunder in accordance with the foregoing, the Employee shall be entitled to
receive his compensation notwithstanding any such physical or mental disability.
(b) If the Employee dies during the Employment Period, his
employment hereunder shall be deemed to cease as of the date of his death.
8. Termination for Cause. The Company may, with the approval of a
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majority of the Board of Directors of the Company, terminate the employment of
the Employee hereunder at any time during the Employment Period for "cause"
(such termination being hereinafter called a "Termination for Cause") by giving
the Employee notice of such termination, upon the giving of which such
termination shall take effect immediately. For the purposes of this Section 8,
"cause" shall mean (a) the Employee's willful misconduct with respect to the
business and affairs of the Company or any subsidiary or affiliate thereof, (b)
the Employee's neglect of duties or failure to act which can reasonably be
expected to materially and adversely affect the business or affairs of the
Company or any subsidiary or affiliate thereof, (c) the Employee's breach of
this Agreement or of his confidentiality obligation to the Company or its
majority owner, VIMRX, (d) the commission by the Employee of an act involving
embezzlement or fraud or (e) the Employee's indictment for any crime; provided,
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however, that (i) in the event of a Termination for Cause, solely pursuant to
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clause (e) hereof, and such indictment is subsequently withdrawn or the Employee
is subsequently acquitted of such crime (and has not at such time been convicted
of any other crime), then upon such withdrawal or acquittal the Employee shall
be entitled to the payments provided for pursuant to Section 11(c) hereof, and
(ii) in the event of a Termination for Cause, solely pursuant to clauses (a) or
(b) hereof, the Company shall first provide written notice to the Employee
specifying the manner in which Employee has engaged in willful misconduct or
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has neglected or failed to act, and Employee shall have 30 days after receipt of
such notice to cure such specified matters, and if a cure is effected, in the
reasonable determination of the Board of Directors, within such 30-day period,
the Company shall not have the right to effect a Termination for Cause relating
to the matters specified in such notice.
9. Termination without Cause. The Company may, with the approval of a
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majority of the Board of Directors of the Company, terminate the employment of
the Employee hereunder at any time during the Employment Period without "cause"
(such termination being hereinafter called a "Termination without Cause") by
giving the Employee notice of such termination, upon the giving of which such
termination shall take effect immediately.
10. Voluntary Termination. Any termination of the employment of the
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Employee hereunder otherwise than as a result of an Involuntary Termination, a
Termination for Cause or a Termination without Cause shall be deemed to be a
"Voluntary Termination". A Voluntary Termination shall be deemed to be
effective immediately upon such termination.
11. Effect of Termination of Employment.
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(a) Upon the termination of the Employee's employment hereunder
pursuant to a Voluntary Termination or a Termination for Cause, neither the
Employee nor his beneficiary or estate shall have any further rights or claims
against the Company under this Agreement except to receive:
(i) any unpaid portion of the Base Salary provided for in
Section 5(a), computed on a pro rata basis to the date of termination;
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(ii) reimbursement for any expenses for which the Employee
shall not have theretofore been reimbursed as provided in Section 6; and
(iii) payment for any accrued but unused vacation.
(b) Upon the termination of the Employee's employment hereunder
pursuant to an Involuntary Termination, neither the Employee nor his beneficiary
or estate shall have any further rights or claims against the Company under this
Agreement except to receive a termination payment equal to that provided for in
Section 11(a) hereof.
(c) Upon termination of the Employee's employment hereunder
pursuant to a Termination Without Cause, neither the Employee nor his
beneficiary or estate shall have any further rights or claims against the
Company under this Agreement except to receive a termination payment equal to
that provided for in Section 11(a) hereof, PLUS an amount equal to $100,000
payable in six (6) equal monthly installments.
12. Change of Control. In the event that, within twelve (12) months
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following a Change of Control (as defined below), the Employee terminates his
employment for Good Reason (as defined below), the Employee shall be entitled to
the payments set forth in Section 11(c), treating such termination for purposes
of this Agreement as a Termination without Cause. The term "Change of Control"
means the sale of substantially all of the assets of the Company to, or the
merger of the Company into, another corporation or entity, or the acquisition of
more than 50% of the voting securities of the Company by an entity which is not
a majority stockholder of
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the Company as of the Effective Date. The term "Good Reason" means: (a) any
significant diminution in the Employee's position, duties, responsibilities,
power, title or office as in effect immediately prior to a Change in Control;
(b) any reduction in the Employee's annual base salary, or material reduction in
the benefits made available to the Employee, as in effect on the Effective Date
or as may be increased from time to time; or (c) any requirement by the Company
that the location at which the Employee performs his principal duties for the
Company be changed to a new location outside a radius of fifty (50) miles from
the Employee's principal residence at the time of the Change of Control.
13. Liquidation. In the event that the Company is dissolved, liquidated
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or otherwise ceases to do business, the Employee will be deemed to have been
subject to a Termination without Cause, and shall be entitled to the payments
set forth in Section 11(c).
14. Remedies and Survival. The Employee acknowledges and understands that
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the provisions of this Agreement are of a special and unique nature, the loss of
which cannot be accurately compensated for in damages by an action at law, and
that the breach or threatened breach of the provisions of this Agreement would
cause the Company irreparable harm. In the event of a breach or threatened
breach by the Employee, the Company shall be entitled to an injunction
restraining him from such breach. Nothing herein contained shall be construed
as prohibiting the Company from pursuing any other remedies available for any
breach or threatened breach of this Agreement.
15. Notices. All notices and other communications which are required or
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permitted hereunder shall be in writing and sufficient if delivered personally
or sent by aid courier or first class certified or registered mail, return
receipt requested and postage prepaid, addressed as follows:
If to the Employee: Xxxxxx X. Xxxxxx
0000 Xxxx Xxxxxx, Xxx 00X
Xxx Xxxx, XX 00000
If to the Company: Xxxxx X. Xxxxxxx, Chairman
Innovir Laboratories, Inc.
c/o VIMRX Pharmaceuticals Inc.
0000 Xxxxxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000
With a copy to: Xxxxxxx X. Xxxxxxx, Esquire
Fulbright & Xxxxxxxx, L.L.P.
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
or to such other address as the party to whom notice is given may have furnished
to the other party in writing in accordance herewith. All notices and other
communications given to any party hereto in accordance with the provisions of
this Agreement shall be deemed to have been given on the date of delivery if
personally delivered; on the business day after the date when sent if sent by
air courier; and on the fifth business day after the date when sent if sent by
mail, in
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each case addressed to such party as provided in this Section or in accordance
with the latest unrevoked direction from such party.
16. Binding Agreement; Benefit. The provisions of this Agreement will be
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binding upon, and will inure to the benefit of, the respective heirs, legal
representatives and successors of the parties hereto.
17. Governing Law. This Agreement shall be governed by, and construed and
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enforced in accordance with, the laws of the State of Delaware.
18. Waiver of Breach. The waiver by either party of a breach of any
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provision of this Agreement by the other party must be in writing and shall not
operate or be construed as a waiver of any subsequent breach by such other
party.
19. Entire Agreement; Amendments. This Agreement contains the entire
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agreement between the parties with respect to the subject matter hereof and
supersedes all prior agreements or understandings among the parties with respect
thereto. This Agreement may be amended only by an agreement in writing signed
by the parties hereto.
20. Headings. The section headings contained in this Agreement are for
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reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
21. Severability. Any provision of this agreement that is prohibited or
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unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
22. Assignment. This Agreement is personal in its nature and the parties
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hereto shall not, without the consent of the other, assign or transfer this
Agreement or any rights or obligations hereunder; provided, however, that the
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provisions hereof shall inure to the benefit of, and be binding upon (i) each
successor of the Company, whether by merger, consolidation, transfer of all or
substantially all assets, or otherwise and (ii) the heirs and legal
representatives of the Employee.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the
date first above written.
INNOVIR LABORATORIES, INC. VIMRX PHARMACEUTICALS, INC.
_______________________ _______________________________
By: Xxxxx X. Xxxxxxx By: Xxxxxxx X. Xxxxxxx
Chairman President and CEO
ACCEPTED:
_______________________________
Xxxxxx X. Xxxxxx
