EXHIBIT 10.19
NON-COMPETITION AND SEVERANCE AGREEMENT
This Non-Competition and Severance Agreement (the "Agreement") is dated
as of November 29, 2001, and is entered into between Pharmion Corporation, a
Delaware corporation (the "Company"), and Xxxxxxx Xxxxxxxx (the "Employee").
WHEREAS, the Employee is currently employed by the Company; and
WHEREAS, the Employee and the Company desire to embody in this
Agreement the terms, conditions and benefits to be provided to the Employee in
the event of the Employee's termination of employment with the Company; and
WHEREAS, this Agreement shall supersede all prior oral and written
agreements, arrangements and understandings relating to the terms and conditions
of severance pay in the event of Employee's employment termination without Just
Cause (as defined herein).
NOW, THEREFORE, the parties hereby agree:
Section 1. DEFINITIONS.
(a) "Board" shall mean the Board of Directors of the Company.
(b) "Just Cause" shall mean (with regard to the Employee's termination
of employment with the Company): (i) Employee has committed or engaged in
negligent or willful conduct that is likely to be detrimental to the Company;
(ii) Employee has engaged in acts which constitute theft, fraud, or other
illegal or dishonest conduct which are considered to be harmful to the Company
as determined by the majority vote of the Board; (iii) Employee has willfully
disobeyed the reasonable and lawful directives of the Company' Chief Executive
Officer or the Company's President or Board; (iv) Employee has refused or is
unwilling to perform his/her job duties; (v) Employee has failed adequately to
perform his/her job duties, provided, however, that the Company shall provide
Employee with written notice of the deficiencies in his/her performance and
Employee shall be given 45 days to remedy such deficiencies. (vi) Employee has
demonstrated habitual absenteeism; (vii) Employee is substantially dependent on
alcohol or any controlled substance or violates any general Company policy with
regard to alcohol or controlled substances; (viii) Employee has engaged in acts
which constitute sexual or other forms of illegal harassment or discrimination;
(ix) Employee makes public remarks that disparage the Company, its Board,
officers, directors, advisors, Employees, affiliates or subsidiaries; (x)
Employee violates his/her fiduciary duty to the Company, or his/her duty of
loyalty to the Company; or (xi) Employee breaches any term of this Agreement or
any other material agreement between Employee and the Company or any of its
subsidiaries.
(c) "Salary" shall mean, at any relevant time, the Employee's regular
annual salary from the Company, excluding shift premiums, overtime, bonuses or
any other allowance.
Section 2. BENEFITS.
(a) Severance Benefit. In the event that the Employee's employment is
terminated by the Company without Just Cause (other than by reason of death or
disability), the Employee shall continue to receive the Salary at the rate in
effect hereunder on the date of such termination (the "Termination Date")
periodically, in accordance with the Company's prevailing payroll practices, for
a period of twelve (12) months following the Termination Date (the "Severance
Benefit"); provided, however, that the payment of the Severance Benefit shall
immediately terminate, and the Company shall have no further obligations to the
Employee with respect thereto, in the event that the Employee violates any of
the provisions contained in Section 3 hereof. Payment of any amounts pursuant to
this Section 2(a) shall be expressly conditioned upon the Employee's execution
of a general waiver and release of claims against the Company and its officers,
directors, agents, and affiliates in a form acceptable to the Company.
(b) Continuation of Benefits in the Event of Death. In the event the
Employee dies prior to receipt of the Employee's entire Severance Benefit, the
remaining portion of such Severance Benefit shall continue to be paid, in the
same form and at the same time as described in Section 2(a) above to the
Employee's spouse, or, if the Employee is not married on the date of death, to
the Employee's estate.
(c) Mitigation/Set Off. (i) The Employee shall not be required to seek
other employment or to attempt in any way to reduce amounts payable to the
Employee pursuant to this Agreement.
Section 3. RESTRICTIVE COVENANTS. The Employee acknowledges and agrees
that the agreements and covenants contained in this Section 3 are (i) reasonable
and valid in geographical and temporal scope and in all other respects, and (ii)
essential to protect the value of the Company's business and assets, and by his
employment with the Company, the Employee will obtain knowledge, contacts,
know-how, training and experience and there is a substantial probability that
such knowledge, know-how, contacts, training and experience could be used to the
substantial advantage of a competitor of the Company and to the Company's
substantial detriment. For purposes of this Section 3, references to the Company
shall be deemed to include its subsidiaries.
(a) Non-Competition. The Employee covenants and agrees that during the
Employee's employment with the Company (the "Employment Period") and for a
period extending to the first anniversary of the Employee's termination of
employment for any reason (the "Restricted Period"), with respect to any State
or foreign country in which the Company is engaged in business at the time of
such termination, the Employee shall not, directly or indirectly, individually
or jointly, own any interest in, operate, join, control or participate as a
partner, director, principal, officer, or agent of, enter into the employment
of, act as a consultant to, or perform any services for any entity which
competes to a material extent with the business activities in which the Company
is engaged at the time of such termination or in which business activities the
Company has documented plans to become engaged in and as to which Employee has
knowledge at the time of Employee's termination of employment, or any entity in
which any such relationship with the Employee would result in the inevitable use
or disclosure of Confidential Information. Notwithstanding anything herein to
the contrary, this Section 3(a)
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shall not prevent the Employee from acquiring as an investment securities
representing not more than one percent (1%) of the outstanding voting securities
of any publicly-held corporation.
(b) Extension. If the Employee violates the provisions of Section 3(a)
above, the Employee shall continue to be bound by the restrictions set forth in
Section 3(a) until a period of one year has expired without any violation of
such provisions.
(c) Blue Pencil. If any court of competent jurisdiction shall at any
time deem the duration or the geographic scope of any of the provisions of this
Section 3 unenforceable, the other provisions of this Section 3 shall
nevertheless stand and the duration and/or geographic scope set forth herein
shall be deemed to be the longest period and/or greatest size permissible by law
under the circumstances, and the parties hereto agree that such court shall
reduce the time period and/or geographic scope to permissible duration or size.
Section 4. INJUNCTIVE RELIEF. Without intending to limit the remedies
available to the Company, the Employee acknowledges that a breach of any of the
covenants contained in Section 3 hereof may result in material irreparable
injury to the Company or its subsidiaries or affiliates 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 thereof,
the Company shall be entitled to obtain a temporary restraining order and/or a
preliminary or permanent injunction, without the necessity of proving
irreparable harm or injury as a result of such breach or threatened breach of
Section 3 hereof, restraining the Employee from engaging in activities
prohibited by Section 3 hereof or such other relief as may be required
specifically to enforce any of the covenants in Section 3 hereof.
Notwithstanding any other provision to the contrary, the Restricted Period shall
be tolled during any period of violation of any of the covenants in Section 3(a)
hereof and during any other period required for litigation during which the
Company seeks to enforce this covenant against the Employee if it is ultimately
determined that such person was in breach of such covenants.
Section 5. TAXES. The Company may withhold from any payments made under
this Agreement all applicable taxes, including but not limited to income,
employment and social insurance taxes, as shall be required by law.
Section 6. SUCCESSORS AND ASSIGNS; NO THIRD-PARTY BENEFICIARIES.
(a) The Company. This Agreement shall inure to the benefit of and be
enforceable by, and may be assigned by the Company to, any purchaser of all or
substantially all of the Company's business or assets, any successor to the
Company or any assignee thereof (whether direct or indirect, by purchase,
merger, consolidation or otherwise). The Company will require any such
purchaser, successor or assignee to expressly assume and agree to perform this
Agreement in the same manner and to the same extent that the Company would be
required to perform it if no such purchase, succession or assignment had taken
place.
(b) The Employee. The Employee's rights and obligations under this
Agreement shall not be transferable by the Employee by assignment or otherwise,
without the prior written consent of the Company; provided, however, that if the
Employee shall die, all amounts then payable to the Employee hereunder shall be
paid in accordance with the terms of
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this Agreement to the Employee's devisee, legatee or other designee or, if there
be no such designee, to the Employee's estate.
Section 7. WAIVER AND AMENDMENTS. Any waiver, alteration, amendment or
modification of any of the terms of this Agreement shall be valid only if made
in writing and signed by the parties hereto; provided, however, that any such
waiver, alteration, amendment or modification is consented to on the Company's
behalf by the Board. No waiver by either of the parties hereto of their rights
hereunder shall be deemed to constitute a waiver with respect to any subsequent
occurrences or transactions hereunder unless such waiver specifically states
that it is to be construed as a continuing waiver.
Section 8. SEVERABILITY AND GOVERNING LAW. If any covenants or such
other provisions of this Agreement are found to be invalid or unenforceable by a
final determination of a court of competent jurisdiction (a) the remaining terms
and provisions hereof shall be unimpaired and (b) the invalid or unenforceable
term or provision hereof shall be deemed replaced by a term or provision that is
valid and enforceable and that comes closest to expressing the intention of the
invalid or unenforceable term or provision hereof. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF COLORADO
(WITHOUT GIVING EFFECT TO THE CHOICE OF LAW PRINCIPLES THEREOF) APPLICABLE TO
CONTRACTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE.
Section 9. NOTICES.
(a) Every notice or other communication relating to this Agreement
shall be in writing, and shall be mailed to or delivered to the party for whom
it is intended at such address as may from time to time be designated by it in a
notice mailed or delivered to the other party as herein provided, provided that,
unless and until some other address be so designated, all notices or
communications by the Employee to the Company shall be mailed or delivered to
the Company at its principal executive office, and all notices or communications
by the Company to the Employee may be given to the Employee personally or may be
mailed to Employee at the Employee's last known address, as reflected in the
Company's records.
(b) Any notice so addressed shall be deemed to be given: (i) if
delivered by hand, on the date of such delivery; (ii) if mailed by courier, on
the first business day following the date of such mailing; and (iii) if mailed
by registered or certified mail, on the third business day after the date of
such mailing.
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Section 10. EFFECT OF AGREEMENT. This Agreement shall not be construed
as creating any contract of employment between the Company and the Employee and
nothing in this Agreement shall be construed to alter the Employee's status as
an "at-will" employee. The Employee shall not have any right to be retained in
the employ or service of the Company for any length of time by reason of this
Agreement, and this Agreement shall not affect the right of the Company to deal
with the Employee in all respects relating to the Employee's employment,
including the Employee's discharge, compensation, and conditions of employment.
Section 11. SECTION HEADINGS. The headings of the sections and
subsections of this Agreement are inserted for convenience only and shall not be
deemed to constitute a part thereof, affect the meaning or interpretation of
this Agreement or of any term or provision hereof.
Section 12. ENTIRE AGREEMENT. This Agreement constitutes the entire
understanding and agreement of the parties hereto regarding the employment of
the Employee. This Agreement supersedes all prior negotiations, discussions,
correspondence, communications, understandings and agreements between the
parties relating to the subject matter of this Agreement.
Section 13. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which
together shall be considered one and the same agreement.
[Signatures appear on next page]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date and year first above written.
PHARMION CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
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Name: Xxxxxx X. Xxxxxxx
Title: Chief Financial Officer
EMPLOYEE
/s/ Xxxxxxx Xxxxxxxx
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