EXHIBIT 10.44
EMPLOYMENT AGREEMENT
This Employment Agreement ("AGREEMENT") is made by and between Xx. Xxxxx X.
Xxxxx ("XX. XXXXX") and Triangle Pharmaceuticals, Inc. ("TRIANGLE") as of
October 28, 1996 (the "Effective Date").
RECITALS
XX. XXXXX has been an employee of TRIANGLE since July 19, 1995. TRIANGLE
and XX. XXXXX wish to set forth in this AGREEMENT the terms and conditions under
which XX. XXXXX is to be employed by TRIANGLE from the date of execution
forward.
In consideration of XX. XXXXX'x agreement to continue providing services to
TRIANGLE, TRIANGLE's agreement to employ XX. XXXXX on the terms and conditions
set forth herein and the mutual agreements set forth herein, the parties hereto
agree as follows:
1. TERM AND NATURE OF EMPLOYMENT
TRIANGLE hereby employs XX. XXXXX as Chief Executive Officer of
TRIANGLE for a two (2) year period commencing on the Effective Date of this
AGREEMENT and ending on the second anniversary of the Effective Date, unless
said period of employment (the "Employment Period") is terminated earlier in
accordance with the terms of this AGREEMENT or is extended pursuant to a written
amendment executed by both parties. XX. XXXXX hereby accepts such employment
and agrees to devote his full business time and attention, best efforts, energy
and skills to the business and affairs of TRIANGLE. XX. XXXXX agrees to perform
such other duties as may from time to time be assigned to him by the Board of
Directors of TRIANGLE and shall act at all times in accordance with the best
interests of TRIANGLE. XX. XXXXX agrees that he shall comply with all
applicable governmental laws, rules and regulations and with all of TRIANGLE's
policies, rules and/or regulations applicable to the employees of TRIANGLE. The
employment relationship between TRIANGLE and XX. XXXXX may be terminated by
TRIANGLE or by XX. XXXXX at any time, with or without cause, subject to the
terms and conditions contained in article 5 of this AGREEMENT and the
obligations described in articles 6 and 7 hereof.
2. WAGE COMPENSATION
2.1 AMOUNT. XX. XXXXX shall be compensated on the basis of an
annualized salary of Two Hundred Sixteen Thousand Dollars ($216,000.00), less
applicable withholding taxes. Increases in salary, if any, shall be made at the
sole discretion of the Board of Directors of TRIANGLE. Nothing in this
paragraph 2.1 shall be construed to limit TRIANGLE's right to terminate this
AGREEMENT in accordance with the terms hereof.
2.2 PAYMENT. Salary payments will normally be made to XX. XXXXX
monthly or otherwise in accordance with TRIANGLE's pay period practices
applicable to executive officers.
3. OTHER BENEFITS
During the Employment Period, XX. XXXXX shall be entitled to receive
any other benefits which are provided to TRIANGLE's executive officers or other
full time employees, in accordance with TRIANGLE's policies and practices.
4. FORMER EMPLOYMENT
4.1 NO CONFLICT. XX. XXXXX represents and warrants that the
execution and delivery by him of this AGREEMENT, his employment by TRIANGLE and
his performance of duties under this AGREEMENT will not conflict with and will
not be constrained by any prior employment or consulting agreement or
relationship, or any other contractual obligations.
4.2 NO USE OF PRIOR CONFIDENTIAL INFORMATION. XX. XXXXX will not
intentionally disclose to TRIANGLE or use on its behalf any confidential
information belonging to any of his former employers, but during his employment
by TRIANGLE he will use in the performance of his duties all information (but
only such information) which is generally known and used by persons with
training and experience comparable to his own or is common knowledge in the
industry or otherwise legally in the public domain.
5. TERMINATION
5.1 TERMINATION OF AGREEMENT DUE TO DEATH. XX. XXXXX'x employment
and this AGREEMENT shall terminate upon XX. XXXXX'x death. In the event that
XX. XXXXX'x employment ends due to his death, TRIANGLE's obligations under this
AGREEMENT shall immediately cease and XX. XXXXX'x estate shall be entitled to no
severance benefits or any other benefits under this AGREEMENT, except
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that if XX. XXXXX dies within three (3) years after the date of this AGREEMENT,
any options or stock of the Company then owned by XX. XXXXX shall automatically
accelerate and become fully vested. This provision shall not otherwise limit
any benefits available under TRIANGLE's benefit plans.
5.2 INVOLUNTARY TERMINATION FOR CAUSE. Notwithstanding anything to
the contrary herein, XX. XXXXX'x employment and this AGREEMENT may be terminated
by TRIANGLE upon written notification upon the occurrence of any of the
following:
a. XX. XXXXX being formally charged with the commission of a
felony, or being convicted of a misdemeanor involving moral turpitude.
b. XX. XXXXX'x demonstrable fraud or dishonesty.
c. XX. XXXXX'x use of illegal drugs or any illegal substance,
or his use of alcohol in any manner that materially interferes with the
performance of his duties under this AGREEMENT.
d. XX. XXXXX'x intentional, reckless or grossly negligent
conduct detrimental to the best interests of TRIANGLE, including, without
limitation, any misappropriation or unauthorized use of TRIANGLE's property or
improper disclosure of confidential information.
e. XX. XXXXX'x failure to perform material duties under this
AGREEMENT if such failure has continued for 20 days after XX. XXXXX has been
notified in writing by TRIANGLE of the nature of XX. XXXXX'x failure to perform.
f. XX. XXXXX'x chronic absence from work for reasons other than
illness.
g. XX. XXXXX'x violation of TRIANGLE's policy prohibiting
sexual harassment.
h. XX. XXXXX'x violation of TRIANGLE's policy prohibiting
unlawful discrimination.
In the event that XX. XXXXX'x employment is terminated with cause by
TRIANGLE pursuant to this paragraph 5.2 of this AGREEMENT within three (3)
years after the Effective Date, TRIANGLE will continue to pay salary payments
to XX. XXXXX (based upon his then-current salary) for a period of two (2)
years following termination. In the event that XX. XXXXX'x employment is
terminated with cause by TRIANGLE for any of the reasons enumerated in this
paragraph 5.2, XX. XXXXX shall have certain obligations to refrain from
disclosing TRIANGLE's confidential or proprietary information, as more fully
described in article 6 below. In the event that XX. XXXXX'x employment is
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terminated with cause by TRIANGLE for any of the reasons enumerated in this
paragraph 5.2 within three (3) years after the Effective Date, XX. XXXXX shall
have certain obligations to refrain from engaging in competitive activities, as
more fully described in article 7, below. XX. XXXXX acknowledges and agrees
that the continuing salary payments described in this paragraph 5.2, shall
constitute good and sufficient consideration for his agreement to abide by the
terms of articles 6 and 7 hereof.
Termination of XX. XXXXX pursuant to this section 5.2 shall be in
addition to and without prejudice to any other right or remedy to which TRIANGLE
may be entitled at law, in equity, or under this AGREEMENT.
5.3 INVOLUNTARY TERMINATION FOR OTHER THAN CAUSE. TRIANGLE may
terminate XX. XXXXX'x employment and this AGREEMENT at any time for any reason
upon written notification to XX. XXXXX. If TRIANGLE so terminates pursuant to
this paragraph 5.3 (i.e., none of the matters specified in paragraph 5.2 has
occurred) within three (3) years after the Effective Date, TRIANGLE will
continue to pay salary payments to XX. XXXXX (based upon his then-current
salary) for a period of two (2) years following termination. If TRIANGLE
terminates XX. XXXXX'x employment pursuant to this paragraph 5.3 within three
(3) years after the Effective Date, it will also accelerate XX. XXXXX'x vesting
in any unvested stock and/or options previously granted to him and any group
health benefits provided to XX. XXXXX during his employment pursuant to this
AGREEMENT will be continued, if permitted by law, by TRIANGLE at its expense for
a period of two (2) years following termination. Except as described in this
paragraph 5.3, TRIANGLE shall have no other obligations to XX. XXXXX in the
event that XX. XXXXX'x employment is terminated pursuant to this paragraph 5.3.
In the event that XX. XXXXX'x employment is terminated by TRIANGLE pursuant to
this paragraph 5.3, XX. XXXXX shall have certain obligations to refrain from
disclosing TRIANGLE's confidential or proprietary information, as more fully
described in article 6 below. In the event that XX. XXXXX'x employment is
terminated by TRIANGLE pursuant to this paragraph 5.3 within three (3) years
after the Effective Date, XX. XXXXX shall have certain obligations to refrain
from engaging in competitive activities, as more fully described in article 7
below. XX. XXXXX acknowledges and agrees that the continuing salary payments
and other benefits described in this paragraph 5.3 shall constitute good and
sufficient consideration for his agreement to abide by the terms of articles 6
and 7 hereof.
5.4 RESIGNATION. XX. XXXXX may terminate his employment and this
AGREEMENT at any time for any reason upon written notification to TRIANGLE. If
XX. XXXXX resigns from his employment for any reason within three (3) years
after the Effective Date, except as provided to the contrary below, TRIANGLE
will continue to pay salary payments to XX. XXXXX (based upon his then-current
salary) for a period of two (2) years following termination. If XX. XXXXX
resigns from his employment pursuant to this paragraph 5.4 within three (3)
years after the Effective Date, except as provided to the contrary below, any
group health benefits provided to XX. XXXXX during his employment pursuant to
this AGREEMENT will be continued, if permitted by law, by TRIANGLE at
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its expense for a period of two (2) years following termination.
Notwithstanding the foregoing, if XX. XXXXX terminates his employment and does
not at the time of termination intend to engage in competitive activities of the
type prohibited by article 7, then TRIANGLE shall not be obligated to make the
salary payments and provide group health benefits to XX. XXXXX pursuant to the
preceding two (2) sentences; provided, however, that if XX. XXXXX, within two
(2) years after his termination of employment under this paragraph 5.4 decides
he would like to engage in competitive activities that are prohibited by
paragraph 7, then TRIANGLE shall make the salary payments and provide group
health benefits to XX. XXXXX for the period of time between the date XX. XXXXX
decides he would like to so compete and the expiration of the two (2) year
period after XX. XXXXX'x termination of his employment under this paragraph 5.4
(but, notwithstanding XX. XXXXX'x desire to compete, in no event shall XX. XXXXX
be permitted to engage in the competitive activities described in paragraph 7
for the period of time described in paragraph 7). Except as described in this
paragraph 5.4, TRIANGLE shall have no other obligations to XX. XXXXX in the
event that XX. XXXXX resigns from his employment for any reason pursuant to this
paragraph 5.4. In the event that XX. XXXXX resigns from his employment with
TRIANGLE pursuant to this paragraph 5.4, XX. XXXXX shall have certain
obligations to refrain from disclosing TRIANGLE's confidential or proprietary
information, as more fully described in article 6 hereof. In the event that XX.
XXXXX resigns from his employment with TRIANGLE pursuant to this paragraph 5.4,
XX. XXXXX shall have certain obligations to refrain from engaging in competitive
activities, as more fully described in article 7 hereof. XX. XXXXX acknowledges
and agrees that the continuing salary payments and other benefits described in
this paragraph 5.4 shall constitute good and sufficient consideration for his
agreement to abide by the terms of articles 6 and 7 hereof.
6. CONFIDENTIALITY
XX. XXXXX acknowledges that he is bound by the terms of that certain
Employee Proprietary Information and Inventions Agreement between TRIANGLE and
XX. XXXXX dated September 7, 1995 (the "Confidentiality Agreement").
7. NON-COMPETITION
XX. XXXXX agrees and promises that if his employment is terminated
pursuant to paragraph 5.2, 5.3 or 5.4 hereof within three (3) years after the
Effective Date, then, for the period of time described below, he will not be
engaged in any other business or as a consultant to or general partner,
employee, officer or director of any partnership, firm, corporation, or other
entity, or as an agent for any person, or otherwise, if: (1) such other
business, partnership, firm, corporation, entity or person is engaged in
for-profit activity in the pharmaceutical industry within the United States
and competes with TRIANGLE in the field of viral diseases; and (2) XX. XXXXX
either (a) is the President, Chief Executive Officer or Chairman of such
other business, partnership, firm, corporation,
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entity or person; or (b) participates in or directs the development of drugs
for the treatment of viral diseases for such other business, partnership,
firm, corporation, entity or person. This agreement to refrain from engaging
in competitive activities shall continue for the period during which TRIANGLE
is required by the terms of paragraphs 5.2, 5.3 or 5.4 of this AGREEMENT to
make salary payments to XX. XXXXX following his termination (i.e., two (2)
years in the case of termination under paragraph 5.2, 5.3 or 5.4). This
agreement to refrain from engaging in competitive activities shall be binding
upon XX. XXXXX even if XX. XXXXX is not compensated for the activities
described in this article 7.
8. TERMINATION UPON MERGER.
Notwithstanding anything to the contrary in this Agreement, this
Agreement shall automatically terminate upon a "Merger." A "Merger" shall
consist of the consolidation or merger of TRIANGLE into or with any other entity
or entities that results in the exchange of shares representing 50% or more of
the outstanding shares of voting capital stock of TRIANGLE for securities or
other consideration issued or paid or caused to be issued or paid by any such
entity or affiliate thereof, or the sale or transfer by TRIANGLE or all or
substantially all of its assets. Upon termination of this Agreement, all of the
obligations of TRIANGLE and XX. XXXXX under this Agreement, including without
limitation, Sections 5 and 7, shall terminate; provided, however, that XX.
XXXXX'x obligations under the Confidentiality Agreement shall continue pursuant
to the terms of the Confidentiality Agreement.
9. GENERAL PROVISIONS
9.1 GOVERNING LAW. This AGREEMENT and the rights of the parties
thereunder shall be governed by and interpreted under North Carolina law without
regard to principles of conflicts of law.
9.2 ASSIGNMENT. XX. XXXXX may not delegate, assign, pledge or
encumber his rights or obligations under this AGREEMENT or any part thereof.
9.3 NOTICE. Any notice required or permitted to be given under this
AGREEMENT shall be sufficient if it is in writing and is sent by registered or
certified mail, postage prepaid, or personally delivered, to the following
addresses, or to such other addresses as either party shall specify by giving
notice under this section:
TO TRIANGLE: Triangle Pharmaceuticals, Inc.
0 Xxxxxxxxxx Xxxxx
0000 Xxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
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TO XX. XXXXX: Xx. Xxxxx Xxxxx
0000 Xxxxx Xxxxxxxxx Xxxxx
Xxxxxx Xxxx, XX 00000
9.4 AMENDMENT. This AGREEMENT may be waived, amended or supplemented
only by a writing signed by both of the parties hereto. To be valid, TRIANGLE's
signature must be by a person specially authorized by TRIANGLE's Board of
Directors to sign such particular document.
9.5 WAIVER. No waiver of any provision of this AGREEMENT shall be
binding unless and until set forth expressly in writing and signed by the
waiving party. To be valid, TRIANGLE's signature must be by a person specially
authorized by TRIANGLE's Board of Directors to sign such particular document.
The waiver by either party of a breach of any provision of this AGREEMENT shall
not operate or be construed as a waiver of any preceding or succeeding breach of
the same or any other term or provision, or a waiver of any contemporaneous
breach of any other term or provision, or a continuing waiver of the same or any
other term or provision. No failure or delay by a party in exercising any
right, power, or privilege hereunder or other conduct by a party shall operate
as a waiver thereof, in the particular case or in any past or future case, and
no single or partial exercise thereof shall preclude the full exercise or
further exercise of any right, power or privilege. No action taken pursuant to
this AGREEMENT shall be deemed to constitute a waiver by the party taking such
action of compliance with any representations, warranties, covenants or
agreements contained herein.
9.6 SEVERABILITY. All provisions contained herein are severable and
in the event that any of them shall be held to be to any extent invalid or
otherwise unenforceable by any court of competent jurisdiction, such provision
shall be construed as if it were written so as to effectuate to the greatest
possible extent the parties' expressed intent; and in every case the remainder
of this AGREEMENT shall not be affected thereby and shall remain valid and
enforceable, as if such affected provision were not contained herein.
9.7 HEADINGS. Article and section headings are inserted herein for
convenience of reference only and in no way are to be construed to define, limit
or affect the construction or interpretation of the terms of this AGREEMENT.
9.8 DRAFTING PARTY. The provisions of this AGREEMENT have been
prepared, examined, negotiated and revised by each party hereto, and no
implication shall be drawn and no provision shall be construed against either
party by virtue of the purported identity of the drafter of this AGREEMENT, or
any portion thereof.
9.9 ARBITRATION. The parties agree that any and all disputes that
they have with one another which arise out of XX. XXXXX'x employment or under
the terms of this AGREEMENT shall be resolved through final and binding
arbitration, as specified herein. This shall include, without limitation,
disputes relating to this AGREEMENT, DR.
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BARRY's employment by TRIANGLE or the termination thereof, claims for breach of
contract or breach of the covenant of good faith and fair dealing, and any
claims of discrimination or other claims under any federal, state or local law
or regulation now in existence or hereinafter enacted and as amended from time
to time concerning in any way the subject of XX. XXXXX'x employment with
TRIANGLE or its termination. The only claims not covered by this paragraph 9.9
are claims for benefits under the workers' compensation laws or claims for
unemployment insurance benefits, which will be resolved pursuant to those laws.
Binding arbitration will be conducted in Durham, North Carolina, in accordance
with the rules and regulations of the American Arbitration Association. Each
party will bear one half of the cost of the arbitration filing and hearing fees,
and the cost of the arbitrator. Each party will bear its own attorneys' fees,
unless otherwise decided by the arbitrator. XX. XXXXX understands and agrees
that the arbitration shall be instead of any civil litigation and that the
arbitrator's decision shall be final and binding to the fullest extent permitted
by law and enforceable by any court having jurisdiction thereof.
10. ENTIRE AGREEMENT
Except for the Confidentiality Agreement, this AGREEMENT constitutes
the entire agreement between the parties pertaining to the subject matter hereof
and completely supersedes all prior or contemporaneous agreements,
understandings, arrangements, commitments, negotiations and discussions of the
parties, whether oral or written, including, without limitation, that certain
Memorandum between TRIANGLE and XX. XXXXX dated July 10, 1995 (the "Memorandum")
(all of which shall have no substantive significance or evidentiary effect).
The parties specifically acknowledge and agree that, except for the
Confidentiality Agreement, all prior agreements and understandings between XX.
XXXXX and TRIANGLE that pertained to XX. XXXXX'x employment with TRIANGLE,
including the Memorandum, are completely superseded. Each party acknowledges,
represents and warrants that this AGREEMENT is fully integrated and not in need
of parol evidence in order to reflect the intentions of the parties.
This AGREEMENT is executed as of this 28th day of October, 1996.
TRIANGLE PHARMACEUTICALS, INC.
/s/ Xxxxx X. Xxxxx By: /s/ X. Xxxxx Xxxxx
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Xx. Xxxxx X. Xxxxx X. Xxxxx Xxxxx, President and
Chief Operating Officer
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