EXHIBIT 10.23
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (the "Agreement") dated as of the 1st day of January,
2002, between FLEMINGTON PHARMACEUTICAL CORPORATION, a Delaware corporation
(together with its successors and assigns referred to herein as the
"Corporation"), with principal executive offices located at 00 Xxxxx Xxxxx 00
Xxxx, Xxxxxxxxxx, Xxx Xxxxxx 00000 and XXXXXX XXXXXXX, residing at 000 Xxxxxxxxx
Xxxxxx, Xxxxxx, Xxx Xxxxxx 00000 (the "Executive").
W I T N E S S E T H
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WHEREAS, the Corporation desires to continue to employ Executive to engage
in such activities and to render such services under the terms and conditions
hereof and has authorized and approved the execution of this Agreement; and
WHEREAS, Executive desires to continue to be employed by the Corporation
under the terms and conditions hereinafter provided;
NOW, THEREFORE, in consideration of the mutual covenants and undertakings
herein contained, the parties agree as follows:
1. EMPLOYMENT, DUTIES AND ACCEPTANCE.
1.1 SERVICES. During employment hereunder, Executive shall be the
Chief Financial Officer of the Corporation, shall have the powers and duties set
forth in the Corporation's By-laws or as established by the Board of Directors
of the Corporation (the "Board") and normally held by a corporate officer
holding such a position and shall report directly to the Chief Executive Officer
and the Board. Executive shall devote Executive's entire business time,
attention, knowledge and skills faithfully, diligently and to the best of
Executive's ability in furtherance of the business and activities of the
Corporation (the "Services"). The principal place of performance by Executive
of services hereunder shall be at the principal offices of the Corporation or
such other place as the Board may designate.
1.2 ACCEPTANCE. Executive hereby accepts such employment and
agrees to render the Services.
2. TERM OF EMPLOYMENT.
2.1 TERM. The Executive's employment under this Agreement (the
"Term") shall commence as of the Effective Date (as hereinafter defined) and
shall continue for a term of three (3) years, unless sooner terminated pursuant
to Sections 5 or 9 of this Agreement. Notwithstanding anything to the contrary
contained herein, the provisions of this Agreement governing Protection of
Confidential Information shall continue in effect as specified in Section 10
hereof and survive the expiration or termination hereof.
2.2 EFFECTIVE DATE. The effective date of this Agreement is the
date set forth above
3. BASE SALARY AND EXPENSE REIMBURSEMENT.
3.1 BASE SALARY. The Corporation shall pay Executive a salary
(the "Base Salary") at the rate of $125,000 per year for the first year of
employment under this Agreement. Payment shall be made monthly, on the last day
of each calendar month. For each subsequent calendar year of employment, the
Base Salary shall be increased by the greater of the "cost of living increase"
(as defined below) or five percent (5%)
3.2 EXPENSE REIMBURSEMENT. All travel and other expenses
reasonably incurred by Executive incidental to the rendering of Services to the
Corporation hereunder shall be paid by the Corporation or reimbursed to
Executive upon receipt and approval of expense reports on Corporation forms
supported by appropriate documentation. From time to time, Executive shall
submit, and obtain approval for, proposed expense budgets. All unbudgeted
expenses in excess of $1,000.00 (individually, or collectively if in connection
with a single, related subject or project within a given month) shall require
advance approval.
3.3 BONUSES. In addition, Executive shall be entitled to such
other cash bonuses and other compensation in the form of stock, stock options or
other property or rights as may from time to time be awarded by the Board in
connection with Executive's employment.
3.4 COST OF LIVING INCREASE. For purposes of this Agreement,
"cost of living increase" means the annual percentage increase of the U.S.
Department of Labor, BLS, Consumer Price Index (CPI-W) (Philadelphia-New Jersey)
during the twelve month period ending on the date of the most recently available
data as of the respective dates of adjustment.
3.5 Automobile Expense Allowance. Executive shall receive a
monthly lump-sum allowance of $600.00 for the purpose of defraying costs of
using his personal automobile in connection with the Corporation's business.
4. [INTENTIONALLY OMITTED].
5. SEVERANCE.
5.1 TERMINATION FOR GOOD REASON. If Executive's employment
hereunder shall be terminated for Good Reason (as defined in Section 9.4 hereof)
at any time prior to the end of the Term, Executive shall be entitled to receive
from the Corporation, in addition to any Base Salary earned to the date of
termination, a severance payment in an amount equal to Executive's Base Salary
for the remainder of the entire Term, payable to the Executive in biweekly
increments until the date on which the Term would have otherwise expired, had
the termination not occurred. In the event of such termination, the amounts due
hereunder shall be payable without offset or defense or any obligation of the
Executive to mitigate damages.
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5.2 EXECUTIVE'S TERMINATION WITHOUT GOOD REASON. If the Executive
terminates employment without Good Reason (as defined in Section 9.4 hereof) at
any time prior to the end of the Term, Executive shall be entitled to receive
from the Corporation payment of any unpaid accrued Base Salary earned through
the date of termination. In the event of such termination, all obligations of
the Corporation hereunder shall terminate on the date of termination and the
Executive's termination without Good Reason shall act as a waiver of all claims
to compensation which would have otherwise accrued after the date of
termination.
6. ADDITIONAL BENEFITS.
During Executive's employment, the Corporation shall cause Executive to be
covered by all the Corporation's employee benefit plans, in effect from time to
time, for which Executive is eligible, including without limitation, any
retirement plan or group insurance.
7. VACATION.
Executive shall be entitled to such holidays as are in effect for all of
the Corporation's employees, and to personal leave in accordance with
Corporation policy as in effect from time to time. In addition, Executive shall
be entitled to four weeks vacation days (twenty business days) per year The
timing of the taking of vacation is left to the discretion of Executive,
provided the same is not inconsistent with the reasonable business requirements
of the Corporation. Vacation days not used by Executive during a given year may
be accumulated and carried forward only in accord with the policies of the
Corporation.
8. INDEMNIFICATION.
The Corporation shall indemnify Executive and hold Executive harmless
against any and all expenses reasonably incurred by him in connection with or
arising out of (a) the defense of any action, suit or proceeding to which
Executive is a named party, or (b) any claim asserted or threatened against
Executive, provided, in either case, the matter has arisen because of or in
connection with Executive's being or having been an employee, officer or
director of the Corporation, whether or not he continues to be such at the time
the expenses indemnified against are incurred, except insofar as (a) such
indemnification may be prohibited by law, (b) the expenses were incurred in
connection with a matter where the Corporation is or was in an adversarial
position to Executive and the Corporation prevailed against Executive in such
matter, or (c) the expenses were incurred in connection with a matter arising
out a material breach by Executive of this Agreement or of Executive's
obligations to the Corporation. Expenses indemnified against include, without
limitation, reasonable attorneys fees, money judgments and money settlements,
provided the Corporation's advance approval has been sought and obtained. This
Section 8 is independent of any similar indemnification obligation which may be
contained in the Corporation's Certificate of Incorporation or By-laws, and
applies as well to matters attributable to Executive's employment by the
Corporation before the Effective Date of this Agreement, if applicable.
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9. TERMINATION.
9.1 DEATH. If Executive dies during the Term of this Agreement,
Executive's employment hereunder shall terminate upon his death and all
obligations of the Corporation hereunder shall terminate on such date, except
that Executive's estate or his designated beneficiary shall be entitled to
payment of any unpaid accrued Base Salary through the date of his death.
9.2 DISABILITY. If Executive shall be unable to perform a
significant part of his duties and responsibilities in connection with the
conduct of the business and affairs of the Corporation and such inability lasts
for a period of at least 180 consecutive days by reason of Executive's physical
or mental disability, whether by reason of injury, illness or similar cause,
Executive shall be deemed disabled, and the Corporation any time thereafter may
terminate Executive's employment hereunder by reason of the disability. During
such 180 day period, the Base Salary and other benefits payable to Executive
hereunder shall not be suspended or diminished, except to the extent equivalent
to the extent of any Corporation-provided disability insurance in effect. Upon
delivery to Executive of notice to terminate, all obligations of the Corporation
hereunder shall terminate, except that Executive shall be entitled to payment of
any unpaid accrued Base Salary through the date of termination. The obligations
of Executive under Section 10 hereof shall continue notwithstanding termination
of Executive's employment pursuant to this Section 9.2.
9.3 TERMINATION FOR CAUSE. The Corporation may at any time during
the Term, with 30 days prior written notice, terminate this Agreement and
discharge Executive for Cause, whereupon the Corporation's obligation to pay
compensation or other amounts payable hereunder to or for the benefit of
Executive shall terminate on the date of such discharge. As used herein the
term "Cause" shall be deemed to mean and include: (i) a material breach by
Executive of this Agreement including without limitation a breach by Executive
of the obligations set forth in Section 10 hereof; (ii) excessive absenteeism,
alcoholism or drug abuse; (iii) substantial neglect or inattention by Executive
of or to his duties hereunder; (iv) willful violation of specific and lawful
written or oral direction from the Board of Directors of the Corporation
provided such direction is not inconsistent with the Executive's duties and
responsibilities as President and Chief Executive Officer of the Corporation; or
(v) fraud, criminal conduct or embezzlement. The following shall be deemed a
material breach for the purposes of Subsection (i) hereof: (a) the Executive's
conviction for, or a plea of nolo contendere to, a felony or a crime involving
moral turpitude (which, through lapse of time or otherwise, is not subject to
appeal); (b) willful misconduct as an employee of the Corporation; or (c)
willful or reckless disregard of his responsibilities under this Agreement. The
obligations of the Executive under Section 10 shall continue notwithstanding
termination of the Executive's employment pursuant to this Section 9.3.
9.4 TERMINATION BY EXECUTIVE. The Executive shall have the right
to terminate this Agreement for Good Reason, as hereinafter defined. Good
Reason shall mean any of the following: (i) the assignment to the Executive of
duties inconsistent with the Executive's position, duties, responsibilities,
titles or offices as described herein; (ii) any material reduction by the
Corporation of the Executive's duties and responsibilities; (iii) any reduction
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by the Corporation of the Executive's compensation or benefits payable hereunder
(it being understood that a reduction of benefits applicable to all employees of
the Corporation, including the Executive, shall not be deemed a reduction of the
Executive's compensation package for purposes of this definition); or (iv)
requiring the Executive to be based without his consent at a location not within
reasonable commuting distance of Flemington, New Jersey.
10. CONFIDENTIALITY; NON-COMPETITION.
10.1 CONFIDENTIALITY. The Corporation and Executive acknowledge
that the services to be performed by Executive under this Agreement are unique
and extraordinary, and, as a result of Executive's employment hereunder,
Executive will be in possession of confidential information and trade secrets
relating to the business and affairs of both the Corporation and its clients.
Executive agrees that Executive will not, other than in the ordinary course of
business and subject to receipt of an appropriate Confidentiality Agreement,
during or after any term of employment, directly or indirectly use or disclose
to any person, firm or corporation any confidential information regarding the
clients, customers, business practices, products, research programs of the
Corporation or its clients acquired by Executive during Executive's employment,
unless Executive has obtained the Corporation's advance written consent
specifically authorizing Executive's disclosure or use thereof.
10.2 NON-COMPETITION. Executive agrees that, for a period
beginning with the Effective Date of this Agreement and ending twelve months
after the date of termination of employment by the Company, Executive will not,
either individually or in conjunction with any person, firm, association,
syndicate, company or corporation, directly or indirectly (as principal, agent,
employee, director, officer, shareholder, partner, independent contractor,
individual proprietor, or as an investor who has made advances, loans or
contributions to capital, or in any other manner whatsoever) compete with
company in the business then conducted by Company. Executive also agrees that,
during such period, Executive will not solicit or encourage any persons who,
during such period, were employees of Company to (i) terminate such persons'
employment with Company; or (ii) become affiliated with any person, firm,
association, syndicate, company or corporation which is in a business similar to
that of the Company and in which Executive, either directly or indirectly, has
an interest. If Company directs Executive to cease and desist a proposed
post-termination course of conduct, on the grounds that he is proposing to
compete with the Company's business, during this one-year post-termination
period, Company shall compensate Executive by paying him his base Salary during
the period he is prevented from pursuing such activity.
10.3 ANTI-RAIDING. Executive agrees that during the term of his
employment hereunder, and, thereafter for a period of one (1) year, Executive
will not, as principal, agent, employee, employer, consultant, director or
partner of any person, firm, corporation or business entity other that the
Corporation, or in any individual or representative capacity whatsoever,
directly or indirectly, without the prior express written consent of the
Corporation approach, counsel or attempt to induce any person who is then in the
employ of the Corporation to leave the employ of the Corporation or employ or
attempt to employ any such person or persons who at any time during the
preceding six months was in the employ of the Corporation.
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10.4 INJUNCTION. Executive acknowledges and agrees that, because
of the unique and extraordinary nature of his services, any breach or threatened
breach of any of the above provisions of this Section 10 hereof will cause the
Corporation irreparable injury and incalculable harm and, therefore, the
Corporation will have "no adequate remedies at law". Executive, therefore,
agrees in advance that Corporation shall be entitled to injunctive and other
equitable relief for such breach or threatened breach and that resort by the
Corporation to such injunctive or other equitable relief shall not be deemed to
waive or to limit in any respect any right or remedy which the Corporation may
have with respect to such breach or threatened breach. The Executive agrees
that in such action, if the Corporation makes a prima facie showing that
Executive has violated or apparently intends to violate any of the provisions of
this Section 10, the Corporation need not prove either damage or irreparable
injury in order to obtain injunctive relief. The Corporation and Executive
agree that any such action for injunctive or equitable relief shall be heard in
a state or federal court situated in New Jersey and each of the parties hereto
agrees to accept service of process by registered mail and to otherwise consent
to the jurisdiction of such courts.
10.5 NO INDEMNIFICATION. The provisions of Section 8, above, do
not apply to any expenses incurred by Executive in defending against any claim
made pursuant to this Section 10.
10.6 SEVERABILITY. If any provision contained within this Section
10 is found to be unenforceable by reason of the extent, duration or scope
thereof, or otherwise, then such restriction shall be enforced to the maximum
extent permitted by law, and Executive agrees that such extent, duration or
scope may be modified in any proceeding brought to enforce such restriction.
11. ARBITRATION.
Except with respect to any proceeding brought under Section 10 hereof, any
controversy, claim, or dispute between the parties, directly or indirectly,
concerning this Employment Agreement or the breach hereof, or the subject matter
hereof, including questions concerning the scope and applicability of this
arbitration clause, shall be finally settled by arbitration in the State of New
Jersey pursuant to the rules then applying of the American Arbitration
Association. The arbitrators shall consist of one representative selected by
the Corporation, one representative selected by the Executive and one
representative selected by the first two arbitrators. The parties agree to
expedite the arbitration proceeding in every way, so that the arbitration
proceeding shall be commenced within thirty (30) days after request therefore is
made, and shall continue thereafter, without interruption, and that the decision
of the arbitrators shall be handed down within thirty (30) days after the
hearings in the arbitration proceedings are closed. The arbitrators shall have
the right and authority to assess the cost of the arbitration proceedings and to
determine how their decision or determination as to each issue or matter in
dispute may be implemented or enforced. The decision in writing of any two of
the arbitrators shall be binding and conclusive on all of the parties to this
Agreement. Should either the Corporation or the Executive fail to appoint an
arbitrator as required by this Section 11 within thirty (30) days after
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receiving written notice from the other party to do so, the arbitrator appointed
by the other party shall act for all of the parties and his decision in writing
shall be binding and conclusive on all of the parties to this Employment
Agreement. Any decision or award of the arbitrators shall be final and
conclusive on the parties to this Agreement; judgment upon such decision or
award may be entered in any competent Federal or state court located in the
United States of America; and the application may be made to such court for
confirmation of such decision or award for any order of enforcement and for any
other legal remedies that may be necessary to effectuate such decision or award.
12. NOTICES.
All notices, requests, consents and other communications required or
permitted to be given hereunder, shall be in writing and shall be deemed to have
been duly given if delivered personally or sent by facsimile or mailed
first-class, postage prepaid, by registered or certified mail (notices sent by
mail shall be deemed to have been given on the date sent), to the parties at
their respective addresses hereinabove set forth or to such other address as
either party shall designate by notice in writing to the other in accordance
herewith. Copies of all notices shall be sent to Xxxxxx X. Xxxxxx, Esq. Esq. at
00 Xxxxx Xxxx, Xxxxxxx, Xxx Xxxxxx 00000.
13. GENERAL.
13.1 GOVERNING LAW. This Agreement shall be governed by and
construed and enforced in accordance with the local laws of the State of New
Jersey applicable to agreements made and to be performed entirely in New Jersey.
13.2 CAPTIONS. The section headings contained herein are for
reference purposes only and shall not in any way affect the meaning or
interpretation of this Agreement.
13.3 ENTIRE AGREEMENT. This Agreement sets forth the entire
agreement and understanding of the parties relating to the subject matter
hereof, and supersedes all prior agreements, arrangements and understandings,
written or oral, relating to the subject matter hereof. No representation,
promise or inducement has been made by either party that is not embodied in this
Agreement, and neither party shall be bound by or liable for any alleged
representation, promise or inducement not so set forth.
13.4 SEVERABILITY. If any of the provisions of this Agreement
shall be unlawful, void, or for any reason, unenforceable, such provision shall
be deemed severable from, and shall in no way affect the validity or
enforceability of, the remaining portions of this Agreement.
13.5 WAIVER. The waiver by any party hereto of a breach of any
provision of this Agreement by any other party shall not operate or be construed
as a waiver of any subsequent breach of the same provision or any other
provision hereof.
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13.6 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which taken
together shall constitute one and the same Agreement.
13.7 ASSIGNABILITY. This Agreement, and Executive's rights and
obligations hereunder, may not be assigned by Executive. The Corporation may
assign its rights, together with its obligations, hereunder in connection with
any sale, transfer or other disposition of all or substantially all of its
business or assets; in any event the rights and obligations of the Corporation
hereunder shall be binding on its successors or assigns, whether by merger,
consolidation or acquisition of all or substantially all of its business or
assets.
13.8 AMENDMENT. This Agreement may be amended, modified,
superseded, canceled, renewed or extended and the terms or covenants hereof may
be waived, only by a written instrument executed by both of the parties hereto,
or in the case of a waiver, by the party waiving compliance. No superseding
instrument, amendment, modification, cancellation, renewal or extension hereof
shall require the consent or approval of any person other than the parties
hereto. The failure of either party at any time or times to require performance
of any provision hereof shall in no matter affect the right at a later time to
enforce the same. No waiver by either party of the breach of any term or
covenant contained in this Agreement, whether by conduct or otherwise, in any
one or more instances, shall be deemed to be, or construed as, a further or
continuing waiver of any such breach, or a waiver of the breach of any other
term or covenant contained in this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
ATTEST: FLEMINGTON PHARMACEUTICAL
CORPORATION.
By: /s/ Xxxxxx X. Xxxxxx By: /s/ Xxxxx X. Xxxxxx III
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Xxxxxx X. Xxxxxx, Secretary Xxxxx X. Xxxxxx, III
WITNESS:
/s/ Xxxxxx X. Xxxxxx /s/ Xxxxxx Xxxxxxx
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Xxxxxx Xxxxxxx
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