EXHIBIT 10.29
EXECUTIVE EMPLOYMENT AGREEMENT
THIS AGREEMENT is made and entered into this 21st day of March, 2002,
by and between Texas Biotechnology Corporation, a Delaware corporation having
its principal executive office at 0000 Xxxxxx, Xxxxxxx, Xxxxx 00000 (hereinafter
referred to as the "Company"), and Xxxxx X. Given, M.D. (hereinafter referred to
as the "Executive").
WITNESSETH:
WHEREAS, the Company desires to employ the Executive in an executive
capacity and the Executive desires to enter the Company's employ.
NOW, THEREFORE, for and in consideration of the mutual promises,
covenants and obligations contained herein, and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
Company and the Executive hereby agree as follows:
1. Certain Definitions.
As used in this Agreement, the following terms have the meanings
prescribed below:
Affiliate is used in this Agreement to define a relationship to a
person or entity and means a person or entity who, directly or indirectly
through one or more intermediaries, controls, is controlled by, or is under
common control with, such person or entity.
Annual Bonus shall have the meaning assigned thereto in Section 4.2
hereof.
Base Salary shall have the meaning assigned thereto in Section 4.1
hereof.
Beneficial Owner shall have the meaning assigned thereto in Rule
13(d)-3 under the Exchange Act; provided, however, and without limitation, that
any individual, corporation, partnership, group, association or other person or
entity that has the right to acquire any Voting Stock at any time in the future,
whether such right is (a) contingent or absolute or (b) exercisable presently or
at any time in the future, pursuant to any agreement or understanding or upon
the exercise or conversion of rights, options or warrants, or otherwise, shall
be the Beneficial Owner of such Voting Stock.
Cause shall have the meaning assigned thereto in Section 5.3 hereof.
Code means the Internal Revenue Code of 1986, as amended, and the rules
and regulations promulgated by the Internal Revenue Service thereunder, all as
in effect from time to time during the Employment Period.
Common Stock means the Company's common stock, par value $.05 per
share.
Company means Texas Biotechnology Corporation, a Delaware corporation,
the principal executive office of which is located at 0000 Xxxxxx, Xxxxxxx,
Xxxxx 00000.
Competing Business means any individual, business, firm, company,
partnership, joint venture, organization, or other entity that markets or has
entered clinical development of any product addressing the same disease target
as a product discovered by, or licensed to, the Company which is either (i) in
Phase III of clinical development, (ii) pending approval at FDA or (iii)
marketed by the Company or its licensee.
Confidential Information shall have the meaning assigned thereto in
Section 8.2 hereof.
Date of Termination means the earliest to occur of (i) the date of the
Executive's death or (ii) the date of receipt of the Notice of Termination, or
such later date as may be prescribed in the Notice of Termination in accordance
with Section 5.6 hereof.
Disability means an illness or other disability which prevents the
Executive from discharging his responsibilities under this Agreement for a
period of 180 consecutive calendar days, or an aggregate of 180 calendar days in
any calendar year, during the Employment Period, all as determined in good faith
by the Board of Directors of the Company (or a committee thereof).
Effective Date means March 25, 2002.
Executive means Xxxxx X. Given, M.D., an individual residing at 00
Xxxxxxxx Xxxx, Xxxxxxxxxx, Xxx Xxxxxx 00000.
Exchange Act means the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated by the Securities and Exchange Commission
thereunder, all as in effect from time to time during the Employment Period.
Employment Period shall have the meaning assigned thereto in Section 3
hereof.
Good Reason shall have the meaning assigned thereto in Section 5.5
hereof.
Initial Term shall have the meaning assigned thereto in Section 3
hereof.
Notice of Termination shall have the meaning assigned thereto in
Section 5.6 hereof.
Vacation Time shall have the meaning assigned thereto in Section 4.3
hereof.
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Voting Stock means all outstanding shares of capital stock of the
Company entitled to vote generally in an election of directors; provided,
however, that if the Company has shares of Voting Stock entitled to more or less
than one vote per share, each reference to a proportion of the issued and
outstanding shares of Voting Stock shall be deemed to refer to the proportion of
the aggregate votes entitled to be cast by the issued and outstanding shares of
Voting Stock.
Without Cause shall have the meaning assigned thereto in Section 5.4
hereof.
2. General Duties of Company and Executive.
2.1 (a) The Company agrees to employ the Executive, and the Executive
agrees to accept employment by the Company and to serve the Company as
its President and Chief Executive Officer. The Executive will also be
elected as a member of the Board of Directors during the Employment
Period. The Executive shall report to and be subject to the direction
of the Board of Directors. The Executive shall have the authority,
duties and responsibilities that are normally associated with and
inherent in the executive capacity in which Executive will be
performing, and shall have such other or additional duties which are
not inconsistent with the Executive's position, as may from time to
time be reasonably assigned to the Executive by the Board of Directors
(or a committee thereof). While employed hereunder, the Executive shall
devote full time and attention during normal business hours to the
affairs of the Company and use his best efforts to perform faithfully
and efficiently his duties and responsibilities. Executive agrees to
cooperate fully with the Board, and other executive officers of the
Company, and not to engage in any activity which conflicts with or
interferes with the performance of his duties hereunder. During the
Employment Period, Executive shall devote his best efforts and skills
to the business and interests of Company, do his utmost to further
enhance and develop Company's best interests and welfare, and endeavor
to improve his ability and knowledge of Company's business, in an
effort to increase the value of his services for the mutual benefit of
the parties hereto. During the Employment Period, it shall not be a
violation of this Agreement for Executive (i) serve on any corporate
board or committee thereof with the approval of the Board, (ii) to
serve on any civic, or charitable boards or committees (except for
boards or committees of a Competing Business unless approved by the
Board), (iii) deliver lectures, fulfill teaching or speaking
engagements, (iv) testify as a witness in litigation involving a former
employer or (v) manage personal investments; provided, however, any
such activities must not materially interfere with performance of
Executive's responsibilities under this Agreement.
(b) Executive represents and covenants to Company that he is not
subject or a party to any employment agreement, noncompetition
covenant, nondisclosure agreement, or any similar agreement or covenant
that would prohibit Executive from executing this Agreement and fully
performing his duties and responsibilities hereunder, or would in any
manner, directly or indirectly, limit or affect the duties and
responsibilities that may now or in the future be assigned to Executive
hereunder. The Executive further
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represents and warrants that he is not presently subject to any legal
actions, claims or administrative proceedings, including bankruptcy
proceedings or IRS audits or proceedings, which would effect his
ability to perform his responsibilities hereunder. The Executive and
the Company agree that they have each reviewed and discussed with each
other the Ortho-Clinical Diagnostics agreement dated January 8, 2000
signed by the Executive, and that the execution and performance of this
Agreement by the Executive will not, to the best of their respective
knowledge, violate or conflict with the Ortho-Clinical Diagnostics
Agreement.
2.2 The Executive agrees and acknowledges that he owes a fiduciary duty
of loyalty, fidelity and allegiance to act at all times in the best interests of
the Company and to do no act and to make no statement, oral or written, which
would injure Company's business, its interests or its reputation.
2.3 The Executive agrees to execute and comply at all times during the
Employment Period with all applicable policies, rules and regulations of the
Company, including, without limitation, the Company's Code of Ethics and the
Company's policy regarding trading in the Common Stock, as each is in effect
from time to time during the Employment Period.
2.4 The Executive will, as soon as possible, but in any event within
six months of the date of this Agreement, relocate his permanent residence to
Houston, Texas.
3. Term.
Unless sooner terminated pursuant to other provisions hereof, the
Executive's period of employment under this Agreement shall be a period of one
year beginning on the Effective Date (the "Initial Term"). After the expiration
of the Initial Term, the Executive's period of employment under this Agreement
shall be automatically renewed for successive one-year terms on each anniversary
of the Effective Date (the Initial Term and any and all renewals thereof are
referred to herein collectively as the "Employment Period"), unless written
notice of nonrenewal is delivered by one party to the other at least 60 days
before the end of any such one-year renewal term.
4. Compensation and Benefits.
4.1 Base Salary. As compensation for services to the Company, the
Company shall pay to the Executive from the Effective Date until the Date of
Termination an annual base salary of $325,000 (the "Base Salary"). The Board of
Directors (or a committee thereof) will conduct an annual review of the
Executive's compensation and, in its discretion, may increase the Base Salary
based upon relevant circumstances. The Executive's first annual review will
occur on or before March 31, 2003, and any increases in compensation provided by
the Board of Directors from that review will be effective as of March 1, 2003.
The Base Salary shall be payable in equal semi-monthly installments or in
accordance with the Company's established policy, subject only to such payroll
and withholding deductions as may be required by law and other
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deductions (consistent with Company policy for all employees) relating to the
Executive's election to participate in the Company's insurance and other
employee benefit plans. The Executive will receive no additional compensation
for serving as a director.
4.2 Bonus. In addition to the Base Salary, the Executive shall be
awarded, for each fiscal year until the Date of Termination, an annual bonus to
be determined by the Board of Directors (or a committee thereof), in its sole
discretion (the "Annual Bonus"). Each such Annual Bonus shall be payable at a
time to be determined by the Board of Directors (or a committee thereof) in its
sole discretion. The Company's Incentive Program for senior executives, as
presently in effect and which is subject to change at the sole discretion of the
Board of Directors (or a committee thereof), is attached hereto as Exhibit A.
The Company agrees that the Executive's Annual Bonus for calendar year 2002 will
be a minimum of $244,000.
4.3 Vacation. Until the Date of Termination, the Executive shall be
entitled to four weeks paid vacation during each one year period commencing on
the Effective Date (the "Vacation Time"). Any Vacation Time not taken during the
applicable one year period will not accrue and will expire on the applicable
anniversary of the Effective Date.
4.4 Incentive, Savings and Retirement Plans. Until the Date of
Termination, the Executive shall be eligible to participate in and shall receive
all benefits under all executive incentive, savings and retirement plans and
programs currently maintained or hereinafter established by the Company for the
benefit of its executive officers and/or employees.
4.5 Benefit Plans. Until the Date of Termination, the Executive and/or
the Executive's family, as the case may be, shall be eligible to participate in
and shall receive all benefits under each welfare benefit plan of the Company
currently maintained or hereinafter established by the Company for the benefit
of its employees. Such welfare benefit plans may include, without limitation,
medical, dental, disability, group life, accidental death and travel accident
insurance plans and programs. The Company shall not be obligated to institute,
maintain, or refrain from changing, amending, or discontinuing, any such
employee benefit program or plan, so long as such actions are similarly
applicable to covered employees generally. In addition, during the Employment
Period, the Company will provide the Executive at no cost, a term life insurance
policy in the amount of $500,000, assuming satisfactory evidence of insurability
of the Executive. Upon request, Executive agrees to take any physical exams, and
to provide such information, which are reasonably necessary or appropriate to
secure or maintain such benefits and insurance coverage.
4.6 Reimbursement of Expenses. The Executive may from time to time
until the Date of Termination incur various business expenses customarily
incurred by persons holding positions of like responsibility, including, without
limitation, travel, entertainment and similar expenses incurred for the benefit
of the Company. Subject to the Executive complying with the Company's policy
regarding the reimbursement of such expenses as in effect from time to time
during the Employment Period, which does not necessarily allow
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reimbursement of all such expenses, the Company shall reimburse the Executive
for such expenses from time to time, at the Executive's request, and the
Executive shall account to the Company for all such expenses.
4.7 Relocation Expenses. The Company will provide for
reimbursement of moving and relocation expenses of the Executive and his family
as set forth on Exhibit B attached hereto.
4.8 Stock Options/Stock Grants.
(a) Effective as of March 21, 2002 (the date that the
Executive was elected as a director of the Company), the Company
granted to the Executive options to acquire 425,000 shares of Common
Stock, with the exercise price to be the closing sales price for the
Common Stock on The Nasdaq National Market on the trading day
immediately preceding the date of his election as a director. These
options provide for vesting of one-third of the shares covered by the
options on each of the first, second and third anniversaries of the
date of grant. The Company also hereby grants to the Executive
additional options covering 125,000 shares of Common Stock. Because of
the grant of these 125,000 options, the Executive will not be eligible
for any option grants in 2003 as part of his annual compensation review
of his performance in 2002, but will be eligible for any new stock
option grants in 2004 as part of his annual compensation review of his
performance in 2003. The 125,000 additional options granted pursuant to
the preceding sentence will have an exercise price equal to the closing
price on The Nasdaq National Stock Market on the trading day
immediately preceding the Effective Date of this Agreement. These
125,000 options will also provide for vesting of one-third of the
shares covered by these options on each of the second, third and fourth
anniversaries of the execution of this Agreement. Any options granted
under this Section 4.8(a) (the "Options") will be granted pursuant to,
and will be governed by the terms of, the Company's incentive stock
plans as then in effect, and the provisions of this Agreement
(including Section 6.3(e) hereof). At the request of the Executive, the
Company will cause the Options covering 125,000 shares to be granted as
Incentive Stock Options under the Code, to the extent permitted, and
subject to the terms provided under, the Code. All Options will provide
that they will not continue to vest after the breach (and failure to
cure such breach as provided for therein) by the Executive of any of
Sections 7, 8, 9, 10 or 11 of this Agreement.
(b) The Company will grant the Executive ten shares of Common
Stock for each one share of Common Stock the Executive buys from the
Company or on the open market within 30 days after the date of this
Agreement, up to a maximum grant amount of 50,000 shares. These shares
granted by the Company will be issued as of the date of execution of
this Agreement as "restricted stock" under the Company's incentive
stock plans, and will vest on the third anniversary of the execution of
this Agreement. Prior to vesting, these shares will be held by the
Company and will bear the restrictive legends set forth in, and be
governed by the terms of, the Company's incentive stock plans. This
restricted stock will not be
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transferable or saleable until vested, and all unvested restricted
stock will be forfeited and cancelled by the Company if the Executive
terminates his employment for any reason or is terminated for Cause by
the Company prior to the third anniversary of their grant. Upon death
or disability of the Executive, the restricted stock will vest in full.
Upon the termination of Executive by the Company Without Cause prior to
the third anniversary of their grant, the restricted shares will vest
on a pro rata basis based on how much of the three year vesting period
has expired prior to the Executive's termination Without Cause. All
unvested shares of restricted stock will provide that they will be
forfeited after the breach (and failure to cure such breach as provided
for therein) by the Executive of any of Sections 7, 8, 9, 10 and 11 of
this Agreement. Upon the vesting of these shares of restricted stock,
the Company will cause the removal of the restrictive legends on the
certificates representing such shares that relate to the vesting
conditions described in this Section 4.8(b).
(c) The Company will cause the Options and restricted stock to
be issued under the Company's 1999 Incentive Stock Plan (the "1999
Plan") by the execution and delivery of agreements containing the terms
and conditions set forth in this Agreement, and the other terms and
conditions of the Plan that are not inconsistent herewith. The
Compensation Committee has, pursuant to the Plan, authorized such
agreements to be issued on the terms set forth herein pursuant to the
authority granted to the Compensation Committee to alter appropriate
terms and conditions of the Plan when granting incentive awards under
the Plan.
4.9 Legal Expenses. The Company will reimburse the Executive for his
reasonable legal expenses incurred in connection with the negotiation and
execution of this Agreement.
4.10 Termination and Indemnification Agreements. (a) The Company will
enter into with the Executive a Termination Agreement regarding compensation
payable to the Executive in the event of termination of employment following a
change of control of the Company, and an Indemnification Agreement regarding
indemnification of the Executive, in the form attached hereto as Exhibit C.
(b) The Company will also cause the Executive to be covered by
its director and officer insurance policies as they are in effect from
time to time. A summary of the Company's current director and officer
insurance policy is attached hereto as Exhibit D. The Company also
represents and warrants that it is not presently subject to any legal
actions, claims or administrative proceedings other than routine
matters arising in the ordinary course of its business and the matter
described on Exhibit D attached hereto, and to the best knowledge of
the Company, no such legal actions, claims or administrative
proceedings are threatened which would cause a Material Injury.
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5. Termination.
5.1 Death. This Agreement shall terminate automatically upon the death
of the Executive.
5.2 Disability. The Company may terminate this Agreement, upon written
notice to the Executive delivered in accordance with Sections 5.6 and 12.1
hereof, upon the Disability of the Executive.
5.3 Cause. The Company may terminate this Agreement, upon written
notice to the Executive delivered in accordance with Sections 5.6 and 12.1
hereof, for Cause. For purposes of this definition of "Cause", the term
"Company" shall mean the Company and/or its Affiliates. For purposes of this
Agreement, subject to the notice provisions set forth below, "Cause" means (i)
the conviction (or plea of nolo contendere or equivalent plea) of the Executive
of a felony (which, through lapse of time or otherwise, is not subject to
appeal), (ii) the Executive having engaged in intentional misconduct causing a
violation by the Company of any state or federal laws which results in a
material injury to the business, condition (financial or otherwise), results of
operations or prospects of the Company as determined in good faith by the Board
of Directors of the Company or a committee thereof (a "Material Injury"), (iii)
the Executive having engaged in a theft of corporate funds or corporate assets
or in an act of fraud upon the Company, (iv) an act of personal dishonesty taken
by the Executive that was intended to result in personal enrichment of the
Executive at the expense of the Company, (v) the Executive's refusal, without
proper legal cause, to perform his duties and responsibilities as contemplated
in this Agreement or any other breach by the Executive of this Agreement, and
(vi) the Executive's engaging in activities which would constitute a breach of
the Company's Business Ethics Policy, the Company's policies regarding trading
in the Common Stock or any other applicable policies, rules or regulations of
the Company which results in a Material Injury. If the Company desires to
terminate the Executive for Cause pursuant to the provisions of this Section
5.3, the Executive will be given a written notice by the Board of Directors of
the facts and circumstances providing the basis for termination for Cause, and
the Executive will have 30 days from the date of such notice to remedy, cure or
rectify the situation giving rise to termination for Cause to the reasonable
satisfaction of the Board of Directors (except in the event of termination for
Cause pursuant to subparagraph (i) above as to which no cure period will be
permitted).
5.4 Without Cause. The Company may terminate this Agreement Without
Cause, upon written notice to the Executive delivered in accordance with
Sections 5.6 and 12.1 hereof. For purposes of this Agreement, the Executive will
be deemed to have been terminated "Without Cause" if the Executive is terminated
by the Company for any reason other than Cause, Disability or death or if the
Company delivers a notice of nonrenewal of this Agreement pursuant to Section 3
hereof..
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5.5 Good Reason. The Executive may terminate this Agreement for Good
Reason, upon written notice to the Company delivered in accordance with Sections
5.6 and 12.1 hereof. For purposes of this Agreement, "Good Reason" means (i) the
assignment to the Executive of any duties materially inconsistent in any respect
with the Executive's duties or responsibilities as contemplated in this
Agreement, provided that Executive specifically terminates his employment for
Good Reason hereunder within 120 days from the date that he has actual notice of
such material breach; (ii) any other action by the Company which results in a
material diminishment in the Executive's position (including status, offices,
titles and reporting requirements), authority, duties or responsibilities,
provided that Executive specifically terminates his employment for Good Reason
hereunder within 120 days from the date that he has actual notice of such
material breach; (iii) any breach by the Company of any of the provisions of
this Agreement, provided that Executive specifically terminates his employment
for Good Reason hereunder within 120 days from the date that he has actual
notice of such material breach; (iv) requiring the Executive to relocate to any
office or location other than Houston, Texas, without his consent, or (v) a 5%
or more reduction, or attempted reduction, at any time during the Employment
Period, of the Base Salary of the Executive unless such reduction is also
applied to all other senior executives of the Company.
Notwithstanding the preceding provisions of this Section 5.5, if
Executive desires to terminate his employment for Good Reason, he shall first
give written notice of the facts and circumstances providing the basis for Good
Reason to the Board of Directors of the Company or the Compensation Committee,
and allow the Company thirty (30) days from the date of such notice to remedy,
cure or rectify the situation giving rise to Good Reason to the reasonable
satisfaction of Executive.
5.6 Notice of Termination. Any termination of this Agreement by the
Company or the Executive, shall be communicated by Notice of Termination to the
other party hereto given in accordance with this Agreement. For purposes of this
Agreement, a "Notice of Termination" means a written notice which (i) indicates
the specific termination provision in this Agreement relied upon, (ii) sets
forth in reasonable detail the facts and circumstances claimed to provide a
basis for termination of the Executive's employment under the provision so
indicated and (iii) specifies the termination date, if such date is other than
the date of receipt of such notice (which termination date shall not be more
than 15 days after the giving of such notice, unless otherwise provided herein).
Notwithstanding the foregoing, the Company may elect to consider the Executive
as an employee after the Date of Termination for purposes of complying with the
provisions of Section 6 hereof.
6. Obligations of Company upon Termination.
6.1 Cause; Other Than Good Reason. If this Agreement shall be
terminated either by the Company for Cause or by the Executive for any reason
other than Good Reason (including delivery by the Executive of a notice of
nonrenewal of this Agreement pursuant to Section 3 hereof), the Company shall
pay to the Executive, in a lump sum in cash within 30 days after the Date of
Termination, the aggregate of the Executive's Base Salary (as in effect on the
Date of
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Termination) through the Date of Termination, if not theretofore paid, and, in
the case of compensation previously deferred by the Executive, all amounts of
such compensation previously deferred and not yet paid by the Company. All other
obligations of the Company and rights of the Executive hereunder shall terminate
effective as of the Date of Termination, except as provided for in any benefit
plans, incentive stock plans or other compensation plans and as otherwise
provided in this Agreement.
6.2 Death or Disability. If this Agreement is terminated as a result of
the Executive's death or Disability, the Company shall pay to the Executive or
his estate, in a lump sum in cash within 30 days of the Date of Termination, the
Executive's Base Salary (as in effect on the Date of Termination) through the
Date of Termination, if not theretofore paid, and, in the case of compensation
previously deferred and bonuses previously earned by Executive, all amounts of
such compensation previously deferred and earned and not yet paid by the
Company. In addition, in the event of the Executive's death or Disability, the
Company will pay to the Executive or his estate the Annual Bonus the Executive
would have received, if any, pursuant to Section 4.2 above during the year of
his death or Disability, pursuant to and subject to the terms of any bonus plan
then in effect in which the Executive is eligible to participate; provided, that
such Annual Bonus, if any, will be paid at such time and in such amount as all
other Annual Bonuses are paid pursuant to the applicable bonus plan, and that
the amount of such Annual Bonus, if any, will be paid on a pro rata basis based
on the number of months during the year in question prior to the Executive's
death or Disability. The Executive or his estate shall also be entitled to
receive those death and Disability benefits to which the Executive is entitled
under the Company's benefit and insurance plans. All other obligations of the
Company and rights of the Executive hereunder shall terminate effective as of
the Date of Termination, except as provided for in any benefit plans, incentive
stock plans or other compensation plans and as otherwise provided in this
Agreement.
6.3 Good Reason; Without Cause; Nonrenewal. If this Agreement shall be
terminated either by the Executive for Good Reason, by the Company Without Cause
(which includes delivery by the Company of a notice of nonrenewal of this
Agreement pursuant to Section 3 hereof):
(a) the Company shall pay to the Executive:
(1) in a lump sum in cash within 30 days after the
Date of Termination, if not theretofore paid, the Executive's
Base Salary (as in effect on the Date of Termination) through
the Date of Termination;
(2) a lump sum equal to the product of (x) the Annual
Bonus which would have been paid to the Executive for the full
fiscal year during which the Date of Termination occurred in
an amount determined by the Board of Directors of the Company
(or a committee thereof) pursuant to the bonus program then in
effect for senior executives of the Company and (y) the
fraction obtained by dividing (i) the number of days between
the Date of Termination and the last day of the last full
fiscal year preceding the Date of Termination and (ii) 365,
which lump sum
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will be paid at the same time as bonuses are paid to all
executives for such fiscal year; and
(3) in a lump sum in cash within 30 days after the
Date of Termination, in the case of compensation previously
deferred and bonuses previously earned by the Executive, all
amounts of such compensation previously deferred and earned
and not yet paid by the Company;
(b) the Company shall, promptly upon submission by the
Executive of supporting documentation, pay or reimburse to the
Executive any costs and expenses (including moving and relocation
expenses) paid or incurred by the Executive which would have been
payable under Sections 4.6 and 4.7 of this Agreement if the Executive's
employment had not terminated; and
(c) during the 12-month period commencing on the Date of
Termination, the Company shall continue benefits (other than disability
benefits) to the Executive and/or the Executive's family at least equal
to those which would have been provided to them under Section 4.5 if
the Executive's employment had not been terminated; and
(d) during the 12-month period following the Date of
Termination, the Company shall pay to the Executive, in equal
semi-monthly installments, the Executive's Base Salary (as in effect on
the Date of Termination).
(e) During the 12-month period after the Date of Termination,
all stock options (including the Options) and restricted stock held by
the Executive will continue to vest and be exercisable in accordance
with their terms in effect on the Date of Termination. On the
conclusion of said 12-month period, all unexpired, unexercised options
will be fully vested and all restricted stock will be fully vested.
Thereafter, all such fully vested stock options will be exercisable by
Executive until the earlier to occur of the expiration of the term of
each stock option or 12 months after the date they become fully vested.
(f) Notwithstanding any of the above to the contrary, the
Executive will not be entitled to any of the benefits or payments
provided in Section 6.3(a)(2), (c), (d) or (e) if (i) the Executive
breaches this Agreement including the provisions of Sections 8, 9, 10
and 11 hereof, or (ii) the Executive fails to execute on or before the
Date of Termination a release from liability and waiver of right to xxx
in a form reasonably acceptable to the Company.
7. Executive's Obligation to Avoid Conflicts of Interest. For purposes of this
Section 7, all references to Company shall mean and include its Affiliates. The
Executive further agrees to comply with the Company's conflict of interest
policy, including the Business Ethics Policy, as in effect from time to time.
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8. Executive's Confidentiality Obligation.
8.1 For purposes of this Section 8, all references to Company shall
mean and include its Affiliates. Executive hereby acknowledges, understands and
agrees that all Confidential Information, as defined in Section 8.2, whether
developed by Executive or others employed by or in any way associated with
Executive or Company, is the exclusive and confidential property of Company and
shall be regarded, treated and protected as such in accordance with this
Agreement. Executive acknowledges that all such Confidential Information is in
the nature of a trade secret. Failure to xxxx any writing confidential shall not
affect the confidential nature of such writing or the information contained
therein.
8.2 For purposes of this Agreement, "Confidential Information" means
information, which is used in the business of the Company and (i) is proprietary
to, about or created by the Company, (ii) gives the Company some competitive
business advantage or the opportunity of obtaining such advantage or the
disclosure of which could be detrimental to the interests of the Company, (iii)
is designated as Confidential Information by the Company, is known by the
Executive to be considered confidential by the Company, or from all the relevant
circumstances should reasonably be assumed by the Executive to be confidential
and proprietary to the Company, or (iv) is not generally known by non-Company
personnel. Confidential Information excludes, however, any information which is
lawfully in the public domain or has been publicly disclosed by the Company.
Such Confidential Information includes, without limitation, the following types
of information and other information of a similar nature (whether or not reduced
to writing or designated as confidential):
(a) Internal personnel and financial information of the
Company, vendor information (including vendor characteristics,
services, prices, lists and agreements), purchasing and internal cost
information, internal service and operational manuals, and the manner
and methods of conducting the business of the Company;
(b) Marketing and development plans, price and cost data,
price and fee amounts, pricing and billing policies, quoting
procedures, marketing techniques, forecasts and forecast assumptions
and volumes, and future plans and potential strategies (including,
without limitation, all information relating to any acquisition
prospect and the identity of any key contact within the organization of
any acquisition prospect) of the Company which have been or are being
discussed;
(c) Names of customers and their representatives, contracts
(including their contents and parties), customer services, and the
type, quantity, specifications and content of products and services
purchased, leased, licensed or received by customers of the Company;
and
12
(d) Confidential and proprietary information provided to the
Company by any actual or potential customer, government agency or other
third party (including businesses, consultants and other entities and
individuals).
(e) Work product resulting from or related to the research,
development or production of the drug development programs of the
Company.
8.3 As a consequence of the Executive's acquisition or anticipated
acquisition of Confidential Information, the Executive shall occupy a position
of trust and confidence with respect to the affairs and business of the Company.
In view of the foregoing and of the consideration to be provided to the
Executive, the Executive agrees that it is reasonable and necessary that the
Executive make each of the following covenants:
(a) At any time during the Employment Period and thereafter,
the Executive shall not disclose Confidential Information to any person
or entity, either inside or outside of the Company, other than as
necessary in carrying out his duties and responsibilities as set forth
in Section 2 hereof, without first obtaining the Company's prior
written consent (unless such disclosure is compelled pursuant to court
orders or subpoena, and at which time the Executive shall give notice
of such proceedings to the Company).
(b) At any time during the Employment Period and thereafter,
the Executive shall not use, copy or transfer Confidential Information
other than as necessary in carrying out his duties and responsibilities
as set forth in Section 2 hereof, without first obtaining the Company's
prior written consent.
(c) On the Date of Termination, the Executive shall promptly
deliver to the Company (or its designee) all written materials, records
and documents made by the Executive or which came into his possession
prior to or during the Employment Period concerning the business or
affairs of the Company, including, without limitation, all materials
containing Confidential Information.
9. Disclosure of Information, Ideas, Concepts, Improvements, Discoveries
and Inventions.
As part of the Executive's fiduciary duties to the Company, the
Executive agrees that during his employment by the Company and thereafter
following the Date of Termination, the Executive shall promptly disclose in
writing to the Company all information, ideas, concepts, improvements,
discoveries and inventions, whether patentable or not, and whether or not
reduced to practice, which are conceived, developed, made or acquired by the
Executive during the Employment Period, either individually or jointly with
others, and which relate to the business, products or services of the Company or
its Affiliates, irrespective of whether the Executive used the Company's time or
facilities and irrespective of whether such information, idea, concept,
improvement, discovery or invention was conceived, developed, discovered or
acquired by
13
the Executive on the job, at home, or elsewhere. This obligation extends to all
types of information, ideas and concepts, including information, ideas and
concepts relating to research and development of drugs, drug discovery and
manufacturing processes, new types of services, corporate opportunities,
acquisition prospects, prospective names or service marks for the Company's
business activities, and the like.
10. Ownership of Information, Ideas, Concepts, Improvements, Discoveries
and Inventions, and all Original Works of Authorship.
10.1 All references in this Section 10 to Company shall mean and
include its Affiliates. All information, ideas, concepts, improvements,
discoveries and inventions, whether patentable or not, which are conceived,
made, developed or acquired by the Executive or which are disclosed or made
known to the Executive, individually or in conjunction with others, during the
Executive's employment by the Company and which relate to the business, products
or services of the Company or its Affiliates (including, without limitation, all
such information relating to research and development of drugs, drug discovery
and manufacturing processes, corporate opportunities, research, financial and
sales data, pricing and trading terms, evaluations, opinions, interpretations,
acquisition prospects, the identity of customers or their requirements, the
identity of key contacts within the customers' organizations, marketing and
merchandising techniques, and prospective names and service marks) are and shall
be the sole and exclusive property of the Company. Furthermore, all drawings,
memoranda, notes, records, files, correspondence, manuals, models,
specifications, computer programs, maps and all other writings or materials of
any type embodying any of such information, ideas, concepts, improvements,
discoveries and inventions are and shall be the sole and exclusive property of
the Company.
10.2 In particular, the Executive hereby specifically sells, assigns,
transfers and conveys to the Company all of his worldwide right, title and
interest in and to all such information, ideas, concepts, improvements,
discoveries or inventions, and any United States or foreign applications for
patents, inventor's certificates or other industrial rights which may be filed
in respect thereof, including divisions, continuations, continuations-in-part,
reissues and/or extensions thereof, and applications for registration of such
names and service marks. The Executive shall assist the Company and its nominee
at all times, during the Employment Period and thereafter, in the protection of
such information, ideas, concepts, improvements, discoveries or inventions, both
in the United States and all foreign countries, which assistance shall include,
but shall not be limited to, the execution of all lawful oaths and all
assignment documents requested by the Company or its nominee in connection with
the preparation, prosecution, issuance or enforcement of any applications for
United States or foreign letters patent, including divisions, continuations,
continuations-in-part, reissues and/or extensions thereof, and any application
for the registration of such names and service marks.
10.3 In the event the Executive creates, during the Employment Period,
any original work of authorship fixed in any tangible medium of expression which
is the subject matter of copyright (such as, videotapes, written presentations
on acquisitions, computer programs,
14
drawings, maps, architectural renditions, models, manuals, brochures or the
like) relating to the Company's business, products or services, whether such
work is created solely by the Executive or jointly with others, the Company
shall be deemed the author of such work if the work is prepared by the Executive
in the scope of his employment; or, if the work is not prepared by the Executive
within the scope of his employment but is specially ordered by the Company as a
contribution to a collective work, as a part of a motion picture or other
audiovisual work, as a translation, as a supplementary work, as a compilation or
as an instructional text, then the work shall be considered to be work made for
hire, and the Company shall be the author of such work. If such work is neither
prepared by the Executive within the scope of his employment nor a work
specially ordered and deemed to be a work made for hire, then the Executive
hereby agrees to sell, transfer, assign and convey, and by these presents, does
sell, transfer, assign and convey, to the Company all of the Executive's
worldwide right, title and interest in and to such work and all rights of
copyright therein. The Executive agrees to assist the Company and its
Affiliates, at all times, during the Employment Period and thereafter, in the
protection of the Company's worldwide right, title and interest in and to such
work and all rights of copyright therein, which assistance shall include, but
shall not be limited to, the execution of all documents requested by the Company
or its nominee and the execution of all lawful oaths and applications for
registration of copyright in the United States and foreign countries.
10.4 The provisions of this Section 10 shall not supersede any
proprietary information agreement (the "Proprietary Agreement") between the
Executive and the Company which shall remain in full force and effect and,
moreover, this Agreement, the Proprietary Agreement and any such other similar
agreement between the parties shall be construed and applied as being mutually
consistent to the fullest extent possible.
11. Executive's Non-Competition Obligation.
11.1 (a) All references to the term "Company" in this Section 11 shall
mean and include its Affiliates. During the Employment Period and for
the 12 month period following the Date of Termination hereof, the
Executive shall not, acting alone or in conjunction with others,
directly or indirectly, in the United States and any other business
territories in which the Company is presently or from time to time
during the Employment Period conducting business, invest or engage,
directly or indirectly, in any Competing Business or accept employment
with or render services to such a Competing Business as a director,
officer, agent, executive or consultant or in any other capacity;
provided, however, that the beneficial ownership by the Executive of up
to three percent of the Voting Stock of any corporation subject to the
periodic reporting requirements of the Exchange Act shall not violate
this Section 11.1(a). Notwithstanding the above, the Executive may
serve as an officer, director, agent, employee or consultant to a
Competing Business whose business is diversified and which is, as to
the part of its business to which the Executive is providing services,
not a Competing Business; provided, that prior to accepting employment
or providing services to such a Competing Business, the Executive and
the Competing Business will provide written assurances satisfactory to
the Company that the Executive will not render
15
services directly or indirectly for a 12-month period to any portion of
the Competing Business which competes directly or indirectly with the
Company.
(b) In addition to the other obligations agreed to by the
Executive in this Agreement, the Executive agrees that for 12 months
following the Date of Termination hereof, he shall not directly or
indirectly, (i) hire or attempt to hire any employee of the Company, or
induce, entice, encourage or solicit any employee of the Company to
leave his or her employment, or (ii) contact, communicate or solicit
any distributor, customer or acquisition or business prospect or
business opportunity of the Company for the purpose of causing them to
terminate or alter or amend their business relationship with the
Company to the Company's detriment.
Notwithstanding the foregoing, if the Company fails to make the
payments to the Executive set forth in Section 6.3 hereof, then the terms of
this Section 11.1 will not be effective from the date of such nonpayment;
provided, that if the Company subsequently makes any such payments, this Section
11.1 will become effective in accordance with its terms for so long as the
Company continues to make the payments required by Section 6.3 hereof.
11.2 (a) Executive hereby specifically acknowledges and
agrees that:
(1) Company expended and will continue to expend
substantial time, money and effort in developing its business;
(2) Executive will, in the course of his employment,
be personally entrusted with and exposed to Confidential
Information;
(3) Company, during the Employment Period and
thereafter, will be engaged in its highly competitive business
in which many firms compete;
(4) Executive could, after having access to Company's
financial records, contracts, and other Confidential
Information and know-how and, after receiving training by and
experience with the Company, become a competitor;
(5) Company will suffer great loss and irreparable
harm if Executive terminates his employment and enters,
directly or indirectly, into competition with Company;
(6) The temporal and other restrictions contained in
this Section 11 are in all respects reasonable and necessary
to protect the business goodwill, trade secrets, prospects and
other reasonable business interests of Company;
16
(7) The enforcement of this Agreement in general, and
of this Section 11 in particular, will not work an undue or
unfair hardship on Executive or otherwise be oppressive to
him; it being specifically acknowledged and agreed by
Executive that he has activities and other business interests
and opportunities which will provide him adequate means of
support if the provisions of this Section 11 are enforced
after the Termination Date; and
(8) the enforcement of this Agreement in general, and
of this Section 11 in particular, will neither deprive the
public of needed goods or services nor otherwise be injurious
to the public.
(b) Executive agrees that if an arbitrator (pursuant to
Section 12.13) or a court of competent jurisdiction determines that the
length of time or any other restriction, or portion thereof, set forth
in this Section 11 is overly restrictive and unenforceable, the
arbitrator or court shall reduce or modify such restrictions to those
which it deems reasonable and enforceable under the circumstances, and
as so reduced or modified, the parties hereto agree that the
restrictions of this Section 11 shall remain in full force and effect.
Executive further agrees that if an arbitrator or court of competent
jurisdiction determines that any provision of this Section 11 is
invalid or against public policy, the remaining provisions of this
Section 11 and the remainder of this Agreement shall not be affected
thereby, and shall remain in full force and effect.
(c) In the event of any pending, threatened or actual breach
of any of the covenants or provisions of Sections 8, 9, 10 or 11, as
determined by a court of competent jurisdiction, it is understood and
agreed by Executive that the remedy at law for a breach of any of the
covenants or provisions of these Sections may be inadequate and,
therefore, the Company shall be entitled to a restraining order or
injunctive relief in addition to any other remedies at law and in
equity, as determined by a court of competent jurisdiction. Should a
court of competent jurisdiction or an arbitrator (pursuant to Section
12.13) declare any provision of Sections 8, 9, 10 or 11 to be
unenforceable due to an unreasonable restriction of duration or
geographical area, or for any other reason, such court or arbitrator is
hereby granted the consent of each of the Executive and Company to
reform such provision and/or to grant the Company any relief, at law or
in equity, reasonably necessary to protect the reasonable business
interests of Company or any of its Affiliates. Executive hereby
acknowledges and agrees that all of the covenants and other provisions
of Sections 8, 9, 10 or 11 are reasonable and necessary for the
protection of the Company's reasonable business interests. Executive
hereby agrees that if the Company prevails in any action, suit or
proceeding with respect to any matter arising out of or in connection
with Sections 8, 9, 10 or 11, Company shall be entitled to all
equitable and legal remedies, including, but not limited to, injunctive
relief and compensatory damages, as determined by a court of competent
jurisdiction.
17
(d) It is acknowledged, understood and agreed by and between
the parties hereto that the covenants made by Executive in this Section
11 are essential elements of this Agreement and that, but for the
agreement of the Executive to comply with such covenants, Company would
not have entered into this Agreement.
12. Miscellaneous.
12.3 Notices. All notices and other communications required or
permitted hereunder or necessary or convenient in connection herewith shall be
in writing and shall be deemed to have been given when (i) delivered by hand or
sent by facsimile, or (ii) on the third business day following deposit in the
United States mail by registered or certified mail, return receipt requested, to
the addresses as follows (provided that notice of change of address shall be
deemed given only when received):
If to the Company to:
Texas Biotechnology Corporation
0000 Xxxxxx
Xxxxxxx, Xxxxx 00000
Attention: Chairman of the Board
Facsimile No. - (000) 000-0000
If to the Executive to:
Xxxxx X. Given, M.D.
Texas Biotechnology Corporation
0000 Xxxxxx
Xxxxxxx, Xxxxx 00000
Facsimile No. - (000) 000-0000
or to such other names or addresses as the Company or the Executive, as the case
may be, shall designate by notice to the other party hereto in the manner
specified in this Section 12.1.
12.4 Waiver of Breach. The waiver by any party hereto of a breach of
any provision of this Agreement shall neither operate nor be construed as a
waiver of any subsequent breach by any party. Except as expressly provided for
herein, the failure of either party hereto to take any action by reason of any
breach will not deprive such party of the right to take action at any time while
such breach occurs.
12.5 Assignment. This Agreement shall be binding upon and inure to the
benefit of the Company, its successors, legal representatives and assigns, and
upon the Executive, his heirs, executors, administrators, representatives and
assigns; provided, however, the Executive agrees that his rights and obligations
hereunder are personal to him and may not be
18
assigned without the express written consent of the Company. Any reference to
"Company" herein shall mean the Company as well as any successors thereto.
12.6 Entire Agreement; No Oral Amendments. This Agreement, together
with any exhibit attached hereto and any document, policy, rule or regulation
referred to herein, replaces and merges all previous agreements and discussions
relating to the same or similar subject matter between the Executive and the
Company and constitutes the entire agreement between the Executive and the
Company with respect to the subject matter of this Agreement. This Agreement may
not be modified in any respect by any verbal statement, representation or
agreement made by any Executive, officer, or representative of the Company or by
any written agreement unless signed by an officer of the Company who is
expressly authorized by the Company to execute such document.
12.7 Enforceability. If any provision of this Agreement or application
thereof to anyone or under any circumstances shall be determined to be invalid
or unenforceable, such invalidity or unenforceability shall not affect any other
provisions or applications of this Agreement which can be given effect without
the invalid or unenforceable provision or application.
12.8 (1) Choice of Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS, WITHOUT REGARD TO
THE PRINCIPLES OF CONFLICTS OF LAW.
12.9 Corporate Authority. The Company has all corporate power and
authority necessary to enter into this Agreement and to perform its obligations
hereunder. This Agreement has been duly authorized, executed and delivered by
the Company.
12.10 Defense of Claims. Executive agrees that, during the Employment
Period and for a period of two (2) years after his Termination Date, upon
request from the Company, he will reasonably cooperate with the Company and its
Affiliates in the defense of any claims or actions that may be made by or
against the Company or any of its Affiliates that affect his prior areas of
responsibility, except if Executive's reasonable interests are adverse to the
Company or Affiliates in such claim or action. To the extent travel is required
to comply with the requirements of this Section 12.8, the Company shall, to the
extent possible, provide Executive with notice at least 10 days prior to the
date on which such travel would be required. The Company agrees to promptly pay
or reimburse Executive upon demand for all of his reasonable travel and other
direct expenses incurred, or to be reasonably incurred, to comply, with his
obligations under this Section.
12.11 Withholdings: Right of Offset. Company may withhold and deduct
from any benefits and payments made or to be made pursuant to this Agreement (a)
all federal, state, local and other taxes as may be required pursuant to any law
or governmental regulation or
19
ruling, (b) all other employee deductions made with respect to Company's
employees generally, and (c) any advances made to Executive and owed to Company.
12.12 Nonalienation. The right to receive payments under this Agreement
shall not be subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge or encumbrance by Executive, his dependents or beneficiaries,
or to any other person who is or may become entitled to receive such payments
hereunder. The right to receive payments hereunder shall not be subject to or
liable for the debts, contracts, liabilities, engagements or torts of any person
who is or may become entitled to receive such payments, nor may the same be
subject to attachment or seizure by any creditor of such person under any
circumstances, and any such attempted attachment or seizure shall be void and of
no force and effect.
12.13 Incompetent or Minor Payees. Should the Board of Directors
determine that any person to whom any payment is payable under this Agreement
has been determined to be legally incompetent or is a minor, any payment due
hereunder may, notwithstanding any other provision of this Agreement to the
contrary, be made in any one or more of the following ways: (a) directly to such
minor or person; (b) to the legal guardian or other duly appointed personal
representative of the person or estate of such minor or person; or (c) to such
adult or adults as have, in the good faith knowledge of the Board, assumed
custody and support of such minor or person; and any payment so made shall
constitute full and complete discharge of any liability under this Agreement in
respect to the amount paid.
12.14 Title and Headings; Construction. Titles and headings to Sections
hereof are for the purpose of reference only and shall in no way limit, define
or otherwise affect the provisions hereof. Any and all Exhibits referred to in
this Agreement are, by such reference, incorporated herein and made a part
hereof for all purposes. The words "herein", "hereof", "hereunder" and other
compounds of the word "here" shall refer to the entire Agreement and not to any
particular provision hereof.
12.15 Arbitration. (a) If any dispute or controversy arises between
Executive and the Company relating to (1) this Agreement in any way or arising
out of the parties respective rights or obligations under this Agreement on (2)
the employment of Executive or the termination of such employment, then either
party may submit the dispute or controversy to arbitration under the
then-current Commercial Arbitration Rules of the American Arbitration
Association (AAA) (the "Rules"); provided, however, the Company shall retain its
rights to seek a restraining order or injunctive relief pursuant to Sections
11.2. Any arbitration hereunder shall be conducted before a panel of three
arbitrators unless the parties mutually agree that the arbitration shall be
conducted before a single arbitrator. The arbitrators shall be selected (from
lists provided by the AAA) through mutual agreement of the parties, if possible.
If the parties fail to reach agreement upon appointment of arbitrators within
twenty (20) days following receipt by one party of the other panty s notice of
desire to arbitrate, then within five (5) days following the end of such 20-day
period, each party shall select one arbitrator who, in turn, shall within five
(5) days jointly select the third arbitrator to comprise the arbitration panel
hereunder. The site for any arbitration hereunder shall be in Xxxxxx
20
County, Texas, unless otherwise mutually agreed by the parties, and the parties
hereby waive any objection that the forum is inconvenient.
(b) The party submitting any matter to arbitration shall do so
in accordance with the Rules. Notice to the other party shall state the
question or questions to be submitted for decision or award by
arbitration. Notwithstanding any provision of this Section 12.13,
Executive shall be entitled to seek specific performance of the
Executive's right to be paid during the pendency of any dispute or
controversy arising under this Agreement. In order to prevent
irreparable harm, the arbitrator may grant temporary or permanent
injunctive or other equitable relief for the protection of property
rights.
(c) The arbitrator shall set the date, time and place for each
hearing, and shall give the parties advance written notice in
accordance with the Rules. Any party may be represented by counsel or
other authorized representative at any hearing. The arbitration shall
be governed by the Federal Arbitration Act, 9 U.S.C. Sections 1 et.
seq. (or its successor). The arbitrator shall apply the substantive law
and the law of remedies, if applicable) of the State of Texas to the
claims asserted to the extent that the arbitrator determines that
federal law is not controlling.
(d) (1) Any award of an arbitrator shall be final and binding
upon the parties to such arbitration, and each party shall
immediately make such changes in its conduct or provide such
monetary payment or other relief as such award requires. The
parties agree that the award of the arbitrator shall be final
and binding and shall be subject only to the judicial review
permitted by the Federal Arbitration Act.
(2) The parties hereto agree that the arbitration
award may he entered with any court having jurisdiction and
the award may then be enforced as between the parties, without
further evidentiary proceedings, the same as if entered by the
court at the conclusion of a judicial proceeding in which no
appeal was taken. The Company and the Executive hereby agree
that a judgment upon any award rendered by an arbitrator may
be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law.
(e) Each party shall pay any monetary amount required by the
arbitrator's award, and the fees, costs and expenses for its own
counsel, witnesses and exhibits, unless otherwise determined by the
arbitrator in the award. The compensation and costs and expenses
assessed by the arbitrator(s) and the AAA shall be split evenly between
the parties unless otherwise determined by the arbitrator in the award.
If court proceedings to stay litigation or compel arbitration are
necessary, the party who opposes such proceedings to stay litigation or
compel arbitration, if such party is
21
unsuccessful, shall pay all associated costs, expenses, and attorney's
fees which are reasonably incurred by the other party as determined by
the arbitrator.
12.16 Survival of Certain Provisions. Wherever appropriate to the
intention of the parties hereto, the respective rights and obligations of said
parties, including, but not limited to, the rights and obligations set forth in
Sections 8 through 11 and this Section 12 hereof, shall survive any termination
or expiration of this Agreement.
12.17 No Strict Construction. The Executive represents to Company that
he is knowledgeable and sophisticated as to business matters, including the
subject matter of this Agreement, that he has read the Agreement and that he
understands its terms and conditions. The parties hereto agree that the language
used in this Agreement shall be deemed to be the language chosen by them to
express their mutual intent, and no rule of strict construction shall be applied
against either party hereto. Executive acknowledges that he has had the
opportunity to consult with counsel of his choice, independent of Employer's
counsel, regarding the terms and conditions of this Agreement and has done so to
the extent that he, in his discretion, deemed to be appropriate.
12.18 Superseding Agreement. This Employment Agreement shall supersede
any prior employment agreement entered into between the Company and Executive.
22
IN WITNESS WHEREOF, the undersigned, intending to be legally bound,
have executed this Agreement as of the date first written above.
Texas Biotechnology Corporation
By: /s/ XXXX X. XXXXXXXXX
-------------------------------
Xxxx X. Xxxxxxxxx
Chairman of the Board
Executive:
By: /s/ XXXXX X. GIVEN
-------------------------------
Xxxxx X. Given, M.D.
EXHIBIT A
Terms of current Incentive Program for senior executives of the Company
o Achievement of corporate goals triggers bonus program. Target
payout of 75% of Base Salary for achieving 100% of corporate,
financial and other goals as approved by the Compensation
Committee in advance of the payout. Maximum payout is 150% of
Base Salary for achieving 200% of these goals and minimum
payout is zero.
Example:
Base Salary x 75% of goals met (up to 200%) = Annual Bonus
100% of goals met: $325,000 x 75% x 100% = $243.75
60% of goals met: $325,000 x 75% x 60% = $146,251
Maximum: $325,000 x 75% x 200% = $487,500
o Annual Bonuses are paid 50% in cash and 50% in restricted
stock vesting in _ annual installments starting on the first
anniversary of the grant. Restricted stock is subject to
forfeiture upon termination for Cause or other breach of the
Agreement. Taxes are responsibility of Executive and may be
paid on date of grant or at time of vesting date.
o Annual Bonuses are paid upon completion of annual review of
performance goals during the prior year by the Compensation
Committee at its March meeting.
o Employee must be on the Company payroll at time of payout to
receive bonus award.*
o All restricted stock issued as part of Annual Bonus is subject
to the terms of the stock option plan under which it is
granted.
* The Company agrees that Section 6 of this Agreement modifies this
provision of the Incentive Program.
EXHIBIT B
The Company will pay reasonable expenses of relocation of the Executive
and his family from Bedminster, New Jersey to the Houston, Texas metropolitan
area as follows:
o The Company will pay transportation of household goods and
vehicles, family (via coach airfare or automobile) and
temporary living expenses in Houston for a period of up to 120
days.
o The Company will pay realtor commissions (up to 6%),
inspections and document fees on sale of existing residence
and closing costs including origination fee (up to 1%), title
insurance, survey, document and legal fees on purchase of a
new residence. The Company does not pay points (other than the
origination fee noted above), interest, taxes or insurance in
any form.
o The Company will "gross-up" for income and Medicare taxes any
relocation expenses that are taxable for federal income tax at
the marginal income tax rates applicable for the Executive as
a resident of Texas. Social Security tax will not be grossed
up since Executive will meet Social Security maximum during
the year.
o The Company will reimburse two house hunting trips of up to
six days each for Executive and his family including coach
airfare, hotel, rental car and incidental expenses.
o Expenses will be promptly reimbursed in accordance with
Company policy regarding reimbursement of expenses.
