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Exhibit 10.6
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (the "Agreement") dated as of November 2, 1998 between
INKINE PHARMACEUTICAL COMPANY, INC., a New York corporation ("Employer"), and
▇▇▇▇▇▇ ▇. APPLE ("Employee")
Background. Employee has been employed by Employer in various capacities.
Employer and Employee mutually agree to the employment of Employee as Senior
Vice President and Chief Financial Officer.
NOW THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements hereinafter set forth, the parties hereto, intending to
be legally bound hereby, agree as follows:
1. Employment. Employer hereby employs Employee, and Employee hereby
accepts such employment and agrees to perform his duties and responsibilities
hereunder, in accordance with the terms and conditions hereinafter set forth.
1.1 Employment Term. The employment term of this Agreement shall be for a
period of one year and may be renewed in accordance with Section 1.2.
The term "Employment Term" shall refer to the initial Employment Term,
which shall commence on the date hereof and shall continue and end on
the first anniversary date of this Agreement (unless terminated prior
thereto in accordance with Section 4 hereof and, to the extent this
Agreement is renewed pursuant to Section 1.2, to the last day of any
successive one year period.
1.2 Renewal. This Agreement shall be automatically renewed for
successive one year terms at the expiration of the initial Employment
Term, and any subsequent Employment Term, unless written notice to the
contrary is provided by either the Employer or the Employee at least
ninety days prior to the expiration of such Employment Term
1.3 Duties and Responsibilities.
a) During the Employment Term, Employee shall serve as
Senior Vice President and Chief Financial Officer for Employer
and shall perform all duties and accept all responsibilities
incidental to such position or as may be assigned to him by
Employer's Board of Directors, and he shall report to InKine's
Chief Executive Officer and shall cooperate fully with the Board
of Directors. Employee shall operate primarily out of Employer's
executive office, currently situated in Blue ▇▇▇▇, Pennsylvania.
b) Employee represents and covenants to Employer that he is
not subject to any agreement, covenant, understanding or
restriction which would prohibit Employee from executing this
Agreement and performing his duties and responsibilities
hereunder, or would in any manner, directly or indirectly, limit
or affect the duties and responsibilities which may now or in the
future be assigned to Employee by Employer.
1.4 Extent of Service; Noncompetition. During the Employment Term,
Employee agrees to use his best efforts to carry out his duties and
responsibilities under Section 1.3 hereof and to devote his full time,
attention and energy thereto. The foregoing shall not be construed as
preventing Employee from (a) serving as a consultant or director for one or
more other business enterprises, (b) engaging in charitable or civic
activities, (c) teaching, or (d) making investments in other businesses or
enterprises; provided that such activities in the aggregate shall not
prevent
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him from discharging his duties and responsibilities to Employer. During
the Employment Term, Employee may serve as a director of, but may not serve
as a consultant to, a business enterprise that is engaged in the
development of commercialization of technology which is directly
competitive with the technology then being developed or commercialized by
Employer. Nothing contained herein shall be construed to limit or otherwise
modify Employee's fiduciary and other obligations under applicable state
corporation laws or state and federal securities laws.
1.5 Base Salary. For the services rendered by Employee hereunder,
Employer shall pay Employee and annual salary at the rate of $150,000 for
the initial year of the Employment Term, less withholding required by law
or agreed to by Employee, payable in installments at such times as Employer
customarily pays its other executive officers. The annual base salary shall
be increased by the Board of Directors in its sole discretion, provided
that such annual increase shall be no less than an amount which reflects
the percentage increase (if any) in the Consumer Price Index published by
the United States Department of Labor for the Philadelphia SMASH for the
period since the prior base salary was determined.
1.6 Bonus and Other Benefits. During the Employment Term, Employee
shall be entitled to certain benefits and shall be eligible for certain
bonus compensation as follows:
a) Employee shall be paid an annual bonus, which shall be
determined by Employer's Board of Directors or an appropriate
committee of such Board.
b) Employee shall be entitled to all normal and usual benefits
provided by Employer to its executive employees, including, but not
limited to, participation in profit sharing, disability, health,
hospitalization and retirement plans and such other benefits as the
Board of Directors of Employer may from time to time determine based
upon the benefits paid to other executive officers of Employer.
Employee shall also be entitled to such executive benefits, including
executive disability and life insurance as shall be approved by
Employer's Board of Directors or an appropriate committee of the
Board.
c) Employee shall be eligible to receive such stock options or
other forms of stock grants as shall be determined by Employer's Board
of Directors or an appropriate committee of such Board.
d) Employee shall be entitled to paid vacation time during the
Employment Term in accordance with Employer's then existing vacation
policy for its executive employees.
1.7 Severance Compensation
a) If Employer terminates this Agreement, other than for "cause"
pursuant to Section 4 hereof during the Employment Term, Employer
shall pay to Employee an amount equal to 100% of Employee's base
annual salary, in effect at the date of such termination.
b) Such severance compensation shall be payable in full within
thirty days after the date of termination of this Agreement other than
for "cause" pursuant to Section 4 hereof.
c) Notwithstanding their terms, any options, warrants or other
rights to purchase shares of InKine's capital stock held by Employee
shall become immediately exercisable in full in the event Employer
terminates this Agreement other than for "cause" pursuant to Section 4
hereof. Such options, warrants or other rights shall be exercisable
for the
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balance of the term set forth in such option, warrant or right, and
otherwise in accordance with the term(s) thereof.
1.8 Expenses. Employee shall be reimbursed for the reasonable
business expenses incurred by him in connection with his performance
of services hereunder during the Employment Term upon presentation of
an itemized account and written proof of such expenses.
2. Confidentiality. The Employee agrees that he will not at any time,
either during or subsequent to the Employment Term, unless given express consent
in writing by the Employer, either directly or indirectly use or communicate to
any person or entity any confidential information of any kind concerning matters
affecting or relating to the names, addresses, buying habits or practices of any
of Employer" clients or customers; Employer" marketing methods, programs,
formulas, patterns, compilations, devices, methods, techniques or processes and
related data; the amount of compensation paid by Employer to employees and
independent contractors and other forms of their employment or contractual
relationships; other information concerning Employer's manner of operations.
(The foregoing shall not be deemed to prohibit the disclosure of information
which (i) is, at the time of disclosure, in the public domain other than as a
result of Employee's breach of this Agreement, or (ii) can be demonstrated by
Employee to be known by Employee on the date of his commencement of employment.)
The Employee agrees that the above information and items are important, material
and confidential trade secrets and that they affect the successful conduct of
the Employer's business and its good will. The Employee agrees that all business
procured by Employee while employed by the Employer is and shall remain the
permanent and exclusive property of the Employer. Employee further agrees that
Employer's relationship with each of its employees and independent contractors
is a significant and valuable asset of the employer. Any interference with the
Employer's business, property, confidential information, trade secrets, clients,
customers, employees or independent contractors by the Employee or any
employee's agents during or after the term of this Agreement shall be deemed a
material breach of this Agreement.
3. Equitable Relief.
a) Employee acknowledges that the restrictions contained in
Section 2 hereof are reasonable and necessary to protect the
legitimate interests of Employer and that any violation of such
restrictions would result in irreparable injury to Employer. If the
period of time or other restrictions specified in Section 2 should be
adjudged unreasonable at any proceeding, then the period of time or
such other restrictions shall be reduced by the elimination or
reduction of such portion thereof so that such restrictions may be
enforced in a manner adjudged to be reasonable. Employee acknowledges
that Employer shall be entitled to preliminary and permanent
injunctive relief for a violation of any such restrictions without
having to prove actual damages or to post bond; Employer shall also be
entitled to an equitable accounting of all earnings, profits and other
benefits arising from such violation, which rights shall be cumulative
and in addition to any other rights or remedies to which Employer may
be entitled in law or equity
b) Employee agrees that until the expiration of the covenants
contained in Section 2 of this Agreement, he will provide, and that
Employer may similarly provide, a copy of the covenants contained in
such Sections to any business or enterprise (i) which he may directly
or indirectly own, manage, operate, finance, join, control or
participate in the ownership, management, operation, financing,
control or control of, or (ii) with which he may be connected with as
an officer, director, employee, partner, principal, agent,
representative, consultant or otherwise, or in connection with which
he may use or permit his name to be used.
4. Termination. This Agreement shall terminate prior to the expiration
of the term set forth in Section 1.1 above upon the occurrence of any one of the
following events:
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4.1 Disability. In the event that Employee is unable fully to
perform his duties and responsibilities hereunder to the full extent
required by the Board of Directors of the Employer by reason of
illness, injury or incapacity for six consecutive months, during which
time he shall continue to be compensated as provided in Section 1.5
hereof (less any payments due Employee under disability benefit
programs, including Social Security disability, workers' compensation
and disability retirement benefits), this Agreement may be terminated
by Employer, and Employer shall have no further liability or
obligation to Employee for compensation hereunder; provided, however,
that Employee will be entitled to receive the payments prescribed
under any disability benefit plan which may be in effect for employees
of Employer and in which he participated. Employee agrees, in the
event of any dispute under this Section 4.1 to submit to a physical
examination by a licensed physician mutually agreed on by Employee and
the Board of Directors of Employer.
4.2 Death. In the event that Employee dies during the Employment
Term, Employer shall pay to his executors, legal representatives or
administrators an amount equal to the installment of his salary set
forth in Section 1.5 hereof for the month in which he dies, and
thereafter Employer shall have no further liability or obligation
hereunder to his executors, legal representatives, administrators,
heirs or assigns or any other person claiming under or through him;
provided, however, that Employee's estate or designated beneficiaries
shall be entitled to receive the payments prescribed for such
recipients under any death benefit plan which may be in effect for
employees of the Employer and in which Employee participated.
4.3 Cause. Notwithstanding any other provision hereof, Employer
may terminate this Agreement at any time for "cause". For purposes of
this Agreement, "cause" shall mean a material violation of a written
directive of InKine's Board of Directors, conviction of a crime
involving moral turpitude, willful misconduct which has a material
adverse effect on InKine as determined by a majority of InKine's Board
of Directors including each independent Director.
5. Survival. Notwithstanding the termination of this Agreement by
reason of Employee's disability under Section 4.1 or for cause under Section
4.3, his obligations under Section 2 hereof shall survive and remain in full
force and effect for the periods therein provided, and the provisions for
equitable relief against Employee in Section 3 hereof shall continue in force.
6. Governing Law. This Agreement shall be governed by and interpreted
under the laws of the Commonwealth of Pennsylvania.
7. Disputes and Arbitration. Any disputes arising hereunder, including
disputes arising from or relating to termination, shall be resolved by binding
arbitration. Notice of the demand for arbitration by either party shall be given
in writing to the other party to this Agreement. Upon such demand, the dispute
shall be settled by arbitration before a single arbitrator pursuant to the rules
of the American Arbitration Association (the "AAA"). Discovery shall be
permitted prior to arbitration and Pennsylvania law shall be applied. The
arbitrator shall be selected by the joint agreement of the parties, but if the
parties do not so agree within twenty days after the date of the notice referred
to above, the selection shall be made pursuant to the rules of, and from the
panels of arbitrators maintained by the AAA. Any award rendered by the
arbitrator shall be conclusive and binding upon the parties hereto; provided,
however, that any such award shall be accompanied by written opinion of the
arbitrator giving the reasons for the award. Each party shall pay its own
expenses of arbitration and the expenses of the arbitrator shall be equally
shared by the parties. Nothing herein shall prevent the parties from settling
any dispute by mutual agreement at any time.
8. 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 hand delivered or mailed by
registered or certified mail, as follows (provided that notice of change of
address shall be deemed given only when received):
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If to Employer, to:
InKine Pharmaceutical Company, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: CEO
If to Employee, to:
▇▇▇▇▇▇ ▇. Apple
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Or to such other names or addresses as Employer or Employee, as the case may be,
shall designate by notice to each other person entitled to receive notices in
the manner specified in this Section.
9. Contents of Agreement: Amendment and Assignment.
a) This Agreement supersedes all prior agreements and sets forth
the entire understanding among the parties hereto with respect to the
subject matter hereof and cannot be changed, modified, extended or
terminated except upon written amendment approved by the Board of
Directors of Employer and executed on its behalf by a duly authorized
officer. Without limitation, nothing in this Agreement shall be
construed as giving Employee any right to be retained in the employ of
Employer beyond the expiration of the Employment Term, and Employee
specifically acknowledges that, unless this Agreement is renewed in
accordance with Section 1.2 hereof, he shall be an employee-at-will of
Employer thereafter, and thus subject to discharge by Employer with or
without cause and without compensation of any nature.
b) Employee acknowledges that from time to time, Employer may
establish, maintain and distribute employee manuals or handbooks or
personnel policy manuals, and officers or other representatives of
Employer may make written or oral statements relating to personnel
policies and procedures. Such manuals, handbooks and statements are
intended only for general guidance. No policies, procedures or
statements of any nature by or on behalf of Employer (whether written
or oral, and whether or not contained in any employee manual or
handbook or personnel policy manual), and no acts or practices of any
nature, shall be construed to modify this Agreement or to create
express or implied obligations of any nature to Employee.
c) All of the terms and provisions of this Agreement shall be
binding upon and inure to the benefit of and be enforceable by the
respective heirs, executors, administrators, legal representatives,
successors and assigns of the parties hereto, except that the duties
and responsibilities of Employee hereunder are of a personal nature
and shall not be assignable or delegatable in whole or in part by
Employee.
10. Severability. If any provision of this Agreement or application
thereof to anyone or under any circumstances is adjudicated to be invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall not
affect any other provision or application of this Agreement which can be given
effect without the invalid or unenforceable provision or application and shall
not invalidate or render unenforceable such provision or application in any
other jurisdiction.
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11. Remedies Cumulative: No Waiver. No remedy conferred upon Employer
by this Agreement is intended to be exclusive of any other remedy, and each and
every such remedy shall be cumulative and shall be in addition to any other
remedy given hereunder or now or hereafter existing at law or in equity. No
delay or omission by Employer in exercising any right, remedy or power hereunder
or existing at law or in equity shall be construed as a waiver thereof, and any
such right, remedy or power may be exercised by Employer from time to time and
as often as may be deemed expedient or necessary by Employer in its sole
discretion.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date first above written.
Attest:
INKINE PHARMACEUTICAL COMPANY, INC.
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Ph.D. /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, M.D., Ph.D.
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By:
President ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, M.D., Ph.D.
Chairman and CEO
/s/ ▇▇▇▇▇▇ ▇. Apple
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▇▇▇▇▇▇ ▇. Apple
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