EXHIBIT 10.1
AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT
This AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT (the "Agreement"),
is entered into as of July 25, 2001, by and between POZEN Inc. (the "Company"),
with offices located at 0000 Xxxxxxxxxx Xxxxx, Xxxxx 000, Xxxxxx Xxxx, Xxxxx
Xxxxxxxx, and Xxxx X. Xxxxxxxxx ("Executive"), whose address is 000 Xxxxxx Xxxxx
Xxxxx, Xxxxxx Xxxx, Xxxxx Xxxxxxxx 00000.
WITNESSETH:
WHEREAS, the Company is engaged in certain pharmaceutical research,
development and marketing activities; and
WHEREAS, the Company has employed and wishes to continue to employ
Executive in the position of Chairman of the Board of Directors, President and
Chief Executive Officer, and Executive desires to continue in the employment
with the Company; and
WHEREAS, the Company and Executive previously entered into an Executive
Employment Agreement dated April 1, 1999, as amended (the "Original Agreement")
and desire to amend and restate the Original Agreement as provided herein.
NOW, THEREFORE, in consideration of the foregoing and the provisions and
mutual promises herein contained and other good and valuable consideration, the
parties hereby agree as follows:
1. EMPLOYMENT. The Company hereby engages and employs Executive, and
Executive hereby accepts engagement and employment, as Chairman, President and
Chief Executive Officer of the Company, with such duties and responsibilities as
are normally related to such position in accordance with the standards of the
industry and any additional duties as may be assigned to Executive from time to
time by the Board of Directors of the Company.
2. TERM. Executive's employment shall be for a term of three (3) years
from the date of execution of this Agreement (the "Term"), and thereafter shall
be automatically renewed with additional one (1) year terms to follow
consecutively, subject to the termination and severance provisions herein later
provided, unless amended or modified by mutual agreement of the parties. As used
herein, "Term" shall include the Initial Term and any renewals thereof in
accordance with this Agreement.
3. EXCLUSIVE SERVICE. Executive agrees to devote Executive's full time and
attention to the performance of Executive's duties and responsibilities on
behalf of the Company and to comply with all policies and regulations of the
Company.
4. COMPENSATION. During the Term of this Agreement, Executive's
compensation shall be determined and paid as follows:
(a) Base Salary. Executive shall receive an annual base salary of at
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least $350,000, payable in accordance with the Company's payroll practices.
Annual increases will be made, if any, based upon performance, and in the
sole discretion of the Board of Directors or the Compensation Committee of
the Board of Directors (each or collectively, the "Committee"), such
increases to be effective as of January 1 of each year during the Term.
(b) Bonus. Executive shall be eligible to receive an annual cash
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incentive bonus of up to seventy percent (70%) of annual base salary, or
such greater amount up to one hundred percent (100%) of annual base salary,
as may be set by the Committee by March 31 of each year. The determination
of the actual bonus earned, if any, shall be at the sole discretion of the
Committee and shall be based upon the Committee's assessment of Executive's
performance and the achievement of certain objectives which shall be set by
the Committee from time to time. Executive's performance shall be evaluated
by the Committee on an annual basis, and the Committee shall adjust
Executive's salary in its sole discretion. Nothing in this section shall be
construed as guaranteeing Executive a bonus in any amount.
(c) Stock Options. Executive shall be eligible for future stock
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options as shall be awarded in the discretion of the Committee.
(d) Long Term Incentive Plan. Executive shall be entitled to
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participate in the POZEN Inc. 2001 Long Term Incentive Plan (the "LTIP").
Executive shall be granted an initial award under the POZEN Inc. 2001 Long
Term Incentive Plan (the "LTIP") in January 2002 (or, in the Committee's
discretion, such earlier date in 2001 as the Plan may be adopted by the
Board of Directors), and, in the Committee's discretion, may be granted
additional awards in January 2003 and January 2004, entitling Executive to
earn up to $1,000,000 under each such award. Future awards under the LTIP,
if any, may be awarded in the sole discretion of the Committee. Nothing in
this section shall be construed as guaranteeing Executive any award under
the LTIP, and Executive shall have no rights under, in or to any such award
until it is granted by the Committee in accordance with the terms and
conditions of the LTIP.
(c) Benefits. Executive shall be eligible to participate in the
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Company's standard employee benefit programs made available to employees of
the Company from time to time, subject to appropriate premium
contributions, benefit elections, etc. In addition, Executive shall be
entitled to four (4) weeks of paid vacation per year.
(d) Life Insurance. During the Term, the Company will use its
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reasonable best efforts to obtain and pay insurance premiums on the life of
Executive, in an amount equal to two times Executive's annual base salary,
through the Company's group insurance program or otherwise, as the Company
shall in its discretion determine, payable to such persons as Executive
may, from time to time, designate in writing, or if Executive fails to
designate a beneficiary, to the legal representative of Executive's estate.
Executive agrees to submit to any physical examination required by any
prospective insurer, and will otherwise cooperate with the Company in
obtaining and
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maintaining such life insurance coverage. If Executive is determined to
suffer from any illness or condition which would preclude the Company from
obtaining such insurance at a cost substantially equivalent to the cost of
obtaining such insurance for a healthy individual of Executive's age and
gender, Executive shall have the option to cause the Company to obtain such
insurance with Executive paying the excess premium above that for which the
Company would have been responsible had Executive not been suffering from
such illness or condition, and if Executive does not exercise such option
in a timely fashion, the Company shall purchase the amount of insurance, if
any, that can be purchased at a cost substantially equivalent to the cost
of obtaining such insurance for a healthy individual of Executive's age and
gender. In the event that Executive does not qualify for any such life
insurance, the Company shall pay directly to Executive an amount equal to
such premiums that the Company would have paid to any insurance company to
obtain such life insurance on an annual basis.
(e) Business Expenses. The Company shall reimburse Executive for all
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reasonable expenses incurred in the furtherance of the Company's business
and interests, including travel and entertainment. Executive agrees to
comply with the expense reporting policies and procedures of the Company.
(f) Adequate Office Space. The Company shall provide to Executive
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adequate office space, facilities, and administrative support appropriate
to Executive's position.
(g) Disability. The Company will pay Executive as additional
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compensation an amount equal to the premium costs of an individual long
term disability insurance plan. The plan shall provide for a benefit
indemnity payment schedule equal to no more than 70% (typically 60%) of
Executive's annual base salary rate. The Company shall also pay Executive
as additional salary for such long term disability plan and an amount
sufficient to cover the additional income taxes owed on such compensation
payments.
(h) Estate Planning and Similar Costs. During the term of this
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Agreement, the Company will reimburse Executive for legal fees and expenses
incurred by Executive in connection with (A) estate and tax planning, up to
a maximum of $15,000 per calendar year, and (B) the establishment and
administration of a Rule 10b5-1 securities selling program, up to a maximum
of $15,000 per calendar year.
5. TERMINATION. This Agreement shall or may be terminated, as the case
may be, upon the terms and conditions hereinafter provided.
(a) Voluntary Termination. This Agreement shall be considered
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voluntarily terminated by the parties if either party provides written
notice of such party's intent not to renew this Agreement, provided that
such party shall provide at least one hundred eighty (180) days' written
notice to the other party.
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(b) Involuntary Termination. The Company may terminate this Agreement
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upon written notice to Executive (or Executive's representative) in any of
the following events:
(i) The death of Executive;
(ii) Executive becomes permanently disabled; or
(iii) For Cause, immediately upon written notice to Executive.
"Cause" shall be determined by the Board of Directors and
shall mean: (A) breach by Executive of the terms of this
Agreement; (B) breach of the Nondisclosure, Inventions and
Non-Competition Agreement (described in Section 6 below);
(C) material failure by Executive to comply with the
policies or directives of the Board of Directors; (D) any
illegal or dishonest action that is materially detrimental
to the Company; or (E) Executive's failure to faithfully
carry out the duties of Executive's position, provided
that Executive shall be given a period of thirty (30) days
after receipt of written notice of such failure during
which to cure such failure.
(c) Obligations upon Certain Terminations. Upon voluntary termination
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of this Agreement by Executive, or termination of Executive's employment by
the Company for Cause (as defined below) or upon Executive's death or
disability, or termination by Executive for other than Good Reason (as
defined below), the Company shall have no further obligations hereunder
other than the payment of all compensation and other benefits payable to
Executive through the date of such termination.
(d) Severance. In the event of termination of Executive's employment
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(i) by the Company for reasons other than Cause or Executive's death or
disability, or (ii) by Executive for Good Reason, Executive shall receive a
severance benefit in an amount equal to one (1) year's base salary plus the
average annual bonus awarded Executive over the previous two (2) years.
Executive shall also continue to be entitled to receive all Company
benefits to which Executive was entitled as of the date of termination,
subject to the terms of all applicable benefit plans and to the extent such
benefits can be provided to non-employee (or to the extent such benefits
cannot be provided to non-employees, then the cash equivalent thereof), at
the same average level and on the same terms and conditions which applied
immediately prior to the date of Executive's termination, for the shorter
of (i) one year following the date of such termination or (ii) until
Executive obtains comparable coverage from another employer. At any time
during the severance period, the Company may elect to pay a lump sum amount
to Executive which represents the reasonable value of such benefits reduced
to their present value in lieu of continuing payment of benefits.
(e) Good Reason. For purposes of this Agreement, "Good Reason" shall
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mean, the occurrence, without the consent of Executive, of any of the
following events, unless, in the case of (i), (ii) and (iii) below, such
event is corrected within thirty (30)
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days after written notification by Executive to the Company of the same:
(i) the office from which Executive performs Executive's principal duties
is moved more than 50 miles from the current location of the Company's
offices in Chapel Hill, North Carolina; (ii) Executive's duties and
responsibilities are substantially reduced or diminished; (iii) the Company
materially breaches its obligations under this Agreement; or (iv) a Change
of Control (as defined below) occurs and Executive notifies the Company in
writing within sixty (60) days of the consummation of such Change of
Control that Executive intends to terminate Executive's employment as a
result of the Change of Control, in which event such termination shall be
effective not less than sixty (60) days after the date of such written
notice.
(f) Tax Gross-Up for Parachute Payments.
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(A) If at any time or from time to time it shall be determined
that any payment to Executive pursuant to this Agreement or any other
payment or benefit hereunder or under any other plan or agreement or
otherwise ("Potential Parachute Payment") would constitute an "excess
parachute payment" within the meaning of Section 280G of the Internal
Revenue Code of 1986, as amended (the "Code"), and thus would be subject to
the excise tax imposed by Section 4999 of the Code or any similar tax
payable under any United States federal, state, local, foreign or other law
("Excise Tax"), then Executive shall receive and the Company shall pay or
cause to be paid a Tax Gross-Up Payment with respect to all Taxes (as
defined below). The Tax Gross-Up Payment is intended to compensate
Executive for all such excise taxes and federal, state, local, foreign or
other income, employment or excise taxes or other taxes ("Taxes") payable
by Executive with respect to the Tax Gross-Up Payment and shall be in an
amount such that after payment of Taxes on such amount there remains a
balance sufficient to pay the taxes being reimbursed. For purposes of
determining the amount of the Tax Gross-Up Payment, Executive shall be
deemed to pay federal income tax and employment taxes at the highest
marginal rate of federal income and employment taxation in the calendar
year in which the Tax Gross-Up Payment is to be made and state and local
income taxes at the highest marginal rate of taxation in the state and
locality of Executive's residence (or, if greater, the state and locality
in which Executive is required to file a nonresident income tax return with
respect to the Potential Parachute Payment), net of the maximum reduction
in federal income taxes that may be obtained from the deduction of such
state and local taxes.
(B) The determinations to be made under this Section 5(f) shall
be made by the Company's independent public accountants (the "Accounting
Firm"), which firm shall provide its determinations and any supporting
calculations both to the Company and to Executive. Any such determination
by the Accounting Firm shall be binding upon the Company and Executive. All
fees and expenses of the Accounting Firm in performing the determinations
referred to in this Section 5(f) shall be borne solely by the Company, and
the Company shall indemnify and hold harmless the Accounting Firm of and
from any and all claims, damages and expenses resulting therefrom, except
for claims, damages or expenses resulting from the gross negligence or
willful misconduct of the Accounting Firm.
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(g) Disability. For purposes of this Agreement, Executive shall be
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considered permanently disabled when a qualified medical doctor mutually
acceptable to the Company and Executive or Executive's personal
representative shall have certified in writing that: (i) Executive is
unable because of medically determinable physical or mental disability to
perform substantially all of Executive's duties for more than one hundred
eighty (180) calendar days measured from the last full day of work; or (ii)
by reason of mental or physical disability, it is unlikely that Executive
will be able, within one hundred eighty (180) calendar days, to resume
substantially all business duties and responsibilities in which Executive
was previously engaged and otherwise discharge Executive's duties under
this Agreement.
(h) Change of Control. For purposes of this Agreement, a "Change of
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Control" shall be deemed to have occurred:
(i) If any person (as such term is used in sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act")) (other than the Company or any trustee or fiduciary
holding securities under an employee benefit plan of the Company)
becomes a beneficial owner (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the Company
representing 50% or more of the voting power of the then outstanding
securities of the Company; provided that a Change of Control shall not
be deemed to occur as a result of a transaction in which the Company
becomes a subsidiary of another corporation and in which the
stockholders of the Company, immediately prior to the transaction,
will beneficially own, immediately after the transaction, shares
entitling such stockholders to more than 50% of all votes to which all
stockholders of the parent corporation would be entitled in the
election of directors (without consideration of the rights of any
class of stock to elect directors by a separate class vote); or
(ii) Upon the consummation of (A) a merger or consolidation of
the Company with another corporation where the stockholders of the
Company, immediately prior to the merger or consolidation, will not
beneficially own, immediately after the merger or consolidation,
shares entitling such stockholders to more than 50% of all votes to
which all stockholders of the surviving corporation would be entitled
in the election of directors (without consideration of the rights of
any class of stock to elect directors by a separate class vote), (B) a
sale or other disposition of all or substantially all of the assets of
the Company, or (C) a liquidation or dissolution of the Company.
(i) Resignation from Board of Directors. In the event that Executive
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is terminated pursuant to this Section 5 or upon termination of this
Agreement, Executive agrees to tender his resignation as a member of the
Board of Directors of the Company as of the date of such termination.
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6. NON-DISCLOSURE, INVENTIONS AND NON COMPETITION. Executive shall execute
and be bound by the terms of the Company's standard non-disclosure, inventions
and non-competition agreement in the form attached hereto as Exhibit A and
incorporated herein by reference.
7. NOTICES. Any notice required to be given shall be in writing personally
delivered by certified mail or registered mail or by facsimile (receipt
confirmed) to the address last shown in the Company's records.
8. SEVERABILITY. The provisions of this Agreement shall be deemed
severable, and the invalidity or unenforceability of any provision (or part
thereof) of this Agreement shall in no way affect the validity or enforceability
of any other provision (or remaining part thereof).
9. GOVERNING LAW. This Agreement shall be governed by and construed
according to the laws of the State of North Carolina, without reference to the
choice of law provisions of such laws.
10. ENTIRE AGREEMENT. This Agreement contains the entire agreement of the
parties relating to the subject matter hereof, and the parties hereto have made
no agreements, representations, or warranties relating to the subject matter of
this Agreement which are not set forth herein. No modification of this Agreement
shall be valid unless made in writing and signed by the parties hereto.
11. BENEFIT. This Agreement shall be binding upon and inure to the benefit
of both parties and their respective successors and assigns, including any
corporation or other entity with which or into which the Company may be merged
or which may succeed to its assets or business; provided, however, that the
obligations of Executive are personal and shall not be assigned by Executive.
12. INJUNCTIVE RELIEF. Executive understands and agrees that the Company
will suffer irreparable harm in the event that Executive breaches any of
Executive's obligations under this Agreement and that monetary damages will be
inadequate to compensate the Company for such breach. Accordingly, Executive
agrees that, in the event of a breach or threatened breach by Executive of any
of the provisions of this Agreement, the Company, in addition to and not in
limitation of any other rights, remedies, or damages available to the Company at
law or in equity, shall be entitled to a permanent injunction in order to
prevent or to restrain any such breach by Executive, or by Executive's partners,
agents, representatives, servants, employers, employees and/or any and all
persons directly or indirectly acting for or with Executive; provided such
injunction shall not affect Executive's ownership rights in the Company or
compensation earned or due Executive.
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IN WITNESS WHEREOF, the parties hereto have executed this Executive
Employment Agreement and affixed their seals as of the day and year first above
written.
EMPLOYER:
POZEN INC.
By: /s/ Xxxxx X. Xxxx
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Name: Xxxxx X. Xxxx, M.D.
Title: Vice Chairman
EMPLOYEE:
/s/ Xxxx X. Xxxxxxxxx
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Xxxx X. Xxxxxxxxx
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EXHIBIT A
NON-DISCLOSURE, INVENTION AND NON-COMPETITION AGREEMENT
THIS NON-DISCLOSURE, INVENTION AND NON-COMPETITION AGREEMENT (the
"Agreement") is effective for all purposes and in all respects, by and between
POZEN Inc., a Delaware corporation (hereinafter referred to as "Employer"), and
_____________________________ (hereinafter referred to as "Employee").
WHEREAS, Employer is about to employ Employee in a position of trust and
confidence to aid Employer in its business; and
WHEREAS, Employer desires to receive from Employee a covenant not to
disclose certain information relating to Employer's business and certain other
covenants; and
WHEREAS, as a material inducement to Employer to employ Employee and to pay
to Employee compensation for such services, Employee has agreed to such
covenants; and
WHEREAS, Employer and Employee desire to set forth in writing the terms
and conditions of their agreements and understandings.
NOW, THEREFORE, in consideration of the foregoing, of the mutual promises
herein contained, and of other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending
legally to be bound, hereby agree as follows:
1. Disclosure of Information. Employee acknowledges that, in and as a
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result of his employment by Employer, he will be making use of, acquiring and/or
adding to confidential information of a special and unique nature and value,
including, without limitation, Employer's trade secrets, products, systems,
programs, procedures, manuals, guides (as periodically updated or supplemented),
confidential reports and communications (including, without limitation, customer
site information, technical information on the performance and reliability of
Employer's products and the development or acquisition of future products or
product enhancements by Employer) and lists of customers, as well as the nature
and type of the services rendered by Employer and the fees paid by Employer's
customers. Employee further acknowledges that any information and materials
received by Employer from third parties in confidence (or subject to
non-disclosure covenants) shall be deemed to be and shall be confidential
information within the meaning of this Section 1. As a material inducement to
Employer to employ Employee and to pay to Employee compensation for such
services to be rendered to Employer by Employee (it being understood and agreed
by the parties hereto that such compensation shall also be paid and received in
consideration hereof), Employee covenants and agrees that he shall not, except
with the prior written consent of the Board of Directors of Employer, at any
time during or following the term of his employment with Employer, directly or
indirectly, divulge, reveal, report, publish, transfer or disclose, for any
purpose whatsoever, any of such confidential information which has been obtained
by or disclosed to him as a result of his employment with Employer, including,
without limitation, any Proprietary Information, as defined in Section 2 hereof;
Employee agrees further that upon termination of his employment
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with Employer for any reason, he shall sign the Employee Termination Statement,
a form of which is attached hereto. The aforementioned obligation of
confidentiality and non-disclosure shall not apply when:
(a) Public Domain. The information disclosed to Employee was in the
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public domain at the time of disclosure, or at any time after disclosure has
become a part of the public domain by publication or otherwise through sources
other than Employee, directly or indirectly, and without fault on the part of
Employee in failing to keep such information confidential; or
(b) Requirement of Law or Order. Disclosure is required by law or
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court order, provided Employee gives Employer prior written notice of any such
disclosure; or
(c) Agreement. Disclosure is made with the prior written agreement of
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the Board of Directors of Employer; or
(d) Prior Information. The information is encompassed by the ideas and
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inventions listed on Schedule A hereto or was in Employee's possession at the
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time of disclosure, as shown by written records in existence prior to such time,
and such information has not been transferred to Employer, and was not acquired,
directly or indirectly, from the Employer; or
(e) Third Party Disclosure. The information is lawfully disclosed to
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Employee after the termination of his employment by a third party who is under
no obligation of confidentiality to Employer with respect to such information;
or
(f) Independently Developed. Such information is independently
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developed by Employee subsequent to the termination of his active participation
in the business of Employer, as demonstrated by written records of Employee
which are contemporaneously maintained.
2. Definition of Proprietary Information. For purposes of this Agreement,
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the term "Proprietary Information" shall mean all of the following materials and
information (whether or not reduced to writing and whether or not patentable or
protectable by copyright) which Employee receives, receives access to, conceives
of or develops, in whole or in part, as a direct or indirect result of his
employment with Employer, in the course of his employment with Employer (in any
capacity, whether executive, managerial, planning, technical, sales, research,
development, manufacturing, engineering or otherwise) or through the use of any
of Employer's facilities or resources:
(i) Manufactured products, assembled or unassembled, and any
related goods or systems and any and all future products, software or systems
developed or derived therefrom;
(ii) With respect to the items described in Section 2(i) above,
all hardware and software relating to design or manufacture; all source and
object codes to such hardware and software; all specifications, design concepts,
documents and manuals; all security systems relating to the product or
procedures, including, without limitation, software security systems;
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(iii) Trade secrets, production processes, marketing techniques,
mailing lists, purchasing information, price lists, pricing policies, quoting
procedures, financial information, customer and prospect names and requirements,
customer data, customer site information and other materials or information
relating to the manner in which Employer does business;
(iv) Discoveries, concepts and ideas, whether or not patentable or
protectable by copyright, including, without limitation, the nature and results
of research and development activities, technical information on product or
program performance and reliability, processes, formulas, techniques,
"know-how", source codes, object codes, designs, drawings and specifications;
(v) Any other material or information related to the business or
activities of Employer which is not generally known to others engaged in similar
businesses or activities;
(vi) Any other material or information that has been created,
discovered or developed, or otherwise becomes known to Employer which has
commercial value in the business in which Employer is engaged; and
(vii) All ideas which are derived from or relate to Employee's access
to or knowledge of any of the above-enumerated materials and information.
Failure to xxxx any of the Proprietary Information as confidential shall not
affect its status as part of the Proprietary Information under the terms of this
Agreement.
3. Ownership of Information.
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(i) Employee hereby assigns to Employer all of Employee's right, title
and interest in any idea (whether or not patentable or protectable by
copyright), product, invention, discovery, computer software program or other
computer-related equipment or technology, conceived or developed in whole or in
part, or in which Employee may have aided in its development, while employed by
Employer, including, without limitation, any Proprietary Information. If any one
or more of the aforementioned are deemed in any way to fall within the
definition of "work made for hire", as such term is defined in 17 U.S.C. ss.
101, such work shall be considered "work made for hire", the copyright of which
shall be owned solely, completely and exclusively by Employer. If any of the
aforementioned are considered to be work not included in the categories of work
covered by the "work made for hire" definition contained in 17 U.S.C. ss. 101,
such work shall be owned solely by, or assigned or transferred completely and
exclusively to, Employer. Employee agrees to execute any instruments and to do
all other things reasonably requested by Employer (both during and after
Employee's employment with Employer) in order to more fully vest in Employer all
ownership rights in those items thereby transferred by Employee to Employer.
Employee further agrees to disclose immediately to Employer all Proprietary
Information conceived of or developed in whole or in part by him
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during the term of his employment with Employer and to assign to Employer any
right, title or interest he may have in such Proprietary Information.
(ii) Employee hereby represents and warrants that Employee has fully
disclosed to Employer on Schedule A hereto any idea, invention, product,
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improvement, computer software program or other equipment or technology related
to therapeutic pharmaceuticals (an "Invention") not covered in Section 3(i)
above which, prior to his employment with Employer, Employee conceived of or
developed, wholly or in part, and in which Employee has any right, title or
proprietary interest and which directly relate to Employer's business, but which
has not been published or filed with the United States Patent or Copyright
Offices or assigned or transferred to Employer. If there is no such list of
Schedule A, Employee represents that Employee has made no such Inventions at the
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time of signing this Agreement or Employee hereby assigns such Inventions to
Employer.
(iii) Notwithstanding anything in this Agreement to the contrary, the
obligation of Employee to assign or offer to assign his rights in an Invention
to Employer shall not extend or apply to an Invention that Employee developed
entirely on his own time without using Employer's equipment, supplies, facility
or trade secret information unless such Invention (a) relates to Employer's
business or actual or demonstrably anticipated research or development, or (b)
results from any work performed by Employee for Employer. Employee shall bear
the burden of proof in establishing that his Invention qualifies for exclusion
under this Section 3(iii). With respect to Section 3(iii), it is agreed and
acknowledged that during Employee's employment, Employer may enter other lines
of business, which are related or unrelated to its current lines of business, in
which case this Agreement would be expanded to cover such new lines of business.
4. Injunctive Relief. Employee understands and agrees that Employer will
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suffer irreparable harm in the event that Employee breaches any of his
obligations under this Agreement and that monetary damages will be inadequate to
compensate Employer for such breach. Accordingly, Employee agrees that, in the
event of a breach or threatened breach by Employee of any of the provisions of
this Agreement, Employer, in addition to and not in limitation of any other
rights, remedies or damages available to Employer at law or in equity, shall be
entitled to a permanent injunction in order to prevent or to restrain any such
breach by Employee, or any of employee's partners, agents, representatives,
servants, employers, employees and/or any and all persons directly or indirectly
acting for or with him.
5. Records. All notes, data, tapes, reference materials, sketches,
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drawings, memoranda, models and records in any way relating to any of the
information referred to in Sections 1, 2 and 3 hereof (including, without
limitation, any Proprietary Information) or to Employer's business shall belong
exclusively to Employer, and Employee agrees to turn over to Employer all such
materials and all copies of such materials in his possession or then under his
control at the request of Employer or, in the absence of such a request, upon
the termination of Employee's employment with Employer.
6. Accounting for Profits. Employee covenants and agrees that, if he
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shall violate any of his covenants or agreements under this Agreement, Employer
shall be entitled to an
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accounting and repayment of all profits, compensation, commissions,
remunerations or benefits which Employee directly or indirectly has realized
and/or may realize as a result of, growing out of or in connection with any such
violation; such remedy shall be in addition to and not in limitation of any
injunctive relief or other rights or remedies to which Employer is or may be
entitled at law, in equity or under this Agreement.
7. Covenant Not to Compete. It is recognized and understood by the parties
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hereto that Employee, through Employee's association with Employer as an
employee, shall acquire a considerable amount of knowledge and goodwill with
respect to the business of Employer, which knowledge and goodwill are extremely
valuable to Employer and which would be extremely detrimental to Employer if
used by Employee to compete with Employer. It is, therefore, understood and
agreed by the parties hereto that, because of the nature of the business of
Employer, it is necessary to afford fair protection to Employer from such
competition by Employee. Consequently, as a material inducement to employ
Employee in the aforementioned positions, Employee covenants and agrees to the
following:
(a) Except as otherwise approved in writing by Employer, Employee
agrees:
(i) that Employee will not, directly or indirectly, with or through
any family member or former director, officer or employee of Employer, or acting
along or as a member of a partnership or as an officer, holder of or investor in
as much as 5% of any security of any class, director, employee, consultant or
representative of any corporation or other business entity:
(1) at any time while engaged as an employee of Employer and
for a period of two (2) years following termination as an employee, interfere
with, or seek to interfere with, the relationship between Employer or any
affiliate of Employer and the following: (a) any of the employees of such
entities; (b) any of the customers of such entities then existing or existing at
any time within three (3) years prior to termination of Employee's employment by
Employer; or (c) any of the suppliers of such entities then existing or existing
at any time within three (3) years prior to termination of Employee's employment
by Employer.
(b) The parties hereto agree that in the event that either the length
of time or the geographic area set forth in paragraph (a) is deemed too
restrictive in any court proceeding, that the court may reduce such restrictions
to those which it deems reasonable under the circumstances.
(c) Employee agrees and acknowledges that Employer does not have any
adequate remedy at law for the breach or threatened breach by him of this
covenant and agrees that Employer may in addition to the other remedies which
may be available to it under this Agreement, file a suit in equity to enjoin
Employee from such breach or threatened breach.
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8. Reasonableness of Restrictions.
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(a) Employee has carefully read and considered the provisions of
Sections 1 through 7 hereof and, having done so, agrees that the restrictions
set forth therein are fair and reasonable and are reasonably required for the
protection of the interests of Employer, its officers, directors, stockholders
and employees.
(b) In the event that, notwithstanding the foregoing, any part of the
covenants set forth in Sections 1 through 7 hereof shall be held to be invalid
and unenforceable, the court so deciding may reduce or limit the terms of such
provision to allow such provision to be enforced.
9. Burden and Benefit. This Agreement shall be binding upon, and shall
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inure to the benefit of, Employer and Employee, and their respective heirs,
personal and legal representatives, and, in the case of Employer, its successors
and assigns.
10. Governing Law. In view of the fact that the principal office of
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Employer is located in the State of North Carolina, it is understood and agreed
that the construction and interpretation of this Agreement shall at all times
and in all respects be governed by the laws of the State of North Carolina.
11. Severability. The provisions of this Agreement shall be deemed
------------
severable, and the invalidity or unenforceability of any one or more of the
provisions hereof shall not affect the validity or enforceability of the other
provisions hereof.
12. Employer. As used herein, the term "Employer" shall also include any
--------
corporation which is at any time the parent or a subsidiary of Employer, or any
corporation or entity which is an affiliate of Employer by virtue of common
(although not identical) ownership, and for which Employee is providing services
in any form during his employment with Employer or any such other corporation or
entity.
13. Notices. Any notice required to be given hereunder shall be sufficient
-------
if in writing, and sent by certified or registered mail, return receipt
requested, first-class postage prepaid, in the case of Employee, to his address
as shown on Employer's records, and in the case of Employer, to its principal
office in the State of North Carolina.
14. Entire Agreement. This Agreement contains the entire agreement and
----------------
understandings by and between Employer and Employee with respect to the
covenants herein described, and no representations, promises, agreements or
understandings, written or oral, not herein contained shall be of any force or
effect. Nothing contained in this Agreement shall be deemed or construed to
constitute an agreement by Employer to employ or continue to employ Employee. No
change or modification hereof shall be valid or binding unless the same is in
writing and signed by the parties hereto. No waiver of any provision of this
Agreement shall be valid unless the same is in writing and signed by the party
against whom such waiver is sought to be enforced; moreover, no valid waiver of
any provision of this Agreement at any time shall be deemed a waiver of any
other provision of this Agreement at such time nor will it be deemed a valid
waiver of such provision at any other time.
14
15. Headings. The headings and other captions in this Agreement are for
--------
convenience and reference only and shall not be used in interpreting, construing
or enforcing any of the provisions of this Agreement.
16. Effective Date. This Agreement shall be effective as of the date
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____________, _____.
IN WITNESS WHEREOF, Employer and Employee have duly executed this Agreement
as of the day and year first above written.
EMPLOYER:
---------
POZEN Inc.
By:__________________________
Name: Xxxx X. Xxxxxxxxx, Pharm.D.
Title: President and Chief Executive Officer
EMPLOYEE:
---------
______________________________
_________________________
Date
15
SCHEDULE A
Inventions, Ideas, Products, Etc. Not Covered in Section 3(i) of the Agreement
[Note: If Employee has no such items to disclose, write "NONE" on this line:
___________.]
16
EMPLOYEE TERMINATION STATEMENT
1. I am cognizant of my legal obligations, as stated in that certain
Non-Disclosure, Invention and Non-Competition Agreement, dated _________, ____,
which I signed at the commencement of my employment with respect to confidential
information of POZEN Inc. (the "Company"), and hereby specifically reaffirm all
of the provisions stated therein.
2. I understand that my obligation not to use or disclose Company
confidential information remains in effect after the termination of my
employment with the Company and that if, at any time in the future, I wish to
utilize, disclose or publish any Company confidential information, or if I
should be in doubt as to whether any such information may be confidential to the
Company, I will, prior to such use or disclosure, obtain the written consent of
the Company to do so. I further understand that such consent may be refused
where Company confidential information is involved.
3. I understand that, to the extent permitted by law, any idea, invention,
discovery, computer software program or other computer-related equipment or
technology, conceived or developed by me in whole or in part, or in which I may
have aided in its development during my employment with the Company, belongs
exclusively to the Company. I hereby certify that I have made full disclosure in
writing to the Company or have discussed with my supervisor at the Company all
of such ideas, inventions, discoveries, computer programs and computer-related
equipment or technology. I further understand that I still have an obligation
subsequent to termination of my employment with the Company to execute such
papers as the Company may reasonably request to more fully vest in the Company
all ownership rights in the items referenced in this paragraph.
4. I hereby certify that all materials related directly or indirectly to my
employment with the Company and all copies thereof, have been returned to my
supervisor at the Company. I further certify that no computer listings,
programs, object codes, source codes, product development guides, flow-charts or
other documents owned by the Company or provided to or used by me in connection
with my employment at the Company, whether in machine-readable form or
otherwise, have been retained by me or given to any other third person or entity
in anticipation of my employment termination or for any other reason, and
further certify that none of the aforementioned will be removed from the
Company's premises by me.
ACCEPTED:
POZEN Inc.
By: ______________________________ ______________________________
__________________________________ ______________________________
Date Date
17
