EXHIBIT 10.44
EMPLOYMENT AGREEMENT
This Employment Agreement (the "Agreement") is entered into as of
June 16, 1998 by and between Discovery Laboratories, Inc., a Delaware
corporation (the "Company"), and Xxxx Xxxxxxxxxxx (the "Executive").
WHEREAS, the Company and Executive desire that Executive be
employed by the Company and that the terms and conditions of such employment be
defined;
NOW, THEREFORE, in consideration of the employment of Executive by
the Company, the Company and Executive agree as follows:
1. Term of the Agreement. The Company shall employ Executive and
Executive shall accept employment for a period of three (3) years commencing on
June 16, 1998 (the "Commencement Date") and continuing until June 15, 2001,
subject, however, to prior termination as hereinafter provided in Section 5 (the
"Employment Period").
2. Executive's Duties and Obligations.
a. Duties. Executive shall serve as Director of Clinical
Research. Executive shall be responsible for protocol development, initiation of
clinical sites, execution of clinical protocols, finalizing trial sites and
overall quality of clinical data management.
b. Location of Employment. Executive's principal place of
business shall be at the Company's office to be located within thirty (30) miles
of Doylestown, Pennsylvania.
c. Proprietary Information and Inventions Agreement. Upon
commencement of employment with the Company, Executive shall execute the
Company's standard form of Intellectual Property and Confidential Information
Agreement (the "Confidentiality Agreement") a copy of which is attached to this
Agreement as Exhibit A.
3. Devotion of Time to Company's Business
a. Full-time Efforts. During her employment with the Company,
Executive shall devote substantially all of her business time, attention and
efforts to the high quality performance of her duties to the Company.
b. No Other Employment. During his employment with the Company,
Executive shall not, whether directly or indirectly, render any services of a
commercial or professional nature to any other person or organization, whether
for compensation or otherwise, without the prior written consent of the
Company's Executive Committee or Board of Directors.
c. Non-Competition During Employment. During the Employment
Period and for eighteen (18) months after its termination, Executive shall not,
directly or indirectly, either as an employee, employer, consultant, agent,
principal, partner, stockholder, corporate officer, director, or in any other
individual or representative capacity (i) compete with the Company in the
business of developing or commercializing pulmonary surfactants, Vitamin D
analogs or any other category of compounds which forms the basis of the
Company's products or products under development (a "Competing Business"), or
(ii) directly or indirectly solicit employees of the Company.
4. Compensation and Benefits.
a. Base Compensation. During the term of this Agreement, the
Company shall pay to Executive base annual compensation of Eighty Thousand
Dollars ($80,000), less all required withholdings.
2
b. Bonuses.
(1) Incentive Bonus. Executive shall be eligible for
incentive bonuses in amounts to be determined by the Company's Compensation
Committee after consultation with the Company's Chief Executive Officer, to be
paid in either cash or equity, upon the achievement of each of the following
milestones (which bonuses shall be paid only once for each of the milestones):
(a) the successful completion of Phase II studies for any compound under
development in the Company's portfolio (each a "Portfolio Compound"); (b) the
successful completion of Phase III studies for any Portfolio Compound; and (c)
receipt of marketing approval in the United States for any Portfolio Compound.
(2) Additional Bonus. Executive shall be eligible for such
year-end bonus, which may be paid in either cash or equity, or both, as is
awarded at the discretion of the Compensation Committee of the Board of
Directors of the Company after consultation with the Company's Chief Executive
Officer.
c. Benefits. During the Employment Period, the Company shall
provide reasonable medical and disability benefits to Executive. In addition,
the Company will provide to Executive term life insurance on behalf of
Executive's beneficiaries in the amount of Executive's annual salary for the
term of this Agreement.
d. Stock Options. The Board of Directors of the Company has
granted to Executive, on the date hereof, incentive stock options to purchase:
(i) 11,577 shares of Common Stock, $0.001 par value of the Company (the "Common
Stock"), pursuant to the terms of the Notice of Grant attached hereto as Exhibit
B, (ii) 5,985 shares of Common Stock, subject to acceleration at such time as
the market capitalization of the Company exceeds $75 million, pursuant to the
3
terms of the Notice of Grant attached hereto as Exhibit C, and (iii) 5,152
shares of Common Stock, subject to acceleration upon consummation of a corporate
partnering deal having a total Value (as hereinafter defined) of at least $20
million, pursuant to the terms of the Notice of Grant attached hereto as Exhibit
D. For purposes of this Agreement, "Value" shall mean the total payments,
including without limitation, contingent payments prior to or at receipt of
marketing approval for the Portfolio Compound involved in the relevant
agreement, to be paid to Discovery from corporate partnering transactions of
from any other transactions for the development, clinical testing, regulatory
approval, manufacturing and/or marketing of a Portfolio Compound, including
without limitation upfront fees, milestone payments, research and development
and other contractual commitments.
5. Termination of Employment.
a. Termination for Good Cause. The Company may terminate
Executive's employment at any time for "Good Cause," as herein defined. For the
purposes of this Agreement, "Good Cause" includes, but is not limited to, gross
misconduct, gross neglect of duties, acts involving moral turpitude, material
breach by Executive of this Agreement or the Confidentiality Agreement or any
act or omission involving fraud, embezzlement, or misappropriation of any
property or proprietary information of the Company by Executive which is not
cured by Executive within fifteen (15) days after receipt of written notice from
the Company.
b. Termination without Good Cause. If Executive's employment is
terminated by the Company without Good Cause, the following provisions shall
apply:
(1) Executive shall be entitled to any unpaid compensation
accrued through the last day of Executive's employment;
4
(2) Executive shall be entitled to receive severance
payments equal to her base compensation, payable on normal Company payroll
dates, for a three (3) month period, subject to setoff for other employment or
consulting income received by Executive.
c. Death or Disability. This Agreement shall terminate if
Executive dies or is mentally or physically "Disabled" as herein defined. For
the purposes of this Agreement, "Disabled" shall mean a mental or physical
condition that renders Executive incapable of performing his duties and
obligations under this Agreement for three (3) or more consecutive months or for
a total of six (6) months during any twelve (12) consecutive months; provided,
that during such period the Company shall give Executive at least thirty (30)
days' written notice that it considers the time period for disability to be
running. If this Agreement is terminated under this Section 5.c., Executive or
her estate shall be entitled to any unpaid compensation accrued through the last
day of Executive's employment but shall not be entitled to any severance
benefits.
6. Miscellaneous.
a. Governing Law. This Agreement shall be interpreted,
construed, governed and enforced according to the laws of the Commonwealth of
Pennsylvania as applied to agreements among Pennsylvania residents entered into
and to be performed entirely within Pennsylvania without regards to the
application of choice of law rules.
b. Amendments. No amendment or modification of the terms or
conditions of this Agreement shall be valid unless in writing and signed by the
parties hereto.
c. Severabilitv. If one or more provisions of this Agreement
are held to be unenforceable under applicable law, such provision shall be
construed, if possible, so as to be enforceable under applicable law, else, such
provision shall be excluded from this Agreement and the balance of the Agreement
shall be interpreted as if such provision were so excluded and shall be
enforceable in accordance with its terms.
5
d. Successors and Assigns. The rights and obligations of the
Company under this Agreement shall inure to the benefit of and shall be binding
upon the successors and assigns of the Company. Executive shall not be entitled
to assign any of her rights or obligations under this Agreement.
e. Notices. All notices required or permitted under this
Agreement shall be in writing and shall be deemed effective upon personal
delivery, on the date of scheduled delivery by a nationally recognized overnight
service or two (2) days after deposit in the United States Post Office, by
registered or certified mail, postage prepaid, addressed to the other party at
the address shown below such party's signature, or at such other address or
addresses as either party shall designate to the other in accordance with this
Section 6.e.
f. Entire Agreement. This Agreement, including the exhibits
attached hereto, constitutes the entire agreement between the parties with
respect to the employment of Executive. Executive hereby agrees that the
Employment Agreement by and between Executive and Acute Therapeutics, Inc.,
dated January 2, 1997, shall be of no further force or effect and that he shall
have no further rights under said agreement.
6
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date set forth above.
DISCOVERY LABORATORIES, INC.
/s/ Xxxxxx X. Xxxxxxxx
------------------------------
By: Xxxxxx X. Xxxxxxxx, Ph.D.
Its: President
Address: 0000 Xxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
EXECUTIVE:
/s/ Xxxx Xxxxxxxxxxx
------------------------------
Xxxx Xxxxxxxxxxx
Address:
7
