EMPLOYMENT AGREEMENT
Exhibit
10.1
This Employment Agreement is made and
entered into effective as of January 1, 2011 (the “Effective Date”), by and
between Neoprobe Corporation,
a Delaware Corporation with a place of business at 000 Xxxxx Xxxxx Xxxxx,
Xxxxx 000, Xxxxxx, Xxxx 00000-0000 (the “Company”) and [____________] (the
“Employee”).
WHEREAS, the Company and the Employee
wish to establish new terms, covenants, and conditions for the Employee’s
continued employment with the Company through this agreement (“Employment
Agreement”).
NOW, THEREFORE, in consideration of the
mutual agreements herein set forth, the parties hereto agree as
follows:
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1.
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Duties. From
and after the Effective Date, and based upon the terms and conditions set
forth herein, the Company agrees to employ the Employee and the Employee
agrees to be employed by the Company, as [______________] of the Company
and in such equivalent, additional or higher executive level position or
positions as shall be assigned to him by the Company’s President and
CEO. While serving in such executive level position or
positions, the Employee shall report to, be responsible to, and shall take
direction from the President and CEO of the Company. During the
Term of this Employment Agreement (as defined in Section 2 below), the
Employee agrees to devote substantially all of his working time to the
position he holds with the Company and to faithfully, industriously, and
to the best of his ability, experience and talent, perform the duties that
are assigned to him. The Employee shall observe and abide by
the reasonable corporate policies and decisions of the Company in all
business matters disclosed to
employee.
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The
Employee represents and warrants to the Company that Exhibit A attached
hereto sets forth a true and complete list of (a) all offices,
directorships and other positions held by the Employee in corporations and
firms other than the Company and its subsidiaries and (b) any investment
or ownership interest in any corporation or firm other than the Company
beneficially owned by the Employee (excluding investments in life
insurance policies, bank deposits, publicly traded securities that are
less than five percent (5%) of their class and real estate). The Employee
will promptly notify the Board of Directors of the Company of any
additional positions undertaken or investments made by the Employee during
the Term of this Employment Agreement if they are of a type that if they
had existed on the date hereof, should have been listed on Exhibit A
hereto. As long as the Employee’s other positions or
investments in other firms do not create a conflict of interest, violate
the Employee’s obligations under Section 7 below or cause the Employee to
neglect his duties hereunder, such activities and positions shall not be
deemed to be a breach of this Employment
Agreement.
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2.
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Term of this Employment
Agreement. Subject to Sections 4 and 5 hereof, the Term
of this Employment Agreement shall be for a period
[_____________________].
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3.
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Compensation. During
the Term of this Employment Agreement, the Company shall pay, and the
Employee agrees to accept as full consideration for the services to be
rendered by the Employee hereunder, compensation consisting of the
following:
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A.
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Salary. Beginning
on the first day of the Term of this Employment Agreement, the Company
shall pay the Employee a salary of [__________________] per year, payable
in semi-monthly or monthly installments as requested by the
Employee.
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B.
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Bonus. The
Compensation, Nominating and Governance Committee (the “Committee”) of the
Board of Directors will, on an annual basis, review the performance of the
Company and of the Employee and will pay such bonus, as it deems
appropriate, in its discretion, to the Employee based upon such
review. Such review and bonus shall be consistent with any
bonus plan adopted by the Compensation Committee, which covers the
executive officers and employees of the Company
generally.
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C.
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Benefits. During
the Term of this Employment Agreement, the Employee will receive such
employee benefits as are generally available to all employees of the
Company.
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D.
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Stock
Options. The Committee of the Board of Directors may,
from time-to-time, grant stock options, restricted stock purchase
opportunities and such other forms of stock-based incentive compensation
as it deems appropriate, in its discretion, to the Employee under the
Company’s Second Amended and Restated 2002 Stock Incentive Plan (the “2002
Plan”). The terms of the relevant award agreements shall govern
the rights of the Employee and the Company there under in the event of any
conflict between such agreement and this Employment
Agreement.
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E.
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Vacation. The
Employee shall be entitled to [______] days of vacation during each
calendar year during the Term of this Employment
Agreement.
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F.
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Expenses. The
Company shall reimburse the Employee for all reasonable out-of-pocket
expenses incurred by him in the performance of his duties hereunder,
including expenses for travel, entertainment and similar items, promptly
after the presentation by the Employee, from time-to-time, of an itemized
account of such expenses.
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G.
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Clawback
Policy. The Company’s obligation to pay any bonus or
stock-based incentive compensation under paragraphs B. or D. of this
Section 3, and the Employee’s right to receive or retain such
compensation, shall be subject to any policy adopted by the Board of
Directors or its Compensation, Nominating and Governance Committee (or any
successor committee of the Board of Directors with authority over
executive compensation) pursuant to the “clawback” provisions of Section
304 of the Xxxxxxxx-Xxxxx Act of 2002, Section 10D of the Securities
Exchange Act of 1934, or regulations promulgated thereunder, or pursuant
to any rule of any national securities exchange on which the equity
securities of the Company are listed implementing Section 10D of the
Securities Exchange Act of 1934, or regulations promulgated
thereunder.
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4.
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Termination.
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A.
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For Cause. The Company
may terminate the employment of the Employee prior to the end of the Term
of this Employment Agreement “for cause.” Termination “for cause” shall be
defined as a termination by the Company of the employment of the Employee
occasioned by the failure by the Employee to cure a willful breach of a
material duty imposed on the Employee under this Employment Agreement
within 15 days after written notice thereof by the Company or the
continuation by the Employee after written notice by the Company of a
willful and continued neglect of a duty imposed on the Employee under this
Employment Agreement. In the event of termination by the
Company “for cause,” all salary, benefits and other payments shall cease
at the time of termination, and the Company shall have no further
obligations to the Employee.
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B.
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Resignation. If the Employee
resigns for any reason, all salary, benefits and other payments (except as
otherwise provided in paragraph G of this Section 4 below) shall cease at
the time such resignation becomes effective. At the time of any
such resignation, the Company shall pay the Employee the value of any
accrued but unused vacation time, and the amount of all accrued but
previously unpaid base salary through the date of such
termination. The Company shall promptly reimburse the Employee
for the amount of any expenses incurred prior to such termination by the
Employee as required under paragraph F of Section 3
above.
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C.
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Disability, Death. The Company may
terminate the employment of the Employee prior to the end of the Term of
this Employment Agreement if the Employee has been unable to perform his
duties hereunder or a similar job for a continuous period of six (6)
months due to a physical or mental condition that, in the opinion of a
licensed physician, will be of indefinite duration or is without a
reasonable probability of recovery for a period of at least six (6)
months. The Employee agrees to submit to an examination by a
licensed physician of his choice in order to obtain such opinion, at the
request of the Company, made after the Employee has been absent from his
place of employment for at least six (6) months. The Company
shall pay for any requested examination. However, this
provision does not abrogate either the Company’s or the Employee’s rights
and obligations pursuant to the Family and Medical Leave Act of 1993, and
a termination of employment under this paragraph C shall not be deemed to
be a termination for cause.
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If during
the Term of this Employment Agreement, the Employee dies or his employment is
terminated because of his disability, all salary, benefits and other payments
shall cease at the time of death or disability, provided, however, that the
Company shall provide such health, dental and similar insurance or benefits as
were provided to Employee immediately before his termination by reason of death
or disability, to Employee or his family for the longer of twelve (12) months
after such termination or the full unexpired Term of this Employment Agreement
on the same terms and conditions (including cost) as were applicable before such
termination. In addition, for the first six (6) months of disability,
the Company shall pay to the Employee the difference, if any, between any cash
benefits received by the Employee from a Company-sponsored disability insurance
policy and the Employee’s salary hereunder in accordance with paragraph A of
Section 3 above. At the time of any such termination, the Company
shall pay the Employee, the value of any accrued but unused vacation time, and
the amount of all accrued but previously unpaid base salary through the date of
such termination. The Company shall promptly reimburse the Employee
for the amount of any expenses incurred prior to such termination by the
Employee as required under paragraph F of Section 3 above.
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Notwithstanding
the foregoing, if the Company reasonably determines that any of the benefits
described in this paragraph C may not be exempt from federal income tax, then
for a period of six (6) months after the date of the Employee’s termination, the
Employee shall pay to the Company an amount equal to the stated taxable cost of
such coverages. After the expiration of the six-month period, the Employee shall
receive from the Company a reimbursement of the amounts paid by the
Employee.
Termination without Cause. A
termination without cause is a termination of the employment of the Employee by
the Company that is not “for cause” and not occasioned by the resignation, death
or disability of the Employee. If the Company terminates the
employment of the Employee without cause, (whether before the end of the Term of
this Employment Agreement or, if the Employee is employed by the Company under
paragraph E of this Section 4 below, after the Term of this Employment Agreement
has ended) the Company shall, at the time of such termination, pay to the
Employee the severance payment provided in paragraph F of this Section 4 below
together with the value of any accrued but unused vacation time and the amount
of all accrued but previously unpaid base salary through the date of such
termination and shall provide him with all of his benefits under paragraph C of
Section 3 above for the greater of twelve (12) months or the full unexpired term
of the employment agreement. The Company shall promptly reimburse the
Employee for the amount of any expenses incurred prior to such termination by
the Employee as required under paragraph F of Section 3 above.
If the
Company terminates the employment of the Employee because it has ceased to do
business or substantially completed the liquidation of its assets or because it
has relocated to another city and the Employee has decided not to relocate also,
such termination of employment shall be deemed to be without cause.
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E.
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End of the Term of this
Employment Agreement. Except as otherwise provided in
paragraphs F and G of this Section 4 below, the Company may terminate the
employment of the Employee at the end of the Term of this Employment
Agreement without any liability on the part of the Company to the Employee
but, if the Employee continues to be an employee of the Company after the
Term of this Employment Agreement ends, his employment shall be governed
by the terms and conditions of this Agreement, but he shall be an employee
at will and his employment may be terminated at any time by either the
Company or the Employee without notice and for any reason not prohibited
by law or no reason at all. If the Company terminates the
employment of the Employee at the end of the Term of this Employment
Agreement, the Company shall, at the time of such termination, pay to the
Employee the severance payment provided in paragraph F of this Section 4
below together with the value of any accrued but unused vacation time and
the amount of all accrued but previously unpaid base salary through the
date of such termination. The Company shall promptly reimburse the
Employee for the amount of any reasonable expenses incurred prior to such
termination by the Employee as required under paragraph F of Section 3
above.
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X.
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Xxxxxxxxx. If
the employment of the Employee is terminated by the Company, at the end of
the Term of this Employment Agreement or, without cause (whether before
the end of the Term of this Employment Agreement or, if the Employee is
employed by the Company under paragraph E of this Section 4 above, after
the Term of this Employment Agreement has ended), the Employee shall be
paid, as a severance payment at the time of such termination, the amount
of [_____________] together with the value of any accrued but unused
vacation time.
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G.
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Change of Control
Severance. In addition to the rights of the Employee
under the Company’s employee benefit plans (paragraphs C of Section 3
above) but in lieu of any severance payment under paragraph F of this
Section 4 above, if there is a Change in Control of the Company (as
defined below) and the employment of the Employee is concurrently or
subsequently terminated (a) by the Company without cause, (b) by the
expiration of the Term of this Employment Agreement, or (c) by the
resignation of the Employee because he has reasonably determined in good
faith that his titles, authorities, responsibilities, salary, bonus
opportunities or benefits have been materially diminished, that a material
adverse change in his working conditions has occurred, that his services
are no longer required in light of the Company’s business plan, or the
Company has breached this Employment Agreement, the Company shall pay the
Employee, as a severance payment, at the time of such termination, the
amount of [_________] together with the value of any accrued but unused
vacation time, and the amount of all accrued but previously unpaid base
salary through the date of termination and shall provide him with all of
this benefits under paragraph C of Section 3 above for the longer of
twelve (12) months or the full un-expired Term of this Employment
Agreement. The Company shall promptly reimburse the Employee for the
amount of any expenses incurred prior to such termination by the Employee
as required under paragraph F of Section 3
above.
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3
For the
purpose of this Employment Agreement, a Change in Control of the Company has
occurred when: (a) any person (defined for the purposes of this
paragraph G to mean any person within the meaning of Section 13 (d) of the
Securities Exchange Act of 1934 (the “Exchange Act”)), other than Neoprobe, an
employee benefit plan created by its Board of Directors for the benefit of its
employees, or a participant in a transaction approved by its Board of Directors
for the principal purpose of raising additional capital, either directly or
indirectly, acquires beneficial ownership (determined under Rule 13d-3 of the
Regulations promulgated by the Securities and Exchange Commission under Section
13(d) of the Exchange Act) of securities issued by Neoprobe having thirty
percent (30%) or more of the voting power of all the voting securities issued by
Neoprobe in the election of Directors at the next meeting of the holders of
voting securities to be held for such purpose; (b) a majority of the Directors
elected at any meeting of the holders of voting securities of Neoprobe are
persons who were not nominated for such election by the Board of Directors or a
duly constituted committee of the Board of Directors having authority in such
matters; (c) the stockholders of Neoprobe approve a merger or consolidation of
Neoprobe with another person other than a merger or consolidation in which the
holders of Neoprobe’s voting securities issued and outstanding immediately
before such merger or consolidation continue to hold voting securities in the
surviving or resulting corporation (in the same relative proportions to each
other as existed before such event) comprising eighty percent (80%) or more of
the voting power for all purposes of the surviving or resulting corporation; or
(d) the stockholders of Neoprobe approve a transfer of substantially all of the
assets of Neoprobe to another person other than a transfer to a transferee,
eighty percent (80%) or more of the voting power of which is owned or controlled
by Neoprobe or by the holders of Neoprobe’s voting securities issued and
outstanding immediately before such transfer in the same relative proportions to
each other as existed before such event. The parties hereto agree
that for the purpose of determining the time when a Change of Control has
occurred that if any transaction results from a definite proposal that was made
before the end of the Term of this Employment Agreement but which continued
until after the end of the Term of this Employment Agreement and such
transaction is consummated after the end of the Term of this Employment
Agreement, such transaction shall be deemed to have occurred when the definite
proposal was made for the purposes of the first sentence of this paragraph G of
this Section 4. Notwithstanding the foregoing, before the Employee may resign
pursuant to Section 4(G) (c) above, the Employee shall deliver to the Company a
written notice of the Employee’s intent to terminate his employment pursuant to
Section 4(G)(c), and the Company shall have been given a reasonable opportunity
to cure any such act, omission or condition within Thirty (30) days after the
Company’s receipt of such notice.
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H.
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Benefit and Stock
Plans. In the event that a benefit plan or Stock Plan
which covers the Employee has specific provisions concerning termination
of employment, or the death or disability of an employee (e.g., life insurance or
disability insurance), then such benefit plan or Stock Plan shall control
the disposition of the benefits or stock
options.
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5.
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Proprietary Information
Agreement. Employee has executed a Proprietary
Information Agreement as a condition of employment with the
Company. The Proprietary Information Agreement shall not be
limited by this Employment Agreement in any manner, and the Employee shall
act in accordance with the provisions of the Proprietary Information
Agreement at all times during the Term of this Employment
Agreement.
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6.
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Non-Competition. Employee
agrees that for so long as he is employed by the Company under this
Employment Agreement and for one (1) year thereafter, the Employee will
not:
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A.
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enter
into the employ of or render any services to any person, firm, or
corporation, which is engaged, in any part, in a Competitive Business (as
defined below);
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B.
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engage
in any directly Competitive Business for his own
account;
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C.
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become
associated with or interested in through retention or by employment any
Competitive Business as an individual, partner, shareholder, creditor,
director, officer, principal, agent, employee, trustee, consultant,
advisor, or in any other relationship or capacity;
or
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D.
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solicit,
interfere with, or endeavor to entice away from the Company, any of its
customers, strategic partners, or sources of
supply.
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Nothing
in this Employment Agreement shall preclude Employee from taking
employment in the banking or related financial services industries nor
from investing his personal assets in the securities or any Competitive
Business if such securities are traded on a national stock exchange or in
the over-the-counter market and if such investment does not result in his
beneficially owning, at any time, more than one percent (1%) of the
publicly-traded equity securities of such Competitive
Business. “Competitive Business” for purposes of this
Employment Agreement shall mean any business or enterprise
which:
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a.
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is
engaged in the development and/or commercialization of gamma radiation
detection products and/or systems for use in intraoperative detection of
cancer, or
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b.
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reasonably
understood to be competitive in the relevant market with products and/or
systems described in clause a above,
or
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c.
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the
Company engages in during the Term of this Employment Agreement pursuant
to a determination of the Board of Directors and from which the Company
derives a material amount of revenue or in which the Company has made a
material capital investment.
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The
covenant set forth in this Section 6 shall terminate immediately upon the
substantial completion of the liquidation of assets of the Company or the
termination of the employment of the Employee by the Company without cause
or at the end of the Term of this Employment
Agreement.
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7.
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Arbitration. Any
dispute or controversy arising under or in connection with this Employment
Agreement shall be settled exclusively by arbitration in Columbus, Ohio,
in accordance with the non-union employment arbitration rules of the
American Arbitration Association (“AAA”) then in effect. If
specific non-union employment dispute rules are not in effect, then AAA
commercial arbitration rules shall govern the dispute. If the
amount claimed exceeds $100,000, the arbitration shall be before a panel
of three arbitrators. Judgment may be entered on the
arbitrator’s award in any court having jurisdiction. The
Company shall indemnify the Employee against and hold him harmless from
any attorney’s fees, court costs and other expenses incurred by the
Employee in connection with the preparation, commencement, prosecution,
defense, or enforcement of any arbitration, award, confirmation or
judgment in order to assert or defend any right or obtain any payment
under paragraph C of Section 4 above or under this sentence; without
regard to the success of the Employee or his attorney in any such
arbitration or proceeding.
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8.
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Governing
Law. The Employment Agreement shall be governed by and
construed in accordance with the laws of the State of
Ohio.
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9.
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Validity. The
invalidity or unenforceability of any provision or provisions of this
Employment Agreement shall not affect the validity or enforceability of
any other provision of the Employment Agreement, which shall remain in
full force and effect.
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10.
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Compliance with Section 409A of
the Internal Revenue Code. For purposes of this
Agreement, the Employee's employment with the Company will be considered
to have terminated only if such termination constitutes a “separation from
service” as defined under Section 409A(a)(2)(A)(i) of the Internal Revenue
Code of 1986, as amended (the “Code”). If, when the Employee's
employment with the Company terminates, the Employee is a "specified
employee" as defined in Section 409A(a)(2)(B)(i) of the Code, and if any
payments under this Employment Agreement, including payments under Section
4, will result in additional tax or interest to the Employee under Section
409A(a)(1)(B) ("Section 409A Penalties"), then despite any provision of
this Employment Agreement to the contrary, the Employee will not be
entitled to payments until the earliest of (a) the date that is at least
six months after termination of the Employee's employment for reasons
other than the Employee's death, (b) the date of the Employee's death, or
(c) any earlier date that does not result in Section 409A Penalties to the
Employee. As soon as practicable after the end of the period
during which payments are delayed under this provision, the entire amount
of the delayed payments shall be paid to the Employee in a lump
sum. Additionally, if any provision of this Employment
Agreement would subject the Employee to Section 409A Penalties, the
Company will apply such provision in a manner consistent with Section 409A
of the Code during any period in which an arrangement is permitted to
comply operationally with Section 409A of the Code and before a formal
amendment to this Employment Agreement is
required.
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11.
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Entire
Agreement. This Employment Agreement constitutes the
entire understanding between the parties with respect to the subject
matter hereof, superseding all negotiations, prior discussions, and
preliminary agreements. This Employment Agreement may not be
amended except in writing executed by the parties
hereto.
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12.
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Effect on Successors of
Interest. This Employment Agreement shall inure to the
benefit of and be binding upon heirs, administrators, executors,
successors and assigns of each of the parties
hereto. Notwithstanding the above, the Employee recognizes and
agrees that his obligation under this Employment Agreement may not be
assigned without the consent of the
Company.
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IN WITNESS WHEREOF, the
parties hereto have executed and delivered this Employment Agreement as of the
date first written above.
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NEOPROBE
CORPORATION
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EMPLOYEE
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By:
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Xxxxx
X. Xxxx, President and CEO
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[__________]
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