Exhibit 10(s)
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (hereinafter referred to as the "Agreement") is
made this 16th day of May, 1996, in Baltimore, Maryland, by and between
CHESAPEAKE BIOLOGICAL LABORATORIES, INC., a Maryland corporation (hereinafter
referred to as the "Corporation"), and JOHN C. WEISS, III (hereinafter
referred to as the "Employee").
1. CERTAIN DEFINITIONS. In addition to the other words and terms
defined elsewhere in this Agreement, as used herein, and particularly as used
in Sections 10, 11 and 12 hereof, the terms set forth below shall have the
following meanings, respectively:3
(a) GOOD REASON. "Good Reason" shall mean the occurrence of any of
the following (without the Employee's express written consent):
(i) a failure by the Corporation to comply with any material
provision of this Agreement which has not been cured within ten (10) days
after notice of such noncompliance has been given by the Employee to the
Corporation;
(ii) any purported termination of the Employee's employment
(except upon death of the Employee) which is not effected pursuant to a
Notice of Termination satisfying the requirements of Section 1(c) hereof (and
for purposes of this Agreement no such purported termination shall be
effective);
(iii) without limiting the generality of (i) immediately
above, any material diminution in the title or the scope of the Employee's
responsibilities or duties with or for the Corporation from those of the
Employee immediately following the commencement of the Initial Term, except
in connection with the termination by the Corporation of his employment for
disability or cause, or as a result of his death, or termination by the
Employee of his employment pursuant to Section 11(b) (Discretionary) hereof;
(iv) the taking of any action by the Corporation which would
adversely affect the Employee's participation in any benefit plans to which
the Employee is otherwise entitled under the terms of this Agreement; and
(v) a relocation of the Corporation's principal offices or
the Employee's day-to-day place of work to a location outside of the
Baltimore, Maryland Metropolitan area.
(b) NOTICE OF TERMINATION. "Notice of Termination" shall mean a
notice which shall indicate the specific termination provision in this
Agreement relied upon and shall set forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the Employee's
employment and the Employment Term under the provision so indicated.
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(c) DATE OF TERMINATION. "Date of Termination" shall mean (i) if
the Employee's employment is terminated by his death, the date of his death;
(ii) if the Employee's employment is terminated pursuant to Section 10(b)
(Disability), thirty (30) days after Notice of Termination is given (provided
that the Employee shall not have returned to the performance of his duties on
a full-time basis during such thirty (30) day period); (iii) if the
Employee's employment is terminated pursuant to Section 10(c) (Cause), the
date specified in the Notice of Termination; (iv) if the Employee terminates
his employment pursuant to Section 11(b) (Discretionary) sixty (60) days
after delivery of Notice of Termination; and (v) if the Employee's employment
is terminated by the Employee or the Corporation for any other reason, the
date on which a Notice of Termination is given; provided that if within
thirty (30) days after any Notice of Termination is given the party receiving
such Notice of Termination notifies the other party that a dispute exists
concerning the termination, the Date of Termination shall be the date on
which the dispute is finally determined, either by mutual written agreement
of the parties, by a binding and final arbitration award or by a final
judgment, order or decree of a court of competent jurisdiction (the time for
appeal therefrom having expired and no appeal having been perfected);
provided further that the disputing party shall not be entitled to retain any
benefits derived directly or indirectly by disputing the termination if such
dispute is determined to have been without merit.
2. EMPLOYMENT. The Corporation hereby employs the Employee and the
Employee hereby accepts employment with the Corporation upon the terms and
conditions hereinafter set forth.
3. TERM. Unless further extended or sooner terminated or as expiring
as provided herein, the employment of the Employee as herein provided will be
for an initial term (the "Initial Term") commencing on the date hereof and
ending on the date which (the "Initial Term Expiration Date") which is the
second (2nd) yearly anniversary of the date hereof; provided, however, that
the Corporation shall have the full right, power and option to elect (the
"Early Expiration Option") that the Initial Term Expiration Date be changed
from the date which is the second (2nd) yearly anniversary of the date hereof
to March 31, 1997, in the event either (i) the Expansion Plan Hurdle (as
hereinafter defined) has not been met and satisfied on or before December 31,
1996 and the Corporation shall have delivered to the Employee a notice to
that effect prior to January 31, 1997; or (ii) on or prior to March 31, 1997,
the Corporation, through its Board of Directors (meeting without the Employee
if then a member of the Board of Directors) shall have determined, based on
its reasonable business judgement, that significant and sustained downturn in
the financial performance or condition of the Corporation has occurred, or
that events or circumstances have occurred or arisen which render a
significant and sustained downturn in the financial performance or condition
of the Corporation probable; and the Corporation shall have delivered notice
of such determination to the Employee. In the event that the Corporation
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does not elect to exercise the Early Expiration Option as hereinabove
provided, the term of the Employee's employment hereunder will continue
beyond March 31, 1997, for the balance of the Initial Term, and shall be
automatically extended beyond the Initial Term for indefinite successive
three (3) year renewal terms (each a "Renewal Term" and together the "Renewal
Terms") thereafter unless and until not less than one hundred eighty (180)
days prior to the last day of the Initial Term or five hundred forty-five
(545) days prior to the last day of any Renewal Term then in effect, the
Corporation shall have delivered to the Employee, or the Employee shall have
delivered to the Corporation, written notice that the term of the Employee's
employment hereunder will not be so extended, in which case the Employee's
employment hereunder will expire as of the last day of the Initial Term or
the Renewal Term, as the case may be, then in effect. The Initial Term,
together with all Renewal Terms, is hereinafter referred to as the
"Employment Term." For purposes hereof, "Expansion Plan Hurdle" shall mean
that the Corporation shall have in place arrangements on terms and conditions
satisfactory to the Board of Directors of the Corporation for expansion of
the Corporation's manufacturing facilities located at the Seton Industrial
Park, Baltimore, Maryland, together with all third party debt and/or equity
financing required in connection therewith or attendant thereto, as such
plans for expansion are contemplated by the Application dated March 22, 1996,
submitted by the Corporation to the Maryland Industrial Financing Authority,
and the Board of Directors shall have adopted a resolution to that effect.
Determination as to whether the Expansion Plan Hurdle has been met shall be
made by the Board of Directors (meeting without the Employee if then a member
of the Board of Directors) in its reasonable business judgement.
4. DUTIES. At all times during the Employment Term, the Corporation
agrees to engage the Employee as President of the Corporation and the
Employee agrees to perform such services as are customarily rendered by
Presidents of publicly held companies comparable to the Corporation, together
with such other executive services as shall from time to time be reasonably
assigned to him by the Board of Directors of the Corporation, consistent with
the terms of this Agreement and the stature and position of Employee. In
addition, at all times during the Employment Term, the Corporation, through
its Board of Directors, agrees to nominate the Employee as a member of the
Board of Directors of the Corporation.
5. BASE SALARY. During the Employment Term, the Corporation shall pay
to the Employee a base salary (the "Base Salary") for services rendered under
this Agreement at an Initial rate of One Hundred Thirty Thousand Dollars
($130,000) per year in accordance with the Corporation's normal payroll
policies and subject to required withholding. The Corporation may, through
action of its Board of Directors or the Compensation Committee of the Board
of Directors if then responsible for such matters, at any time and from time
to time increase the amount of the Base Salary payable to Employee hereunder,
and having done so the
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Corporation may thereafter reduce the Base Salary payable to Employee, but
the Corporation may not at any time reduce the Base Salary payable to
Employee below One Hundred Thousand Dollars ($100,000) per year; provided,
however, that the foregoing to the contrary notwithstanding, the Base Salary
applicable to the Employee may be reduced below One Hundred Thousand Dollars
($100,000) (but in no event to less than Eighty Five Thousand Dollars
($85,000) (the "Minimum Base Salary")) only in connection with a negative
adjustment to the base salary applicable to all officer level employees of
the Corporation based upon a reasonable determination by the Board of
Directors either that significant and sustained downturn in the financial
performance or condition of the Corporation has occurred, or that events or
circumstances have occurred or arisen which render a significant and
sustained downturn in the financial performance or condition of the
Corporation probable; and further provided that such negative adjustment is
made applicable PRO RATA to all such officer level employees, except to the
extent which the Minimum Base Salary applicable to the Employee, or to the
extent which any similar minimum base salary constraints applicable to any
such other officer level employees, renders a PRO RATA adjustment impossible.
Compensation of the Employee by payment of the Base Salary shall not be
deemed exclusive and shall not in any way limit or reduce any other
obligation of the Corporation hereunder, and no other compensation, benefit
or payment hereunder shall in any way limit or reduce the obligation of the
Corporation to pay the Base Salary to the Employee hereunder.
6. INCENTIVE COMPENSATION. In addition to payment of the Base Salary,
the Employee shall be entitled to such other and additional compensation as
may be determined by the Board of Directors or Compensation Committee of the
Board of Directors from time to time. Any such compensation, in the form of
cash paid or payable to the Employee, as a bonus or as part of a profit or
incentive cash compensation program established from time to time, shall be
hereinafter referred to as "Incentive Compensation"; and any payment made or
to be made pursuant to any arrangement actually established and in place from
time to time in respect of payment of Incentive Compensation in generally or
specifically defined amounts over a stated future period of time (e.g.,
pursuant to an arrangement established from time to time in respect of the
payment of Incentive Compensation in cash over a given forward looking period
based on past performance of the Employee and/or the Corporation) shall be
hereinafter referred to as "Defined Incentive Compensation."
7. INSURANCE. During the term of the Employee's employment with the
Corporation, the Corporation shall provide the Employee with group life,
health and disability insurance coverage comparable to the coverages
generally furnished by the Corporation to its senior level executive
personnel (other than the Chief Executive Officer, who may be entitled to
additional Benefits) from time to time. The Corporation at all times shall
be free to purchase insurance up to an amount of One Million Dollars
($1,000,000.00) upon the life of Employee naming the
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Corporation or its designee as beneficiary, and Employee agrees to cooperate
fully in applying for such insurance, including submitting to medical
examinations.
8. EXTENT OF SERVICE. During the Employment Term, the Employee shall
diligently devote his full business time, attention and energies to the
performance of his duties under this Agreement and shall exert his best
efforts in furtherance of the business of the Corporation.
9. EXPENSES. The Employee is authorized to incur reasonable expenses
for promoting the business of the Corporation, including expenses for meals,
travel and other similar items. The Corporation shall reimburse the Employee
for all such expenses upon the presentation to the Corporation by the
Employee, from time to time, of an itemized accounting for such expenditures,
and provided that the Corporation, in its reasonable judgment, concurs that
such expenses were incurred by the Employee in promoting the business of the
Corporation.
10. TERMINATION BY CORPORATION WITHOUT BREACH. The Employee's
employment hereunder and the Employment Term may be (or, upon the death of
the Employee, shall be deemed to have been) terminated by the Corporation,
without any breach of this Agreement only under the following circumstances:
(a) DEATH. The Employee's employment hereunder and the Employment
Term shall terminate upon his death, whereupon the Employee (or his spouse or
estate) shall be entitled to the compensation and benefits described in
Section 12(a) of this Agreement.
(b) DISABILITY. In the event that the Employee shall become
disabled by accident or by illness so as to be unable to perform the duties
required of him under this Agreement for a period of one hundred eighty (180)
consecutive days, the Corporation may terminate the Employee's employment
hereunder and the Employment Term. Any two periods of time during which
Employee is disabled (which periods are separated by no more than thirty (30)
calendar days during which Employee is able to perform the duties required
under this Agreement) shall, along with the intervening period during which
the Employee is able to perform services, be considered one continuous period
of disability. Upon any termination of the Employee pursuant to this Section
10(b) as a result of disability, the Employee shall be entitled to the
compensation and benefits described in Section 12(b) hereof.
(c) DISCHARGE FOR CAUSE. The Corporation may terminate the
Employee's employment hereunder and the Employment Term for Cause. For
purposes of this Agreement, the Corporation shall have "Cause" to terminate
the Employee's employment hereunder and the Employment Term upon (i) the
willful and continued failure by the Employee to substantially perform his
duties hereunder (other than any such failure resulting from the Employee's
incapacity
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due to physical or mental illness) after demand for substantial performance
is delivered by the Corporation that specifically identifies the manner in
which the Corporation believes the Employee has not substantially performed
his duties, or (ii) the willful engaging by the Employee in misconduct
(including any act of fraud or moral turpitude) which causes or is likely to
cause material injury to the Corporation, monetarily or otherwise (including
material injury to the reputation of the Corporation), or (iii) the
conviction of the Employee of a felony and the expiration of any period of
appeal therefrom without dismissal of the charge, or (iv) the willful
violation by the Employee of the provisions of this Agreement. For purposes
of this subsection, no act, or failure to act, on the Employee's part shall
be considered "willful" unless done, or omitted to be done, by him not in
good faith and without reasonable belief that his action or omission was in
the best interest of the Corporation. Notwithstanding the foregoing, the
Employee shall not be deemed to have been terminated for Cause without (i)
reasonable notice to the Employee setting forth the reasons for the
Corporation's intention to terminate for Cause, (ii) an opportunity for the
Employee, together with his counsel, to be heard before the highest ranking
officer of the Corporation other than the Employee, and (iii) delivery to the
Executive of a Notice of Termination as defined in Section 1(c) from the
Corporation finding that, in the good faith opinion of the highest ranking
executive of the Corporation other than the Employee, the Employee was guilty
of conduct set forth above in clause (i), (ii), (iii) or (iv) of the
preceding sentence, and specifying the particulars thereof in detail. As
provided in Section 12(c) hereof, upon termination of the Employee for cause
pursuant to this Section 10(d), the Employee shall be entitled to no further
compensation under this Agreement, except payment of the Base Salary and
Defined Incentive Compensation payable through the Date of Termination.
Additionally, as and to the extent provided for in option plans established
by the Corporation from time to time (including the Corporation's First
Incentive Stock Option Plan, Second Incentive Stock Option Plan and Third
Incentive Stock Option Plan), options previously issued but then not
exercised will terminate and lapse immediately upon termination of the
Employee and the Employment Term for cause.
Any termination of the Employee's employment and the Employment Term by
the Corporation under this Section 10 (other than termination upon death of
the Employee pursuant to Section 10(a)) shall be communicated by written
Notice of Termination to the Employee.
11. TERMINATION BY THE EMPLOYEE WITHOUT BREACH. The Employee may
terminate (or, upon his death, shall be deemed to have terminated) his
employment hereunder and the Employment Term, without any breach of this
Agreement, only under the following circumstances:
(a) GOOD REASON. The Employee may terminate his employment and the
Employment Term hereunder for Good Reason
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arising at any time. In the event of termination by the Employee of his
employment and the Employment Term pursuant to this Section 11(a), the
Employee shall be entitled to the compensation and benefits provided for
under Section 12(d) hereof.
(b) DISCRETIONARY. The Employee may terminate his employment and
the Employment Term hereunder for any reason or for no reason, effective
upon the expiration of sixty (60) days after delivery of Notice of
Termination to the Corporation, during which period Employee shall continue
to perform his duties hereunder. Upon any termination by the Employee of his
employment and the Employment Term pursuant to this Section 11(b), the
Employee shall be entitled to the benefits and compensation described in
Section 12(e) hereof.
(c) DEATH. The Employee's employment hereunder and the Employment
Term shall terminate upon his death, whereupon the Employee (or his spouse or
estate) shall be entitled to the compensation and benefits described in
Section 12(a) hereof.
Any termination by the Employee of his employment and the Employment Term
pursuant to this Section 11 (other than termination upon his death pursuant
to Section 11(c) hereof) shall be communicated by written Notice of
Termination to the Corporation.
12. COMPENSATION UPON TERMINATION OR DURING DISABILITY.
(a) DEATH. If the Employee's employment is terminated by his
death, the Corporation shall pay to the Employee's spouse, or if he leaves no
spouse, to his estate, the full Base Salary and Defined Incentive
Compensation which the Employee would otherwise have been entitled to receive
pursuant to Section 5 hereof until the end of the second (2nd) full calendar
month following the month during which the death of the Employee occurred.
Such payments shall be made in accordance with the Corporation's normal
payroll policy, as and when such payments would have been otherwise made had
the death of the Employee not occurred.
(b) DISABILITY. During any period that the Employee fails to
perform his duties hereunder as a result of incapacity due to physical or
mental illness, the Employee shall continue to receive his full Base Salary
and Defined Incentive Compensation at the rate or rates then in effect for
such period until his employment is terminated for disability pursuant to
Section 10(b) hereof, provided that payments so made to the Employee during
the first 180 days of such period shall be reduced by the sum of the amounts,
if any, payable to the Employee at or prior to the time of any such payment
under disability benefit plans of the Corporation and which were not
previously applied to reduce any such payment.
(c) CAUSE. If the Employee's employment shall be terminated for
Cause pursuant to Section 10(c) hereof, the Corporation shall pay the
Employee his full Base Salary and
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Defined Incentive Compensation through the Date of Termination at the rate or
rates in effect at the time Notice of Termination is given, and the
Corporation shall have no further obligations to the Employee under this
Agreement. Additionally, as and to the extent provided for in option plans
established by the Corporation from time to time (including the Corporation's
First Incentive Stock Option Plan, Second Incentive Stock Option Plan and
Third Incentive Stock Option Plan), options previously issued but then not
exercised will terminate and lapse immediately upon termination of the
Employee and the Employment Term for cause.
(d) BREACH/GOOD REASON. If (i) the Corporation shall terminate the
Employee's employment and the Employment Term in breach of this Agreement (it
being understood that a purported termination pursuant to Section 10(b)
(Disability) or 10(c) (Cause) hereof which is disputed and finally determined
not to have been proper shall be a termination by the Corporation in breach
of this Agreement), or (ii) the Employee shall terminate his employment and
the Employment Term at any time for Good Reason pursuant to Section 11(c)
hereof, then:
(w) the Corporation shall pay the Employee his full Base
Salary and Defined Incentive Compensation through the Date of Termination at
the rate or rates in effect at the time Notice of Termination is given; and
(x) in lieu of any further salary payments to the Employee for
periods subsequent to the Date of Termination, the Corporation shall pay as
severance pay to the Employee an amount equal to (i) the Employee's average
aggregate annual cash compensation (including Base Salary plus Incentive
Compensation (inclusive of Defined Incentive Compensation)) computed on the
basis of the Employee's earnings from the Corporation during each of the then
immediately preceding two (2) consecutive periods of twelve (12) complete
calendar months (or, at the option of the Employee, the immediately preceding
two (2) consecutive complete calendar years) multiplied by (ii) the number
two (2), such payment to be made in three (3) substantially equal consecutive
monthly installments, commencing on the first day of the calendar month
immediately following the month during which the Date of Termination occurred
and continuing on the first day of each of the two calendar months
thereafter; and
(y) the Corporation shall pay all other damages to which the
Employee may be entitled as a result of such termination, including damages
for any and all loss of benefits to the Employee under the Corporation's
employee benefit plans (other than Incentive Compensation as defined in
Section 6 above), which the Employee would have received if the Employment
Term not been so terminated and had the Employee's employment continued until
the expiration of the Initial Term or Renewal Term, as the case may be, then
in effect (including specifically but without limitation the benefits which
the Employee would have been entitled to receive pursuant to any retirement
income plan or arrangement had his employment continued for such period at
the
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rate of compensation specified herein), and including all legal fees and
expenses incurred by him as a result of such termination; and
(z) any and all options, rights, warrants or shares of
restricted stock of the Corporation held by the Employee or in which the
Employee has an interest, restricted or otherwise, as of the Date of
Termination shall, notwithstanding any provisions thereof to the contrary,
automatically and without further action of the Board of Directors be deemed
to have become fully vested and immediately exercisable (which may be
effected through delivery of shares of the Corporation's stock held by the
Employee, valued at market value, in payment of the exercise price) by the
Employee (or in the case of restricted stock, all restrictions shall be
deemed to have lapsed). In addition, the term of any and all options, rights
or warrants held by the Employee in respect of any equity securities of the
Corporation shall, notwithstanding any provisions thereof to the contrary,
automatically and without further action of the Board of Directors be deemed
to expire on the date which is the later of (i) the date provided for therein
and (ii) the first yearly anniversary of the Date of Termination. The terms
of this Agreement, and particularly the terms of the two (2) immediately
preceding sentences, shall be controlling to the extent inconsistent with the
terms of any plan or arrangement pursuant to which any such options, rights,
warrants or restricted stock are or were issued; except that, in the case of
any such options which are incentive stock options intended to be issued
pursuant to Section 422A of the Internal Revenue Code of 1986, as amended
(the "Code"), the provisions of this Agreement shall be subject to the
limitations and requirements of the Code, and any terms hereof which would be
construed under the Code as an amendment to such options (and therefore
jeopardizing the status of those options as incentive stock options under
Section 422A of the Code) shall have no effect as respects such options.
(e) DISCRETIONARY. If the Employee shall terminate his employment
under Section 11(b) hereof for no reason or otherwise in the sole discretion
of the Employee, the Corporation shall pay the Employee his full Base Salary
and Defined Incentive Compensation payable through the Date of Termination at
the rate or rates in effect at the time Notice of Termination is given, and
the Corporation shall have no further obligations to Employee hereunder.
(f) MAINTENANCE OF BENEFITS. Unless the Employee is terminated for
Cause pursuant to Section 10(c) hereof, or the employee terminates his
employment hereunder for no reason or otherwise pursuant to Section 11(b), or
the Employment Term expires without renewal upon the expiration of the
Initial Term or Renewal Term then in effect, (including without limitation
any expiration of the Initial Term upon exercise by the Corporation of the
Early Expiration Option), then the Corporation shall, upon termination of the
Employee's employment, maintain in full force and effect, for the continued
benefit of the Employee, until the
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later of (i) the date on which the Employment Term would have otherwise
terminated if not renewed upon the expiration of the Initial Term or Renewal
Term then just terminated, and (ii) twenty-four (24) months after the Date of
Termination, all employee benefit plans and programs (inclusive of health,
life, disability and other insurance plans or programs) in which the Employee
was entitled to participate immediately prior to the Date of Termination,
provided that the Employee's continued participation is possible under the
general terms and provisions of such plans and programs. In the event that
the Employee's participation in any such plan or program is barred or not
otherwise possible or available, the Corporation shall arrange to provide the
Employee, at the expense of the Corporation, with benefits substantially
similar to those which the Employee would otherwise have been entitled to
receive under such plans and programs from which his continued participation
is barred or unavailable.
(g) NO MITIGATION. The Employee shall not be required to mitigate
the amount of any payment provided for in this Section 12 by seeking other
employment or otherwise.
(h) EARLY EXPIRATION OPTION. In the event that the Corporation
shall exercise the Early Expiration Option contemplated by Section 3 hereof
on the basis that the Expansion Plan Hurdle had not been met in a timely
manner, the Corporation shall pay the Employee his full base salary and
Defined Incentive Compensation through March 31, 1997 at the rate or rates
then otherwise in effect and the Corporation shall have no further or
additional obligations to the Employee hereunder; and in the event that the
Corporation shall exercise the Early Expiration Option contemplated by
Section 3 hereof on the basis of a, or probability of a, significant and
sustained downturn in the financial performance or condition of the
Corporation, the Corporation shall continue, notwithstanding expiration of
the Initial Term and the Employee's term of employment hereunder on March 31,
1997, to pay to the Employee, as a severance benefit, an amount equal to the
Employee's base salary and Defined Incentive Compensation at the rate or
rates then in effect, over the period commencing April 1, 1997 and ending
July 30, 1997, as though the Employee had remained employed during that
period, and the Corporation shall have no further obligations to the Employee
hereunder.
13. VACATION. The Employee shall be entitled to vacation with pay as
provided for in the employment manual established from time to time for the
Corporation's employees, but in any event the Employee will be entitled
annually to no less than four (4) weeks of paid vacation.
14. NON-DISCLOSURE AGREEMENT. It is acknowledged that during his
employment with the Corporation, the Employee will have disclosed to him or
be furnished with access to proprietary information and to other trade
secrets and confidential information of the Corporation (inclusive of
information relating
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to the Corporation's proprietary process for the refinement of hyaluronic
acid) (hereinafter collectively, the "Confidential Information"). Employee
agrees that during his employment with the Corporation and at all times
thereafter, he will not disclose any of the Confidential Information to any
party other than authorized employee of the Corporation without the prior
written consent of the Corporation. In addition, during his employment with
the Corporation, Employee shall not be entitled to make use of the
Confidential Information in any manner other than in connection with this
employment with the Corporation and for the benefit of the Corporation, and
upon the termination of his employment with the Corporation, Employee shall
make no use whatsoever of the Confidential Information. Upon the termination
of his employment with the Corporation for any reason, Employee agrees to
return to the Corporation copies of all written materials containing any of
the Confidential Information. The provisions of this Section 14 shall not
apply to Confidential Information which comes into the public domain
otherwise than in breach of the Corporation's rights therein or to
disclosures which are required to be made by Employee in response to legal
process issued by a court or governmental agency of competent jurisdiction.
15. NON-COMPETITION AGREEMENT. Employee agrees that for a period of two
(2) years following the termination of his employment hereunder for any
reason (other than termination for Good Cause or otherwise by or for breach
of this Agreement by the Corporation), Employee shall not (i) directly or
indirectly, for himself or on behalf of any other person, firm, corporation
or association, call upon or otherwise contact or solicit any customer or
client of the Corporation anywhere in the World for the purpose of obtaining
the business of that customer identical or similar to the business of the
Corporation in respect of that customer at any time during the employment by
the Corporation of the Employee, where "customer" or "client" shall mean any
person, corporation or other entity to which the Corporation has rendered or
sold products or services at any time during which the Employee was employed
by the Corporation, or (ii) take any action, affirmative or otherwise, that
would materially impair the goodwill of the Corporation or materially disrupt
the business of the Corporation (other than termination of the Employee's
employment hereunder or as herein provided); provided, however, that the
terms of this Section 15 shall not become effective unless and until the
Employee shall have remained employed by the Corporation hereunder as of the
first day of the first Renewal Term.
16. OWNERSHIP OF INVENTIONS. It is agreed that the Corporation shall
have exclusive ownership of and right to copyright, patent, register or
otherwise protect all inventions, copyrightable materials, trademarks,
service marks and trade names used by the Corporation in connection with its
business, notwithstanding the fact that the Employee may develop or
participate in the development of any of these rights and properties during
the course of his employment with the Corporation.
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17. REMEDY OF SPECIFIC PERFORMANCE. The parties agree that the business
engaged in by the Corporation and the Confidential Information are special,
unique and of extraordinary character and that, in the event of the breach by
Employee of the terms of Sections 14, 15 or 16 of this Agreement, money
damages would not adequately compensate the Corporation; therefore, Employee
agrees that the Corporation shall be entitled, if it so elects, to institute
and prosecute proceedings in any court of competent jurisdiction to enforce
the specific performance of the aforementioned sections of this Agreement and
to enjoin Employee from taking any action in violation of such sections of
this Agreement, and Employee agrees not to raise any defense to any action to
seek such equitable remedy. The remedies hereby provided shall not be
exclusive but shall be in addition to any other remedy legally available to
the Corporation.
18. SEVERABILITY. Each Section and each provision of each Section of
this Agreement shall be separable from the other provisions and Sections of
this Agreement, and if for any reason, any provision or Sections hereof is
determined to be invalid or contrary to existing or future laws, it is
intended that such provision or Section be limited to the extent necessary so
that it will not render this Agreement invalid and any such invalidity will
only impair the operation or effect of those provisions or Sections which are
invalid.
19. AGREEMENT INCLUSIVE. This Agreement supersedes any and all prior
employment agreements, whether written or oral, by and between the Employee
and the Corporation and any and all such prior Agreements are hereby canceled
and rendered null and void effective as of the date of this Agreement.
20. SUCCESSORS. The Corporation will require any successor (whether
direct or indirect, by purchase, merger, consolidation or otherwise) to all
or substantially all of the business and/or assets of the Corporation, by
agreement in form and substance satisfactory to the Employee, to expressly
assume and agree to perform this Agreement in the same manner and to the same
extent that the Corporation would be required to perform it if no such
succession had taken place. Failure of the Corporation to obtain such
agreement prior to the effectiveness of any such succession shall be a breach
of this Agreement and shall entitle the Employee to compensation from the
Corporation in the same amount and on the same terms as he would be entitled
to hereunder if he terminated his employment for Good Reason, except that for
purposes of implementing the foregoing, the date on which any such succession
becomes effective shall be deemed the Date of Termination. As used in this
Agreement, "Corporation" shall mean the Corporation as hereinbefore defined
and any successor to its business and/or assets as aforesaid which executes
and delivers the agreement provided for in this Section 20, or which
otherwise becomes bound by all the terms and provisions of this Agreement by
operation of law.
21. BINDING AGREEMENT. This Agreement and all rights of the Employee
hereunder shall inure to the benefit of and be
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enforceable by the Employee's personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees. If
the Employee should die while any amounts would still be payable to him
hereunder if he had continued to live, all such amounts, unless otherwise
provided herein, shall be paid in accordance with the terms of this Agreement
to the Employee's devisee, legatee, or other designee or, if there be no such
designee, to the Employee's estate.
22. GOVERNING LAW. This Agreement shall be governed by and construed in
all respects in accordance with the laws of the State of Maryland.
23. ENTIRE AGREEMENT. This Agreement contains the entire agreement of
the parties, and may be amended, waived, changed, modified, extended and/or
rescinded only by a writing signed by the party against whom any such
amendment, waiver, change, modification, extension and/or rescission is
sought.
24. NOTICES. All notices and communications hereunder shall be in
writing and shall be deemed given when sent postage prepaid by registered or
certified mail, return receipt requested, and, if intended for the
Corporation, shall be addressed to it, to the attention of its Board of
Directors, 11412 Cronridge Drive, Owings Mills, Maryland 21117, or at such
other address of which the Corporation shall have given notice to the
Employee in the manner herein provided, and if intended for the Employee,
shall be addressed to him at the address which is on file for him from time
to time among the general records of the Corporation, or at such other
address of which the Employee shall have given notice to the Corporation in
the manner herein provided.
IN WITNESS WHEREOF, the parties hereto have set their hands as of the
date first above written.
ATTEST: CHESAPEAKE BIOLOGICAL LABORATORIES, INC.
_________________________ By:____________________________________(SEAL)
William P. Tew, Ph.D.
Chief Executive Officer
WITNESS: EMPLOYEE:
_________________________ _______________________________________(SEAL)
John C. Weiss, III
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