EXHIBIT 10.10
SCHEDULE B
ASPREVA PHARMACEUTICALS CORPORATION
JANUARY 28, 2002
Noel Hall
5077 Cordova Bay Road
Victoria, B.C.
V8Y 2K1
Dear Mr. Hall:
RE: CHANGE IN CONTROL AGREEMENT
Aspreva Pharmaceuticals Corporation (the "Corporation") considers it
essential to the best interests of its members to foster the continuous
employment of its senior executive officers. In this regard, the Board of
Directors of the Corporation (the "Board") has determined that it is in the best
interests of the Corporation and its members that appropriate steps should be
taken to reinforce and encourage management's continued attention, dedication
and availability to the Corporation in the event of a Potential Change in
Control (as defined in Section 2), without being distracted by the uncertainties
which can arise from any possible changes in control of the Corporation.
In order to induce you to agree to remain in the employ of the
Corporation, such agreement evidenced by the employment agreement entered into
as of the date of this Agreement between you and the Corporation (the
"Employment Agreement") and in consideration of your agreement as set forth in
Section 3 below, the Corporation agrees that you shall receive and you agree to
accept the severance and other benefits set forth in this Agreement should your
employment with the Corporation be terminated subsequent to a Change in Control
(as defined in Section 2) in full satisfaction of any and all claims that now
exist or then may exist for remuneration, fees, salary, bonuses or severance
arising out of or in connection with your employment by the Corporation or the
termination of your employment:
1. TERM OF AGREEMENT.
This Agreement shall be in effect for a term commencing on the
Effective Date of the Employment Agreement (as therein defined) and ending on
the date of termination of the Employment Agreement.
2. DEFINITIONS.
(a) "Affiliate" means a corporation that is an affiliate of the
Corporation under the Securities Act (British Columbia), as amended
from time to time.
(b) "Change in Control" of the Corporation shall be deemed to have
occurred:
(i) if a merger, amalgamation, arrangement, consolidation,
reorganization or transfer takes place in which Equity
Securities of the Corporation possessing more than 50% of the
total combined voting power of the Corporation's outstanding
Equity Securities are acquired by a person or persons
different from the persons holding those Equity Securities
immediately prior to such transaction, and the composition of
the Board following such transaction is such that the
directors of the Corporation prior to the transaction
constitute less than 50% of the Board membership following the
transaction, except that no Change in Control will be deemed
to occur if such merger, amalgamation, arrangement,
consolidation, reorganization or transfer is with any
subsidiary or subsidiaries of the Corporation;
(ii) if any person, or any combination of persons acting jointly or
in concert by virtue of an agreement, arrangement, commitment
or understanding shall acquire or hold, directly or
indirectly, 50% or more of the voting rights attached to all
outstanding Equity Securities; or
(iii) if any person, or any combination of persons acting jointly or
in concert by virtue of an agreement, arrangement, commitment
or understanding shall acquire or hold, directly or
indirectly, the right to appoint a majority of the directors
of the Corporation; or
(iv) if the Corporation sells, transfers or otherwise disposes of
all or substantially all of its assets, except that no Change
of Control will be deemed to occur if such sale or disposition
is made to a subsidiary or subsidiaries of the Corporation.
provided however, that a Change in Control shall not be deemed to
have occurred if such Change in Control results solely from the
issuance, in connection with a bona fide financing or series of
financings by the Corporation of Equity Securities.
(c) "Base Salary" shall mean the annual base salary, as referred to in
Section 3 (Base Salary), and as adjusted from time to time in
accordance with Section 4 (Annual Review), of the Employment
Agreement.
(d) "Bonus" shall mean the bonus referred to in Section 5 (Performance
Bonus) of the Employment Agreement.
(e) "Cause" shall have the meaning set out in Section 16 (Termination by
the Corporation for Cause) of the Employment Agreement.
(f) "Date of Termination" shall mean, if your employment is terminated,
the date specified in the Notice of Termination.
(g) "Equity Security" in respect of a security of the Corporation, shall
have the meaning ascribed thereto in Part II of the Securities Act
(British Columbia), as it existed on the date of this Agreement, and
also means any security carrying the right to convert such security
into, exchange such security for, or entitling the holder to
subscribe for, any equity security, or into or for any such
convertible or exchangeable security or security carrying a
subscription right.
(h) "Good Reason" shall mean the occurrence of one or more of the
following events, without your express written consent, within 12
months of Change in Control:
(i) a material change in your status, position, authority or
responsibilities that does not represent a promotion from or
represents an adverse change from your status, position,
authority or responsibilities in effect immediately prior to
the Change in Control;
(ii) a material reduction by the Corporation, in the aggregate, in
your Base Salary, or incentive, retirement, health benefits,
bonus or other compensation plans provided to you immediately
prior to the Change in Control, unless an equitable
arrangement has been made with respect to such benefits in
connection with a Change in Control;
(iii) a failure by the Corporation to continue in effect any other
compensation plan in which you participated immediately prior
to the Change in Control (except for reasons of
non-insurability), including but not limited to, incentive,
retirement and health benefits, unless an equitable
arrangement has been made with respect to such benefits in
connection with a Change in Control;
(iv) any request by the Corporation or any affiliate of the
Corporation that you participate in an unlawful act; or
(v) any purported termination of your employment by the
Corporation after a Change in Control which is not effected
pursuant to a Notice of Termination satisfying the
requirements of clause (i) below and for the purposes of this
Agreement, no such purported termination shall be effective.
(i) "Notice of Termination" shall mean a notice, in writing,
communicated to the other party in accordance with Section 6 below,
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 your employment under the provision so indicated.
(j) "Potential Change in Control" of the Corporation shall be deemed to
have occurred if:
(i) the Corporation enters into an agreement, the consummation of
which would result in the occurrence of a Change in Control;
(ii) any person (including the Corporation) publicly announces an
intention to take or to consider taking actions which if
consummated would constitute a Change in Control; or
(iii) the Board adopts a resolution to the effect that, for the
purposes of this Agreement, a Potential Change in Control of
the Corporation has occurred.
3. POTENTIAL CHANGE IN CONTROL.
You agree that, in the event of a Potential Change in Control of the
Corporation occurring after the Effective Date, and until 12 months after a
Change in Control, subject to your right to terminate your employment by issuing
and delivering a Notice of Termination for Good Reason, you will continue to
diligently carry out your duties and obligations, on the terms set out in the
Employment Agreement.
4. COMPENSATION UPON TERMINATION FOLLOWING CHANGE IN CONTROL.
Subject to compliance by you with Section 3, upon your employment
terminating pursuant to a Notice of Termination within 12 months after a Change
in Control, the Corporation agrees that you shall receive and you agree to
accept, subject to your prior resignation as a director of the Corporation, the
following payments in full satisfaction of any and all claims you may have or
then may have against the Corporation, for remuneration, fees, salary, benefits,
bonuses or severance, arising out of or in connection with your employment by
the Corporation or the termination of your employment:
(a) If your employment shall be terminated by the Corporation for Cause
or by you other than for Good Reason, the terms of the Employment
Agreement shall govern and the Corporation shall have no further
obligations to you under this Agreement.
(b) If your employment by the Corporation shall be terminated by you for
Good Reason or by the Corporation other than for Cause, then you
shall be entitled to the payments and benefits provided below:
(i) subject to the withholding of all applicable statutory
deductions, the Corporation shall pay you a lump sum equal to
12 months' Base Salary, as referred to in Section 3 (Base
Salary) and as adjusted from time to time in accordance with
Section 4 (Annual Review) of the Employment Agreement, plus
other sums owed for arrears of salary, vacation pay and, if
awarded, Bonus;
(ii) to the extent permitted by law and subject to the terms and
conditions of any benefit plans in effect from time to time,
the Corporation shall
maintain the benefits and payments set out in Section 6
(Benefits) of the Employment Agreement during the 12 month
period;
(iii) the Corporation shall arrange for you to be provided with such
outplacement career counselling services as are reasonable and
appropriate, to assist you in seeking new executive level
employment; and
(iv) all incentive stock options granted to you by the Corporation
under any stock option agreement that is entered into between
you and the Corporation and is outstanding at the time of
termination of your employment, which incentive stock options
have not yet vested, shall immediately vest upon the
termination of your employment and shall be fully exercisable
by you in accordance with the terms of the agreement or
agreements under which such options were granted.
You shall not be required to mitigate the amount of any payment provided for in
this Section 4 by seeking other employment or otherwise, nor will any sums
actually received be deducted.
5. BINDING AGREEMENT.
This Agreement shall enure to the benefit of and be enforceable by
your personal or legal representatives, executors, administrators, successors,
heirs, distributees, devisees and legatees. If you die while any amount would
still be payable to you under this Agreement if you had continued to live, that
amount shall be paid in accordance with the terms of this Agreement to your
devisee, legatee or other designee or, if there is no such designee, to your
estate.
6. NOTICES.
Any notice or other communication required or contemplated under,
this Agreement to be given by one party to the other shall be delivered or
mailed by prepaid registered post to the party to receive same at the addresses
set out below:
IF TO ASPREVA PHARMACEUTICALS CORPORATION:
Aspreva Pharmaceuticals Corporation
c/o Farris, Vaughan, Wills & Murphy
26th Floor, 700 West Georgia Street
Vancouver, BC V7Y 1B3
Attn: R. Hector MacKay-Dunn
IF TO NOEL HALL:
Noel Hall
5077 Cordova Bay Road
Victoria, BC V8Y 2K1
Any notice delivered shall be deemed to have been given and received on the
first business day following the date of delivery. Any notice mailed shall be
deemed to have been given and received on the fifth business day following the
date it was posted, unless between the time of mailing and actual receipt of the
notice there shall be a mail strike, slow-down or other labour dispute which
might affect delivery of the notice by mail. In such event, the notice shall be
effective only if actually delivered.
7. MODIFICATION: AMENDMENTS: ENTIRE AGREEMENT.
This Agreement may not be modified, waived or discharged unless such
waiver, modification or discharge is agreed to in writing and signed by you and
such officer as may be specifically designated by the Board. No waiver by either
party at any time of any breach by the other party of, or compliance with, any
condition or provision of this Agreement to be performed by such other party
will be deemed a waiver of similar or dissimilar provisions or conditions at the
same or at any prior or subsequent time. Except as set forth in your Employment
Agreement, no agreements or representations, oral or otherwise, express or
implied, with respect to the subject matter hereof have been made by either
party which are not expressly set forth in this Agreement.
8. GOVERNING LAW.
This Agreement shall be governed by and interpreted in accordance
with the laws of the Province of British Columbia and applicable laws of Canada
and the parties hereto attorn to the exclusive jurisdiction of the provincial
and federal courts of such province.
9. VALIDITY.
The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement, which shall remain in full force and effect.
10. NO EMPLOYMENT OR SERVICE CONTRACT
Nothing in this Agreement shall confer upon you any right to
continue in the employment of the Corporation for any period of specific
duration or interfere with or otherwise restrict in any way the rights of the
Corporation or you, which rights are hereby expressly reserved by each, to
terminate your employment at any time for any reason whatsoever, with or without
cause.
If the foregoing sets forth our agreement on this matter, kindly
sign and return to the Corporation a copy of this letter.
Yours truly,
ASPREVA PHARMACEUTICALS
CORPORATION
By: /s/ RICHARD M. GLICKMAN
---------------------------
Authorized Signatory
Accepted and agreed to by Noel Hall, as of the 28th day of January, 2002
/s/ NOEL HALL
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NOEL HALL