AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT
Amendment No. 1 to Employment Agreement, dated as of April 1, 1996, by and
between Innovir Laboratories, Inc., a Delaware corporation ("Innovir"), and Dr.
Allan R. Goldberg ("Employee").
WHEREAS, Innovir and Employee hereby wish to amend and extend the terms
of the Employment Agreement, dated as of April 1, 1992, between Innovir and
Employee (the "Employment Agreement").
NOW, THEREFORE, it is hereby agreed as follows:
1. Definitions. Capitalized terms used herein that are not otherwise
defined shall have the meanings assigned to such terms in the Employment
Agreement.
2. The first sentence of Section 1.(A) of the Employment Agreement is
hereby deleted and replaced in its entirety with the following sentence:
"(A) "Services" -- Employee shall act in the capacity of Chairman of the
Board and Chief Executive Officer of Employer and shall be elected as a member
of the Board of Directors."
3. Section 4 of the Employment Agreement is hereby deleted and replaced in
its entirety with the following new Section 4:
"4. Term. Employee's term of employment shall end on March 31, 1998, unless
sooner terminated in accordance with this Agreement. The parties agree to
commence negotiations in good faith for renewal of this Agreement on the
one-year anniversary of this Agreement. Employee's last day of employment,
regardless of how terminated pursuant to this Agreement, shall be the
"Termination Date."
4. Section 5 of the Employment Agreement is hereby deleted and replaced in
its entirety with the following new Section 5:
"5. Compensation.
(a) Salary. As compensation for the Services rendered by Employee under
this Agreement, Employer shall pay Employee a salary at the annual rate of
$200,000 ("Salary"). Employee's Salary shall be payable in arrears in equal
monthly installments, subject to such deductions and withholding as may be
required by law or by agreement of Employee. Employee's Salary shall be reviewed
annually and shall be subject to upward adjustment as shall be determined by the
Board of Directors.
(b) Expenses. Employer shall reimburse Employee for all reasonable, proper
and necessary out-of-pocket expenses that Employee may incur in connection
with the performance of Services, upon submission to Employer of itemized
statements supported by documentation specified by Employer.
(c) Fringe Benefits. Employee shall be entitled to all rights and benefits
generally provided to executive employees as decided by the Board of Directors
from time to time, including, without limitation, vacation, medical, accident
and disability insurance, life insurance (provided that Employee and Employer
are joint beneficiaries), pension, vehicle use and related expenses.
(d) Facilities. Employer shall provide Employee with appropriate research
facilities, office space, equipment, furniture, supplies and clerical staff.
(e) Equity Participation. Employer and Employee shall negotiate in good
faith to determine the vesting schedule of TARSOPs previously granted to
Employee.
(f) Key Performance Bonus. A cash bonus may be paid to Employee at the
reasonable discretion of Employer's Board of Directors upon the achievement of
specific and reasonable key performance objectives to be established and
measured by the Board of Directors. These objectives will be a set of specific
critical tasks prepared by Employee and recommended by Employee to the Board of
Directors for review and approval. At a minimum, each set of critical tasks will
be prepared by Employee and authorized by the Board of Directors once each
fiscal year, or more frequently as may be appropriate."
5. Subsection (c) of Section 6 is hereby deleted and replaced in its
entirety with the following subsection:
"(c) Effect of Termination. Upon any termination pursuant to this Section
6, all rights of Employee hereunder shall cease to be effective as of the
Termination Date, Employee shall be removed or resign from any position held
hereunder, and, except to the extent otherwise provided by law or mutually
agreed to, Employee shall have no rights to receive any payments or benefits
hereunder, except for:
i) Salary payable pursuant to Subsection 5(a) up to the Termination Date;
ii) reimbursement of expenses incurred in accordance with Subsection 5(b)
prior to the Termination Date;
iii) in the case of termination for death or Permanent Disability, an
amount equal to the Salary which would have been payable herewith up to a
maximum of eighteen months following the Termination Date;
-2-
iv) in the case of any Termination Not For Cause, the balance of the bonus
due to the Employee pursuant to subparagraph 5(f) notwithstanding his
termination of employment;
v) notwithstanding subsection (iv) above, if a merger, acquisition or
change in the majority ownership of the stock of the Employer occurs, Employee
shall be entitled to a lump sum severance payment, in consideration of past
services, paid to Employee no later than the fifth day following the termination
date, equal to one year's salary.
vi) Other Events. In the event of the earlier of (i) any termination in
connection with a liquidation of Employer as a result of any merger or
acquisition of the Employer with or by another company or firm, wherein the
shareholders of the Corporation do not own fifty percent (50%) of the shares of
the surviving corporation after the merger; (ii) a public offering of the
securities of the Employer wherein the Employer receives proceeds in the amount
of $20,000,000 or more; all restricted stock and stock options and rights held
by the Employee shall immediately accelerate and irrevocably vest in their
entirety.
vii) In the event of any termination Not For Cause, 100% of Employee's
non-vested shares will vest, unless termination results from a determination by
the Board of Directors that Employee has failed to perform his duties in a
manner reasonably consistent with the best interests of the Corporation, which
determination has been based on facts and circumstances set forth in a written
communication to Employee affording a reasonable period of at least 15 days, but
not more than 30 days, for Employee to rectify the specified shortcomings.
viii) Notwithstanding anything to the contrary herein, in the case of
Employee's termination hereunder For Cause or Not For Cause, and in
consideration of Employee's agreement contained in Section 9 hereof, the Company
shall pay Employee an amount equal to the Salary for eighteen months following
the Termination Date during which time the Employee shall serve as a consultant
to the Company and perform such duties as may reasonably be determined by the
Company."
6. Subsection (1) of Section 13 of the Employment Agreement is hereby
deleted and replaced in its entirety with the following new Subsection (1):
"(i) If to Employer:
Innovir Laboratories, Inc.
510 E. 73rd St.
New York, New York 10021
Attn: Gary Pokrassa
-3-
With a copy to:
Fulbright & Jaworski L.L.P.
666 Fifth Avenue
New York, New York 10103
Attn: Merrill M. Kraines, Esq."
7. All other sections of the Employment Agreement not hereby amended shall
remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment No. 1
as of the date first above written.
INNOVIR LABORATORIES, INC.
By: /s/ GARY POKRASSA
------------------------------
/s/ ALLAN R. GOLDBERG
-------------------------------
Dr. Allan R. Goldberg
-4-