EXHIBIT 10.4
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement"), made this 1st day of
November, 2001, is entered into by The Medicines Company, a Delaware corporation
with its principal place of business at One Cambridge Center, Cambridge,
Massachusetts 02142 (the "Company"), and David Stack, residing at One Robin
Drive, Oak Ridge, New Jersey 07438 (the "Employee").
WHEREAS, the Company and the Employee are parties to an Employment
Agreement dated April 1, 2000 (the "April 2000 Employment Agreement"), which was
amended by an Amendment to Employment Agreement dated July 10, 2001 ("Amendment
No. 1", with the April 2000 Employment Agreement, as amended by Amendment No. 1,
being referred to as the "Former Employment Agreement");
WHEREAS, on September 24, 2001, the Board of Directors of the Company
elected the Employee as President and Chief Executive Officer and a Director of
the Company; and
WHEREAS, the Company and the Employee wish to amend and restate the
Former Employment Agreement to, among other things, reflect the Employee's new
positions with the Company;
NOW THEREFORE, in consideration of the mutual covenants and promises
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties hereto, the parties
agree as follows:
1. Term of Employment. The Company hereby agrees to employ the
Employee, and the Employee hereby accepts employment with the Company, upon the
terms set forth in this Agreement, for the period commencing on November 1, 2001
(the "Commencement Date") and ending on November 1, 2002 (such period, as it may
be renewed as provided in the following sentence, the "Employment Period"),
unless sooner terminated in accordance with the provisions
of Section 4. The Employment Period shall automatically be renewed for
successive one (1) year periods unless either the Employee or the Company
provide written notice of non-renewal to the other party at least ninety (90)
days prior to the expiration of the then current term.
2. Title; Capacity. The Employee shall serve as President and Chief
Executive Officer or in such other position or positions as the Company or its
Board of Directors (the "Board") may determine from time to time. The Employee
shall be based at the Company's principal offices in New Jersey, unless
otherwise agreed by the parties. The Employee shall be subject to the
supervision of, and shall have such authority as is delegated to him by Clive
Meanwell (or if Dr. Meanwell shall have ceased to serve as Chairman of the
Company, the Board or such officer of the Company as may be designated by the
Board.)
The Employee hereby accepts such employment on a full-time basis and
agrees to undertake the duties and responsibilities inherent in such position
and/or such other duties and responsibilities as Dr. Meanwell (or the Board or
its designee) shall from time to time reasonably assign to him. The Company
acknowledges and agrees that during the Employment Period, the Employee may
continue to serve on the board of directors of the companies listed on Exhibit A
attached hereto (as amended from time to time upon the written agreement of the
Company and the Employee, the "Permitted Boards"). The Company also acknowledges
and agrees that the Employee may devote a portion of his business time to the
winding down and termination of operations of Stack Pharmaceuticals, Inc.
("SPI"), provided that the Employee is working in good faith to wind down and
terminate the operations of SPI as promptly as possible, consistent with good
business judgment and SPI's obligations under contracts to which SPI is
currently a party. The Employee agrees to abide by the rules, regulations,
instructions, personnel practices and policies of the Company and any changes
therein which may be adopted from time to time by the Company except as provided
in these agreements. The Employee acknowledges receipt of copies of all such
rules and policies committed to writing as of the date of this Agreement.
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3. Compensation and Benefits.
3.1 Salary. The Company shall pay the Employee, in semi-monthly
installments, an annual base salary of $265,000 for the one-year period
commencing on the Commencement Date. Such salary shall be subject to adjustment
thereafter as determined by the Board, but shall not be reduced below the amount
set forth above without the Employee's consent.
3.2 Bonus. The Employee shall be eligible to receive a bonus of
up to 40% of his base salary upon the achievement of annual objectives to be
approved by the Chairman of the Company after discussion with the Employee. The
Board shall review the Employee's performance and determine the amount of the
bonus, if any, to be paid to the Employee.
3.3 Reimbursement of Expenses. The Company shall reimburse the
Employee for all reasonable travel, entertainment and other expenses incurred or
paid by the Employee in connection with, or related to, the performance of his
duties, responsibilities or services under this Agreement, upon presentation by
the Employee of documentation, expense statements, vouchers and/or such other
supporting information as the Company may request.
3.4 Fringe Benefits. The Employee shall be entitled to
participate in all other bonus and stock incentive programs that the Company
establishes and makes available to its other employees at the same level as the
Employee to the extent that Employee's position, tenure, salary, age, health and
other qualifications make him eligible to participate. The Employee shall be
entitled to four weeks paid vacation per year, to be taken at such times as may
be approved by Dr. Meanwell (or the Board or its designee).
4. Employment Termination. The employment of the Employee by the
Company pursuant to this Agreement shall terminate upon the occurrence of any of
the following:
4.1 Expiration of Employment Period. Expiration of the Employment
Period in accordance with Section 1.
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4.2 Termination for Cause. At the election of the Company,
immediately upon written notice by the Company to the Employee, for "cause" as
determined by the Board. For purposes of this Section 4.2, "cause" for
termination shall be deemed to exist only if any of the following shall have
occurred:
(a) the Employee's conviction of any crime (whether or not
involving the Company) which constitutes a felony in the jurisdiction involved
(other than unintentional motor vehicle felonies);
(b) any act of theft, fraud, misappropriation of funds or
embezzlement by the Employee, in connection with his work with the Company, or
any other act or acts of dishonesty on the part of the Employee resulting or
intended to result directly or indirectly in personal gain or enrichment of the
Employee at the expense of the Company;
(c) the Employee's failure to perform in all material respects
the services required to be performed pursuant to Section 2 of this Agreement,
provided that if such failure is capable of being corrected, such failure
continues uncorrected for a period of thirty (30) days after the Employee shall
have received written notice from the Company stating with reasonably
specificity the nature of such failure;
(d) the Employee's breach of Sections 6 or 7 of this Agreement;
(e) the Employee's excessive use of alcohol and/or drugs which
is judged by the Board to materially interfere with the performance of his
duties;
(f) any misconduct by the Employee which in the reasonable
judgment of the Board would jeopardize the success of the Company; or
(g) the Employee's breach of the Invention and Non-Disclosure
Agreement dated as of July 10, 2001 between the Company and the Employee (the
"Invention Agreement").
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4.3 Death or Disability. Thirty (30) days after the death or
disability of the Employee. As used in this Agreement, the term "disability"
shall mean the inability of the Employee, due to a physical or mental
disability, for a period of ninety (90) days, whether or not consecutive, during
any 360-day period to perform the services contemplated under this Agreement. A
determination of disability shall be made by a physician satisfactory to both
the Employee and the Company, provided that if the Employee and the Company do
not agree on a physician, the Employee and the Company shall each select a
physician and these two together shall select a third physician, whose
determination as to disability shall be binding on all parties.
4.4 Voluntary Termination. At the election of either party, upon
written notice of termination given at least ninety (90) days prior to the
effective date of termination.
4.5 Voluntary Termination for "Good Reason." At the election of
the Employee, upon at least 30 days prior written notice to the Company, for
"Good Reason," which shall be deemed to exist only if:
(i) if the Company fails to comply in any material respect
with the provisions of Section 3, other than an isolated, insubstantial and
inadvertent failure which is remedied by the Company promptly after receipt of
notice thereof given by the Employee; or
(ii) the Company shall require the Employee to be based at a
location that is more than 50 miles from Parsippany, New Jersey.
5. Effect of Termination.
5.1 Termination for Cause or at Election of Employee. In the
event the Employee's employment is terminated for cause pursuant to Section 4.2,
at the election of the Employee pursuant to Section 4.4, or at the election of
either party pursuant to Section 4.6, the Company shall pay to the Employee all
sums otherwise payable to him under Section 3 through the last day of his actual
employment by the Company.
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5.2 Termination for Death or Disability. If the
Employee's employment is terminated by death or because of disability pursuant
to Section 4.3, the Company shall pay to the estate of the Employee or to the
Employee, as the case may be, all sums which would otherwise be payable to the
Employee under Section 3 up to the end of the month in which the termination of
his employment because of death or disability occurs.
5.3 Termination for Good Reason or at Election of
Company. In the event that Employee's employment is terminated by the Employee
for "Good Reason" pursuant to Section 4.5, or at the election of the Company
pursuant to Section 4.4, the Company shall continue to pay to the Employee the
salary set forth in Section 3.1, and shall continue to make available to the
Employee the benefits set forth in Section 3.3, excluding vacation days and
bonus sums under said Section 3.3 accrued during this period, until the date
three (3) months after the date of termination, but in no event later than such
date as the Employee shall have commenced full-time employment with a new
employer.
5.4 Survival. The provisions of Sections 6 and 7 shall
survive the termination of this Agreement.
6. Non-Compete.
6.1 Non-Compete Restrictions During the Employment Period
and for a period of one (1) year after the termination or expiration thereof
(such one (1) year period being inapplicable in the event of a termination
pursuant to Section 4.4 at the election of the Company or by the Employee
pursuant to Section 4.5), the Employee will not directly or indirectly as an
individual proprietor, partner, officer, consultant, employee, director, joint
venturer, or in any other similar capacity engage in the business of developing,
producing, marketing or selling (or assist any other person engaging in the
business of developing, producing, marketing or selling)
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any Competitive Products. For this purpose, "Competitive Products" shall mean a
product with chemical or commercial characteristics of the kind or type
developed or being developed, produced, marketed or sold by the Company during
the Employment Period. Notwithstanding the foregoing, the Employee shall not be
prohibited from engaging in the activities and business conducted by SPI under
contracts to which SPI is currently a party until such time as the operations of
SPI are wound down and terminated.
6.2 Limitations. Notwithstanding the provisions of
Section 6.1, it is recognized that the Employee's primary experience is in the
pharmaceutical industry, and that his ability to earn a livelihood is likely to
be dependent on future employment in such industry. Accordingly, the Company
agrees that the employment of the Employee by a pharmaceutical company in a
position in which he assumes responsibility for multiple products, most of which
are not Competitive Products, shall not be considered a violation of Section
6.1, so long as (i) the Employee's responsibilities in such position are not
directed principally to Competitive Products, (ii) the portfolio of the
pharmaceutical company which hires the Employee must contain the Competitive
Products prior to the hiring of the Employee, and (iii) the pharmaceutical
company which hires the Employee has been in existence for at least five (5)
years prior to hiring the Employee. The Company also agrees that a directorship
by the Employee on a Permitted Board shall not be considered a violation of
Section 6.1, so long as the Employee notifies the Company in writing of any
potential violation of Section 6.1 as a result of such directorship and Dr.
Meanwell (or the Board or its designee) agrees in writing that such directorship
shall not be considered a violation of Section 6.1.
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6.3 Extension. If the Employee violates the provisions of
Section 6.1, the Employee shall continue to be bound by the restrictions set
forth in this Section 6 until a period of one year has expired without any
violation of such provision.
6.4 Cutback Clause. If any restriction set forth in this
Section 6 is found by any court of competent jurisdiction to be unenforceable
because it extends for too long a period of time or over too great a range of
activities or in too broad a geographic area, it shall be interpreted to extend
only over the maximum period of time, range of activities or geographic area as
to which it may be enforceable.
6.5 Equitable Remedies. The restrictions contained in
this Section 6 are necessary for the protection of the business and goodwill of
the Company and are considered by the Employee to be reasonable for such
purpose. The Employee agrees that any breach of Section 6.1 is likely to cause
the Company substantial and irrevocable damage and therefore, in the event of
any such breach, the Employee agrees that the Company, in addition to such other
remedies which may be available, shall be entitled to specific performance and
other injunctive relief.
7. Non-solicitation.
7.1 Non-solicitation Restrictions. While the Employee is
employed by the Company and for a period of one (1) year after the termination
or cessation of such employment for any reason, the Employee will not directly
or indirectly recruit, solicit or hire any employee of the Company, or induce or
attempt to induce any employee of the Company to terminate his/her employment
with, or otherwise cease his/her relationship with, the Company (other than
Thomas Quinn, Fred Ryan, or Melinda Popolla). If the Employee violates the
provisions of this Section 7.1, the Employee shall continue to be bound by the
restrictions set forth in this Section 7.1 until a period of one (1) year has
expired without any violation of such provisions.
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7.2 Cutback Clause. If any restriction set forth in
Section 7.1 is found by any court of competent jurisdiction to be unenforceable
because it extends for too long a period of time or over too great a range of
activities or in too broad a geographic area, it shall be interpreted to extend
only over the maximum period of time or range of activities as to which it may
be enforceable.
7.3 Equitable Remedies. The restrictions contained in
Section 7.1 are necessary for the protection of the business and goodwill of the
Company and are considered by the Employee to be reasonable for such purpose.
The Employee agrees that any breach of Section 7 is likely to cause the Company
substantial and irrevocable damage and therefore, in the event of any such
breach, the Employee agrees that the Company, in addition to such other remedies
which may be available, shall be entitled to specific performance and other
injunctive relief.
8. Inventions and Proprietary Information. On July 10, 2001, the
Employee executed the Invention Agreement with the Company. The Employee hereby
confirms and ratifies his obligation thereunder.
9. Other Agreements. Employee hereby represents that he is not
bound by the terms of any agreement with any previous employer or other party to
refrain from using or disclosing any trade secret or confidential or proprietary
information in the course of his employment with the Company or to refrain from
competing, directly or indirectly, with the business of such previous employer
or any other party. Employee further represents that his performance of all the
terms of this Agreement and as an employee of the Company does not and will not
breach any agreement to keep in confidence proprietary information, knowledge or
data acquired by him in confidence or in trust prior to his employment with the
Company.
10. Notices. All notices required or permitted under this
Agreement shall be in writing and shall be deemed effective upon personal
delivery or upon deposit in the United
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States Post Office, by registered or certified mail, postage prepaid, addressed
to the other party at the address shown above, or at such other address or
addresses as either party shall designate to the other in accordance with this
Section 10.
11. Pronouns. Whenever the context may require, any pronouns used
in this Agreement shall include the corresponding masculine, feminine or neuter
forms, and the singular forms of nouns and pronouns shall include the plural,
and vice versa.
12. Entire Agreement. This Agreement, together with the Invention
Agreement, constitutes the entire agreement between the parties and supersedes
all prior agreements and understandings, whether written or oral, relating to
the subject matter of this Agreement, including without limitation the Former
Employment Agreement, which this Agreement amends and restates and which shall
be of no further force or effect after the date hereof.
13. Amendment. This Agreement may be amended or modified only by a
written instrument executed by both the Company and the Employee.
14. Governing Law. This Agreement shall be construed, interpreted
and enforced in accordance with the laws of the State of New Jersey.
15. Successors and Assigns. This Agreement shall be binding upon
and inure to the benefit of both parties and their respective successors and
assigns, including any entity with which or into which the Company may be merged
or which may succeed to its assets or business, provided, however, that the
obligations of the Employee are personal and shall not be assigned by him.
16. Miscellaneous.
16.1 No Waiver. No delay or omission by the Company in
exercising any right under this Agreement shall operate as a waiver of that or
any other right. A waiver or consent given by the Company on any one occasion
shall be effective only in that instance and shall not be construed as a bar or
waiver of any right on any other occasion.
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16.2 Captions. The captions of the sections of this
Agreement are for convenience of reference only and in no way define, limit or
affect the scope or substance of any section of this Agreement.
16.3 Enforceability. In case any provision of this
Agreement shall be invalid, illegal or otherwise unenforceable, the validity,
legality and enforceability of the remaining provisions shall in no way be
affected or impaired thereby.
16.4 Counterparts. This Agreement may be executed in one
or more counterparts, each of which shall be deemed to be an original, but all
of which shall be one and the same document.
[Remainder of page intentionally omitted]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year set forth above.
THE MEDICINES COMPANY
By: /s/ Clive Meanwell
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Clive A. Meanwell
Chairman
/s/David Stack
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David Stack
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Exhibit A
Bio-Imaging Technologies, Inc.
Medsite, Inc.
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