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Exhibit 10.40
SERVICE AGREEMENTS WITH THE COMPANY
Service Agreement dated June 30, 1997 between with the Company and Dr R.A. Oakes
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EXECUTIVE OFFICER'S AGREEMENT
AN AGREEMENT made the 30th day of June 1997.
BETWEEN
SENETEK PLC ("the Company") whose registered office is situated at 23 Palace
Street, London SW1E 5HW, and
ROGER ANTHONY OAKES of Allstoe House, Church Lane, Greetham, Oakham, Rutland,
Leicestershire LE15 7NF ("the Executive").
WHEREAS the Company employs the Executive and the Executive serves the Company
as President and Chief Executive Officer of the Company's Pharmaceutical
Division pursuant to an Executive Officer's Agreement dated 16th October
1995 ("the Existing Agreement") the Company and the Executive have
agreed that the Existing Agreement shall be superseded in its entirety
by this present Agreement of June 30, 1997.
NOW IT IS HEREBY AGREED that the Company shall employ the Executive and the
Executive shall serve the Company as President of the Company's
Pharmaceutical Division, reporting to the Company's Board of Directors
and/or its Chief Executive Officer with effect from June 1, 1997, which
reporting duties shall confer an obligation upon the Executive to
provide promptly and faithfully full, detailed information covering the
Company's research and development activities, its clinical trials data,
the stages reached in the application for regulatory approvals
world-wide, and any and all matters arising therefrom relating to the
Company's existing and potential future products, whenever requested by
the Board of Directors, the Company's Chief Executive Officer or the
Company's Chief Scientific Advisor, upon and subject to the following
terms and conditions:
1. In this Agreement:
(a) the expression "the Board" means the Board of Directors for the
time being of the Company.
(b) the expression "Subsidiary" means a subsidiary (as defined by
Section 736 of the Companies Act 1985) for the time being of the
Company.
(c) the expression "associated Company" means in relation to a
company, its holding company (as defined by Section 736 of the
Companies Act 1985) or any subsidiary of such holding company.
(d) the expression "the Group" means the Company and any
subsidiaries of the Company.
(e) any reference to a statutory provision shall be deemed to
include a reference to any statutory modification or
re-enactment of the same.
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2. The employment shall be for a fixed period from June 1, 1997 to December
31, 1999, and shall be subject to termination as hereinafter provided.
3. (a) The remuneration of the Executive shall be a salary (which shall
accrue from day to day) at a rate of pound sterling 122,480
pounds sterling per annum (representing U.S.$200,000 per annum
at the exchange rate ruling as at June 1, 1997), such
remuneration not to be varied as a result of any subsequent
change in the present rate of currency exchange. Such salary
shall be payable by equal monthly installments on the last day
of every month and the first of such payments shall be due with
effect from June 30, 1997. The over-all remuneration (which term
shall also include the cost to the Company of the total benefits
enjoyed by the Executive) of the Executive shall be subject to
review by the Company's Compensation Committee during the first
quarter of each of the Company's fiscal years and the
Compensation Committee shall decide what, if any, increase in
the said over-all remuneration shall apply to the fiscal year in
question.
(b) The Executive shall be entitled to and the Company shall effect
payment of a health insurance policy for the benefit of the
Executive, his spouse and his immediate family with BUPA or a
similar organisation offering equivalent benefits. Such policy
to be reviewed and sanctioned by the Company prior to each
renewal date.
(c) The Executive shall be entitled to participate in the Company's
Number 1 Executive Share Option Scheme for Employees ("the
Option Scheme") under the terms and conditions of that scheme
and shall be granted Options to subscribe for shares of the
Company in accordance with the Schedule attached hereto. The
grant of options listed on the said Schedule shall be in
addition to the Executive's existing option entitlements, the
rights to which shall remain in full force and effect. The
Company hereby confirms that the Board has undertaken to
exercise its discretion in favor of the Executive under Clause
4.(1), (2)(a) & (b), and (4)(a) & (b), of the Option Scheme in
connection with the Executive's right of conversion of his
option entitlements into shares and the subsequent sale of the
said shares subject only to (i) the termination of this
Executive Agreement for cause as provided in Clause 6(b) below,
and (ii) compliance with the relevant provisions of Rule 144 of
the U.S. Securities Act of 1933, as amended.
(d) During the period of his employment, the Company will effect
insurance cover on the life of the Executive in the sum of pound
sterling 306,200 (representing U.S.$500,000 at the exchange rate
ruling as at June 1, 1997), such cover not to be varied as a
result of any change in the subsequent rate of currency
exchange, expressed in favour of the Executive's dependants or
as he may direct, on a term basis only. Such cover to be
reviewed and sanctioned by the Company prior to each renewal
date.
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(e) The Company shall be entitled to require the Executive to work
at such locations or offices of the Company, its subsidiaries or
associated companies as it may direct.
(f) There are no fixed hours of work.
4. The Company will provide the Executive with a car allowance of pound
sterling 459 per month (representing U.S.$750 per month at the exchange
rate ruling as at June 1, 1997), such allowance not to be varied as a
result of any change in the present rate of currency exchange, from
which the Executive shall meet all costs relating to his use of whatever
vehicle he may decide to utilise. The existing Company owned vehicle,
L69 DOM, Saab 9000 CSE, 2.3, may either be returned to the Company's
London office forthwith or alternatively the Executive may continue to
utilise the vehicle on the present basis until 30th September 1997 at
which date the vehicle shall be returned to the Company's London office.
5. The Company shall reimburse the Executive all reasonable hotel and other
expenses wholly and exclusively incurred by him in or about the
performance of his duties.
6. (a) In the case of illness of the Executive or other cause
incapacitating him from attending to his duties, the Executive
shall continue to be paid during such absence provided that if
such absence shall aggregate in all thirteen weeks in any
twenty-six consecutive weeks, the Company may terminate the
employment of the Executive hereunder by notice given on the
date not more than fourteen days after the end of the last of
such thirteen weeks. In this event the Executive shall be paid 6
months salary in lieu of notice.
(b) Termination for cause. The Company shall not be obligated to pay
or provide for any compensation or other benefits to the
Executive or give effect to any rights for the exercise of
options for any period after termination for cause. For the
purposes of this Agreement, "cause" shall mean termination for
personal dishonesty, wilful misconduct, breach of fiduciary duty
involving personal profit, wilful material violation of any law,
rule or regulation or material breach of any provision of this
Agreement.
7. The Executive shall (in addition to the usual public and bank holidays)
be entitled to four weeks holiday in each year to be taken at a time or
times convenient to the Company. Any vacation not taken during the 12
month period to December 31 of each year shall lapse and shall not be
carried forward. No payment shall be made in lieu of vacation time not
taken.
8. During the continuance of his employment hereunder, the Executive shall,
unless prevented by ill health, do all in his power to promote, develop,
and extend the business of the Group and shall at all times and in all
respects conform to and comply with the directions and regulations made
by the Board and also shall not, without the previous
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consent of the Board, engage in any other business of a similar nature
to or competitive with that carried on by the Group.
9. Any invention, discovery or improvement upon or in addition to any of
the Company's or the Group's inventions made by the Executive during the
period of employment shall be forthwith communicated to the Company and
shall be the absolute property of the Group and at the request of the
Company the Executive shall give and supply all information, know-how
and data as may be requisite to enable the Group to exploit such
invention, discovery or improvement and shall execute and do all
documents and things as may be necessary or desirable for obtaining
patent or similar protection for the same in any parts of the world as
may be specified by the Company and for vesting the same in the Group as
it may direct.
10. The Executive shall not (except in the proper course of his duties
hereunder) either during or after the period of his employment
hereunder, divulge to any person and shall use his best endeavors to
prevent the publication or disclosure of any trade secret or
manufacturing process or any information concerning the business or
finances of the Group or any of its dealings, transactions or affairs or
any trade secret or secret manufacturing process of any such
confidential information governing the Group and all notes and memoranda
of such trade secrets or information made or received by the Executive
during the course of his employment hereunder shall be the property of
the Company and shall be surrendered by the Executive or someone duly
authorized in that behalf at the termination of his employment or at the
request of the Board at any time during the course of his employment.
11. The Executive hereby covenants with the Company that he will not, within
2 years after ceasing to be employed hereunder, without the consent of
the Company in writing under the hand of a Director duly authorized by a
resolution of the Board, directly or indirectly seek to procure orders
from or do business with any person, firm, or company who, on the date
of the Executive ceasing to be employed hereunder or at any time in the
twelve months prior to that date, was a client or customer of the Group
and with whom in the course of his employment, the Executive shall have
had dealings, provided always, that nothing in this clause contained
shall be deemed to prohibit the seeking or procuring of orders or the
doing of business not in direct or indirect competition with the
business or businesses conducted by the Group.
12. This Agreement shall not be terminated by any:
(a) merger or consolidation where the Company is not the
consolidating or surviving entity; or
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(b) transfer of all or a substantial majority of the assets of the
Company.
(c) acquisition or control of 50 per cent or more of the Company's
issued and voting equity share capital by any party, or by
parties acting in concert or under common control.
In the event of any such merger or consolidation or transfer of all or a
substantial majority of the assets of the Company or acquisition or
control of 50 per cent or more of the Company's issued and voting equity
share capital by any party, or by parties acting in concert or under
common control, the surviving or resulting entity or the transferee or
transferrees of the Company's assets or its issued and voting equity
share capital shall be bound by, and shall have the benefit of, the
provisions of this Agreement, and the Company shall endeavor to take all
actions necessary to ensure that such entity or transferee or
transferees is bound by the provisions of the Agreement. Moreover, in
the event of such merger or consolidation, or transfer of all or a
substantial majority of the assets of the Company or acquisition or
control of 50 per cent or more of the Company's issued and voting equity
share capital as aforesaid, the Executive may at his option at any time
continue his employment under the terms and conditions of this
Agreement, or upon giving not less than 28 days Notice at any time, by
registered mail, to the registered office of the Company, require the
Company to effect full settlement of all of the Executive's entitlements
under the terms and conditions of this Agreement, which settlement shall
also include the payment of his remuneration for the full term of the
Agreement and the right to convert any and all Option entitlements,
(whether such Options be vested or not) up to and including December 31,
1999 and the Company shall effect full and final settlement within 28
days of receiving the said Notice from the Executive.
13. There is no pension payable, and there is no contracting out certificate
in force in respect of the Executive's employment hereunder.
14. There are no disciplinary rules or grievance procedures in place in
relation to the Executive's employment hereunder. The Executive may
raise any grievance or concern about any disciplinary matter with the
Board.
15. This Agreement shall be construed and governed by the laws of England
and Wales and to the jurisdiction of the English Courts.
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Signed by } /s/ Paul A. Logan
for and on behalf of } ----------------------------------------
SENETEK PLC in the presence } PAUL A. LOGAN
of:
Witness
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Signed by } /s/ Roger Anthony Oakes
ROGER ANTHONY OAKES } ----------------------------------------
in the presence of: } ROGER ANTHONY OAKES
Witness
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SCHEDULE
NO. OF OPTIONS GRANTED CONVERSION SECURITY CONVERSION PRICE VESTING DATE
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100,000 5p Ordinary shares U.S.$1.50 December 31, 1997
of Senetek PLC
100,000 5p Ordinary shares U.S.$1.50 December 31, 1998
of Senetek PLC
100,000 5p Ordinary shares U.S.$1.50 December 31, 1999
of Senetek PLC