EXHIBIT 10.47
SEVERANCE AGREEMENT
THIS SEVERANCE AGREEMENT (the "Agreement") is made as of September 23,
1999 between INCARA PHARMACEUTICALS CORPORATION, a Delaware corporation (the
"Company"), and _____________ ("Employee").
Recitals
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A. Employee is employed by the Company as an officer, and as such, the
Company recognizes the valuable services performed by Employee for the
Company and wishes to encourage his/her continued employment.
B. Employee desires to be assured that he/she will be entitled to a
certain amount of compensation and benefits for some definite period of
time upon the occurrence of certain events.
C. The parties desire to enter into this Agreement to provide the terms
and conditions upon which the Company will pay severance benefits to
Employee upon the occurrence of certain events.
Statement of Agreement
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In consideration of the foregoing and the promises and covenants
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby agree as
follows:
1. Definitions. Whenever used in this Agreement, the following terms shall
have the meanings respectively assigned to them in this Section 1:
(a) "Cause" shall have the meaning as defined in the Employment
Agreement (as defined below), and in addition, shall include
conviction of a felony and the violation of "insider trading laws",
as determined by the Securities and Exchange Commission.
(b) "Change in Control" means any of the following events or
transactions:
(i) A merger or consolidation of the Company with another
corporation (A) where the stockholders of the Company
immediately prior to the merger or consolidation do not
beneficially own, immediately after the merger or
consolidation, shares of the corporation issuing cash or
securities in the merger or consolidation entitling such
stockholders to more than fifty percent (50%) of all votes
(without consideration of the rights of any class of stock
to elect directors by a separate class vote) to which all
stockholders of such surviving corporation would be
entitled in the election of directors, or (B) where the
members of the Board of Directors of the Company
immediately prior to the merger or consolidation do not,
immediately after the merger or consolidation, constitute
a majority of the Board of Directors of the corporation
issuing cash or securities in the merger or consolidation;
(ii) The sale, transfer or other disposition of all or
substantially all of the assets of the Company; or
(iii) The acquisition, directly or indirectly, by any person or
related group of persons (other than the Company or a
person that directly or indirectly controls, is controlled
by, or is under common control with, the Company) of
beneficial ownership (within the meaning of Rule
13d-3 of the Securities Exchange Act of 1934, as amended)
of securities possessing more than fifty percent (50%) of
the total combined voting power of the Company's
outstanding securities pursuant to a tender or exchange
offer made directly to the Company's stockholders.
(c) "Employment Agreement" shall mean the Employment Agreement between
the Employee and the Company dated ___________ (or any subsequent
employment agreement which supplements, supersedes or replaces such
agreement).
(d) "Good Reason" shall mean any reduction, without Employee's consent,
in Employee's status, title, authority, duties, salary, benefits,
eligibility for bonuses or location of employment that is more than
thirty (30) miles from Employee's current location of employment.
(e) "Separation Event" shall mean the termination by the Company of
Employee's employment without Cause or termination by Employee for
Good Reason, in either case within two and one-half years after the
earliest date of a Change in Control of the Company (the
"Termination Period"). The death or disability of Employee shall
not be a Separation Event.
Other terms used in this Agreement are defined in other provisions of
this Agreement and shall have the respective meanings given such terms in those
provisions.
2. Employment. Employee shall, so long as he/she remains in the active
employment of the Company, devote such of his/her time and efforts as
shall be necessary to the proper discharge of his/her duties and
responsibilities as an officer of the Company.
3. Severance Benefits.
(a) In consideration of Employee remaining an employee of the Company,
if there is a Separation Event, then Employee shall receive the
following in lieu of any other severance benefits due to Employee
pursuant to Company policies or the Employment Agreement, if any.
(i) Accrued and unpaid salary less all applicable and
customary withholding taxes and deductions;
(ii) A bonus in the amount of the average annual bonus earned
by Employee during the previous two years, prorated for
the portion of the current year worked through the date of
termination, less all applicable withholding taxes and
deductions;
(iii) A lump sum severance payment equal to two and one-half
times the sum of his/her current annual base salary and
average annual bonus during the previous two years, less
all applicable withholding taxes and deductions; and
(iv) Medical and insurance benefits paid by the Company or its
successor-in-interest equal to those provided by the
Company to Employee immediately prior to the date of the
Separation Event for two and one-half years following the
Separation Event.
(b) The amounts in Subsections 3(a)(i), (ii) and (iii) shall be paid
within thirty (30) days following the Separation Event.
(c) In addition to the foregoing, all restricted stock and all stock
options for the purchase of capital stock of the Company held by
Employee shall vest in full immediately upon the occurrence of a
Separation Event.
4. Other Termination of Employment. If the Company or the Employee
terminates Employee's employment with the Company for any reason other
than a Separation Event, then
(i) No benefits shall become due and payable under Section 3,
above;
(ii) This Agreement shall be considered terminated with respect
to Employee; and
(iii) Company policy and the Employment Agreement shall
determine the severance benefits, if any, due to Employee
or his/her descendents.
5. Corporate Assets. No provision in this Agreement, or any action taken
pursuant to its provisions by either party, shall create, or be
construed to create, a trust of any kind, or a fiduciary relationship
between the Company and the Employee, his/her designated beneficiary,
other beneficiaries of Employee, or any other person. The payments to
Employee, his/her designated beneficiary, or any other beneficiary
shall be made from assets which shall continue to be a part of the
general assets of the Company. No person shall have, by virtue of the
provisions of this Agreement, any interest in the Company's assets. To
the extent that any person acquires a right to receive payments or
benefits from the Company under this Agreement, the right shall be no
greater than the right of any unsecured general creditor of the
Company.
6. No Employment Contract. Nothing contained in this Agreement shall be
construed as a contract of employment for any term of years, nor as
conferring upon Employee the right to continue as an employee of the
Company in any capacity. It is understood by the parties that this
Agreement relates exclusively to severance benefits payable after
termination of Employee's employment with the Company during the
Termination Period, and is not intended to be an employment contract.
7. Employee's Capacity. Employee represents and warrants to the Company
that he/she has the capacity and right to enter into this Agreement
without any restriction whatsoever by any other agreement, other
document or otherwise.
8. Complete Agreement. This document contains the entire agreement between
the parties regarding severance arrangements resulting from certain
terminations of Employee's employment during the Termination Period and
supersedes any prior discussions, negotiations, representations, or
agreements between them relating to such severance arrangements for
Employee. No additions or other changes to this Agreement shall be made
or be binding on either party unless made in writing and signed by each
party to this Agreement.
9. Notices. All notices and other communications under this Agreement to
any party shall be in writing and shall be deemed given when delivered
personally, via facsimile (which is confirmed) to that party at the
telecopy number for that party set forth below, mailed by certified
mail (return receipt requested) to that party at the address for that
party set forth below (or at such other address for such party as such
party shall have specified in notice to the other party), or delivered
to Federal Express, UPS or any similar express delivery service for
delivery to that party at that address:
(a) If to the Company:
Incara Pharmaceuticals Corporation
P.O. Box 14287
3200 East Highway 54
Cape Fear Building, Suite 300
Research Triangle Park, NC 27709
Attention: President
Facsimile No.: (919) 544-1245
(b) If to the Employee:
The Employee's current address in the Company's
personnel files
10. Governing Law. All questions concerning the validity, intention, or
meaning of this Agreement or relating to the rights or obligations of
the parties with respect to performance hereunder shall be construed
and resolved under the laws of North Carolina.
11. Severability. The intention of the parties to this Agreement is to
comply fully with all laws and public policies, and this Agreement
shall be construed consistently with all laws and public policies to
the extent possible. If and to the extent that any court of competent
jurisdiction determines that it is impossible or violative of any legal
prohibition to construe any provision of this Agreement consistently
with any law, legal prohibition, or public policy and consequently
holds that provision to be invalid or prohibited, that shall in no way
affect the validity of the other provisions of this Agreement which
shall remain in full force and effect.
12. Nonwaiver. No failure by any party to insist upon strict compliance
with any term of this Agreement, to exercise any option, enforce any
right, or seek any remedy upon any default of any other party shall
affect, or constitute a waiver of, the first party's right to insist
upon such strict compliance, exercise that option, enforce that right,
or seek that remedy with respect to that default or any prior,
contemporaneous, or subsequent default; nor shall any custom or
practice of the parties at variance with any provision of this
Agreement affect or constitute a waiver of, any party's right to demand
strict compliance with all provisions of this Agreement.
13. Captions. The captions of the various sections of this Agreement are
not part of the context of this Agreement, but are only labels to
assist in locating those sections, and shall be ignored in construing
this Agreement.
14. Successors. This Agreement shall be personal to Employee and no rights
or obligations of Employee under this Agreement may be assigned by
him/her. Except as described in the preceding sentence, this Agreement
shall be binding upon, inure to the benefit of, and be enforceable by
and against the respective heirs, legal representatives, successors,
and assigns of each party to this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Severance
Agreement as of the date and year first above written.
INCARA PHARMACEUTICALS CORPORATION
By:_______________________________
Title:____________________________
EMPLOYEE:
(SEAL)
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