EXHIBIT 10.2
PRO-PHARMACEUTICALS, INC.
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT, entered into on this 19th day of January 2009
(the "Effective Date"), between Pro-Pharmaceuticals, Inc., a Nevada corporation
having an address of 7 Wells Avenue, Suite 34, Newton, Massachusetts 02459 (the
"Company"), and Maureen E. Foley, an individual residing at 46 Pond Circle,
Jamaica Plain, MA, 02130 (the "Employee").
WHEREAS, the Employee has been engaged by the Company since January
2001, as a consultant, and as an employee as of May 1, 2001 ("Prior Engagement")
prior to the Effective Date;
WHEREAS, the Company desires to employ the Employee, and Employee
desires to continue to be employed by the Company, on the terms and conditions
set forth in this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained in this Agreement, the parties agree as follows:
1. Employment. The Company and the Employee acknowledge that Employee's
employment by the Company commenced on May 28, 2001. The Company agrees to
continue to employ the Employee, and Employee agrees to be so employed in an
"Executive" capacity, with the title "Chief Operating Officer" (the "COO") and
reports to the President and Chief Executive Officer of the Company (the "CEO").
The Employee agrees that, to the best of the Executive's ability and experience,
the Executive will at all times conscientiously perform all of the duties and
obligations assigned to the Executive under this Agreement.
2. Salary; Reimbursement of Expenses.
(a) Salary. The Executive's salary will continue at $185,000 per year
(the "Base Salary"), less required withholdings, payable on the Company's
regular payroll dates. The Executive's salary shall be reviewed at least
annually and is subject to adjustment in connection therewith. Such salary as in
effect from time to time is herein referred to as the "Base Salary".
(b) Reimbursement of Expenses. The Company shall reimburse the
Executive for all reasonable and appropriate or necessary out-of-pocket expenses
incurred in connection with the Executive's carrying out the Executive's duties
under this Agreement, in conformity with such procedures as the Company may
establish from time to time.
3. Benefits.
The Executive will be entitled to insurance, four weeks vacation and
other benefits commensurate with the Executive's position in accordance with the
Company's standard employee benefits policies as in effect from time to time.
To the extent the Company obtains insurance with respect to (i)
directors' and officers' liability, (ii) errors and omissions and (iii) general
liability insurance, the Executive shall be covered by such insurance to the
same extent as other senior executives and directors of the Company.
4. Conflicting Employment.
The Executive agrees that, during the term of the Executive's
employment with the Company, Executive will not engage in any other employment,
occupation, consulting or other business activity related to the business in
which the Company is now involved or becomes involved during such Term, nor will
the Executive engage in any other activities that conflict with the Executive's
obligations to Company.
5. Compliance with Company Policy.
During this agreement, the Executive shall observe all Company rules
and policies, including such policies as are contained in the Company policy and
procedures manual as from time to time amended.
6. Termination of Employment.
(a) For Cause. The Company shall have the right, upon written notice
thereof to the Executive, to terminate the Executive's employment hereunder if
(i) the Executive
(a) fails or refuses in any material respect to perform any
duties consistent with the terms hereof communicated to the
Executive in writing by either the CEO and/or the President.
(b) is grossly negligent in the performance of the Executive's
duties hereunder,
(c) is convicted of a felony or other violation which in the
reasonable judgment of the CEO or President could materially
impair the Company from substantially meeting its business
objectives, or
(d) is found to have committed any act of fraud,
misappropriation of funds or embezzlement with respect to
the Company; and
(ii) except as to the matters referred to in clauses (c) or (d),
within thirty (30) days (the "Cure Period") after delivery of written notice
from the CEO, President or the Board of Directors of the Company (the "Board"),
stating with specificity the nature of the reason for an anticipated for-cause
termination, if the Executive fails to cure, or if the matter is not curable
within the Cure Period the Executive fails, in the judgment of the CEO or
President, within the Cure Period to undertake diligently to cure such, failure,
refusal or negligence. In the event of termination pursuant to this Section
6(a), the Executive shall be entitled to the payments and benefits set forth in
Sections 2 and 3 hereof through the end of the Cure Period.
(b) Without Cause. In the event the employment of the Executive is
terminated by the Company for any reason other than as stated in Section 6(a) or
6(c), any such termination deemed for the purposes hereof to be "without cause."
In that event,
(i) if termination occurs prior to or within six (6) months of
hire (May 1, 2001), the Executive shall be paid Base Salary for one month, after
the effective date of such termination,
(ii) if the termination occurs after six (6) months of hire
(May 1, 2001), the Executive shall be paid Base Salary for two (2) months, plus
one (1) month of service for each year, not to exceed six (6) months;
(iii) the Executive shall be reimbursed for all expenses
pursuant to Section 2 incurred through such effective date,
(iv) the Executive shall continue to have during such
post-employment period six (6) months of benefits, to the extent permitted by
law, to which she was entitled pursuant to Section 3 hereof while he was
employed by the Company,
(c) For Good Reason. The Executive may terminate his employment for "Good
Reason" after giving the Company detailed written notice of his intention to
terminate for Good Reason, if the Company shall have failed to cure the event or
circumstance constituting "Good Reason" within twenty (20) business days after
receiving such notice (which 20-day period may be extended by written consent of
the parties). Good Reason shall mean the occurrence of any of the following
without the written consent of the Executive or her approval in her capacity as
the Chief Operating Officer:
(i) the assignment to the Executive of duties inconsistent with this
Agreement or a change in her titles or authority;
(ii) any failure of the Company to comply with Section 1 hereof in
any material way;
(iii) any material breach of this Agreement by the Company; or
(iv) any failure by the Company to obtain the assumption of this
Agreement by any successor or assign of the Company.
For avoidance of confusion, the voluntary resignation by the Executive for
reasons other than Good Reason shall not constitute an event that entitles her
to the severance set forth in subsection (d) below.
(d) Effect of Termination by Executive for Good Reason or After Change of
Control. If the Executive's employment is terminated by Executive for Good
Reason or, in the event of any Change in Control the Executive's employment is
terminated for any reason within twelve (12) months after such Change in Control
(as hereinafter defined),
(i) the Executive shall be paid a lump sum equal to the sum of her
Base Salary and accrued vacation pay through the effective date of such
termination;
(ii) the Executive shall be paid (in accordance with the Company's
customary payroll practices for senior management) the Executive's Base Salary
for six months after the effective date of such termination;
(iii) the Executive shall be reimbursed for all expenses pursuant to
Section 3 incurred through such effective date;
(iv) the Executive shall continue to have during such
post-employment period, to the extent permitted by law, the benefits to which
the Executive and her eligible spouse were entitled pursuant to Section 3 hereof
while the Executive was employed by the Company, and if the Company cannot
include Executive and her family in any health plan subsequent to the
termination of his employment, Company shall provide Executive, for not less
than six (6) months following the effective date of her termination of
employment, funding sufficient to obtain private health insurance coverage for
herself and her spouse that is substantially equal to the benefits available
under the Company's health insurance policy as in effect at the date of
Executive's termination;
(v) any stock option or other right to acquire securities of the
Company, to the extent not fully vested, shall accelerate so that such option or
other rights are immediately exercisable upon Executive's termination be
exercisable during their term whether or not the Executive is then employed by
Pro-Pharmaceuticals or this agreement has terminated.
For purposes of this Agreement, a Change of Control means the occurrence
of any of the following in connection with which the Executive has not in his
sole discretion consented in writing to waive any or all of the severance
provisions stated in subsection (f) above: (i) any sale, merger, consolidation,
tender offer or similar acquisition of shares, or other transaction or series of
related transactions (each a "Transaction"), other than any Transaction the
substantial purpose of which in the reasonable determination of the Board is
equity or debt finance of the Company, as a result of which at least a majority
of the voting power of the Company is not held, directly or indirectly, by the
persons or entities who held the Company's securities with voting power before
such Transaction (provided, however, that any person who acquired voting
securities of the Company in contemplation of the Transaction and who
immediately after such Transaction possesses direct or indirect ownership of at
least ten percent (10%) of the securities of the Company or the surviving entity
(or if the Company or the surviving entity is a controlled affiliate of another
entity, then of such controlling entity) shall not be included in the group of
those persons or entities who held the Company's securities with voting power
before such Transaction); (ii) a sale or other disposition of all or a
substantial part of the Company's assets, whether in one transaction or a series
of related transactions; or (iii) individuals who on the Effective Date
constitute the Board and together with any individual who becomes a director
after such date (other than a director designated by a person or entity who has
entered into an agreement to effect a transaction described in clause (i) or
(ii) above or designated pursuant to requirements of any debt or equity finance)
whose nomination and/or election to the Board was approved by a vote of at least
a majority of the directors then still in office who either were members of the
Board on the Effective Date or whose election or nomination for election after
the Effective Date was previously so approved, cease for any reason to
constitute a majority of the Board.
(e) Survival of Obligations. The obligations of the Company and the
Executive set forth in Section 2(b) (reimbursement of expenses), in this Section
6, Section 7 (confidentiality), Section 8 (assignment of inventions), Section 9
(return of property), Section 10 (non-solicitation), Section 11
(non-competition), and Section 12 (publications) will survive the termination of
Executive's employment hereunder, whether with or without cause or for Good
Reason.
7. Confidential Information.
(a) Company Information. The Executive agrees at all times during the
term of the Executive's employment or other involvement with the Company and
thereafter to hold in strictest confidence, and not to use, except for the
benefit of the Company, or to disclose to, or permit the use by, any person,
firm or corporation without written authorization of its Board of Directors, any
Confidential Information of the Company. The Executive understands that
"Confidential Information" means any Company proprietary information, technical
data, trade secrets or know-how or other business information disclosed to the
Executive by the Company, either directly or indirectly in writing, orally or by
drawings or inspection of parts or equipment, including, but not limited to:
(i) medical and drug research and testing results and information,
research and development techniques, processes, methods, formulas, trade
secrets, patents, patent applications, computer programs, software, electronic
codes, mask works, inventions, machines, innovations, ideas, designs, creations,
writings, books and other works of authorship, discoveries, improvements, data,
formats, projects and research projects;
(ii) information about costs, profits, markets, sales, contracts
and lists of customers, and distributors, business, marketing, and strategic
plans; forecasts, unpublished financial information, budgets, projections, and
customer identities, characteristics and agreements as well as all business
opportunities, conceived, designed, devised, developed, perfected or made by the
Executive whether alone or in conjunction with others, and related in any manner
to the actual or anticipated business of the Company or to actual or anticipated
areas of research and development; and
(iii) employee personnel files and compensation information.
The Executive further understands that Confidential Information does
not include any of the foregoing items which (A) has become publicly known or
made generally available to the public through no wrongful act of the Executive,
(B) has been disclosed to the Executive by a third party having no duty to keep
Company matters confidential, (C) has been developed by the Executive
independently of employment by the Company, (D) has been disclosed by the
Company to a third party without restrictions on disclosure, or (E) has been
disclosed with the Company's written consent. The Executive further agrees that
all Confidential Information shall at all times remain the property of the
Company.
(b) Third Party and Former Employer Information. The Executive agrees
that the Executive will not improperly use or disclose any proprietary
information or trade secrets of any former employer or other person or entity
with which the Executive has an agreement or duty to keep in confidence
information acquired by the Executive and that the Executive will not bring onto
the premises of the Company any unpublished document or proprietary information
belonging to any such employer, person or entity unless consented to in writing
by such employer, person or entity.
(c) Future Third Party Information. The Executive recognizes that the
Company has received and in the future will receive from third parties their
confidential or proprietary information subject to a duty on the Company's part
to maintain the confidentiality of such information and to use it only for
certain limited purposes. The Executive agrees to hold all such confidential or
proprietary information in the strictest confidence and not to disclose it to
any person, firm or corporation or to use it except as necessary in carrying out
the Executive's work for the Company consistent with the Company's agreement
with such third party.
(d) Prior Actions and Knowledge. The Executive represents and warrants
that from the time of the Executive's first contact with the Company, the
Executive has held in strict confidence all Confidential Information and has not
disclosed any Confidential Information, directly or indirectly, to anyone
outside the Company, or used, copied, published, or summarized any Confidential
Information, except to the extent otherwise permitted in this Agreement.
(e) Third Parties. The Executive will not disclose to the Company or
use on its behalf any confidential information belonging to others, and the
Executive will not bring onto the premises of the Company any confidential
information belonging to any such party unless consented to in writing by such
party.
8. Inventions.
(a) Inventions Retained and Licensed. Attached hereto, as Exhibit A, is
a list describing all ideas, processes, trademarks, service marks, inventions,
designs, technologies, computer hardware or software, original works of
authorship, formulas, discoveries, patents, copyrights, copyrightable works,
products, marketing and business ideas, and all improvements, know-how, data,
rights, and claims related to the foregoing, whether or not patentable,
registrable or copyrightable, which were conceived, developed or created by the
Executive prior to Executive's employment or first contact with the Company
(collectively referred to as "Prior Inventions"), (A) which belong to the
Executive, (B) which relate to the Company's current or contemplated business,
products or research and development, and (C) which are not assigned to the
Company hereunder. If there is no Exhibit A or no items thereon, the Executive
represents that there are no such Prior Inventions. If in the course of
Executive's employment with the Company, the Executive incorporates or embodies
into a Company product, service or process a Prior Invention owned by the
Executive or in which the Executive has an interest, the Company is hereby
granted and shall have a nonexclusive, royalty-free, irrevocable, perpetual,
worldwide license to make, have made, modify, use and sell such Prior Invention
as part of or in connection with such product, service or process.
(b) Assignment of Intellectual Property Items. The Executive agrees
that Executive will promptly make full written disclosure to the Company and
will hold in trust for the sole right and benefit of the Company, and the
Executive hereby assigns to the Company, or its designee, all of the Executive's
right, title and interest in and to any and all ideas, processes, trademarks,
service marks, inventions, designs, technologies, computer hardware or software,
original works of authorship, formulas, discoveries, patents, copyrights,
copyrightable works, products, marketing and business ideas, and all
improvements, know-how, data, rights, and claims related to the foregoing,
whether or not patentable, registrable or copyrightable, which the Executive
may, on or after the Effective Date, solely or jointly with others conceive or
develop or reduce to practice, or cause to be conceived or developed or reduced
to practice, during the period of time the Executive is in the employ of the
Company (collectively referred to as "Intellectual Property Items"); and the
Executive further agrees that the foregoing shall also apply to Intellectual
Property Items which relate to the business of the Company or to the Company's
anticipated business as of the end of the Executive's employment and which are
conceived, developed, or reduced to practice during a period of one year after
the end of such employment. Without limiting the foregoing, the Executive
further acknowledges that all original works of authorship which are made by the
Executive (solely or jointly with others) within the scope of the Executive's
employment and which are protectable by copyright are works made for hire as
that term is defined in the United States Copyright Act.
(c) Maintenance of Records. The Executive agrees to keep and maintain
adequate and current written records of all Intellectual Property Items made by
the Executive (solely or jointly with others) during the term of the Executive's
employment with the Company. The records will be in the form of notes, ketches,
drawings, and any other format that may be specified by the Company. The records
will be available to, and remain the sole property of, the Company at all times.
(d) Patent and Copyright Registrations. The Executive agrees to assist
the Company, or its designee, at the Company's expense, in every proper way to
secure the Company's rights in the Intellectual Property Items and any
copyrights, patents, mask work rights or other intellectual property rights
relating thereto in any and all countries, including the disclosure to the
Company of all pertinent information and data with respect thereto and the
execution of all applications, specifications, oaths, assignments and all other
instruments which the Company shall deem necessary in order to apply for and
obtain such rights and in order to assign and convey to the Company, its
successors, assigns and nominees the sole and exclusive rights, title and
interest in and to such Inventions, and any copyrights, patents, mask work
rights or other intellectual property rights relating thereto.
(e) No Use of Name. The Executive shall not at any time use the
Company's name or any of the Company trademark(s) or trade name(s) in any
advertising or publicity without the prior written consent of the Company.
9. Return of Company Property.
The Executive agrees that, at any time upon request of the Company, and in any
event at the time of leaving the employ of the Company, Executive will deliver
to the Company (and will not keep in the Executive's possession or deliver to
anyone else) any and all devices, records, data, notes, reports, proposals,
lists, correspondence, specifications, drawings, blueprints, sketches,
materials, equipment, other documents or property, or reproductions of any of
the aforementioned items, containing Confidential Information or otherwise
belonging to the Company, its successors or assigns, whether prepared by the
Executive or supplied to the Executive by the Company.
10. Non-Solicitation.
The Executive agrees that Executive shall not during the Executive's employment
or other involvement with the Company and for a period of twelve (12) months
immediately following the termination of the Executive's employment with the
Company for any reason, whether with or without cause, (i) either directly or
indirectly solicit or take away, or attempt to solicit or take away employees of
the Company, either for the Executive's own business or for any other person or
entity, or (ii) either directly or indirectly recruit, solicit or otherwise
induce or influence any proprietor, partner, stockholder, lender, director,
officer, employee, sales agent, joint venturer, investor, lessor, supplier,
customer, agent, representative or any other person which has a business
relationship with the Company to discontinue, reduce or modify such employment,
agency or business relationship with the Company.
11. Covenants Against Competition.
(a) Definitions. For the purposes of this Section:
(i) "Competing Product" means any product, process, or service
of any person or organization other than the Company, in existence or under
development (A) which is identical to, substantially the same as, or an adequate
substitute for any product, process, or service of the Company, in existence or
under development, based on any patent or patent application (provisional or
otherwise) naming Executive as inventor thereunder and which Executive has
assigned or licensed to the Company, or other intellectual property of the
Company about which the Executive acquires Confidential Information, and (B)
which is (or could reasonably be anticipated to be) marketed or distributed in
such a manner and in such a geographic area as to actually compete with such
product, process or service of the Company.
(ii) "Competing Organization" means any person or
organization, including the Executive, engaged in, or about to become engaged
in, research on or the acquisition, development, production, distribution,
marketing, or providing of a Competing Product.
(b) Non-Competition. As a material inducement to the Company to employ
or continue the employment of the Executive, and in order to protect the
Company's Confidential Information and good will, the Executive agrees to the
following stipulations:
(i) For a period of twelve (12) months after termination of
the Employee's employment with the Company or its affiliates for any reason,
whether with or without cause, the Employee will not directly or indirectly
solicit or divert or accept business relating in any manner to Competing
Products or to products, processes or services of the Company, from any of the
customers or accounts of the Company with which the Employee had any contact as
a result of the Executive's employment.
(ii) For a period of six (6) months after termination of the
Executive's employment with the Company for any reason, whether with or without
cause, the Executive will not (A) render services directly or indirectly, as an
employee, consultant or otherwise, to any Competing Organization in connection
with research on or the acquisition, development, production, distribution,
marketing or providing of any Competing Product, or (B) own any interest in any
Competing Organization.
(c) Modification of Restrictions. The Executive agrees that the
restrictions set forth in this Section are fair and reasonable and are
reasonably required for the protection of the interests of the Company. However,
should an arbitrator or court nonetheless determine at a later date that such
restrictions are unreasonable in light of the circumstances as they then exist,
then the Executive agrees that this Section shall be construed in such a manner
as to impose on the Executive such restrictions as may then be reasonable and
sufficient to assure Company of the intended benefits of this Section.
12. Publications.
The Executive agrees that Executive will in advance of publication
provide the Company with copies of all writings and materials which Executive
proposes to publish during the term of the Executive's employment and for two
years thereafter. The Executive also agrees that Executive will, at the
Company's request, cause to be deleted from such writings and materials any
information disclosing Confidential Information. The Company's good faith
judgment in these matters will be final. At the Company's sole discretion, the
Executive will also, at the Company's request, cause to be deleted any reference
whatsoever to the Company from such writings and materials.
13. Equitable Remedies.
The Executive agrees that it would be impossible or inadequate to
measure and calculate the Company's damages from any breach of the covenants set
forth in Sections 7, 8, 9, 10 and 11 herein. Accordingly, at the sole discretion
of the Company, the Executive agrees that if Executive breaches any of such
Sections, the Company will have, in addition to any other right or remedy
available, the right to obtain an injunction from a court of competent
jurisdiction restraining such breach or threatened breach and to specific
performance of any such provision of this Agreement and, if it prevails in such
a proceeding, the right to recover from the Executive the costs and expenses
thereof, including reasonable attorneys' fees.
14. Representations and Warranties of Executive.
The Executive represents and warrants as follows: (i) that the
Executive has no obligations, legal or otherwise, inconsistent with the terms of
this Agreement or with the Executive's undertaking a relationship with the
Company; and (ii) that Executive has not entered into, nor will Executive enter
into, any agreement (whether oral or written) in conflict with this Agreement.
15. Miscellaneous.
(a) Entire Agreement. This Agreement contains the entire understanding
of the parties with respect to the subject matter. It may not be changed orally
but only by an agreement in writing signed by the party against whom enforcement
of any waiver, change, modification, extension or discharge is sought.
(b) No Waiver. The failure of either party to insist on strict
compliance with the terms of this agreement in any instance or instances will
not be deemed a waiver of any such term of this Agreement or of that party's
right to require strict compliance with the terms of this Agreement in any other
instance.
(c) Successors and Assigns. This Agreement shall be binding on and
inure to the benefit of the successors in interest of the parties, including, in
the case of the Executive, the Executive's heirs, executors and estate. The
Executive may not assign the Executive's obligations under this Agreement. The
Company may not assign its obligations under this Agreement, except with the
prior written consent of the Executive.
(d) Notices. Any notices or other communications provided for hereunder
may be made by fax, email, first class mail or express courier services provided
that the same are addressed to the party required to be notified at its address
first written above, or such other address as may hereafter be established for
notices, and any notices or other communications sent by first class mail shall
be considered to have been made when posted. The parties fax numbers are is
follows: Company - (617) 928-3450.
(e) Severability. If any term or condition of this Agreement shall be
invalid or unenforceable to any extent or in any application, then the remainder
of this Agreement, and such term or condition except to such extent or in such
application, shall not be affected thereby, and each and every term and
condition of this Agreement shall be valid and enforceable to the fullest extent
and in the broadest application permitted by law.
(f) Captions; Gender Captions of sections herein are for convenience
only and are not intended to cover all matters therein. Any pronoun or other
gender-linked term shall in each case refer, as applicable, to the masculine,
feminine or neuter. Any defined term shall include it singular or plural form or
other part of speech.
(g) Governing Law. This Agreement shall be construed and enforced in
accordance with the laws of The Commonwealth of Massachusetts without giving
effect to its principles on conflict of laws.
IN WITNESS WHEREOF, the parties hereto have executed this Employment
Agreement as of the date and year first above written.
PRO-PHARMACEUTICALS, INC.
By: /s/ David Platt
--------------------------
Name: David Platt
Title: Chief Executive Officer
By: /s/ Maureen E. Foley
-------------------------
Name: Maureen E. Foley
Title: Chief Operating Officer
Exhibit A
List of Prior Inventions
and Original Works of Authorship
--------------------------------
Identifying
Number or
Title Date Brief Description
----- ---- -----------------
Not Applicable
Name of
Employee: ____________________________________________
Maureen E. Foley