Exhibit 10.39

 

DIRECTORSHIP AGREEMENT

 

By and between:

 

Prime European Therapeuticals S.P.A., with registered office in Milan, Viale
Bianca Maria, n. 25, Italian VAT registration number 07254610152, in person of
Mariesa Beth Coppola ("Euticals" or the "Company");

 

AMRI Albany Molecular Research Inc., with registered office in 26 Corporate
Circle, Albany, NY 12212, in person of Mariesa Beth Coppola ("AMRI");

- on the one side -

 

and

 

Ms. Margalit Fine, (the "Director"; together with the Company and AMRI, the
"Parties")

 

-on the other side -

 

WHEREAS

 

i.On May 5, 2016 AMRI Inc. and Lauro Cinquantasette Spa with registered office
in via del Lauro n. 7, Italian VAT registration number 04849340965 ("Lauro
Cinquantasette"),have signed that certain Sale and Purchase Agreement ("SPA")
for the purchase and sale of 100% of Euticals (the "Transaction") which is
expected to be completed within July 11, 2016 (the "Closing Date");

 

ii.The Parties acknowledge that the Director has been the director and Managing
Director of Euticals and Lauro Cinquantasette (the "Old Offices") until 5 July
2016, when she has given her resignations effective the date of the Transaction;

 

iii.Effective as of the Closing Date, the Parties desire that the Director shall
vest the office of director and be appointed as Managing Director of Euticals
and the Executive Vice President - API Business Unit of AMRI, reporting to the
Chief Operating Officer of AMRI;

 

iv.The Director is willing to accept the appointments under point (iii) above,
with the related powers that shall be delegated to her within such appointments
on the terms and conditions set forth herein (the "Agreement").

 

*    *    *

 

In consideration of the foregoing recitals, which form an integral and
substantive part of this Agreement, the Parties agree as follows.

 

1.Appointment

 

1.1.          Pursuant to the provisions of the SPA, on the Closing Date, AMRI
shall cause Eutical's parent company to appoint the Director as a director of
Euticals.

 

1.2.          Upon such appointment, AMRI shall have Euticals' parent company to
cause the competent corporate body of Euticals to resolve as follows: (a)
appoint the Director as managing director of Euticals; and (b) grant the
Director with certain powers necessary to perform her role as managing director
of the Company and (c) appoint the Director as Executive Vice President of its
API Division (the aforementioned offices, present and/or future, within the
Company shall be collectively referred to as the "Offices"). The powers to be
granted with such appointment are listed in Annex 1; and are effective as of the
date thereof.

 

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1.3.          The Parties hereby acknowledge and agree that, for the entire
duration of this Agreement and the Offices, certain powers will be retained to
the exclusive competence Euticals' Board of Directors ("BOD") or granted to
other members of the same BOD. In particular, but not in limitation, the Parties
agree that the powers and responsibilities of the Datore di Lavoro (as
contemplated in Italian Legislative Decree 81/2008 as amended), environmental
Gestore, and responsibility for privacy / treatment of personal data will be
retained by BOD or be granted to other members of the BOD or to other persons.

 

1.4.           The Director acknowledges that the powers set out in Annex 1 are
suitable to allow her to manage the Company and undertakes to exercise them in
accordance with the guidelines of the BOD, the terms and conditions of this
Agreement and the Company' By-laws, a copy of which guidelines and By-laws the
Company has provided to the Director.

 

1.5.           The Director hereby undertakes to accept the Offices and hold
them for the entire duration of this Agreement.

 

2.              Director's Duties and Responsibilities

 

2.1.           For the entire duration of this Agreement, the Director will have
the duties of director and managing director of the Company and, pursuant to
Article 2392 of the Italian Civil Code ("ICC"), perform her duties as set forth
by law and the Company's By-laws using the diligence requested by the nature of
her assignment and by her specific competence.

 

2.2.           The Director, in her capacity as director and managing director
of the Company, for the entire duration of this Agreement, will be responsible
for the business management and administration of the Company with reference to
all managerial aspects in respect of the powers granted and will act in
compliance with the general and specific guidelines provided for by the
Company's BOD and the AMRI Chief Executive Officer and Chief Operating Officer
as appointed by the parent company of the Company for the achievement of the
Company business objectives.

 

2.3.           The Director will report to the AMRI Chief Operating Officer as
appointed by the Company parent company and to the BOD, according to law and at
the BOD's requests.

 

3.              Remuneration, expenses and benefits

 

3.1.           As partial consideration under the Agreement for the Director's
performance of the role of managing director of Euticals and all other roles
that she may be given in AMRI, including her role as Executive Vice President,
API Division, the Manager shall receive an aggregate annual base gross
remuneration of EUR Three Hundred Fifty Thousand (Euro350K) (the "Base Gross
Remuneration"). AMRI shall have Euticals' parent company to cause the competent
corporate bodies of Euticals to resolve to make such payments to the Director,
for the whole duration of the Offices.

 

3.2.           The Base Gross Remuneration will be paid, net of all fiscal and
social security deductions, in 12 (twelve) monthly instalments of equal amount,
at the end of each relevant calendar month.

 

3.3.           The Director shall also be eligible to receive a bonus, with
reference to 2016 financial year, pursuant to Section 3.4 and the terms
indicated under Annex 2 (the "Bonus"). For all financial years of the Initial
Term and the Renewal Term after 2016, the Director shall be eligible to
participate in the bonus program that may be made available to the other
executive officers of AMRI.

 

3.4.           The Bonus will be paid, net of all fiscal and social security
deductions, at the same time that all bonuses, if any, are paid to the executive
team of AMRI for financial year 2016, which is expected following completion of
the annual financial audit and prior to March 31, 2017.

 

3.5.           The Director shall be granted by the competent corporate bodies
of AMRI a certain number of Restricted Stock Units for shares in AMRI ("RSUs")
as per the terms indicated under Annex 3.

 

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3.6           The Director acknowledges and agree that the (i) Base Gross
Remuneration, (ii) the Bonus (to the extent payable) and any other bonus payable
to the Director under any bonus program for which it she is eligible pursuant to
Section 3.3, and the RSUs and any other Restricted Stock Units, Stock Options or
similar programs for which she may become eligible and be granted in AMRI's sole
discretion include any and all compensation regarding the Offices and any other
offices that the Director may hold in the AMRI group of companies, and for any
activity that the Director may perform in favour of the Company or in favour of
any other company of such Group.

 

3.7.           The Director shall be entitled to receive by the Company the
reimbursement of all costs and expenses borne by reason of her Offices, in a
manner consistent with Euticals' practice, provided that the Director will have
submitted the relevant documentary evidence of such expenses and costs. AMRI
shall have Euticals' parent company to cause the competent corporate bodies of
each to resolve to make such reimbursements to the Director, for the whole
duration of the Offices.

 

3.8           The Director shall be provided with fringe benefits, including a
life insurance, a health insurance, and liability insurance coverage in line
with fringe benefits and insurances usually granted to directors of a comparable
level and usually considered as reasonable by companies of a size comparable to
the size of Euticals, that are granted in accordance with the policies of the
Company and AMRI. It is agreed between the Parties that such fringe benefits
will include: a full health insurance policy, whose annual cost will up to Euro
5.000,00 gross; company credit card (to be used only for business purposes);
cell phone with subscription; personal computer with internet connection; office
spaced in the company office in Lodi, with support of a personal assistant;
reimbursement of the annual fees and expenses of her tax advisor for the
preparation of the annual tax report (dichiarazione dei redditi) and for the
preparation of the tax report to be filed immediately after the termination of
this Agreement; and any other fringe benefits the Director was receiving from
Eutiicals in consideration of her carrying out the Old Offices. AMRI shall have
Euticals' parent company to cause the competent corporate body of Euticals to
resolve to provide all the aforementioned fringe benefits to the Director, for
the whole duration of the Offices.

 

4.              Duration

 

4.1.           Subject to the provisions of Section 7 hereof, the initial term
of the Offices shall be for a period commencing on the appointment in accordance
with Section 1 and ending on the date of approval of the 2018 financial
statements of Euticals (the "Initial Term").

 

4.2           Subject to the provisions of Section 7 hereof, such term shall
automatically renew for an additional one year period, as further described
below, unless either the Director or an authorized officer of the Company or
AMRI provide to the other Parties written notice of non-renewal on or before
January 1, 2019. Such extension of the Initial Term shall be for a further
period lasting to the date of approval of the 2019 financial statements of
Euticals under the terms and conditions of this Directorship Agreement (the
"Renewal Term"). In case of such renewal after the Initial Term, AMRI shall have
Euticals parent company to cause the competent corporate bodies of Euticals to
confirm and renew the appointment of the Director in her Office for the Renewal
Term. For the sake of clarity, it remains understood that no Termination
Indemnity (as defined under Section 7 below) is due in case - for any reason -
any of the Parties decides (and notifies the other Parties of such decision) not
to renew after the Initial Term.

 

4.3.           Without prejudice to the Initial Term and Renewal Term of this
Agreement, or Director's rights hereunder, the Parties acknowledge that the
duration of the Offices will be regulated by the relevant corporate resolutions.

 

5.              Non-solicitation covenant

 

In the course of performing services hereunder and for a period of twelve (12)
months following the termination of the Offices for any reason, the Director
shall not, directly or indirectly, alone or as a member of any partnership or
limited liability company or entity, or as an officer, director, shareholder, or
employee of any corporation or entity (a) solicit or otherwise encourage any
employee or independent contractor of the Company to terminate her or his
relationship with the Company, or (b) recruit, hire or solicit for employment or
for engagement as an independent contractor, any person who is or was employed
by the Company at any time during the Offices with the Company. This paragraph
shall not apply to persons whose employment and/or retention with the Company
has already been terminated at the time of the recruitment, hiring or
solicitation.

 

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6.            Confidentiality

 

6.1.         In the course of performing services hereunder and otherwise in her
role and activities under the Office and the Old Offices, the Director has had,
and will from time to time, have access to confidential records, data, customer
lists, trade secrets, technology and similar confidential information owned or
used in the course of business by the Company and its subsidiaries and
affiliates (the "Confidential Information"). The Director agrees (i) to hold the
Confidential Information in strict confidence, (ii) not to disclose the
Confidential Information to any person outside of the Company (other than in the
regular business of the Company), and (iii) not to use, directly or indirectly,
any of the Confidential Information for any competitive or commercial purpose
outside of the commercial activities carried out for the Company; provided,
however, that the limitations set forth above shall not apply to any
Confidential Information which (A) Director can demonstrate with timely
documentation to have been known by her without disclosure from the Company
and/or any of their subsidiaries or affiliates, (B) is then generally known to
the public, (C) became or becomes generally known to the public through no fault
of the Director, or (D) is disclosed in accordance with an order of a court of
competent jurisdiction or applicable law. Upon termination of the Offices for
any reason, all data, memoranda, customer lists, notes, programs and other
papers and items, and reproductions thereof relating to the foregoing matters in
the Director's possession or control, shall be returned to Euticals and
thereafter shall remain in the Company's possession. This Section 6 shall
survive the termination of this Agreement for any reason.

 

7.            Termination

 

7.1.         In case of occurrence of a Bad Leaver circumstance, (within the
meaning indicated in Section 7.2 below) Euticals will be entitled to immediately
terminate this Agreement by providing written notice - with prior notice when
required by applicable law - and to revoke the Director from the Offices for
just cause pursuant to Article 2383 of the ICC (if necessary). In this event,
the Director will be entitled to receive no remuneration and/or other indemnity
and/or compensation by Euticals, exception made for the Base Gross Remuneration
due until the effective date of termination, without prejudice, however, to the
Euticals right to any claim for the damages suffered.

 

7.2.         Any of the following circumstances will be considered as a case of
"Bad Leaver":

 

7.2.1.           Director's resignation from the Offices unless in case such
resignation (i) has been requested - for other reasons than Just Cause - by the
Board of Directors of the Company or (ii) is grounded on material breach by the
Company of any of its obligations.

 

7.2.2.           Without prejudice to any mandatory or inderogable provisions of
applicable law, the following shall be considered just cause of revocation from
the Offices ("Just Cause"):

 

(i)        the Director is subject to an investigation, a trial and/or a
plea-bargain for a felony, which may reasonably be expected to bring Euticals or
any of the Group Companies into public disgrace or disrepute; and/or

 

(ii)       the commission by the Director of an act, or an omission, intended to
materially harm the business of the Company or any of the Group Companies;
and/or

 

(iii)      Director's gross negligence or wilful misconduct with respect to the
management of the Company or any of the Group Companies; and/or

 

(iv)      any act, event, omission or cause by the Director within the concept
of "just cause" according to the provisions of section 2383 of the ICC; and/or

 

(v)       serious breach of the Director's duties as provided for in the
Company's By-laws, or in any other relevant corporate resolution capable of
infringing the fiduciary relationship existing between the Company and the
Director; and/or

 

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(vi)      material breach by the Director of the provisions under sections 2390
or 2391 of the ICC; and/or

 

(vii)     material breach by the Director of any of its obligations under
Sections 2, or 5 or 6 of this Agreement;

 

(viii)    Director's death or impossibility to perform one or more of the
Offices for a period of 6 (six) months in a row or over the duration of this
Agreement.

 

7.3.         In case of occurrence of a circumstance of "Good Leaver" (within
the meaning indicated in Section 7.4 below), Euticals will be entitled to
terminate this Agreement and shall cause Euticals to pay to the Director, as
liquidated damages pursuant to Section 1382 of the ICC, a termination indemnity
('Termination Indemnity") equal to the Base Gross Remuneration which will be due
from the date of the occurrence of the Good Leaver and the natural expiration
date of the Initial Term (or Renewal Term, if this is the case), plus the pro
rata bonus (if any) accrued up to the effective date of termination of the Good
Leaver. In addition, the Director will remain entitled to retain any shares of
restricted stock which have already vested at that time pursuant to Annex 3 or,
in the case of other RSUs, pursuant to the vesting terms of any RSU Agreement(s)
signed between AMRI and the Director as at the date of the occurrence of the
Good Leaver. The Termination Indemnity covers any other possible claim or
damages or indemnity connected with the termination of the Directorship
Agreement, which could be raised by the Director.

 

7.4.         Any of the following circumstances will be considered as a case of
"Good Leaver":

 

7.4.1.Director's resignation from the Offices in case such resignation (i) has
been requested – for other reasons than Just Cause - by any of the Company or
(ii) is grounded on material breach by the Company of any of its obligations
under Section 3 above;

 

7.4.2.revocation from the Offices for other reasons than Just Cause.

 

7.5.         The payment of the Termination Indemnity to the Director due under
this Agreement, shall be subject to the execution by the Director - but solely
if and and to the extent that Company also carries out execution of a formal
settlement agreement with the Company, whereby the Director expressly waives any
and all other claims and/or demands (even of a compensatory and/or employment
requalification nature) - pursuant to Article 2383, paragraph 3, of the ICC
and/or Article 2113 of the ICC - relating to or arising from or connected with
the termination of this Agreement, the Offices, and/or any other relationship
among the Director, any of the Company and/or one or more of the Group
Companies.

 

8.            Conditions

 

8.1.         It remains understood that (i) should the Closing not occur within
later of (i) the Closing Date or (ii) the later date indicated by Euticals to
the Director or (iii) in any event at within December 31, 2016, or (ii) should
the Director not remain in the Old Offices until the Closing Date - the Parties
recognizing and agreeing that this is intended as the effective date of
Director's leaving the Old Offices, and not the date of her tendering
resignation - this Agreement shall become automatically null and void and/or
ineffective, without any need of communication between the Parties, and without
any entitlement to any reciprocal indemnities.

 

9.            Miscellaneous

 

9.1          The Agreement may only be amended in writing with amendments duly
signed by all the Parties.

 

9.2.         The failure of, or delayed or partial exercise, by the Parties, of
any right or remedy under this Agreement will not be construed as a waiver
thereof.

 

9.3.         In the event any provision of this Agreement should be declared
null and/or void, in whole or in part, the validity of any other provisions
hereof will not be affected and the provision which has been declared null
and/or void will be interpreted, to the possible extent, in accordance with the
original intention of the Parties.

 

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9.4.         For any matter not regulated hereunder, reference shall be made to
the ICC and other applicable provisions of Italian law.

 

9.5.         All notices, requests, demands and other communications required or
permitted hereunder will be in writing and will be deemed to have been duly
given when delivered by hand against acknowledgement of receipt or mailed,
certified or registered mail with postage prepaid, or sent by e- mail (followed
by courier) or courier, as follows:

 

if to the Director:

 

Name: Margalit Fine

Email address

 

if to Euticals:

 

Name: Mrs. Lori M. Henderson

Attn: Lori M. Henderson

Address: Viale Bianca Maria 25, 20122 Milan (Ml), Italy

Email address:

 

if to AMRI:

 

Name: Mrs. Lori M. Henderson

Address: 201 Jones Road, Waltham, MA 2451

Email address:

 

Any of the Parties may modify the address to which the notices, requests,
demands and other communications under this Agreement will be sent in respect of
that Party, by serving a relevant written notice upon the other Parties.

 

10.          Governing Law

 

10.1.        This Agreement is governed by Italian law.

 

11.           Language

 

11.1         This Agreement is drafted in English, except for Annex1 which is
drafted in Italian. 

 

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