Exhibit
10.1


 


AGREEMENT


 


AGREEMENT made this 21st
day of May, 2004 (hereinafter referred to as the “Agreement”), by and
between Sim Fass, an individual residing at 
8 Hamlin Road, Edison, New Jersey 08817 (hereinafter referred to as “Executive”
or “Dr. Fass”), and Savient Pharmaceuticals, Inc., a Delaware
corporation (formerly known as Bio-Technology General Corp.) with an office at
One Tower Center, 14th Floor, East Brunswick, New Jersey 08816
(hereinafter referred to as “Savient” or the “Company”).


 


W  I  T  N  E  S  S
E  T  H :


 


WHEREAS, Executive has
been an executive officer of the Company since August 1983 and the Chief
Executive Officer of the Company since May 1984;


 


WHEREAS, Executive and
the Company are party to an employment agreement dated January 1, 2002 (the “Employment
Agreement”);


 


WHEREAS, Executive now
desires to retire from all positions with the Company and to end his employment
relationship with the Company effective upon the conclusion of the Company’s
2004 Annual Meeting of Stockholders;


 


WHEREAS, the Company, in
recognition of the services provided by Executive to the Company since August
1983, desires to provide Executive with certain retirement benefits.


 


NOW, THEREFORE, in
consideration of the promises and of the representations, agreements and
obligations herein contained, the parties hereto agree as follows:


 


1.             Executive hereby retires as
Chairman of the Board and Chief Executive Officer of the Company effective upon
the conclusion of the Company’s 2004 Annual Meeting of Stockholders (the “Retirement
Date”) and the Employment Agreement shall be terminated and no longer be of
any force or effect as of the Retirement Date, and effective as of the
Retirement Date, Executive shall have no further rights under the Employment
Agreement other than for the payment of accrued but unpaid salary, payment for
accrued but unused vacation days and reimbursement of expenses in accordance
with Article VI of the Employment Agreement through the Retirement Date.  Effective as of the Retirement Date,
Executive hereby resigns as an officer and director of Bio-Technology General
(Israel) Ltd., Acacia Biopharma Ltd., Rosemont Pharmaceuticals Limited and
Myelos Corporation.


 


2.             In recognition of Executive’s
services to the Company since August 1983, the Company agrees to pay Executive
a special retirement award of $1,928,000 (the “Retirement Payment”).  The Retirement Payment shall be paid in cash
to Executive in equal bi-weekly installments, less any applicable tax
withholding, over a period of thirty months. Such payments shall be made on the
same dates that the Company pays its employees, commencing on the first such
date following the Retirement Date. 
Executive may elect, upon written notice to the Company given at least twenty
(20) days prior to the Retirement Date, to


 

















 


have the Retirement Payment paid in a lump sum, in which event (i) all
but $723,000 of the Retirement Payment shall be discounted at the rate of 7.5%
per annum, (ii) all but $50,000 of such discounted amount (less applicable tax
withholding) shall be paid on the first payroll date following the Retirement
Date and (iii) $50,000 of the Retirement Payment (less applicable tax
withholding) shall be paid on the first anniversary of the Retirement Date as
long as Executive has not violated the provisions of paragraphs 8 and 9 hereof.


 


3.             The Company shall provide to
Executive a continuation of the welfare benefits of health care, life and
accidental death and dismemberment insurance coverage (or if continuation under
the Company’s then current plans is not allowed, then provision at the
Company’s expense, but subject to payment by Executive of those payments which
Executive would have been obligated to make under the Company’s then current
plan, of substantially similar welfare benefits from one or more third party
providers) for a period of thirty (30) months after the Retirement Date (the “Post-Retirement
Period”).  These benefits shall be
provided to Executive at the same coverage level as in effect as of the
Retirement Date, and at the same premium cost to Executive which was paid by
Executive at the time such benefits were provided.  However, in the event the premium cost and/or level of coverage
shall change for all employees of the Company, or for management employees with
respect to supplemental benefits, the cost and/or coverage level, likewise,
shall change for Executive in a corresponding manner.  The continuation of these welfare benefits shall be discontinued
if, prior to the expiration of the Post-Retirement Period, Executive has
available substantially similar benefits at a comparable cost to Executive from
a subsequent employer, as determined by the Compensation Committee of the
Company’s Board of Directors (or, in the event the Compensation Committee
ceases to exist, the Board of Directors). 
Executive covenants that he will promptly notify the Company if he
becomes eligible for health care, life and/or accidental death and
dismemberment insurance coverage from another employer.  The continuation of healthcare coverage
provided to Executive and his dependents pursuant to this paragraph 3 is being
provided as an alternative to continuation coverage under the Consolidated
Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”).  Executive acknowledges and agrees that he
and his dependents shall have no right to continuation coverage under COBRA
following the cessation of such alternative coverage.


 


4.             Executive shall be entitled to
53.0% of any target bonus he would have earned under the Company’s bonus
program if he had remained an employee through the end of 2004.  The parties acknowledge that under the
Company’s bonus program Executive’s target bonus is 60% of his 2004 base salary
if the targets established by the Compensation Committee are met.  The determination of Executive’s bonus
pursuant to this paragraph will be based on the same revenue, EPS and strategic
targets established for all senior executives of the Company, as well as on the
individual goals for Executive previously established by the Compensation
Committee, it being understood that the Compensation Committee has discretion
to make changes to the bonus calculations based on their view of overall
corporate performance.  Executive
acknowledges and understands that there is no assurance that any bonus will be
earned under the bonus program.  All
other outstanding long-term incentive awards shall be subject to the treatment
provided under the applicable long-term incentive plan of the Company and all
other benefits to which Executive has a vested right at the Retirement Date,
according to the provisions of the governing plan or program.


 


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5.             Executive agrees that as of the
Retirement Date, he will have returned all property of the Company, including
but not limited to, any computers (other than the computers located at
Executive’s homes which Executive shall be entitled to retain), blackberry
devices, telephones, documents, books, records (whether in electronic format or
hard copy), reports, files, correspondence, notebooks, manuals, notes,
specifications, mailing lists, credit cards and data in his possession or
control.  Notwithstanding the foregoing,
Executive shall have the right remove from the Company’s premises the works of
art and other personal items that Executive owns.  Executive shall also have the right to continue to use the car
leased for him in the United States until the end of the lease term in June 30,
2005, it being agreed that the Company shall continue to make the lease
payments but Executive shall be responsible for all other costs associated with
the car, including maintaining insurance on the vehicle and the cost of
repairs.  Within thirty (30) days prior
to the expiration of the lease term for such car, Executive shall provide
notice to the Company of his intention to either purchase the car with his own
funds or return the car to its lessor upon the expiration of the lease.  The Company agrees to transfer to Executive
the car provided to him in Israel, provided, however, that Executive shall be
responsible for any taxes incurred in connection with the transfer of title and
ownership from the Company to Executive.


 


6.             Executive shall not make any
statements, either directly or through other persons or entities, which are
disparaging to the Company or any of its affiliates, management, officers,
directors, services, products, operations, prospects or other matters relating
to the Company’s businesses now or in the future.  The Company, and its officers and directors shall not make any
statements, either directly or through other persons or entities, which are
disparaging to Executive now or in the future. 
The parties agree that a breach of the provisions of this paragraph 6
shall constitute a material breach of the Agreement.


 


7.             Executive recognizes that he had
access to and knowledge of confidential and proprietary information of the
Company and its subsidiaries (collectively, the “Savient Group”) that is
essential to the performance of his duties. 
Executive agrees that he will not, in whole or in part, disclose such
information to any person, firm, corporation, association, or other entity for
any reason or purpose whatsoever, nor shall he make use of any such information
for his own purposes, so long as such information has not otherwise been
disclosed to the public or is not otherwise in the public domain except as
required by law or pursuant to administrative or legal process.  The parties agree that a breach of the
provisions of this paragraph 7 shall constitute a material breach of the
Agreement.


 


8.             For a period of twelve (12) months
following the Retirement Date, Executive agrees not to actively solicit any
employee of the Savient Group to terminate his or her employment with any
member of the Savient Group or to interfere in a similar manner with the
business of the Savient Group.  The
parties agree that a breach of the provisions of this paragraph 8 shall
constitute a material breach of the Agreement.


 


9.             For a period of twelve (12) months
following the Retirement Date, Executive will not:  (a) directly or indirectly own any equity or proprietary interest
in (except for ownership of shares in a publicly traded company not exceeding
three percent (3%) of any class of outstanding securities), or be an employee,
agent, director, advisor, or consultant to or for any competitor of the Savient
Group, whether on his own behalf or on behalf of any


 


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person; or (b) undertake any action to induce or cause any customer or
client to discontinue any part of its business with any member of the Savient
Group.  The parties agree that a breach
of the provisions of this paragraph 9 shall constitute a material breach of the
Agreement.  The Company and Executive
agree that $200,000 of the Retirement Payment is allocated to Executive’s
agreement under this paragraph 9.


 


10.           Executive agrees that he will
cooperate with the Company following the Retirement Date by making himself
reasonably available to testify on behalf of the Company or any subsidiary or
affiliate of the Company in any action, suit, or proceeding, whether civil,
criminal, administrative, or investigative, and to reasonably assist the
Company or any such subsidiary or affiliate in any such action, suit, or
proceeding by providing information and meeting and consulting with the Board
or its representatives or counsel, or representatives or counsel to the Company
or any such subsidiary or affiliate, as reasonably requested; provided,
however, that the same does not materially interfere with his then current professional
activities.  The Company will reimburse
Executive for all out-of-pocket expenses reasonably incurred by him in
connection with his provision of testimony or assistance; provided that if
Executive is required to provide testimony or assistance (other than in any
proceeding in which Executive is a named party) at any time after January 12,
2007, and at such time Executive is not serving as a director of the Company,
the Company will pay Executive a per diem of $1,850 (pro rated to the extent
less than a full day).  The parties
agree that a beach of the provisions of this paragraph 10 shall constitute a
material breach of this Agreement.


 


11.           Nothing in this Agreement shall
effect the Company’s obligation to indemnify and hold harmless Executive to the
extent provided in the Company’s Certificate of Incorporation and Bylaws in
effect on the date hereof or as required by that certain Indemnification
Agreement, dated May 13, 1987, between the Company (formerly known as
Bio-Technology General Corp.) and Executive.


 


12.           The Company and Executive agree that
Executive will be included in management’s slate of nominees for election as a
director at the 2004 Annual Meeting of Stockholders.


 


13.           Executive acknowledges and agrees
that damages in an action at law for breach of any of the provisions of
paragraphs 6, 7, 8, 9 and 10 will be difficult to determine and will not afford
a full and adequate remedy and, therefore, agrees that the Company, in addition
to seeking damages in an action at law, may seek specific performance and such
equitable or other remedies as may be available for breach of these paragraphs,
including, without limitation, the issuance of a temporary or permanent
injunction, without the necessity of a bond.


 


14.           Executive represents that he has no
cause of action or other claim against the Company, other than a claim for
indemnification as described in paragraph 11 above.  Executive represents that he has been represented by an attorney
of his choice regarding the terms of this Agreement


 


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15.           Any notice to be given hereunder
shall be in writing and shall be deemed given when mailed by certified mail,
return receipt requested, addressed as follows:


 


	
  To Dr. Fass at:

  	
   

  	
  8 Hamlin Road

  
	
   

  	
   

  	
  Edison, New Jersey 08817

  
	
   

  	
   

  	
   

  
	
  With a copy to:

  	
   

  	
  Schulte Roth & Zabel LLP

  
	
   

  	
   

  	
  919 Third Avenue

  
	
   

  	
   

  	
  New York, New York 
  10022

  
	
   

  	
   

  	
  Mark Brossman, Esq.

  
	
   

  	
   

  	
   

  
	
  To the Company at:

  	
   

  	
  Savient Pharmaceuticals, Inc.

  
	
   

  	
   

  	
  One Tower Center, 14th Floor

  
	
   

  	
   

  	
  East Brunswick, New Jersey

  
	
   

  	
   

  	
  Attention: 
  Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
  With a copy to:

  	
   

  	
  Fulbright & Jaworski L.L.P.

  
	
   

  	
   

  	
  666 Fifth Avenue

  
	
   

  	
   

  	
  New York, New York 
  10103

  
	
   

  	
   

  	
  Attention: 
  Roy L. Goldman, Esq.

  



 


or at such other
address as may be indicated in writing by any party to the other parties in the
manner provided herein for giving notice.


 


16.           In the event that any provision or
portion of this Agreement shall be determined to be invalid or unenforceable
for any reason, the remaining provisions of this Agreement shall be unaffected
thereby and shall remain in full force and effect.


 


17.           The Company shall withhold from any
benefits payable under this Agreement all federal, state, local or other taxes
as may be required pursuant to any law or governmental regulation or ruling.


 


18.           With the exception of the Company’s
willful material breach of its payment obligations under paragraphs 2, 3 and 4
of this Agreement (provided, however, that no such breach shall be deemed to
have occurred until Executive has provided the Company’s Board of Directors with
written notice of such breach and a reasonable opportunity for cure), which
breach if not cured after notice as provided above shall constitute a material
breach of the Agreement, the covenants contained in paragraphs 6, 7, 8, 9 and
10 hereof are independent of any other contractual obligations in this
Agreement or otherwise owed by the Company to Executive. Except as provided in
this paragraph, the existence of any claim or cause of action by Executive
against the Company, whether based on this Agreement or  otherwise, shall not create a defense to the
enforcement by the Company of any restrictive covenant contained herein.


 


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19.           This Agreement shall be construed in
accordance with, and be governed by the substantive laws of the State of New
Jersey, without giving effect to any principles of conflicts of law.


 


20.           Each of the parties agrees to do and
perform or cause to be done and performed all further acts and shall execute
and deliver all other documents necessary on its part to carry out the intent
and accomplish the purposes of this Agreement and the transaction contemplated
hereby.


 


21.           The Company shall reimburse Executive
up to an aggregate of $15,000 for legal and tax consultation fees and expenses
incurred by Executive in connection with the negotiation and execution of this
Agreement.


 


22.           All rights that Executive has under
any option agreement shall continue after the Retirement Date in accordance
with the terms of such agreement.


 


23.           This Agreement shall be binding upon
the Company and its successors and assigns and shall inure to the benefit of
Executive and his spouse, heirs, successors, assigns, executors, personal
representatives, or other legal representatives.


 


24.           In the event of Executive’s death,
the Company shall pay to Executive’s estate or legal representative any unpaid
amounts set forth in paragraphs 2 and 4 of this Agreement, and allow his
dependents to continue to receive the health care benefits set forth in
paragraph 3 that they were receiving prior to his death until the expiration of
the Post-Retirement Period.


 


25.           This Agreement sets forth the entire
agreement between the parties hereto concerning the subject matter hereof and
may not be changed or terminated without the written consent of each of the
parties.


 


[SIGNATURES ON FOLLOWING PAGE]


 


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IN WITNESS WHEREOF, the
parties have each executed this Agreement as of the date first written above.


 


 


	
   

  	
  SAVIENT PHARMACEUTICALS, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
      /s/
  Christopher Clement

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Christopher Clement

  
	
   

  	
   

  	
  Title:

  	
  President and Chief Operating Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Sim Fass

  	
   

  
	
   

  	
  Sim Fass

  
							



 


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