**Exhibit 10.12**

 

**AMENDED AND RESTATEDEMPLOYMENT AGREEMENT**

 

ThisAMENDED AND RESTATED EMPLOYMENT AGREEMENT (this “Agreement”) is made andentered into as of the 24th day of January, 2006, by and between FIRST HORIZONPHARMACEUTICAL CORPORATION, a Delaware corporation (the “Company”) and **PATRICK FOURTEAU** (“Executive”).

 

**WITNESSETH:**

 

WHEREAS,Executive is employed by the Company pursuant to the terms and conditions ofthat certain Employment Agreement dated May 16, 2003 between the Companyand Executive as amended and restated September 17, 2003 (the “OriginalAgreement”): and

 

WHEREAS,the parties desire to amend and restate the terms and conditions of theOriginal Agreement, effective as of the date hereof;

 

NOW,THEREFORE, in consideration of Executive’s continued employment, the covenantsand mutual agreements set forth herein and other good and valuableconsideration, the receipt and sufficiency of which are hereby acknowledged,the parties hereto do hereby agree as follows:

 

1.     *Employment*.   Throughout the Term(as defined in Section 2 below), the Company shall employ Executive asprovided herein, and Executive hereby accepts such employment. In acceptingsuch employment, Executive states that, to the best of his knowledge, he is notnow, and by accepting such employment, will not be, under any restrictions inthe performance of the duties contemplated under this Agreement as a result ofthe provisions of any prior employment agreement or non-compete or similaragreement to which Executive is or was a party.

 

2.     *Term of Employment*.   The termof Executive’s employment by the Company hereunder shall continue thereafterunless sooner terminated as a result of Executive’s death or in accordance withthe provisions of Section 6 below (the “Term”).

 

3.     *Duties*.   Throughout the Term,and except as otherwise expressly provided herein, Executive shall be employedby the Company as the President and Chief Executive Officer of the Company.Executive shall devote his full time to the performance of his duties asPresident and Chief Executive Officer of the Company in accordance with theCompany’s By-laws, this Agreement and the directions of the Company’s Board ofDirectors and any executive officer of the Company who is senior to Executive.Without limiting the generality of the foregoing, throughout the Term Executiveshall faithfully perform his duties as President and Chief Executive Officerat all times so as to promote the best interests of the Company.

 

4.     *Compensation*.

 

(a)           *Salary*.   For any and allservices performed by Executive under this Agreement during the Term, inwhatever capacity, the Company shall pay to Executive an annual salary of ThreeHundred Twenty-five Thousand Dollars ($325,000.00) per year (the “Salary”) lessany and all applicable federal, state and local payroll and withholding taxes.The Salary shall be paid in the same increments as the Company’s normalpayroll, but no less frequent than bi-monthly and prorated, however, for anyperiod of less than a full month. The Salary will be reviewed annually by theCompensation Committee of the Board and a determination shall be made at thattime as to the appropriateness of an increase, if any, thereto.

 

 (b)          *Bonus*.   In addition to theSalary, Executive shall be eligible to receive from the Company an incentivecompensation bonus (the “Bonus”) based on a percentage of

 

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hisSalary. The Bonus, if any, shall be determined based on such criteria as shallbe determined from time to time by the Compensation Committee of the Board ofDirectors. The nature of the criteria and the determination as to whether thecriteria have been satisfied, shall be determined by the Compensation Committeeof the Board in its sole discretion. Accordingly, there is no assurance that aBonus will be paid to Executive with respect to all or any particular yearduring the Term.

 

5.     *Benefits and Other Rights*.   Inconsideration for Executive’s performance under this Agreement, the Companyshall provide to Executive the following benefits: 

(a)           TheCompany will provide Executive with cash advances for or reimbursement of allreasonable out-of-pocket business expenses incurred by Executive in connectionwith his employment hereunder. Such reimbursement, however, is conditioned uponExecutive adhering to any and all reasonable policies established by Companyfrom time to time with respect to such reimbursements or advances including,but not limited to, a requirement that Executive submit supporting evidence ofany such expenses to the Company.

 

(b)           TheCompany will provide Executive and his family with the opportunity to receivegroup medical coverage under the terms of the Company’s health insurance plan,but subject to completion of normal waiting periods. During any such waitingperiod, the Company will pay, or reimburse Executive for, the cost of COBRAcoverage for Executive and his family under his prior health plan.

 

(c)           During theTerm the Executive shall be entitled to fifteen (15) days paid vacation,it being understood and agreed that unused vacation shall not be carried overfrom one year to the next. In addition, Executive shall be entitled to eight (8) paidholidays and four (4) paid personal days off.

 

(d)           TheCompany will pay Executive’s reasonable moving costs for the relocation of hisresidence to the Atlanta, Georgia metropolitan area, subject to the approval ofsuch moving costs by the Compensation Committee of the Company’s Board ofDirectors.

 

6.     *Termination of the Term*.

 

(a)           TheCompany shall have the right to terminate the Term under the followingcircumstances:

 

(i)            Executiveshall die;

 

(ii)           With orwithout Cause, effective upon written notice to Executive by the Company; or

 

(iii)          Uponor within one (1) year following a Change of Control.

 

(b)           Executiveshall have the right to terminate the Term under the following circumstances:

 

(i)            At anytime upon sixty (60) days prior written notice to the Company; or

 

(ii)           For GoodReason upon or within one (1) year following a Change of Control.

 

(c)           Forpurposes of this Agreement, “Cause” shall mean:

 

(i)            Executiveshall be convicted of the commission of a felony or a crime involvingdishonesty, fraud or moral turpitude;

 

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(ii)           Executivehas engaged in acts of fraud, embezzlement, theft or other dishonest actsagainst the Company;

 

(iii)          Executivecommits an act which negatively impacts the Company or its employees including,but not limited to, engaging in competition with the Company, disclosingconfidential information or engaging in sexual harassment, discrimination orother human rights-type violations;

 

(iv)          Executive’sgross neglect or willful misconduct in the discharge of his duties andresponsibilities; or

 

(v)           Executive’srepeated refusal to follow the lawful direction of the Board of Directors orsupervising officers.

 

(d)           Forpurposes of this Agreement, “Change of Control” shall mean the occurrence ofany of the following:

 

(i)            Theacquisition (other than by a direct purchase of shares from the Company) by any“person,” including a “syndication” or “group”, as those terms are used in Section 13(d)(3) or14(d)(2) of the Securities Exchange Act of 1934, as amended (other thanany such person currently owning in excess of the following amount), ofsecurities representing 20% or more of the combined voting power of the Company’sthen outstanding voting securities, which is any security that ordinarilypossesses the power to vote in the election of the Board of Directors of acorporation without the happening of any precondition or contingency;

 

(ii)           TheCompany is merged or consolidated with another corporation and immediatelyafter giving effect to the merger or consolidation less than 80% of theoutstanding voting securities of the surviving or resulting entity are thenbeneficially owned in the aggregate by (x) the stockholders of the Companyimmediately prior to such merger or consolidation, or (y) if a record datehas been set to determine the stockholders of the Company entitled to vote onsuch merger or consolidation, the stockholders of the Company as of such recorddate;

 

(iii)          Ifat any time during a calendar year a majority of the directors of the Companyare not persons who were directors at the beginning of the calendar year;

 

(iv)          The Companytransfers substantially all of its assets to another corporation which is aless than 80% owned subsidiary of the Company; or

 

(v)           TheCompany approves a plan or proposal for dissolution on liquidation of theCompany.

 

(e)           Forpurposes of this Agreement, “Good Reason” shall mean the occurrence of any oneor more of the following events which continues uncured for a period of notless thirty (30) days following written notice given by Executive to theCompany within fifteen (15) days following the occurrence of such event,unless the Executive specifically agrees in writing that such event shall notbe Good Reason:

 

(i)            Any materialbreach of this Agreement by the Company;

 

(ii)           Anyfailure to continue the Executive as an executive officer of the Company;

 

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(iii)          Therequirement by the Company that Executive perform his services hereunderprimarily at a location outside of the metropolitan Atlanta, Georgia area; or

 

(iv)          Thereduction of the Employee’s salary below the amount set forth in Section 4(a) abovewithout the written consent of Executive.

 

7.     *Effect of Expiration or Termination of the Term*.  Promptly following the termination of the Term, and except asotherwise expressly agreed to by the Company in writing, Executive shall:

 

(a)           Immediatelyresign from any and all other positions or committees which Executive holds oris a member of with the Company or any subsidiary of the Company including, butnot limited to, as an officer and director of the Company or any subsidiary ofthe Company.

 

(b)           Providethe Company with all reasonable assistance necessary to permit the Company tocontinue its business operations without interruption and in a mannerconsistent with reasonable business practices; provided, however, that suchtransition period shall not exceed thirty (30) days after termination norrequire more than twenty (20) hours of Executive’s time per week andExecutive shall be promptly reimbursed for all out-of-pocket expenses.

 

(c)           Deliver tothe Company possession of any and all property owned or leased by the Companywhich may then be in Executive’s possession or under his control,including, without limitation, any and all such keys, credit cards,automobiles, equipment, supplies, books, records, files, computer equipment,computer software and other such tangible and intangible property of anydescription whatsoever. If, following the expiration or termination of theTerm, Executive shall receive any mail addressed to the Company, then Executiveshall immediately deliver such mail, unopened and in its original envelope orpackage, to the Company.

 

(d)           Other thanas provided in this Section 7, upon a termination of employment all otherbenefits and/or entitlements to participate in programs or benefits, if any,will cease as of the effective date except medical insurance coverage that may becontinued at Executive’s own expense as provided by applicable law or writtenCompany policy.

 

(e)           Upontermination of Executive pursuant to § 6(a)(i) or § 6(a)(ii) withoutCause following the six (6) month anniversary of the Effective Date, theCompany shall: (i) provide Executive with Salary continuance, subject to § 7(h) fortwelve (12) months (a “Salary Continuance”) at the rate in effectimmediately prior to termination, plus (ii) a lump sum payment equal toOne Hundred Percent (100%) of the Bonus, if any, paid to Executive for thecalendar year immediately preceding termination, plus (iii) provide twelve(12) months of COBRA coverage for Executive which shall be substantiallyequivalent to that provided by the Company prior to termination, plus (iv) allof Executive’s then unvested options and stock awards previously issued pursuantto the Company’s stock option and other equity incentive plans shallimmediately vest and be exercisable as herein provided. In the event oftermination of Executive’s employment prior to the six (6) monthanniversary of the Effective Date. Executive shall not be entitled to anyseverance from the Company.

 

(f)            Upontermination of Executive pursuant to § 6(a)(ii) with Cause or § 6(b)(i),the Company shall pay Executive or Executive’s estate all Salary accrued butunpaid as of the date of such termination.

 

(g)           Upontermination of Executive pursuant to § 6(a)(iii) or § 6(b)(ii),the Company shall: (i) provide Executive with Salary continuance fortwenty-four (24) months at the rate

 

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ineffect immediately prior to termination, plus (ii) a lump sum paymentequal to Two Hundred Percent (200%) of the Bonus, if any, paid to Executive forthe calendar year immediately preceding termination, plus (iii) provideCOBRA coverage for Executive which shall be substantially equivalent to thatprovided by the Company prior to termination until the earlier of (A) twenty-four(24) months after the date of termination, (B) the availability ofreplacement coverage to Executive from a third party employer after Executivehas accepted another full-time position and (C) the expiration of COBRAbenefits by reason or lapse of the statutory or regulatory benefit periodestablished by governmental authority. Further, upon a Change in Control,regardless of whether the Executive is terminated, all of Executive’s thenunvested options and stock awards previously issued pursuant to the Company’sstock option and other equity incentive plans shall immediately vest and beexercisable as herein provided.

 

(h)           In theevent that Executive shall be entitled to receive a Salary Continuance andCOBRA benefit pursuant to § 7(e), such Salary Continuance and COBRAbenefit shall continue only until such time as Executive shall have acceptedanother full time position. In addition, in the event that Executive shall perform consultingor other services for which he shall receive compensation, all compensationshall be reported to the Company and shall be offset against any remainingSalary Continuance payments. Failure of Executive to promptly report thereceipt of any compensation from a third party or the acceptance of a newposition shall entitle the Company to terminate all remaining SalaryContinuance and COBRA benefits and to seek restitution for any payments made toExecutive subsequent to such job acceptance or compensation receipt.

 

(i)            Anydollar amounts which are to be paid at the time of termination under this Section 7,other than Salary Continuance, payments under Section 7(g)(i) andCOBRA payments, shall be paid within thirty (30) days after the date oftermination. Any Salary Continuance, payments under Section 7(g)(i) orCOBRA payments shall be made in accordance with the usual payroll practiceswhich were applicable prior to termination. Except as otherwise specificallyset forth herein, any and all payments made pursuant to this Agreement shall benet of any and all applicable federal, state and local payroll and withholdingtaxes.

 

(j)            If theCompany or the Company’s accountants determine that the payments called forunder Section 7(g) of this Agreement either alone or in conjunctionwith any other payments or benefits made available to the Employee by theCompany will result in the Employee being subject to an excise tax (“Excise Tax”)under Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”),or if an Excise Tax is assessed against Executive as a result of such paymentsor other benefits, the Company shall make a Gross-Up Payment (as defined below)to or on behalf of Executive as and when such determination(s) andassessments(s), as appropriate, are made, subject to the conditions of this subsection (i).A “Gross-Up Payment” shall mean a payment to or on behalf of Executive thatshall be sufficient to pay (i) any Excise Tax in full, (ii) anyfederal, state and local income tax and Social Security or other employment taxon the payment made to pay such Excise Tax as well as any additional Excise Taxon the Gross-Up Payment, and (iii) any interest or penalties assessed bythe Internal Revenue Service on Executive if such interest or penalties areattributable to the Company’s failure to comply with its obligations under thissubsection (i) or applicable law. Any determination under this subsection (i) bythe Company or the Company’s accountants shall be made in accordance with Section 280Gof the Code, any applicable related regulations (whether proposed, temporary orfinal), any related Internal Revenue Service rulings and any related case law,and shall assume that Executive shall pay Federal income taxes at the highestmarginal rate in effect for the year in which the Gross-Up Payment is made andstate and local income taxes at the highest marginal rate in effect in thestate of

 

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Executive’sresidence for such year. Executive shall take such action (other than waivingEmployee’s right to any payments or benefits) as the Company reasonablyrequests under the circumstances to mitigate or challenge such tax. If theCompany reasonably requests that Executive take action to mitigate orchallenge, or to mitigate and challenge, any such tax or assessment and Executivecomplies with such request, the Company shall provide Executive with suchinformation and such expert advice and assistance from the Company’saccountants, lawyers and other advisors as Executive may reasonablyrequest and shall pay for all expenses incurred in effecting such complianceand any related fines, penalties, interest and other assessments. Subject tothe provisions of this subsection (i), all determinations required to bemade under this subsection (i), including whether and when a Gross-Up Paymentis required and the amount of such Gross-Up Payment and the assumptions to beutilized in arriving at such determination, shall be made by the publicaccounting firm that is retained by the Company as of the date immediatelyprior to the Change of Control (the “Accounting Firm”) which shall providedetailed supporting calculations both to the Company and Executive withinthirty (30) business days of the receipt of notice from the Company orExecutive that there has been a payment that could trigger a Gross-Up Payment,or such earlier time as is requested by the Company (collectively, the “Determination”).In the event that the Accounting Firm is serving as accountant or auditor forthe individual, entity or group effecting the Change of Control, Executive may appointanother nationally recognized public accounting firm to make the determinationsrequired hereunder (which accounting firm shall then be referred to as theAccounting Firm hereunder). All fees and expenses of the Accounting Firm shallbe borne solely by the Company and the Company shall enter into any agreementrequested by the Accounting Firm in connection with the performance of theservices hereunder. The Gross-Up Payment under this subsection (i) withrespect to any payments shall be made no later than sixty (60) daysfollowing such payments. If the Accounting Firm determines that no Excise Taxis payable by Executive, it shall furnish Executive with a written opinion tosuch effect, and to the effect that failure to report the Excise Tax, if any,on Executive’s applicable federal income tax return will not result in theimposition of a negligence or similar penalty. The Determination by theAccounting Firm shall be binding upon the Company and Executive. As a result ofthe uncertainty in the application of Section 4999 of the Code at the timeof the Determination, it is possible that Gross-Up Payments which will not havebeen made by the Company should have been made (“Underpayment”) or Gross-upPayments are made by the Company which should not have been made (“Overpayment”),consistent with the calculations required to be made hereunder. In the eventthat Executive thereafter is required to make payment of any additional ExciseTax, the Accounting Firm shall determine the amount of the Underpayment thathas occurred and any such Underpayment (together with interest at the rateprovided in Section 1274(b)(2)(B) of the Code) shall be promptly paidby the Company to or for the benefit of Executive. In the event the amount ofthe Gross-Up Payment exceeds the amount necessary to reimburse Executive forhis Excise Tax as herein set forth, the Accounting Firm shall determine theamount of the Overpayment that has been made and any such Overpayment (togetherwith interest at the rate provided in Section 1274(b)(2) of the Code)shall be promptly paid by Executive to or for the benefit of the Company.Executive shall cooperate, to the extent Executive’s expenses are reimbursed bythe Company, with any reasonable requests by the Company in connection with anycontests or disputes with the Internal Revenue Service in connection with theExcise Tax.

 

8.     *Restrictive Covenants for Executive*.   Executivehereby covenants and agrees with the Company that for so long as Executive isemployed by the Company and for a period (the “Restricted Period”) of twelvemonths after the termination of such employment for any reason, Executive shallnot, without the prior written consent of the Company, which consent shall bewithin the sole and exclusive discretion of the Company, either directly orindirectly

 

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on hisown account or on behalf of any other person or entity:

 

(a)           Perform servicesfor a Competing Business that are substantially similar in whole or in part tothose that he performed for the Company in his role as Chief Executive Officer,including specifically, but not limited to, the sale or marketing of drugproducts or the management of individuals involved in the sale or marketing ofdrug products. For purposes of this covenant, the term “Competing Business”shall mean any company engaged in the development, marketing or sale ofprescription drug products, including generic and nongeneric drug products,which are competitive with: (1) those products being marketed by theCompany at the time of Executive’s termination; or (2) those products thatExecutive was aware were under development by the Company and expected to bemarketed within two years of Executive’s termination. This covenant shall applyonly within the “Territory” which is defined as the fifty states of the UnitedStates. Executive recognizes and agrees that in capacity of Chief Executive Officer,his duties extend throughout the entire service area of the Company whichincludes, at a minimum, the fifty states of the United States and that, becauseof the executive nature of Executive’s position with the Company, in order toafford the Company protection from unfair competition by the Executivefollowing his termination of employment, this covenant must extend throughoutthe stated Territory. Executive further acknowledges that this covenant doesnot prohibit him from engaging in his entire trade or business but only a verylimited segment of the pharmaceuticals industry

 

(b)           Solicitany current supplier, customer or client of the Company with whom Executivedealt, or with whom anyone in Executive’s direct chain of command dealt, onbehalf of the Company within the year preceding Executive’s termination ofemployment, for the purpose of purchasing drug products (or ingredients of drugproducts) or selling or marketing drug products, including generic andnongeneric drug products, which are competitive with: (1) those productsbeing marketed by the Company at the time of Executive’s termination; or (2) thoseproducts that Executive was aware were under development by the Company andexpected to be marketed within two years of Executive’s termination.Notwithstanding this subsection (b), Executive may solicit suppliersthat have excess capacity as reasonably determined by the Company.

 

9.     *Confidentiality*.   Attached tothis Agreement as Exhibit A is the form of the Employee/IndependentContractor Confidentiality and Non-Solicitation Agreement (the “ConfidentialityAgreement”) which the Company requires all employees, including, but notlimited to, the Executive, to execute and which is a part of each employee’sterms of employment. By signing this Agreement, Executive acknowledges havingreceived, read, executed and delivered to the Company a copy of theConfidentiality Agreement and agrees that the terms of the ConfidentialityAgreement shall be incorporated by reference into this Agreement and shall beconsidered as part of the terms and conditions of Executive’s continuedemployment with the Company.

 

10.   *Remedies*.

 

(a)           Thecovenants of Executive set forth in Section 8 and Section 9 areseparate and independent covenants for which valuable consideration has beenpaid, the receipt, adequacy and sufficiency of which are acknowledged byExecutive, and have also been made by Executive to induce the Company to enterinto this Agreement and continue Executive’s employment with the Company. Eachof the aforesaid covenants may be availed of, or relied upon, by theCompany in any court of competent jurisdiction, and shall form the basisof injunctive relief and damages including expenses of litigation (including,but not limited to, reasonable attorney’s fees upon trial and appeal) sufferedby the Company arising out of any breach of the aforesaid covenants byExecutive. The covenants of Executive set forth in this

 

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Section 10are cumulative to each other and to all other covenants of Executive in favorof the Company contained in this Agreement and shall survive the termination ofthis Agreement for the purposes intended.

 

(b)           Each ofthe covenants contained in Section 8 and Section 9 above shall beconstrued as agreements which are independent of any other provision of thisAgreement, and the existence of any claim or cause of action by any partyhereto against any other party hereto, of whatever nature, shall not constitutea defense to the enforcement of such covenants. If any of such covenants shallbe deemed unenforceable by virtue of its scope in terms of geographical area,length of time or otherwise, but may be made enforceable by the impositionof limitations thereon, Executive agrees that the same shall be enforceable tothe fullest extent permissible under the laws and public policies of thejurisdiction in which enforcement is sought. The parties hereto herebyauthorize any court of competent jurisdiction to modify or reduce the scope ofsuch covenants to the extent necessary to make such covenants enforceable.

 

(c)           In theevent that Executive believes that the Company is in violation of a materialobligation owed to Executive under this Agreement, and the Executive has givennotice of such violation to the Company requesting that the Company cure suchviolation, and within twenty (20) business days the Company has notundertaken steps to cure such violation or to provide information to Executivedemonstrating that the Company is not in violation of the Agreement, and as aresult of such failure to cure or dispute such violation, the Executiveterminates the Agreement in accordance with Section 6(b), Executive shallnot be barred from seeking employment with a competitor notwithstanding therestriction of Section 8(a); provided, however, that all otherrestrictions contained in this Agreement, including, but not limited to thecovenants in Section 8(b) and in Section 9, shall remain in fullforce and effect.

 

11.   *Enforcement Costs*.   If anylegal action or other proceeding is brought for the enforcement of thisAgreement, or because of an alleged dispute, breach, default ormisrepresentation in connection with any provisions of this Agreement, thesuccessful or prevailing party or parties shall be entitled to recoverreasonable attorney’s fees, court costs and all expenses even if not taxable ascourt costs (including, without limitation, all such fees, costs and expensesincident to appeal and other post judgment proceedings), incurred in thataction or proceeding, in addition to any other relief to which such party orparties may be entitled. Attorneys fees shall include, without limitation,paralegal fees, investigative fees, administrative costs, sales and use taxesand all other charges billed by the attorney to the prevailing party.

 

12.   *Notices*.   Any and all noticesnecessary or desirable to be served hereunder shall be in writing and shall be:

 

(a)           Personallydelivered, or

 

(b)           Sent bycertified mail, postage prepaid, return receipt requested, or guaranteedovernight delivery by a nationally recognized express delivery company, in eachcase addressed to the intended recipient at the address set forth below.

 

(c)           Fornotices sent to the Company:

 

FirstHorizon Pharmaceutical Corporation6195 Shiloh RoadAlpharetta, Georgia 30005Telephone No.: (770) 442-9707Facsimile No.: (770) 442-9594

 

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(d)           Fornotices sent to Executive:

 

Mr. PatrickFourteau160 Prospect Ave.Gilford, CT 06437

 

Eitherparty hereto may amend the addresses for notices to such party hereunderby delivery of a written notice thereof served upon the other party hereto asprovided herein. Any notice sent by certified mail as provided above shall bedeemed delivered on the third (3rd) business day next following the postmarkdate which it bears.

 

13.   *Entire Agreement*.   ThisAgreement sets forth the entire agreement of the parties hereto with respect tothe subject matter hereof, and specifically supercedes any other agreement orunderstanding among the parties hereto related to the subject matter hereof,including, without limitation, the Original Agreement. This Agreement may notbe modified or revised except pursuant to a written instrument signed by theparty against whom enforcement is sought.

 

14.   *Severability*.   The invalidityor unenforceability of any provision hereof shall not affect the enforceabilityof any other provision hereof, and except as otherwise provided in Section 10above, any such invalid or unenforceable provision shall be severed from thisAgreement.

 

15.   *Waiver*.   Failure to insist uponstrict compliance with any of the terms or conditions hereof shall not bedeemed a waiver of such term or condition, and the waiver or relinquishment ofany right or remedy hereunder at any one or more times shall not be deemed awaiver or relinquishment of such right or remedy at any other time or times.

 

16.   *Arbitration*.   Any claims,disputes or controversies arising out of or relating to this Agreement betweenthe parties (other than those arising under Section 10) shall be submittedto arbitration by the parties. The arbitration shall be conducted in Atlanta,Georgia in accordance with the rules of the American ArbitrationAssociation then in existence and the following provisions: Either party may serveupon the other party by guaranteed overnight delivery by a nationallyrecognized express delivery service, written demand that the dispute,specifying in detail its nature, be submitted to arbitration. Within sevenbusiness days after the service of such demand, each of the parties shallappoint an arbitrator and serve written notice by guaranteed overnight deliveryby a nationally recognized express delivery service, of such appointment uponthe other party. The two arbitrators appointed shall appoint a thirdarbitrator. The decision of two arbitrators in writing under oath shall befinal and binding upon the parties. The arbitrators shall decide who is to paythe expenses of the arbitration. If the two arbitrators appointed fail to agreeupon a third arbitrator within ten days after their appointment, then anapplication may be made by either party, upon notice to the other party,to any court of competent jurisdiction for the appointment of a thirdarbitrator, and any such appointment shall be binding upon both parties.

 

17.   *Governing Law*.   This Agreementand the rights and obligations of the parties hereto shall be governed by andconstrued in accordance with the law of the State of Georgia, without regard toits conflicts of laws provisions. Subject to Section 16, each party heretohereby (a) agrees that the state and federal courts of the NorthernDistrict of Georgia shall have exclusive jurisdiction and venue of anylitigation which may be initiated with respect to this Agreement or toenforce rights granted hereunder and (b) consents to the personaljurisdiction and venue of such courts for such purposes.

 

18.   *Benefit and Assignability*.   ThisAgreement shall inure to the benefit of and be binding upon the Company and itssuccessors and assigns. The rights and obligations of Executive

 

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hereunderare personal to him, and are not subject to voluntary or involuntaryalienation, transfer, delegation or assignment.

 

INWITNESS WHEREOF, the parties hereto have executed this Employment Agreement asof the day and year first above written. 

 
|   | EXECUTIVE:                                |
|--------|-------------------------------------------|
|   |                                      |
|   | /s/ Patrick  Fourteau                     |
|   | Name: Patrick Fourteau                    |
|   |                                      |
|   | FIRST HORIZON  PHARMACEUTICAL CORPORATION |
|   |                                      |
|   |                                      |
|   | By:                                       | /s/ Darrell  Borne |
|   | Name:                                     | Darrell Borne,  CFO |

 

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