Exhibit 10.39

 

DATED                                             2005

 

 

(1) GW PHARMACEUTICALS plc

 

(2) DR STEPHEN WRIGHT

 

 

SERVICE AGREEMENT

 



L O N D O N

 











 

TABLE OF CONTENTS

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
1.
    	
Interpretation
    	
1
    
	
 
    	
 
    	
 
    
	
2.
    	
Appointment
    	
4
    
	
 
    	
 
    	
 
    
	
3.
    	
Duties   During the Appointment
    	
4
    
	
 
    	
 
    	
 
    
	
4.
    	
Confidentiality
    	
6
    
	
 
    	
 
    	
 
    
	
5.
    	
Location
    	
8
    
	
 
    	
 
    	
 
    
	
6.
    	
Salary   and Bonus
    	
8
    
	
 
    	
 
    	
 
    
	
7.
    	
Expenses
    	
9
    
	
 
    	
 
    	
 
    
	
8.
    	
Ill   Health and Injury
    	
9
    
	
 
    	
 
    	
 
    
	
9.
    	
Holidays
    	
11
    
	
 
    	
 
    	
 
    
	
10.
    	
Benefits   During the Appointment
    	
12
    
	
 
    	
 
    	
 
    
	
11.
    	
Intellectual   Property Rights
    	
13
    
	
 
    	
 
    	
 
    
	
12.
    	
Termination
    	
16
    
	
 
    	
 
    	
 
    
	
13.
    	
Obligations   Relating to Termination
    	
18
    
	
 
    	
 
    	
 
    
	
14.
    	
Statements   And Further Assistance
    	
19
    
	
 
    	
 
    	
 
    
	
15.
    	
Data   Protection
    	
19
    
	
 
    	
 
    	
 
    
	
16.
    	
Use And   Monitoring of Equipment
    	
21
    
	
 
    	
 
    	
 
    
	
17.
    	
Restrictive   Covenants
    	
21
    
	
 
    	
 
    	
 
    
	
18.
    	
Continuing   Obligations
    	
24
    
	
 
    	
 
    	
 
    
	
19.
    	
Corporate   Reconstruction
    	
24
    
	
 
    	
 
    	
 
    
	
20.
    	
Agreements   with other Companies in the Group
    	
25
    
	
 
    	
 
    	
 
    
	
21.
    	
Additional   Terms
    	
25
    
	
 
    	
 
    	
 
    
	
22.
    	
Notices
    	
25
    
	
 
    	
 
    	
 
    
	
23.
    	
Miscellaneous
    	
25
    


 

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SERVICE AGREEMENT

 

	
DATE:
    	
 
    	
2005
    


 

PARTIES:

 

(1)                                 GW PHARMACEUTICALS plc whose registered office is at Porton Down Science Park, Salisbury, Wiltshire SP4 0JQ (“the Company”); and

 

(2)                                 DR STEPHEN WRIGHT of [address](“the Executive”).

 

IT IS AGREED as follows:

 

1.                                      INTERPRETATION

 

1.1                               Definitions:

 

In this Agreement the following words and phrases have the meanings given below:-

 

	
“AIM”
    	
the   Alternative Investment Market of London Stock Exchange plc;
    
	
 
    	
 
    
	
“Appointment”
    	
the   employment of the Executive on the terms of this Agreement;
    
	
 
    	
 
    
	
“Associated Company”
    	
any   company which for the time being is:
    
	
 
    	
 
    
	
 
    	
(i)                                          a holding company (as defined   by Section 736 of the Companies Act 1985) of the Company;
    
	
 
    	
 
    
	
 
    	
(ii)                                       a subsidiary (as defined by the   same section) of the Company or of any holding company of the Company; or
    
	
 
    	
 
    
	
 
    	
(iii)                                    a company over which the   Company or any holding company of the Company has control within the meaning   of Section 416 of the Income and Corporation Taxes Act 1988; or
    
	
 
    	
 
    
	
 
    	
(iv)                                   a subsidiary undertaking as   defined by 
    


 

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Section 258   of the Companies Act 1985;
    
	
 
    	
 
    
	
“Board”
    	
the   Board of Directors of the Company including any duly appointed committee or   nominee of the Board;
    
	
 
    	
 
    
	
“day’s salary”
    	
1/260th   of the Executive’s salary;
    
	
 
    	
 
    
	
“Effective Date”
    	
23   March 2005
    
	
 
    	
 
    
	
“Executive’s Personal Data”
    	
Personal   Data and Sensitive Personal Data;
    
	
 
    	
 
    
	
“Group”
    	
the   Company and/or any Associated Company;
    
	
 
    	
 
    
	
“holiday year”
    	
the   calendar year;
    
	
 
    	
 
    
	
“London Stock Exchange”
    	
London   Stock Exchange plc;
    
	
 
    	
 
    
	
“Personal Data”
    	
personal   data (as defined by s.1(1) Data Protection Act 1998) about the   Executive;
    
	
 
    	
 
    
	
“Remuneration Committee”
    	
the   committee of directors of the Company as appointed by the Board to determine   the remuneration from time to time of the Company’s executives;
    
	
 
    	
 
    
	
“salary”
    	
the   salary payable from time to time under Clause 6.1;
    
	
 
    	
 
    
	
“Scheme”
    	
the   permanent health insurance scheme referred to in Clause 10.4.
    
	
 
    	
 
    
	
“Sensitive Personal Data”
    	
data   about the Executive’s:
    
	
 
    	
 
    
	
 
    	
(i)                                          racial or ethnic origins;
    
	
 
    	
 
    
	
 
    	
(ii)                                       political opinions;
    
	
 
    	
 
    
	
 
    	
(iii)                                    religious beliefs or other   beliefs of a similar nature;
    
	
 
    	
 
    
	
 
    	
(iv)                                   membership of a trade union;
    
	
 
    	
 
    
	
 
    	
(v)                                      physical or mental health or   condition;
    
	
 
    	
 
    
	
 
    	
(vi)                                   sexual life;
    
	
 
    	
 
    
	
 
    	
(vii)                                commission or alleged   commission of any offence, or any proceedings for any offence 
    


 

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committed   or alleged to have been committed by him, the disposal of such proceedings or   any sentence of any court in connection with such proceedings;
    
	
 
    	
 
    
	
“termination”
    	
the   ending of the Appointment however it arises and irrespective of its cause or   manner but excluding wrongful termination by the Company in relation to   Clause 17; and
    
	
 
    	
 
    
	
“UKLA”
    	
the   Financial Services Authority in its capacity as the competent authority for   the purposes of the Financial Services and Markets Act 2000.
    


 

1.2                               Construction:

 

(a)                                 The provisions of Schedule 13, Part 1 of the Companies Act 1985 apply in determining whether the Executive has an interest in any shares or other securities.

 

(b)                                 References to acting directly or indirectly include acting alone or jointly with or on behalf of or by means of another person and/or giving advice or providing services with a view to assisting another person.

 

(c)                                  References to a person include an individual, firm, corporation and any other organisation however it is constituted and words denoting the singular include the plural and vice versa.

 

(d)                                 References to an individual holding a position in the Company or the Group mean the holder of that position from time to time or his nominee or such other representative as the Board may nominate.

 

(e)                                  References to statutory provisions are construed as references to those provisions as amended or re-enacted from time to time (whether before or after the date of this Agreement) and references to documents are construed as references to 

 

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documents as replaced or amended from time to time after the date of this Agreement.

 

2.                                      APPOINTMENT

 

2.1                               Upon and subject to the terms of the Appointment, the Company will from the Effective Date employ the Executive as Research and Development Director and the Executive agrees to serve the Company in that capacity, or in such other capacity of similar status as may reasonably be required of him from time to time by the Board.

 

2.2                               The Executive acknowledges that he is not entering into this Agreement in reliance upon any representation, warranty or undertaking which is not contained in this Agreement.

 

3.                                      DUTIES DURING THE APPOINTMENT

 

3.1                               The Executive will (unless prevented by ill health or injury) devote the whole of his working time, attention and abilities during the Appointment to the business of the Group and will not without the prior written consent of the Board (such consent not to be unreasonably withheld)

 

(a)                                 accept any other appointment, work for or be directly or indirectly engaged in or concerned with the conduct of any other business; or

 

(b)                                 be directly or indirectly financially interested in any business which may be considered competitive to the business of the Company (and which therefore compromises his ability to perform his duties to the Company under this contract), other than through his holding or being interested in bona fide investments representing not more than three per cent of any class of shares or securities in any company listed or dealt in on any recognised stock exchange.

 

3.2                               During the Appointment the Executive will :-

 

(a)                                 loyally and diligently perform such duties and exercise such powers for the Group as the Board may from time to time reasonably require, and accept without further payment other offices within the Group;

 

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(b)                                 keep the Board properly and regularly informed about the business of the Group and his activities in that business;

 

(c)                                  comply with the reasonable and lawful directions given from time to time by the Board;

 

(d)                                 comply with the Company’s articles of association, the City Code on Takeovers and Mergers, applicable regulations for UKLA, London Stock Exchange and any other applicable stock exchange, the code mentioned in Clause 3.7, any other internal codes of conduct for employees of the Group and all relevant policies and procedures;

 

(e)                                  co-operate with the Group in complying with its obligations on health and safety;

 

(f)                                   promptly give the Company such information as the Group may require to enable it to comply with its legal obligations or the requirements of the UKLA, London Stock Exchange or any other applicable stock exchange; and

 

(g)                                  promote and protect the interests of the Group, always giving it the full benefit of his knowledge, expertise and skill and not knowingly or deliberately doing anything which is to its detriment.

 

3.3                               The Company may assign to the Executive duties which are either additional to or instead of those referred to in Clause 3.2(a), it being understood that he will not be assigned duties which he cannot in the reasonable opinion of the Board be expected to perform. The Company may also from time to time appoint any other person to act jointly with the Executive in the performance of his duties and the exercise of his powers.

 

3.4                               The duties of the Executive as a director of the Company and any other company in the Group are subject to the relevant Articles of Association from time to time.

 

3.5                               Unless he has the prior written consent of the Board, the Executive may not directly or indirectly receive or retain any payment or benefit, either in respect of any business transacted (whether or not by him) by or on behalf of the Group or with a view to any such business being transacted.

 

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3.6                               As part of and in the normal course of his duties, the Executive will:

 

(a)                                 continue to carry out research into and development of the processes, products, programs, designs, equipment, techniques and projects which are from time to time used, made or undertaken by the Group or which could be used, made or undertaken by it, and will invent discover, design, develop or improve them for the benefit of and for use by the Group; and

 

(b)                                 seek and pursue the adoption and development of new processes, products, programs, designs, equipment, techniques and projects which could be used, made or undertaken by the Group.

 

3.7                               During the Appointment or while he is a director of any company in the Group the Executive will comply and will procure, so far as he is able, that his spouse and dependent children (if any) or any trust in which he, his spouse or dependent children may be concerned or interested as trustee or beneficiary, comply with any code of conduct relating to securities transactions by directors and specified employees applicable within the Group. The Executive confirms that a copy of the current code has been given to him.

 

4.                                      CONFIDENTIALITY

 

4.1                               The Executive acknowledges that during his employment with the Company he will have access to and will be entrusted with confidential information and trade secrets relating to the business of the Group. This includes but is not limited to information and secrets relating to:

 

(a)                                 corporate and marketing strategy, business development and plans, sales reports and research results;

 

(b)                                 business methods and processes, technical information and know-how relating to the Group’s business and which is not in the public domain, including inventions, designs, programs, techniques, database systems, formulae and ideas;

 

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(c)                                  business contacts, lists of customers and suppliers and details of contracts with them and information on employees and their terms of employment;

 

(d)                                 stock levels, sales, expenditure levels and pricing policies;

 

(e)                                  budgets, management accounts, trading statements and other financial reports;

 

(f)                                   unpublished price sensitive information or potentially price sensitive information relating to shares or securities listed or dealt in on any recognised stock exchange; and

 

(g)                                  any document marked “confidential” or any information not in the public domain the disclosure of which would put the Group at a competitive or legal disadvantage.

 

4.2                               The Executive will not during the Appointment (otherwise than in the proper performance of his duties and then only to those who need to know such information or secrets) or thereafter (except with the prior written consent of the Board or as required by law) :

 

(a)                                 divulge or communicate to any person (including any representative of the press or broadcasting or other media);

 

(b)                                 cause or facilitate any unauthorised disclosure through any failure by him to exercise all due care and diligence; or

 

(c)                                  make use of (other than for the benefit of the Group)

 

any confidential information or trade secrets relating to the business of the Group which may have come to his knowledge during his employment with the Company or in respect of which the Group may be bound by an obligation of confidence to any third party. The Executive will also use his best endeavours to prevent the publication or disclosure of any such information or secrets. These restrictions will not apply after the Appointment has terminated to information which has become available to the public generally, otherwise than through unauthorised disclosure.

 

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4.3                               All notes, memoranda, and other records (however stored) made by the Executive during his employment with the Company and which relate to the business of the Group will belong to the Group and will promptly be handed over to the Company (or as the Company directs) from time to time on request and at the end of the Appointment, without copies being kept by the Executive or anyone else on his behalf.

 

5.                                      LOCATION

 

The Executive will be based at the company’s offices in central London from time to time, but may be required to work at other locations within the United Kingdom within a 50 mile radius of central London as the Board may from time to time reasonably determine, whether on a temporary or permanent basis, in the performance of his duties. If the Executive agrees to change his principal residence at the request of the Company, it will reimburse him such removal and other incidental expenses as the Board considers fair and reasonable in the circumstances.

 

6.                                      SALARY AND BONUS

 

6.1                               The Company will pay to the Executive a salary at the rate of £135,000 per annum, including any director’s fees from the Group. This salary will accrue from day to day and will normally be payable by equal instalments in arrears at the end of each month, and will be subject to such deductions as may be required by law or under the terms of the Appointment.

 

6.2                               The Remuneration Committee will review the Executive’s Salary annually, but such review does not necessarily imply an increase. The review will take account of such factors as the Remuneration Committee considers, in its absolute discretion, to be appropriate, which may include anticipated future performance or service and/or past performance of the Executive and/or the Company and/or the Group, although it has no obligation to take any of these factors into account. Any increase in the rate of the Executive’s Salary will normally be effective from 1 January in each year following the review.

 

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6.3                              The Executive will, in addition to his salary, be eligible for a bonus on such terms and of such amount as may be approved from time to time by the Board in its sole discretion.

 

6.4                              The Executive will also be eligible for a car allowance of £15,000 per annum. The car allowance will be paid monthly, less such deductions as are required by law. It will not be part of the Executive’s salary and will not count towards any salary related benefits, including his pension.

 

6.5                              The Group may deduct from any money owed to the Executive any money which the Executive, owes to the Company or any Associated Company.

 

7.                                      EXPENSES

 

The Executive will be entitled, upon production of satisfactory evidence of payment or expenditure, to be reimbursed all reasonable out-of-pocket expenses properly and wholly incurred by him in the performance of his duties.

 

8.                                      ILL HEALTH AND INJURY

 

8.1                              If at any time during the Appointment the Executive is physically or mentally unable to perform his duties for the Group as a result of ill health or injury, he will nevertheless, for so long as the Appointment remains in force, be entitled to his salary during any period of incapacity of not more than 180 days (whether consecutive or not) in any period of fifty-two consecutive weeks. Thereafter, for so long as the Appointment remains in effect and subject to Clauses 8.5 to 8.7, any further payments will be limited to those payments which may be due under the Scheme or, if no payments are due, to such salary as may be determined in the sole discretion of the Board and, as a condition of any such payment, the Executive may be required to comply with Clause 13 as if the Appointment had been terminated.

 

8.2                              The payment of any such salary will be:-

 

(a)                                subject to the production of satisfactory evidence from a registered medical practitioner in respect of any period of absence in excess of seven consecutive days; and

 

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(b)                                inclusive of any statutory sick pay to which the Executive may be entitled and the Company may deduct from his salary the amount of any social security benefits he may receive or be entitled to receive.

 

8.3                              The Executive will promptly inform the Company if he is unable to perform his duties as a result of ill health or injury caused by a third party and for which compensation is or may be recoverable. In return for the Company continuing to pay his salary and to provide other benefits during the Appointment, he will take such action as the Company may reasonably request in connection with pursuing a claim against such third party, in order to recover for the benefit of the Company the costs of continuing the Appointment. He will keep the Company regularly informed of the progress of any claim, provide such information about it as the Company may from time to time reasonably require, and will immediately notify the Company in writing of any compromise, settlement, award or judgment. He will, upon being requested to do so, refund to the Company the lesser of the amount recovered by him (after deducting any related costs borne by him) and the aggregate cost of the salary and other benefits paid to him during his ill health or injury and will hold these proceeds on trust for the Company to apply them in repayment of this obligation.

 

8.4                              At the request and expense of the Company the Executive will from time to time submit himself to a medical examination by a suitably qualified person of the Company’s choice, whether or not he is unable to perform his duties for the Group as a result of ill health or injury. If such person is unable to confirm that he is fit to perform his duties or if there are factors which such person considers are relevant to the performance of those duties, the Executive will co-operate in ensuring the prompt delivery of all relevant medical reports to the Company and will allow the Company access to any relevant medical report which has been prepared by a medical practitioner responsible for his clinical care.

 

8.5                              At any time during his incapacity the Company may refer the Executive to the insurers of the Scheme subject always, to the provisions of Clause 10.4 and Clause 10.5.

 

8.6                              If any claim under the Scheme is accepted in whole or in part:

 

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(a)                                the Company will immediately upon that acceptance cease to be under any obligation to pay any amounts or to provide any benefits to the Executive other than those provided under the terms of the Scheme; and

 

(b)                                the provisions of Clause 13 will immediately apply as if the Appointment had terminated. The Company will then automatically become entitled to appoint a successor to the Executive to perform all or any of his duties and Clause 3 will be amended accordingly.

 

8.7                              If the Board considers that the Executive is likely to qualify for payments under the Scheme or upon acceptance of his claim under Clause 8.6 and for so long as he receives benefits under the Scheme, the Company will not terminate the Appointment on arbitrary or capricious grounds or if its sole intention is to deprive him of the benefits under the Scheme. Nothing in this Clause 8 will prevent the Company from terminating the Appointment on any other grounds, including if it is not a requirement that the Executive remains an employee of the Company in order to receive the benefits under the Scheme.

 

8.8                              If the Executive has been incapacitated by ill health or injury for the period set out in Clause 8.1, the Company may, notwithstanding any other provision of the Appointment, terminate it with immediate effect by notice in writing to the Executive

 

9.                                    HOLIDAYS

 

9.1                              The Executive will (in addition to normal public holidays) be entitled to 25 paid days’holiday in each complete holiday year during the Appointment. The Executive is expected to take no fewer than 20 working days holiday in each holiday year. This holiday is to be taken at such times as are convenient to the Company in line with its operational requirements and the availability of other directors of the Company. The Company may require the Executive to take any outstanding holiday during any period of notice under Clause 12.1 or for which he is not required to work pursuant to Clause 12.5.

 

9.2                              The entitlement to holiday accrues pro rata throughout each holiday year. Any entitlement to holiday remaining at the end of any holiday year will lapse (unless such 

 

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entitlement arises according to the circumstances stated in clause 9.1.), unless otherwise permitted by the Board, and no salary in lieu of such entitlement will be paid.

 

9.3                              On the termination of the Appointment (other than by reason of Clause 12.2 or where he terminates the Appointment in breach of its terms) the Executive will be entitled to a day’s salary in lieu of each day’s holiday accrued due but not taken. If he has taken holiday in excess of his accrued entitlement, the Company may deduct a day’s salary for each excess day taken from any monies owed to him by the Company.

 

10.                              BENEFITS DURING THE APPOINTMENT

 

10.1                       The Executive will arrange his own personal pension scheme into which the Company will for each complete year of the Appointment contribute on a monthly basis a sum equal to 17.5 per cent of his salary, provided that the Executive’s scheme has been approved by the Commissioners of the Inland Revenue and the Company’s contributions do not exceed the limits prescribed by law. If they do exceed the limits prescribed by law, the Company’s contributions will be restricted to them.

 

10.2                       The Company shall during the term of this Agreement pay all necessary premiums and make all necessary payments to provide the Executive with life assurance cover which in the event of the Executive’s death while employed under this Agreement shall pay to the Executive’s chosen dependants a sum equal to six times his basic salary, subject to any limits, terms and conditions imposed by statute or the relevant insurance company including the requirement for a medical examination.

 

10.3                       The Company shall during the term of this Agreement cover the cost of membership for the Executive and the Executive’s spouse and children under the age of 18 or in full time education of an appropriate private patients medical plan with “BUPA” or such other reputable medical insurance scheme as the Company shall decide from time to time, subject to the rules of the scheme and the approval of his application for membership by the relevant insurer.

 

10.4                       The Company shall pay all premiums and make all necessary payments to make available the Scheme for the benefit of the Executive upon such terms as shall provide for the 

 

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payment to the Executive throughout the period of any qualifying ill-health or disability (with the exception of the first 26 consecutive weeks thereof) of sums at a rate per annum equal to 75 per cent of pensionable salary on the date such absence commences less the amount of a single person’s state sickness benefits, subject to any limits, terms and conditions imposed by statute or the relevant insurance company including the requirement for a medical examination and acceptance of the Executive’s claim.

 

10.5                       The Executive agrees that the provision by the Company of the insured benefits above is on the basis that the Company will have no responsibility for the decisions taken by the insurers about any claim by the Company or the Executive and that there are no circumstances in which the Group can be liable to the Executive for any such benefits, or loss of such benefits, which the insurers have declined to pay for whatever reason. Any such insured benefits will be subject always to the terms of the relevant insurance policy between the Company and the insurer.

 

11.                              INTELLECTUAL PROPERTY RIGHTS

 

11.1                       For the purpose of this Clause 11:

 

(a)                                “Intellectual Property” means all present and future intellectual property, including patents, utility models, trade and service marks, trade names, domain names, rights in designs, copyrights, moral rights, topography rights, rights in databases, trade secrets and know-how, in all cases whether or not registered or registrable and including registrations and applications for registration of any of these and rights to apply for the same, rights to receive equitable remuneration in respect of any of these and all rights and forms of protection of a similar nature or having equivalent or similar effect to any of these anywhere in the world, in each case for the full term thereof including all renewals and extensions;

 

(b)                                “Executive Intellectual Property” means all Intellectual Property and all works in which Intellectual Property rights subsist or may subsist and any related materials which the Executive alone or with one or more others makes, originates or develops during the period of his employment with the Company (whether or 

 

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not made, originated or developed during normal working hours) and which affect or relate to the business of the Group or are capable of being used or adapted for use in it; and

 

(c)                                 “Executive Invention” means all inventions (which term bears the same meaning as in the Patents Act 1977) which the Executive alone or with one or more others may make, originate or develop during the period of his employment with the Company (whether or not made, originated or developed during normal working hours) and which affect or relate to the business of the Group or are capable of being used or adapted for use in it.

 

11.2                       Any Executive Intellectual Property and any Executive Inventions will be notified and disclosed by the Executive to the Company in an appropriate manner as soon as it comes into existence. (In the case of Executive Inventions the notification and disclosure obligations in this Paragraph 11.2 apply irrespective of whether the Executive is entitled to ownership of such Executive Invention by virtue of s39 Patents Act 1977.)

 

11.3                       Save as provided by law and in particular as provided by the Patents Act 1977, any Executive Inventions or Executive Intellectual Property will belong to the Company or the relevant member of the Group. Insofar as permissible by law the Executive hereby assigns to the Company or the relevant member of the Group absolutely with full title guarantee and free from all encumbrances (by way of present assignment of all future rights) all rights in Executive Inventions and Executive Intellectual Property. Any Executive Inventions or Executive Intellectual Property which do not belong and cannot be assigned to the Company or the relevant member of the Group in accordance with this Clause 11.3 will insofar as permissible by law be held on trust by the Executive for the benefit of the Company (or relevant member of the Group) until the same are vested absolutely in the Company (or relevant member of the Group).

 

11.4                       The Executive acknowledges for the purpose of s39 Patents Act 1977 that, because of the nature of his duties and the particular responsibilities arising from those duties, his employment with the Company carries with it a special obligation to further the interests of the Company and other members of the Group.

 

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11.5                       Executive undertakes that, at the Company’s expense and upon request (whether during or after the termination of the Appointment), he will execute such documents, make such applications, give such assistance and do such acts and things as may be necessary to enable the Company or relevant member of the Group to enjoy the full benefit of this Clause 11.5. This will include the giving of assistance or advice (including giving evidence if so required) in connection with:

 

(a)                                the prosecution of any applications for the registration of;

 

(b)                                any proceedings brought to prevent the infringement of; and/or

 

(c)                                 any proceedings concerning or affecting the validity of,

 

any Executive Intellectual Property.

 

11.6                      Should the Executive fail to comply with a request under Clause 11.5 the Board is irrevocably authorised to appoint some person in his name and on his behalf to sign any documents and take such other steps as are necessary to give effect to this Clause 11.

 

11.7                       Immediately upon the termination of the Appointment or earlier at the Company’s request, the Executive will deliver up to the Company all Executive Intellectual Property and Executive Inventions in the Executive’s possession, custody or power in which the Company or relevant member of the Group has rights by virtue of Clause 11.3 above.

 

11.8                       The Executive irrevocably waives all moral rights which he might otherwise have or be deemed to have under Chapter IV Copyright, Designs and Patents Act 1988 or under any other similar law anywhere in the world.

 

11.9                       Save as provided by law and set out herein, the Executive has no rights to additional remuneration or compensation in respect of any Executive Intellectual Property or Executive Invention.

 

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12.                               TERMINATION

 

12.1                       The Appointment will continue until either party gives to the other not less than twelve months’ written notice.

 

12.2                       The Company may, notwithstanding any other provision of the Appointment and irrespective of whether the grounds for termination arose before or after it began, at any time by notice in writing to the Executive terminate the Appointment with immediate effect :-

 

(a)                                if a petition is presented or any order is made or any notice is issued convening a meeting for the purpose of passing a resolution for his bankruptcy or he becomes bankrupt or makes any composition or enters into any deed of arrangement with his creditors generally;

 

(b)                                if he is prohibited by law or by any decision of a regulatory body from being a director or taking part in the management of the Group or ceases to be a director of the Company without the consent of the Board;

 

(c)                                 if he is convicted of

 

(i)                                    a criminal offence other than one which in the opinion of the Board does not affect his position as an employee of the Company, bearing in mind the nature of his duties and the capacity in which he is employed; or

 

(ii)                                 an offence relating to insider dealing;

 

(d)                                if he commits, in the opinion of the Financial Services Authority, the civil offence of market abuse under the Financial Services and Markets Act 2000;

 

(e)                                 if he is guilty of any serious default or misconduct in connection with or affecting the business of the Group;

 

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(f)                                   if he commits any serious or repeated breach of his obligations of the Appointment or is guilty of serious neglect or negligence in the performance of his duties;

 

(g)                                  if he behaves in a manner (whether on or off duty) which is likely to bring the Group into disrepute or prejudice its interests or which seriously impairs his ability to perform his duties.

 

12.3                        Notwithstanding any other provision of the Appointment, it will automatically cease without any notice being given on the Executive’s 65th birthday. All obligations relating to termination detailed in Clauses 13, 14, 17 and 18 shall apply in the event of the Appointment ceasing pursuant to this Clause 12.3.

 

12.4                        Instead of requiring the Executive to continue performing duties and of the Company providing him with duties during the period of notice under Clause 12.1, the Company may, at its sole discretion by written notice to him, give him a payment in lieu of salary for the whole or any part of such period, less such deductions as are required by law. For the avoidance of doubt, this will not prevent the company from terminating the Appointment in breach of its terms.

 

12.5                        If the Company wishes to terminate the employment of the Executive or if the Executive wishes to leave the employment of the Company in either case before the expiry of the period of notice specified in Clause 12.1 and whether or not notice has been given under that Clause, the Company may require the Executive:

 

(a)                                 to perform duties not within his normal duties or to undertake special projects; or

 

(b)                                 not to attend for work for all or any part of the period of notice (if notice has been given) or (if notice has not been given) for a period equivalent to the notice required to be given by the Executive under Clause 12.1. For so long as the Executive is not required to work during such period, he will remain an employee of the Company. He will continue to receive his salary and other contractual entitlements and to be bound by all the terms of the Appointment. He will not

 

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directly or indirectly work for any person, have any contact with any customer of the Group or, for business purposes, any such employee without the prior written agreement of the Board. If the Executive is not to attend for work under this Clause the Company shall be entitled to offset any outstanding accrued holiday due to the Executive for each day of non-attendance.

 

13.                               OBLIGATIONS RELATING TO TERMINATION

 

13.1                        Upon the termination of the Appointment or, upon the exercise by the Company of its right under Clause 12.5(b), the Executive will hand over to the Company all property belonging to the Group or its customers, or suppliers which may be in his possession or under his control, and without him or anyone on his behalf keeping copies of any reproduceable items and without having downloaded any information stored on any computer storage medium. He will, on being requested to do so, send to the Company Secretary a signed statement that he has complied with this sub-clause;

 

13.2                        Upon the termination of the Appointment or (if earlier) upon either party giving notice under Clause 12.1 and the Company exercising its rights under Clause 12.4 or 12.5, the Executive will resign at the request of the Company, without claim for compensation, from all offices held by him in the Group and from all trusteeships held by him of any pension scheme or other trusts established by the Company or any Associated Company. Should he fail to do so the Board is irrevocably authorised to appoint some person in his name and on his behalf to sign any documents and take such other steps as are necessary to give effect to such resignations. Such resignations will be given and accepted without prejudice to any claims which the Company and the Executive may have arising out of or in connection with the Appointment and its termination.

 

13.3                        Upon the Termination of the Appointment, the Executive will have no rights as a result of this Agreement or any alleged breach of this Agreement to any compensation under or in respect of any share options or long term incentive plans in which he may participate or have received grants or allocations at or before the date the Appointment terminates. Any rights which he may have under such schemes will be exclusively governed by the rules of such schemes.

 

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14.                               STATEMENTS AND FURTHER ASSISTANCE

 

After the termination of the Appointment the Executive :-

 

(a)                                 will not at any time make any adverse, untrue or misleading statement about any company in the Group or its officers or employees or represent himself as being employed by or connected with any such company; and

 

(b)                                 will co-operate with any company in the Group for whom he performed duties by providing such reasonable assistance as may be required in connection with any claim made by or against any such company, where it considers that the Executive has knowledge or information which is relevant to such claim. The provision of such assistance may include attending meetings, giving and signing statements and attending hearings at such times and at such locations that may be convenient to the Executive. The Company will reasonably compensate the Executive for his time on a per diem basis (with reference to his day’s salary under this contract of employment or such other amount as the Executive can reasonably justify with reference to his usual employment terms at that time) and will reimburse the Executive for his reasonable out of pocket expenses incurred in providing such assistance.

 

15.                               DATA PROTECTION

 

15.1                        For the purpose of the Data Protection Act 1998, the Executive, by signing this Agreement, consents to the collection, holding, use, disclosure and processing (both electronically and manually) by the Company or any Associated Company (or a company appointed by them for such purposes) of the Executive’s Personal Data. The Executive’s Personal Data may be used solely for purposes relating to the Executive’s employment and the operation, management, security and administration of the business of the Company or any Associated Company. This may include but is not limited to processing done in connection with:

 

(a)                                 administering and maintaining personnel records;

 

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(b)                                 planning, paying and reviewing salary and other remuneration and benefits;

 

(c)                                  planning, providing and administering benefits whether statutory or contractual;

 

(d)                                 assessments of the Executive’s performance or conduct including performance appraisals and reviews and for disciplinary and grievance procedure purposes;

 

(e)                                  maintaining sickness and other absence records;

 

(f)                                   maintaining health and safety records and ensuring a safe working environment;

 

(g)                                  taking decisions on the Executive’s fitness to work and complying with obligations under the Disability Discrimination Act 1995;

 

(h)                                 providing references and information to future employers (whether inside the Group or outside the Group);

 

(i)                                     providing information to the appropriate external authorities for tax, social security and other purposes as required by law to comply with any statutory duty;

 

(j)                                    equal opportunities, ethnic monitoring and compliance with legal obligations in connection with them;

 

(k)                                 providing information to any future purchasers of the Company or to any transferees of the business in which you work, including but not limited to, for due diligence purposes; and

 

(l)                                     planning or reviewing options, in relation to the operation or management of the Company.

 

15.2                       The Executive also consents to the transferring of the Executive’s Personal Data to a country or territory outside the European Economic Area for any of the above purposes.

 

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16.                               USE AND MONITORING OF EQUIPMENT

 

16.1                        Unless he has the prior written consent of the Chairman, the Executive will not use any computer hardware or software or any other technical equipment or systems owned, licensed or rented:

 

(a)                                 by the Company for any purpose other than to carry out his proper duties; or

 

(b)                                 by him or any person other than the Company for any purpose connected with the carrying out of his proper duties.

 

16.2                        The Executive agrees that the Group may monitor, intercept or record his use of office equipment, including but not limited to: email, the internet, his telephone and any mobile phone issued to the Executive by the Company.

 

17.                               RESTRICTIVE COVENANTS

 

17.1                        During the Appointment and for the periods set out below after the termination of the Appointment, he will not (except with prior written consent of the Board) directly or indirectly do or attempt to do any of the following:

 

(a)                                 for 12 months undertake, carry on or be employed, engaged or interested in any capacity in either any business which is competitive with or similar to a Relevant Business within the Territory, or any business an objective or anticipated result of which is to compete with a Relevant Business within the Territory. For the avoidance of doubt, the business of G-Pharm Limited (registered company number 3107561), which is to cultivate plants (including cannabis) for use by companies in the development of medicinal and nutraceutical products, is not considered to fall within the categories of competing businesses as identified in this clause;

 

(b)                                 for 12 months entice, induce or encourage a Customer to transfer or remove custom from the Company or any Associated Company;

 

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(c)                                  for 12 months solicit or accept business from a Customer for the supply of Competitive Services; or

 

(d)                                 for 12 months entice, induce or encourage an Employee to leave or seek to leave his or her position with the Company or any Associated Company for the purpose of being involved in or concerned with either the supply of Competitive Services or a business which competes with or is similar to a Relevant Business or which plans to compete with a Relevant Business, regardless of whether or not that Employee acts in breach of his or her contract of employment with the Company or any Associated Company by so doing and regardless of whether the Relevant Business is within or outside the Territory.

 

17.2                        For the purpose of this Clause 17:

 

(a)                                 “Customer” means a person:

 

(i)                                     who is at the expiry of the Relevant Period or who was at any time during the Relevant Period a customer of the Company or any Associated Company (whether or not goods or services were actually provided during such period) or to whom at the expiry of the Relevant Period the Company or any Associated Company was actively and directly seeking to supply goods or services, in either case for the purpose of a Relevant Business; and

 

(ii)                                  with whom the Executive or an Employee in a Relevant Business reporting directly to him had dealings at any time during the Relevant Period or and/or for whom the Executive was responsible and/or about whom he was in possession of confidential information, in any such case in the performance of his or their duties to the Company or any Associated Company.

 

(b)                                 “Competitive Services” means goods or services identical or similar to or competitive with those which at the expiry of the Relevant Period the Company or

 

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any Associated Company was supplying or negotiating or actively and directly seeking to supply to a Customer for the purpose of a Relevant Business;

 

(c)                                  “Relevant Business” means the business of the Company or any Associated Company in which, pursuant to his duties, the Executive was materially involved at any time during the Relevant Period.

 

(d)                                 “Territory” means England, Wales, Scotland and/or Northern Ireland and any other country or state in which the Company or any Associated Company is operating or planning to operate (as evidenced by written documentation) at the expiry of the Relevant Period. A business of the Company or any Associated Company will be operating within the Territory at the expiry of the Relevant Period if a Relevant Business has been conducted or promoted during the Relevant Period. A business will be within the Territory if either any such business in which the Executive is to be involved is located or to be located within the Territory or it is conducted or to be conducted wholly or partly within the Territory;

 

(e)                                  “Employee” means a person who is employed by or who renders services to the Company or any Associated Company in a Relevant Business in a managerial or marketing or sales or distribution or senior capacity and/or who has responsibility for customers of the Company or any Associated Company or influence over them or who is in possession of confidential information about such customers and who in any such case was so employed or so rendered services during the period of twelve months ending on the last day on which the Executive actively worked during the Appointment for the Company or any Associated Company and who had dealings with him during that period.

 

(f)                                   “Relevant Period” means the period of twelve months ending on the last day of the Appointment or the period of the Appointment if shorter than twelve months.

 

17.3                        Each sub-clause and part of such sub-clause of this Clause constitutes an entirely separate and independent restriction and does not operate to limit any other obligation owed by the

 

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Executive, whether that obligation is express or implied by law. If any restriction is held to be invalid or unenforceable by a court of competent jurisdiction, it is intended and understood by the parties that such invalidity or unenforceability will not affect the remaining restrictions.

 

17.4                        The Executive acknowledges that each of the restrictions in this Clause goes no further than is necessary for the protection of the Company’s and each Associated Company’s legitimate business interests.

 

18.                               CONTINUING OBLIGATIONS

 

The termination of the Appointment will not affect the rights or remedies of either party against the other in respect of any antecedent breach of any of its provisions or the continuing obligations of the Executive or the Company (as the case may be) under any provision of the Appointment expressed to have effect after it has terminated.

 

19.                               CORPORATE RECONSTRUCTION

 

19.1                        If the Appointment terminates

 

(a)                                 by reason of the liquidation of the Company for the purpose of amalgamation or reconstruction; or

 

(b)                                 as part of any arrangement for the amalgamation of the undertaking of the Company not involving liquidation; or

 

(c)                                  as part of any arrangement for the transfer of the whole or part of the undertaking of the Company to an Associated Company

 

and the Executive is offered employment of a similar nature with any person resulting from such amalgamation or reconstruction or with which the undertaking of the Company is amalgamated or such Associated Company on terms which when taken as a whole are not less favourable to the Executive than the terms of the Appointment, the Executive will have no claim against the Company or any Associated Company in respect of the

 

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termination of the Appointment by reason of the events described in (a), (b) or (c) of this Clause.

 

20.                               AGREEMENTS WITH OTHER COMPANIES IN THE GROUP

 

20.1                        This Agreement is entered into by the Company for itself and in trust for each Associated Company with the intention that each company will be entitled to enforce the terms of this Agreement directly against the Executive.

 

20.2                        The Contracts (Rights of Third Parties) Act 1999 will not create any rights in favour of the Executive in relation to the benefits granted now or at any time in connection with his employment.

 

21.                               ADDITIONAL TERMS

 

21.1                        The terms set out in the Schedule are added in compliance with the requirements of the Employment Rights Act 1996.

 

22.                               NOTICES

 

All notices and other communications relating to the Appointment will take effect if delivered, upon delivery; if posted, at the earlier of the time of delivery and (if posted in the United Kingdom by first class post) 10.00am on the second business day after posting; or if sent by facsimile, when a complete and legible copy of the communication has been received.

 

23.                               MISCELLANEOUS

 

23.1                        The Appointment operates in substitution for and wholly replaces with effect from the date of this Agreement all terms previously agreed between the Company and the Executive which will be deemed to have been terminated by mutual consent and the Executive acknowledges that he has no outstanding claims against any member of the Group in respect of salary or any matter prior to that date.

 

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23.2                        The Appointment constitutes the entire agreement and understanding between the parties and no variation or addition to it and no waiver of any provision will be valid unless in writing and signed by or on behalf of both parties. The Company will have no liability or remedy in tort against it in respect of any representation, warranty or other statement (other than those contained in this Agreement) being false, inaccurate or incomplete unless it was made fraudulently. The Executive acknowledges that he is not entering into this Agreement in reliance on any representation, warranty or undertaking which is not contained in this Agreement.

 

23.3                        In the event of any conflict between this Agreement and any Company handbook or policies, the terms of this Agreement will prevail.

 

23.4                        This Agreement will be construed in accordance with English law and the parties irrevocably submit to the exclusive jurisdiction of the English Courts to settle any disputes which may arise in connection with this Agreement.

 

EXECUTION

 

The parties have shown their acceptance of the terms of this Agreement by executing it below as a Deed at the end of the Schedule.

 

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SCHEDULE

 

1.                                      The following terms of the Appointment apply on the date of the Agreement to which this is a Schedule.

 

(a)                                 The Executive’s period of continuous employment began on 1 January 2004.

 

(b)                                 The Executive has no normal working hours but is required to work during normal business hours and such other hours as may be reasonably necessary for the proper performance of his duties for the Group. The Executive agrees that the duration of his working time is not measured or pre-determined and can be determined by him in a manner consistent with the Appointment.

 

(c)                                  For Statutory Sick Pay purposes, the Executive’s qualifying days are Monday to Friday.

 

2.                                      The following information is supplied pursuant to the Employment Rights Act 1996 and reflects the Company’s current practice.

 

(a)                                 There is no formal disciplinary procedure applicable to this employment.  The  Executive is expected to exhibit a high standard of propriety, integrity and efficiency in all his dealings with and in the name of the Company and the Group and may be suspended (with pay) or required to take any accrued holiday entitlement during any investigation which it may be necessary for the Company to undertake.

 

(b)                                 If the Executive is dissatisfied with any disciplinary decision, he should refer such decision to the Chairman or his nominee, whose decision will be final and binding.

 

(c)                                  If the Executive has any grievance relating to the Appointment or matters where he considers the Company or any other member of the Group is failing to comply fully with its legal obligations, he should refer such grievance to the Chairman or his nominee and the reference will be dealt with by him; should the Executive

 

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remain dissatisfied with his ruling an appeal, initially in writing, may be made to the Board whose decision will be final and binding.

 

EXECUTION

 

	
SIGNED   as a Deed by
    	
)
    	
 
    
	
 
    	
)
    	
 
    
	
Justin   Gover, Director
    	
) 
    	
/s/   Justin Gover
    
	
 
    	
)
    	
 
    
	
and   David Mace, Director
    	
)
    	
/s/   David Mace
    
	
 
    	
)
    	
 
    
	
duly   authorised for and on behalf of
    	
)
    	
 
    
	
 
    	
)
    	
 
    
	
G W   PHARMACEUTICALS plc
    	
)
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
SIGNED   as a Deed by
    	
)
    	
 
    
	
 
    	
)
    	
 
    
	
DR   STEPHEN WRIGHT
    	
)
    	
/s/   Dr. Stephen Wright
    
	
 
    	
)
    	
 
    
	
in the   presence of:
    	
)
    	
 
    
	
 
    	
)
    	
 
    
	
Witness’s   Signature:
    	
)
    	
/s/   Carole Paton
    
	
 
    	
)
    	
 
    
	
Name   (in capitals):
    	
)
    	
 
    
	
 
    	
)
    	
 
    
	
Address:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Occupation:
    	
 
    	
 
    


 

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