Document:

ex102.htm

EXHIBIT10.2

CONSULTING AGREEMENT

This Consulting Agreement (“Agreement”), effective as of April 7, 2010 (“Effective Date”), is made by and between Emergent BioSolutions Inc. (“Emergent”), with a principal office at 2273 Research Blvd., Suite 400, Rockville, MD 20850, and Denise Esposito (“Consultant”).  Emergent and Consultant are hereinafter referred to individually as “Party” or collectively as the “Parties”.  The Parties hereby agree as follows:

1. Services; Performance Standards.  Consultant agrees to perform services (“Services”) for Emergent as set forth in Exhibit A.  Services shall be provided in accordance with the terms of this Agreement, any specific requirements as mutually agreed in writing, and best industry standards applicable thereto.  Consultant shall (a) provide the facilities and supplies necessary to perform Services unless otherwise specified, (b) report to the authorized contact(s) identified in Exhibit A or such other person(s) as Emergent or its Affiliates may designate from time to time in writing, and (c) provide Emergent with deliverables and reports described in Exhibit A, or such other reports as Emergent or its Affiliates may from time to time request.  “Affiliate” shall mean any direct or indirect, current or future subsidiary of a Party, or any other entity controlled by, under common control with, or which controls such Party.  “Control” shall mean direct or indirect possession of at least fifty percent (50%) of another entity’s voting equity (or other comparable interest for a non-corporation), or the power to direct or cause the direction of the management or policies of such entity whether through ownership of securities, by contract or otherwise.

2. Payment.  Emergent shall compensate Consultant for Services rendered as set forth in Exhibit A based on invoices submitted by Consultant and in accordance with the terms of this Agreement, provided that no invoice shall be required for payment of the retainer set forth in Exhibit A.  All invoices shall reference the Emergent Accounting Codes designated in Exhibit A, and, if Consultant bills on an hourly basis, be accompanied by a timesheet signed by the Parties that details the hours worked.  Invoices shall be payable within forty-five (45) days of receipt by Emergent.  Payment of an invoice shall be in full compensation for the corresponding Services performed unless expressly otherwise agreed in writing by the Parties.  Consultant shall not receive employee benefits (such as paid vacation, sick leave or any insurance benefits) from Emergent even if Consultant is physically situated at Emergent’s offices.  Consultant shall be fully responsible for payment of all income taxes, social security taxes, and for any other taxes or payment which may be due and owing by Consultant as the result of fees or amounts paid to it by Emergent under this Agreement, and Consultant shall indemnify and hold harmless Emergent from and against any such tax or payment.

3. Expenses.  Emergent shall reimburse Consultant for out-of-pocket expenses reasonably incurred in the performance of Services in addition to the compensation detailed in Exhibit A.  Consultant shall submit monthly invoices detailing and categorizing expenses incurred during the immediately preceding month and shall provide supporting documentation as reasonably required by Emergent.  Expenses shall not be marked up and shall not exceed fifteen percent (15%) of Maximum Compensation for the applicable invoice period without prior written pre-approval by Emergent.  All travel must be in accordance with the Emergent Corporate Travel, Food and Lodging Policy.  This Agreement relates to the provision of Services only, and Consultant shall not purchase equipment, goods, software or other tangible or intangible property for which it will seek reimbursement from Emergent without Emergent's express, prior written authorization.

4. Confidential Information.  Consultant acknowledges that this Agreement creates a confidential relationship between the Parties, and that, in order to perform the Services, Consultant or its members, principals, directors, shareholders, officers, employees, agents, affiliates and advisors (collectively, “Representatives”) may need to have access to certain commercially valuable, proprietary, and non-public information that Emergent considers to be Confidential Information.  “Confidential Information” means any and all written, oral, electronic, graphic or other information relating directly or indirectly to Emergent or the business, products, markets, customers, suppliers, condition (financial or otherwise), operations, assets, liabilities, results of operations, cash flows or prospects of Emergent that is delivered, disclosed or furnished by or on behalf of Emergent to Consultant or its Representatives, whether before, on or after the Effective Date hereof, or which Consultant or its Representatives otherwise learns or obtains, through observation or through analysis of such information, and shall also be deemed to include all notes, analyses, compilations, studies, forecasts, interpretations or other documents prepared by Consultant or its Representatives to the extent such material contains, reflects or is directly based upon, in whole or in part, such information.  Confidential Information may include, without limitation, technical information, business plans, identification or characterization of biological or other materials, results and/or design of experiments or preclinical or clinical testing, know-how, trade secrets, methods, methodologies, designs, specifications, clinical protocols, data, inventions, improvements, intellectual properties, devices, processes, procedures, financial analysis, accounting policies and procedures, employee staffing, employee compensation and benefits, manuals and marketing and advertising strategies disclosed directly or indirectly by Emergent to Consultant (whether prepared by Emergent, its advisors or otherwise). Consultant agrees to keep confidential and not, without the prior written consent of Emergent, publish, disclose to any third party or use (except for purposes of performance under this Agreement) any Confidential Information. The obligations of this paragraph do not pertain to information which is generally known or hereafter becomes generally known to the public through no fault of Consultant or which is disclosed by Consultant with the written approval of Emergent.  Consultant shall return all Confidential Information to Emergent upon completion of the corresponding Services hereunder or upon Emergent’s request.  Consultant shall be entitled to disclose Confidential Information as required by applicable law, regulation or court order only to the extent necessary to comply therewith; provided, however, Consultant shall, if reasonably practicable, provide Emergent an opportunity to seek to prevent disclosure of, or to obtain a protective order for, such Confidential Information by giving advance written notice of such required disclosure; provided further, that Consultant shall make such required disclosures in consultation with Emergent and shall cooperate with Emergent in connection with efforts to obtain any protective order or other remedy.

5. Ownership of Work. Consultant shall promptly disclose to Emergent in writing all data, information, documents, materials and inventions relating to or arising out of Services, and agrees that all right, title, and interest in and to the foregoing shall belong to and be the property of Emergent.  Consultant hereby assigns all its rights in the foregoing to Emergent and agrees, without further payment by Emergent, to make any further assignments and execute all documents necessary to effect Emergent's title thereto in all countries of the world.  All documents and materials prepared by Consultant in the performance of Services constitute works-for-hire and shall belong to and be the exclusive property of Emergent, and shall be surrendered by Consultant to Emergent upon request.

6. Independent Contractor.  With respect to the subject matter hereof, the Parties are and remain independent contractors.  This Agreement shall not be deemed to create an employer/employee relationship, joint venture, partnership, association, or agency between the Parties.  Consultant is not authorized to incur or create any obligation (express or implied) on behalf of Emergent or to bind Emergent in any manner whatsoever.

7. Term; Termination.  This Agreement is effective as of the Effective Date and shall continue in effect for twelve (12) months thereafter or until the Agreement otherwise terminates under this Section (“Term”); provided, however, that in the event that any amendment thereto is then pending, the Term shall be automatically extended until the Services to be provided under such amendment are completed.  This Agreement shall terminate upon the expiration of the Term or the first to occur of (a) the date Emergent provides Consultant with written notice that this Agreement is being terminated for “cause” where Consultant:  (i) commits any act of embezzlement, theft or fraud against Emergent; (ii) is convicted of a felony or any crime involving moral turpitude, whether or not related to Services; (iii) commits any act of gross negligence or willful misconduct; or (iv) breaches the representations, warranties or covenants contained in this Agreement; or (b) the date on which either Party terminates the Agreement for convenience on not less than thirty (30) days’ prior written notice.  Upon termination of this Agreement, neither Party shall have further liability to the other Party, except for Emergent’s obligation for payment in accordance with the terms of this Agreement for Services provided prior to the termination date.  The provisions of Sections 2 – 5, 7, and 9 – 12, shall survive the expiration or termination of this Agreement for any reason.

8. Representations and Warranties. In addition to any other representations and warranties set forth in this Agreement, Consultant represents and warrants that Consultant:  (a) will perform Services in a competent, diligent and workmanlike manner consistent with the expected industry standards of professional conduct; (b) has not ever been debarred, and any Consultant representative who provides any portion of the Services has not been debarred, pursuant to the United States Food, Drug and Cosmetic Act, or been excluded from any federal health care program (including Medicare or Medicaid), and Consultant will notify Emergent immediately if any of the foregoing occurs; (c) will perform Services for Emergent and has been advised of the restrictions and obligations set forth in this Agreement, including without limitation, the requirements of confidentiality and compliance with laws; (d) has full power to enter into and fully perform this Agreement and has the full and unrestricted right to disclose to Emergent any information Consultant makes available to Emergent under this Agreement; and (e) in the event Consultant is employed by a third party, Consultant has verified that the Services do not present a conflict with Consultant’s primary employment and that Consultant has the right and authority to authority to enter into this Agreement and to comply with the requirements of Section 5 (Ownership of Work).

9. Compliance with Laws.  Consultant shall perform its duties and responsibilities hereunder in accordance with the highest standards of ethical business conduct and not engage in any acts or activities that are illegal or that may adversely affect or reflect upon the business, integrity or goodwill of Emergent.  Consultant shall take no action that it believes might cause (or be construed as causing) Emergent to be in violation of international, federal, state or local laws or regulations, or Emergent’s policies and procedures.  Consultant further agrees, to the extent applicable to performance of the Services, to abide by the Emergent BioSolutions Code of Conduct and Business Ethics policy as posted from time to time on the company’s website.  Without limiting the generality of the foregoing, Consultant represents, warrants and agrees that Consultant will: (a) comply with all applicable laws, rules and regulations, including those governing employment practices (including employee recruiting and hiring), anti-bribery, anti-corruption and anti-gratuities laws or other similar laws; (b) comply with Emergent stated policies and procedures generally applicable to parties operating at Emergent’s offices, including those governing safety, health, harassment, and discrimination; (c) prohibit its staff or any representatives from involvement with the payment or giving of anything of value, either directly or indirectly, to an official of any government, political party or official thereof, any candidate for foreign political office, or any official of an international organization, for the purpose of influencing an act or decision in its official capacity, or inducing that official to use influence with any government, to assist Emergent in obtaining or retaining business for or with, or directing business to, any person, or for obtaining an improper advantage; and (d) certify in writing, at such times as may be requested by Emergent, that Consultant and its Representatives understand, have complied with and are in compliance with the foregoing.  Consultant will immediately advise Emergent if Consultant should learn of or have reason to believe that there has been a violation of any of the foregoing undertakings.

10. Export Control Restrictions.  Each Party acknowledges that, in the course of exchanging Confidential Information, it may desire to have access to certain information about the production and/or development of materials that is subject to export controls by the U.S. Department of Commerce and requires a specific license from that agency before such technology can be transferred outside the United States or disclosed in the United States to nationals of other countries (unless such individuals have been granted U.S. citizenship, permanent residence, or asylee status) (“Controlled Technology”).  Each Party agrees that Controlled Technology will not be transferred or “released” (as that term is defined in Title 15 CFR Sect. 734.2(b)(3)) to the other Party unless and until the disclosing Party notifies the prospective receiving Party that such information constitutes Controlled Technology and the prospective receiving Party agrees in writing to receive such Controlled Technology, and that any such ultimate disclosure or “release” shall be provided under a license or as may be otherwise authorized by the laws of the United States.

11. Dispute Resolution.  All disputes or claims arising hereunder that cannot be resolved by the Parties shall be submitted to non-binding mediation for a period of thirty (30) days, which may be extended by written agreement of the Parties.  If such dispute is not resolved through mediation or otherwise within the specified period, either Party may pursue remedies available to it at law or in equity, subject to the terms of this Agreement.

12. Restriction on Insider Trading.  Emergent BioSolutions Inc. is a publicly traded company on the New York Stock Exchange.  Consultant acknowledges the existence of laws and regulations prohibiting “insider trading,” including the purchase or sale of securities of a company while in the possession of material information that has not been generally disclosed in the marketplace.  Consultant acknowledges and agrees that, to the extent that material nonpublic information of Emergent BioSolutions Inc. or its Affiliates is shared with Consultant to enable Consultant to perform the Services, Consultant covenants and agrees that it will not engage in insider trading or disclose such information to any third parties.

13. Force Majeure.  Neither Party shall be liable for delay or failure in the performance of any of its obligations under this Agreement if and to the extent such delay or failure is due to circumstances beyond the reasonable control of such Party, including but not limited to fires, floods, explosions, accidents, acts of God, war, riot, strike, lockout or other concerted acts of workers, acts of government and shortages of materials. The Party claiming force majeure shall use its commercially reasonable efforts to eliminate or prevent the cause so as to continue performing its obligations under this Agreement.  During such time that the event of force majeure causes such a delay or failure of performance, this Agreement and the Parties’ obligations and responsibilities under it shall be deemed suspended until the event of force majeure ceases.

14. Miscellaneous Provisions.

(a) Non-Waiver.  No delay by or omission of any Party in exercising any right, power, privilege, or remedy shall impair such right, power, privilege, or remedy or be construed as a waiver thereof.

(b) Remedies.  The rights and remedies provided in this Agreement are cumulative and are not exclusive of other rights or remedies provided by law.

 

(c) Notices.  Any notice hereunder shall be given by first class mail, express mail, or facsimile (followed by confirmation), addressed to the Parties at the addresses given in the preamble of this Agreement, or to such other address as a Party may later designate in writing to the other Party.  Notice of any legal action, claim or other legal matter given by Consultant to Emergent shall be directed to Emergent’s General Counsel at 2273 Research Boulevard, Rockville, Maryland, USA 20850.

(d) Use of Name.  Neither Party shall use the name, tradename or trademark of the other Party in a press release, advertising, publicity or promotional activity without the prior written consent of the other Party.

(e) Severability.  In the event that any section or any part of a section of this Agreement should be declared void, invalid, or unenforceable by any court of law, for any reason, such a determination shall not render void, invalid, or unenforceable any other section or any part of any other section of this Agreement and the remainder of this Agreement shall remain in full force and effect.

(f) Headings.  Headings and titles of parts and sections are for convenience only and have no interpretative significance.

(g) Assignability.  This Agreement may not be assigned by Consultant without Emergent’s prior, express written consent.  Emergent may, without Consultant’s written consent, assign and transfer this Agreement to any Affiliate, in which event Consultant agrees to continue to perform the duties and obligations according to the terms hereof to or for such assignee or transferee of this Agreement.

(h) Amendments.  No modification or amendment to this Agreement shall be effected by or result from the receipt, acceptance, signing or acknowledgement of any purchase order, quotation, invoice, shipping document or other business form containing terms or conditions different from those set forth in this Agreement, and all such additional terms and conditions are hereby specifically rejected by both Parties.

(i) Governing Law and Jurisdiction.  This Agreement and its interpretation shall be governed by the laws of the State of Maryland without reference to its conflict of law or choice of law provisions.  Any action commenced by a Party to enforce the terms of this Agreement must be brought in the courts of the jurisdiction where the Services were primarily delivered hereunder, and the Parties hereby irrevocably consent to the jurisdiction and venue of such courts to enforce the terms of this Agreement.  The Parties expressly waive any right that they have or may have to a jury trial of any dispute arising out of or in any way related to this Agreement, or any breach thereof.

(j) Integration; Counterparts; Signatures.  This Agreement (including any corresponding exhibits) constitutes the entire agreement of the Parties, supersedes all prior discussions, negotiations and understandings verbal and written, if any, and may only be amended or modified by a written agreement signed by both Parties.  In the event of a conflict between the terms of this Agreement and the terms of any Exhibit or attachment hereto, or any proposal, quotation or any Consultant documentation, the terms of this Agreement shall prevail.  This Agreement may be signed in multiple identical copies, each of which shall be deemed to be an original copy, and each facsimile or electronic copy shall constitute a legally binding, enforceable document.  Electronic signatures shall not be an acceptable means of execution unless both Parties have agreed in writing to the format and standard of such signature.

(k) Advice of Counsel.  EACH PARTY ACKNOWLEDGES THAT, IN EXECUTING THIS AGREEMENT, SUCH PARTY HAS HAD THE OPPORTUNITY TO SEEK THE ADVICE OF INDEPENDENT LEGAL COUNSEL, AND HAS READ AND UNDERSTOOD ALL OF THE TERMS AND PROVISIONS OF THIS AGREEMENT. THIS AGREEMENT SHALL NOT BE CONSTRUED AGAINST ANY PARTY BY REASON OF THE DRAFTING OR PREPARATION HEREOF.

IN WITNESS WHEREOF, Emergent and Consultant have entered into this Agreement as of the Effective Date.

 

	
Emergent BioSolutions Inc.

 

By:  /s/Jay G. Reilly

Name: Jay G. Reilly

Title:   Acting General Counsel

Date:  April 28, 2010

	
Denise Esposito

 

By:  /s/Denise Esposito

Date: April 28, 2010

 

  

  

  

Exhibit A

SERVICES

 

Capitalized terms used but not defined herein shall have the meaning ascribed to such terms in the Agreement.

1.           Description of Services:  Consultant shall cooperate fully with Emergent in the defense or prosecution of any litigation currently pending or that may be brought in the future against or on behalf of Emergent, whether before a state or federal court, in an arbitral forum or before a state or federal agency, related to the litigation against Protein Sciences Corporation, or any investigation relating to Emergent, if, in the judgment of Emergent or its counsel, your assistance or cooperation is needed due to your personal involvement in or knowledge about the circumstances to which the litigation or investigation relates.  These Services shall include, but not be limited to, being available to meet with counsel to prepare Emergent’s claims or defenses, to prepare for trial, arbitration, discovery or an administrative hearing and to act as a witness when requested by Emergent at reasonable times designated by Emergent.  Consultant shall notify Emergent promptly in the event that Consultant is served with a subpoena or is asked to provide a third party with information concerning any actual or potential complaint or claim against Emergent, dispute with Emergent or investigation or inquiry relating to Emergent.

2.           Reports: Consultant shall provide the Emergent Representative with such reports as requested by Emergent from time to time.

3.           Fees:  In consideration for the Services, Emergent shall pay Consultant (a) a retainer of $6,500.00, and (b) for any specific Services as mutually-agreed in writing, an additional fee at a rate of $300.00 per hour.

4.           Invoicing and Payment:  Invoices shall be sent to and payments made in accordance with the terms of the Agreement, and the following shall apply:

Manner/Location for Payments: First-class mail to Consultant business address

 

Accounting Codes (Must be noted on invoices for payment to be processed):

 

G/L No.: 650081                                                                Cost Center:                                10070

 

	
Emergent Address for Invoices:

	
Emergent BioSolutions Inc.

	
  

	
2273 Research Blvd., Suite 400

	
  

	
Rockville, MD  20850

	
  

	
Attn:  Accounts Payable

5.           Expenses:  Reimbursable in accordance with the terms of the Agreement.

6.           Contacts:                      Consultant Notices:                        Denise Esposito

 

Emergent Representative:  Jay Reillyex103.htm

EXHIBIT 10.3

April 7, 2010

Denise Esposito, Esquire

c/o Paul F. Mickey, Jr., Esquire

Steptoe & Johnson LLP

1330 Connecticut Avenue, NW

Washington, DC 20036-1765

Re:  Letter Agreement and Release

Dear Denise:

This Letter Agreement sets forth the terms and conditions of the agreement between you and Emergent BioSolutions Inc. (the “Company”) with respect to your separation from the Company.  If you accept the terms of this Letter Agreement, please sign and return it to Donald N. Sperling, Esquire at Stein Sperling et al., 25 West Middle Lane, Rockville, Maryland  20850, no later than 5 pm on April 28, 2010.

You are advised to consult with an attorney of your choosing before signing this Letter Agreement, and you may take up to 21 days to do so.  If you sign the Letter Agreement, you may change your mind and revoke your acceptance during the seven-day period after you have signed it by notifying Donald N. Sperling, Esquire in writing.  If you timely sign and return this Letter Agreement, and do not revoke your signature within the seven-day period after you sign it, the following terms and conditions will become binding:

1.       Termination of Employment – The parties agree that your employment with the Company ended as of March 12, 2010 (the “Termination Date”).  Effective as of the Termination Date, you no longer hold your positions as SVP, Legal Affairs and General Counsel; Chief Legal Officer; Secretary; or any other positions as an employee, officer and/or director of the Company or any of the Company’s subsidiaries.

 

2.       Severance and Compensation – You and the Company agree that your separation from the Company constitutes a qualifying event under the Severance Plan and Termination Protection Program (the “SPTPP”).  The Company agrees to provide you with the severance benefits described in the SPTPP and you agree to be bound by the conditions and obligations of the SPTPP. Accordingly, the Company will pay or provide you with the following compensation and other payments, less appropriate deductions for federal and state withholding and other applicable taxes and any lawfully authorized or required payroll deductions, in full satisfaction of the severance benefits payable under the SPTPP and in consideration for this Letter Agreement:

 

	
a.  

	
$315,016.00 which represents your annual base salary in effect as of the Termination Date;

 

	
b.  

	
$27,571.78 for 2010 pro rata target annual bonus calculated as follows: $315,016.00 (2010 base salary) x 45% (2010 bonus opportunity) x 19.45% (portion of year calculated from January 1 – March 12, 2010);

 

	
c.  

	
$8,362.50 in lieu of the Company match to your 401(k) contributions calculated as follows: $6,300 representing the balance of the maximum matching contribution for 2010 plus $2,062.50 representing the matching contribution for 2011 based on the same maximum amount ($8,250.00);

	
d.  

	
Extended health benefits for you and your eligible dependants for twelve (12) months after the Termination Date, except where the provision of such benefits would result in a duplication of benefits provided by a subsequent employer; and

	
e.  

	
Reimbursement of the premiums for your current level of life insurance coverage for twelve (12) months after the Termination Date.

The severance benefits described in subparagraphs (a) through (e) above are payable only if this Letter Agreement becomes irrevocable.  The severance payments described in subparagraphs (a) through (c) of this Section 2 will be paid out provided that you have not exercised your right to revoke this Letter Agreement as follows: $175,475.14 on September 13, 2010 and $29,245.86 shall be paid to you on the same date of each of the six (6) consecutive months thereafter.  Because you are a specified employee within the meaning of Section 409A(2)(B)(i) of the Internal Revenue Code (the “Code”), no amounts shall be paid to you pursuant to subparagraphs (a) through (c) until that date which is six (6) months and one (1) day after your “separation from service” within the meaning of Section 409A(a)(2)(A)(i).  In the event the United States Food and Drug Administration (“FDA”) requires you to divest or liquidate your right to receive severance payments under this agreement as a condition of employment with the FDA, the Company agrees to consider your request to accelerate any remaining installments hereunder to the extent permitted in accordance with Treasury Regulation Section 1.409A-3(j)(4)(iii) and in a manner consistent with any agreement between you and the FDA ethics office.  The health benefits described in subparagraph (d) of this Section 2 will be paid directly on your behalf.

In addition, you are entitled to the following payments, regardless of whether you sign and return this Letter Agreement, and you agree that you have received such payments:

	
·  

	
$109,633.68 which represents your bonus for calendar year 2009;

 

	
·  

	
All earned but unpaid salary and accrued but unused paid time off earned during the 2010 calendar year through the Termination Date, at your current base salary of $315,016.00, less all applicable employment taxes and other withholding pursuant to federal and state regulations.  Such payments have been made in the normal payroll period following the Termination Date; and

 

	
·  

	
Reimbursement for any unreimbursed reasonable business expenses that you incurred before the Termination Date, which will be paid within thirty days of submission of the required expense reports and supporting documentation.

 

3.         Release - In consideration of the payment of the severance benefits described in Section 3(a) of the SPTPP and in Sections (a) through (e) of Paragraph 2 above, you hereby fully, forever, irrevocably and unconditionally release, remise and discharge the Company and all affiliates, subsidiaries, and parent companies and their respective owners, officers, directors, employees, and agents (each in their individual and corporate capacities), and all employee benefit plans and plan fiduciaries (hereinafter, the "Released Parties") from any and all claims, charges, complaints, demands, actions, causes of action, suits, rights, debts, sums of money, costs, accounts, reckonings, covenants, contracts, agreements, promises, doings, omissions, damages, executions, obligations, liabilities, and expenses (including attorneys' fees and costs), of every kind and nature that you ever had or now have against any or all of the Released Parties, including, but not limited to, any and all claims arising out of or relating to your employment with and/or separation from the Company, including, but not limited to, all employment discrimination claims under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq., the Americans with Disabilities Act of 1990, 42 U.S.C. § 12101 et seq., the Age Discrimination in Employment Act, 29 U.S.C. § 621 et seq., the Rehabilitation Act of 1973, 29 U.S.C. § 701 etseq., Executive Order 11246, Executive Order 11141, the Maryland Fair Employment Practices Act, Md. Ann. Code art. 49B, § 1 et seq., the Maryland Anti-Discrimination Act (96 DLR A-2, 5/17/01), the Maryland Regulations on Anti-Discrimination Relating to Persons with Disabilities, Md. Regs. Code tit. 14, § 03.02.01 et seq., the Maryland Equal Pay Law, Md. Code Ann., Lab. & Empl. § 3-301 et seq. all as amended, all as amended, all claims arising out of the Fair Credit Reporting Act, 15 U.S.C. § 1681 et seq., the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1001 et seq., and Section 806 of the Corporate and Criminal Fraud Accountability Act of 2002, 18 U.S.C. § 1514(A), all as amended, all common law claims including, but not limited to, actions in defamation, intentional and negligent infliction of emotional distress, misrepresentation, fraud, wrongful discharge and breach of contract, all claims to any non-vested ownership interest in the Company, contractual or otherwise, including, but not limited to, claims to stock or equity compensation, all claims with respect to any bonus or other incentive compensation with respect to a sale of the Company or any affiliate thereof or to any termination protection pay under the SPTPP, and any claim or damage arising out of your employment with and/or separation from the Company (including a claim for retaliation) under any common law theory or any federal, state or local statute or ordinance not expressly referenced above; provided, however, that nothing in this Letter Agreement prevents you from filing, cooperating with, or participating in any proceeding before the Equal Employment Opportunity Commission or a state fair employment practices agency (except that you acknowledge that you may not be able to recover any monetary benefits in connection with any such claim, charge or proceeding).  To implement a full and complete release and discharge, you expressly acknowledge that this Release is intended to include in its effect, without limitation, all claims you do not know or suspect to exist in your favor at the time of execution of this Release.  You agree that this Release contemplates the extinguishment of any such claim or claims.

 

4.         Confidentiality; Continuing Obligations - You acknowledge and reaffirm your obligation to maintain the confidentiality of all non-public information concerning the Company and its affiliates that you acquired during the course of your employment with the Company.  You reconfirm and agree that you remain bound by the terms and conditions of the Non-Disclosure and Invention Assignment Agreement that you signed on December 2, 2004 and the Confidentiality and Non-Solicitation Agreement that you signed on the same date.  You further acknowledge the continuing effect of the obligations set forth in Exhibit I to the letter dated August 11, 2006 by which you elected to participate in the SPTPP and you hereby agree to comply with such obligations for a period of twelve (12) consecutive months after the Termination Date (instead of the six (6) month period set forth therein).

 

5.         Return of Company Property - You confirm that you have returned to the Company in good working order all Company property including, but not limited to, keys, files, records, books, manuals, lists, printouts, and any other documents (and copies thereof), equipment (including, but not limited to, computer hardware, software and accessories, printers, wireless handheld devices, zip drives, diskettes, flashdrives, cellular phones, pagers, etc.), Company identification, Company vehicles, Company confidential and proprietary information and any other Company-owned property that is in your possession or control.  You further confirm that you have left intact and agree to leave intact all electronic Company documents, including, but not limited to, those that you developed or helped to develop during your employment, except for those electronic Company documents that you deleted in accordance with the Company’s written records management policy.  You also confirm that you have cancelled all accounts for your benefit, if any, in the Company’s name, including, but not limited to, credit cards, telephone charge cards, cellular phone and/or pager accounts and computer accounts.

6.           Compensation; Loans - You acknowledge and agree that you have received all payments to which you are entitled for all services rendered to date in conjunction with your employment and that no other compensation, including salary, bonuses, or severance payments or benefits pursuant to any plan, policy or practice, are owed to you, other than those described herein.  You also represent that you do not have any outstanding loans, advances, or extensions of credit under which you are or may be liable to the Company or its affiliates.

7.           Non-Disparagement - You understand and agree that you shall not make any false, disparaging or derogatory statements to any media outlet, industry group, financial institution or current or former employee, consultant, client or customer of the Company or to any other person or entity regarding the Company or any of its stockholders, directors, officers, employees, agents or representatives or about the Company’s business affairs and financial condition.  The Company agrees that it shall not make any false, disparaging or derogatory statements about you to any media outlet, industry group, financial institution or current or former employee, consultant, client or customer of the Company or to any other person or entity.

 

8.           Cooperation - You agree to cooperate fully with the Company in the defense or prosecution of any litigation currently pending or that may be brought in the future against or on behalf of the Company, whether before a state or federal court, in an arbitral forum or before a state or federal agency, or any investigation relating to the Company, if, in the judgment of the Company or its counsel, your assistance or cooperation is needed due to your personal involvement in or knowledge about the circumstances to which the litigation or investigation relates.  Your full cooperation in connection with such litigation or investigation shall include, but not be limited to, being available to meet with counsel to prepare the Company’s claims or defenses, to prepare for trial, arbitration, discovery or an administrative hearing and to act as a witness when requested by the Company at reasonable times designated by the Company.  In consideration for such cooperation, the Company agrees to pay you at your reasonable and customary hourly rate as authorized in advance by the Company.  For the purposes of any payments made to and retained by you pursuant to this Section 8, you acknowledge that you shall be treated as an independent contractor and not as an employee.  You further acknowledge and agree that the company shall not be liable for any withholding taxes, including, without limitation, worker's compensation, unemployment insurance, employers' liability, employer's FICA, social security, or other withholding tax for payments made and retained by you pursuant to this Section 8.  All such costs shall be your responsibility. You agree that you will notify the Company promptly in the event that you are served with a subpoena or in the event that you are asked to provide a third party with information concerning any actual or potential complaint or claim against the Company, dispute with the Company or investigation or inquiry relating to the Company.  You agree to maintain the confidentiality of all non-public information concerning the Company and its affiliates that you acquire during the course of your engagement with the Company pursuant to this Section 8.  Notwithstanding the foregoing, any services that you provide to the Company in connection with the litigation against Protein Sciences Corporation shall be compensated in accordance with the terms and conditions of that certain Consulting Agreement effective April 7, 2010, between you and the Company.

 

9.           References – You agree to copy Paula Lazarich on all reference requests to the Company.  The Company will thereafter respond to any such reference request by providing the inquiring party with confirmation of your dates of employment, positions held, salary, and other information as you and Company may agree in writing.  You acknowledge that no representative of the Company is authorized to provide a further reference on behalf of the Company.  You further acknowledge and agree that to the extent any employee of the Company provides a personal reference for you, you will not make or threaten to make any claim or to take any other action against such Company employee based on or relating to such personal reference.

 

10.           Amendment - This Letter Agreement shall be binding upon the parties and may not be modified in any manner, except by an instrument in writing of concurrent or subsequent date signed by duly authorized representatives of the parties hereto.  This Letter Agreement is binding upon and shall inure to the benefit of the parties and their respective agents, assigns, heirs, executors, successors and administrators.

11.           Tax Provision – In connection with the severance benefits provided to you pursuant to this Letter Agreement, the Company shall withhold and remit to the tax authorities the amounts required under applicable law, and you shall be responsible for all applicable taxes with respect to such severance benefits under applicable law.  You acknowledge that you are not relying upon advice or representation of the Company with respect to the tax treatment of any of the severance benefits set forth herein.

12.           Section 409A - This Letter Agreement shall be interpreted to ensure that the payments made to you are exempt from, or comply with, Section 409A of the Code; provided, however, that nothing in this Letter Agreement shall be interpreted or construed to transfer any liability for any tax (including a tax or penalty due as a result of a failure to comply with Section 409A) from you to the Company or to any other individual or entity.

 

13.           Waiver of Rights - No delay or omission by the Company in exercising any right under this Letter Agreement shall operate as a waiver of that or any other right.  A waiver or consent given by the Company on any one occasion shall be effective only in that instance and shall not be construed as a bar to or waiver of any right on any other occasion.

 

14.           Validity - Should any provision of this Letter Agreement be declared or be determined by any court of competent jurisdiction to be illegal or invalid, the validity of the remaining parts, terms or provisions shall not be affected thereby and said illegal or invalid part, term or provision shall be deemed not to be a part of this Letter Agreement.

 

15.           Confidentiality - To the extent permitted by law, you understand and agree that you and your agents and representatives shall maintain as confidential the terms and contents of this Letter Agreement, and the contents of the negotiations and discussions resulting in this Letter Agreement, and shall not disclose such terms, contents, negotiations or discussions except to the extent required by federal or state law or as otherwise agreed to in writing by the Company or as specifically disclosed by the Company in any public disclosure or public filing.  You are to advise any such person with whom you have discussed this Letter Agreement of the existence and requirements of this confidentiality provision, and you shall instruct any such person that he/she shall not disclose the existence of this Letter Agreement or its terms to any other person.  Disclosure by you to any other person or entity in violation of the provisions of this Letter Agreement shall be deemed to be a breach of this Letter Agreement.

 

16.           Nature of Agreement - You understand and agree that this Letter Agreement is a severance agreement and does not constitute an admission of liability or wrongdoing on the part of the Company.

17.           Indemnification - The Company agrees that you are not releasing any claims you may have for indemnification under state law, the charter, articles, or by-laws of the Company and/or its affiliates, or under the Indemnity Agreement with the Company, which you signed on January 26, 2005, or any applicable insurance policy providing directors’ and officers’ coverage; provided, however, that (i) the Company’s execution of this Agreement is not a concession or guaranty that you have any such rights to indemnification, (ii) this Agreement does not create any additional rights to indemnification, and (iii) the Company retains any defenses it may have to such indemnification or coverage.

18.           Accrual of Benefits.  The parties acknowledge and agree that, following the Termination Date, you shall not receive or accrue any benefits other than those described herein and those required by law, including but not limited to paid time off, insurance, holiday pay, or other benefits as provided by the Company.

19.           No Workplace Injury.  You acknowledge that you have suffered no workplace injuries during your employment by the Company and its affiliates.  You agree that, as of the date of this Letter Agreement, you were able to perform the essential functions of your job.

20.           Acknowledgments - You acknowledge that you have at least 21 days to consider this Letter Agreement and that the Company hereby advises you in writing to consult with an attorney of your own choosing prior to signing this Letter Agreement.  You understand that you may revoke this Letter Agreement for a period of seven days after you sign this Letter Agreement by notifying Donald N. Sperling, Esquire in writing, and the Letter Agreement shall not be effective or enforceable until the expiration of this seven-day revocation period.  You understand and agree that by entering into this Letter Agreement, you are waiving any and all rights or claims you might have under the Age Discrimination in Employment Act, as amended by the Older Workers Benefits Protection Act, and that you have received consideration beyond that to which you were previously entitled.

21.           Voluntary Assent - You affirm that no other promises or agreements of any kind have been made to or with you by any person or entity whatsoever to cause you to sign this Letter Agreement and that you fully understand the meaning and intent of this Letter Agreement.  You state and represent that you have had an opportunity to fully discuss and review the terms of this Letter Agreement with an attorney.  You further state and represent that you have carefully read this Letter Agreement understand the contents herein, freely and voluntarily assent to all of the terms and conditions hereof, and sign your name of your own free act.

22.           Applicable Law - This Letter Agreement shall be interpreted and construed by the laws of the State of Maryland, without regard to conflict of laws provisions.

23.           Dispute Resolution - The parties agree to first submit any claims against the other party or against any directors, officers, employees, agents or representatives of the Company or its affiliates, relating in any way to this Letter Agreement, to your retention by or services for the Company, to the termination of such retention or services, or to any or all other claims that one party might have against the other party, including, without limitation, claims for employment or other discrimination under any federal, state or local law, regulation, ordinance or executive order to nonbinding mediation.  Only after the completion of such nonbinding mediation efforts may either party initiate legal proceedings against the other party.  Notwithstanding the foregoing, either party may institute legal proceedings against the other party for claims for injunctive relief related to Paragraphs 4, 5, 7, and 15 herein.  The parties hereby irrevocably submit to and acknowledge and recognize the exclusive jurisdiction of the courts of the State of Maryland, or if appropriate, a federal court located in Maryland (which courts, for purposes of this Letter Agreement, are the only courts of competent jurisdiction), over any suit, action or other proceeding arising out of, under or in connection with this Letter Agreement or the subject matter hereof, except as otherwise provided herein.

24.           Entire Agreement - This Letter Agreement contains and constitutes the entire understanding and agreement between the parties hereto with respect to your severance benefits and the settlement of claims against the Company and cancels and supersedes all previous oral and written negotiations, agreements and commitments in connection therewith. Nothing in this Paragraph, however, shall modify, cancel or supersede any of the documents referenced herein except that your continuing obligations under Exhibit I to the letter dated August 11, 2006 shall be modified by Paragraph 4 herein.  Notwithstanding the foregoing, the Consulting Agreement between you and the Company effective April 7, 2010 shall not be modified, canceled or superseded by this Letter Agreement.

* * * * *

If you are in agreement with the terms of this Letter Agreement, please sign the Agreement on Page 7 and return it to Donald N. Sperling, Esquire at Stein Sperling et al., 25 West Middle Lane, Rockville, Maryland  20850.  The Agreement must be signed and returned to Donald N. Sperling, Esquire no later than 5pm on April 28, 2010.

If you choose not to timely sign and return this Letter Agreement, or if you timely revoke your acceptance of it in writing, you will not receive the severance benefits described in Sections (a) through (e) of Paragraph 2, above.  Regardless of whether you sign and return this Letter Agreement, or if you sign it but timely revoke your acceptance, you are entitled to receive unpaid salary and accrued but unused paid time off earned during the 2010 calendar year through the termination of your employment, less all applicable employment taxes and other withholdings pursuant to federal and state regulations, and reimbursement of outstanding business expenses.

If you have any questions about the matters covered in this Letter Agreement, please contact Donald N. Sperling, Esquire at 301-838-3202.

Sincerely,

 

/s/Paula Lazarich

Paula Lazarich

Vice President Human Resources

NOTE:  THIS LETTER AGREEMENT CONTAINS A GENERAL RELEASE OF CLAIMS.  PLEASE READ IT CAREFULLY BEFORE SIGNING BELOW.

I hereby agree to the terms and conditions set forth above.  I have been given at least 21 days to consider the terms set forth in this Letter Agreement, and I have chosen to execute it on the date below.  I agree and intend that this Letter Agreement is a binding agreement between the Company and me if I do not revoke my acceptance within seven days of my execution of the document.

 

 

/s/Denise Esposito_                                      4/28/10

Denise Esposito                                             Date

Please execute and return to return it to Donald N. Sperling, Esquire at Stein Sperling et al., 25 West Middle Lane, Rockville, Maryland  20850, no later than 5pm on April 28, 2010.

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