AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
This Amended and
Restated Employment Agreement (this “Agreement”) is
made and entered into as of November 10, 2008 (the
“Effective Date”) by and between GTx, Inc. ,
located at 3 North Dunlap, 3 rd Floor, Memphis, Tennessee 38163 (the
“Employer”), and MARK E. MOSTELLER (the
“Employee”), residing at 5064 Anchor Cove, Memphis,
Tennessee 38117.
WHEREAS, the
Employee has been providing services to Employer as Chief Financial
Officer under the terms of an Employment Agreement effective as of
October 1, 2003 (the “Prior Employment
Agreement”); and
WHEREAS, the
Employer and the Employee wish to amend and restate the Prior
Employment Agreement as set forth herein in order to comply with
the parties’ intent that the Prior Employment Agreement be
interpreted, construed and administered in a manner that satisfies
Section 409A of the Internal Revenue Code of 1986, as amended
from time to time (the “Code”); and
WHEREAS, during
the course of Employee’s employment with the Employer, the
Employer will train and continue to train Employee and to impart to
Employee proprietary, confidential, and/or trade secret
information, data and/or materials of the Employer; and
WHEREAS, the
Employer has a vital interest in maintaining its confidential
information and trade secrets, as well as rights to inventions,
since doing so allows the Employer to compete fairly and enhances
the value of the Employer to shareholders and job security for
employees; and
WHEREAS, the
Employer desires to procure the services of Employee and Employee
is willing to be employed and continue to be employed with the
Employer upon the terms and subject to the conditions set forth in
this Agreement;
NOW, THEREFORE, in
consideration of the mutual covenants and agreements contained in
this Agreement, the employment and continued employment of Employee
in accordance with the terms and conditions of this Agreement, and
other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the Parties, intending to be
legally bound, agree and covenant as follows:
For the purposes
of this Agreement, the following terms have the meanings specified
or referred to in this Section 1.
“Agreement” has the meaning set forth in
first paragraph of this Agreement.
“Basic Compensation” means Salary and
Benefits.
“Benefits” means as defined in
Section 3.1(b).
“Board of Directors” means the Board of
Directors of the Employer.
1.
“CEO” has the meaning set forth in
Section 2.2.
“Change of Control” means any of the
following events: (a) the sale or other disposition of all or
substantially all of the assets of Employer in a single transaction
or in a series of transactions (including, without limitation, any
liquidation or dissolution of Employer); (b) any Person or
group becomes the beneficial owner, directly, or indirectly, of
securities of the Employer representing more than fifty percent
(50%) of the combined voting power of the Employer’s then
outstanding securities other than by virtue of a merger,
consolidation or similar transaction (for such purposes,
“voting stock” shall mean the capital stock of Employer
of any class or classes, the holders of which are ordinarily, in
the absence of contingencies, entitled to vote for the election of
members of the Board of Directors (or Persons performing similar
functions) of Employer); or (c) a merger or consolidation of
Employer with or into any other entity, if immediately after giving
effect to such transaction more than fifty percent (50%) of the
issued and outstanding voting stock of the surviving entity of such
transaction is held by persons who were not holders (taking into
account their individual and affiliated holdings) as of the
Effective Date of at least twenty percent (20%) of the voting stock
of Employer. A Change of Control shall not include: (1) any
transfer or issuance of stock of Employer to one or more of
Employer’s lenders (or to any agents or representatives
thereof) in exchange for debt of Employer owed to any such lenders;
(2) any transfer of stock of Employer to or by any person or
entity, including but not limited to one or more of the
Employer’s lenders (or to any agents or representatives
thereof), pursuant to the terms of any pledge of said stock as
collateral for any loans or financial accommodations to Employer
and/or its subsidiaries; (3) any transfer or issuance to any
person or entity, including but not limited to one or more of
Employer’s lenders (or to any agents or representatives
thereof), in connection with the workout or restructuring of
Employer’s debts to any one of Employer’s lenders,
including but not limited to the issuance of new stock in exchange
for any equity contribution to Employer in connection with the
workout or restructuring of such debt; (4) any transfer of
stock by a stockholder of Employer which is a partnership or
corporation to the partners or stockholders in such stockholder or
any transfer of stock by a stockholder of Employer to an entity
affiliated with such stockholder or the immediate family of such
stockholder or a trust or similar entity for the benefit of such
family members; or (5) any transfer or issuance of stock in
connection with an offering of the Employer’s stock in a
registered public transaction not involving a transaction described
in Rule 145, promulgated under the Securities Act of 1933, as
amended, provided that the Employer’s officers and Board of
Directors shall not materially change as a result
thereof.
“Change of Control Termination” means
(i) a Termination Without Cause of the Employee’s
employment by the Employer (other than for death or disability)
within six (6) months after a Change of Control or
(ii) the Employee’s resignation for Good Reason within
six (6) months after a Change of Control.
“Confidential Information and/or Proprietary
Information” means any and all:
(a) information
disclosed to Employee or known by Employee as a consequence of, or
through, Employee’s employment with the Employer since his
date of employment on August 6, 2001 (including information
conceived, originated, discovered, or developed in whole or in part
by Employee), not generally known in the relevant trade or
industry, about the Employer’s business, products, processes,
and services; and trade secrets concerning the business and affairs
of the Employer, product specifications, data, know-how, formulae,
compositions, research, processes, designs, sketches, photographs,
graphs, drawings, samples, inventions and ideas, past,
2.
current, and
planned research and development, current and planned manufacturing
or distribution methods and processes, customer lists, current and
anticipated customer requirements, price lists, market studies,
business plans, computer software and programs (including object
code and source code), computer software and database technologies,
systems, structures, and architectures (and related formulae,
compositions, processes, improvements, devices, know-how,
inventions, discoveries, concepts, ideas, designs, methods and
information); and any other information, however documented, that
is a trade secret within the meaning of Tenn. Code §39-14-138;
and
(b) information
concerning the business and affairs of the Employer (which includes
historical financial statements, financial projections and budgets,
historical and projected sales, capital spending budgets and plans,
the names and backgrounds of key personnel, personnel training and
techniques and materials), however documented; and
(c) intellectual
property, inventions, methods, processes, techniques, computer
programs, devices, products, services, compounds, gene therapy
products, pharmaceuticals, substances, vectors, enzymes, genes,
concepts, discoveries, improvements, and designs, whether or not
patenable in the United States or foreign countries, any trade
secrets, information, procedures, technologies, data, results,
conclusions, know-how or show-how and business information;
and
(d) notes,
analysis, compilations, studies, summaries, and other material
prepared by or for the Employer containing or based, in whole or in
part, on any information included in the foregoing.
“Delayed Initial Payment Date” has the
meaning stated in Section 9.2 of this Agreement.
“Effective Date” means the date stated in
the first paragraph of the Agreement.
“Employee” has the meaning stated in the
first paragraph of this Agreement.
“Employee Invention” means any idea,
invention, technique, modification, process, improvement (whether
patentable or not), industrial design (whether registerable or
not), work of authorship (whether or not copyright protection may
be obtained for it), design, copyrightable work, discovery,
trademark, copyright, trade secret, formula, device, method,
compound, gene, prodrug, pharmaceutical, structure, product
concept, marketing plan, strategy, customer list, technique,
blueprint, sketch, record, note, drawing, know-how, data, patent
application, continuation application, continuation-in-part
application, file wrapper continuation application or divisional
application, created, conceived, or developed by the Employee,
either solely or in conjunction with others, during the
Employee’s employment, or a period that includes a portion of
the Employee’s employment, that relates in any way to, or is
useful in any manner in, the business then being conducted or
proposed to be conducted by the Employer, and any such item created
by the Employee, either solely or in conjunction with others,
following termination of the Employee’s employment with the
Employer, that is based upon or uses Confidential Information
and/or Proprietary Information.
“Employer” means GTx, Inc., its
successors and assigns, and any of its current or future
subsidiaries, or organizations controlled by, controlling, or under
common control with it.
“Expenses” has the meaning stated in
Section 4.1 of this Agreement.
3.
“Good
Reason” for termination means that Employee
voluntarily resigns from all positions he then holds with Employer
if and only if:
(a) one
of the following actions have been taken without Employee’s
express written consent:
(i) following
a Change of Control, an adverse change in the Employee’s
authority, duties or responsibilities (including reporting
responsibilities) which, without Employee’s consent,
represents a material reduction in or a material demotion of the
Employee’s authority, duties or responsibilities as in effect
immediately prior to a Change of Control or the assignment to the
Employee of any duties or responsibilities which are materially
inconsistent with and materially adverse to such authority, duties
or responsibilities;
(ii) following
a Change of Control, a material reduction in the then current
Salary of Employee;
(iii) following
a Change of Control, the relocation of the Employer’s
principal Employee offices to a location that increases
Employee’s one-way commute by more than twenty
(20) miles; or
(iv) following
a Change of Control, the failure of the Employer to obtain an
agreement reasonably satisfactory to Employee from any successor or
assign of the Employer to assume and agree to perform this
Agreement in all material respects; or
(v) Employer
materially breaches its obligations under this Agreement or any
other then-effective agreement with Employee (including any
agreement or arrangement providing for incentive compensation or
employee benefits, including the Benefits provided in this
Agreement).
(b) Employee
provides written notice to the Employer’s Board within the
thirty (30) day period immediately following such action;
and
(c) Such
action is not remedied by the Employer within thirty (30) days
following the Employer’s receipt of such written notice;
and
(d) Employee’s
resignation is effective not later than sixty (60) days after
the expiration of such thirty (30)-day cure period.
“Person” means any individual,
corporation (including any non-profit corporation), general or
limited partnership, limited liability company, joint venture,
estate, trust, association, organization, or governmental
body.
“Proprietary Items” means any Proprietary
and/or Confidential Information embodied in any document, record,
recording, electronic media, formulae, notebook, plan, model,
component, device, or computer software or code, whether embodied
in a disk or in any other form.
“Release” means a general release of
claims, which shall specifically relate to all of Employee’s
rights and claims in existence at the time of such execution and
shall confirm Employee’s continuing obligations to the
Employer (including but not limited to obligations
4.
under
Section 7 and Section 8 of this Agreement and any other
confidentiality and/or non-competition agreement with the
Employer).
“Salary” has the meaning stated in
Section 3.1(a) of this Agreement.
“Section 409A” has the meaning
stated in Section 9.2 of this Agreement.
“Termination Date” has the meaning stated
in Section 6.3 of this Agreement.
“Termination With Cause” means the
termination of the Employee’s employment by act of the Board
for any of the following reasons:
(a) the
Employee’s conviction for a felony;
(b) the
Employee’s theft, embezzlement, misappropriation of or
intentional infliction of material damage to the Employer’s
property or business opportunities;
(c) the
Employee’s breach of the provisions contained in
Section 7 of this Agreement; or
(d) the
Employee’s ongoing willful neglect of or failure to perform
his duties hereunder or his ongoing willful failure or refusal to
follow any reasonable, unambiguous duly adopted written direction
of the CEO that is not inconsistent with the description of the
Employee’s duties set forth in Section 2.3, if such
willful neglect or failure is materially damaging or materially
detrimental to the business and operations of the Employer;
provided that Employee shall have received written notice of such
failure and shall have continued to engage in such failure after 30
days following receipt of such notice from the CEO, which notice
specifically identifies the manner in which the CEO believes that
Employee has engaged in such failure. For purposes of this
subsection, no act, or failure to act, shall be deemed
“willful” unless done, or omitted to be done, by
Employee not in good faith, and without reasonable belief that such
action or omission was in the best interest of the
Employer.
“Termination Without Cause” means the
termination of the Employee’s employment by the Employer for
any reason other than (i) Termination With Cause, or
(ii) a termination by the Employer due to Employee’s
death or disability.
2. EMPLOYMENT
TERMS AND DUTIES
The Employer
hereby continues the employment of the Employee, and the Employee
hereby accepts continued employment by the Employer, upon the terms
and conditions set forth in this Agreement.
Either the
Employee or the Employer may terminate this Agreement and the
Employee’s employment and compensation with or without Cause
or notice, at any time, at either the Employer’s or the
Employee’s option. No company officer or manager has the
authority to enter into any other agreement for employment for a
specified period of time, or to modify or to make
5.
any agreement
contrary to the foregoing, except by written amendment to this
Agreement, dated and signed by the Chief Executive Officer
(“CEO”) or the President of the Employer.
The Employee will
continue to have such duties as are assigned or delegated to the
Employee by the Board of Directors, CEO or the President, and will
initially serve as Chief Financial Officer for the Employer. The
Employee will devote his full time, attention, skill and energy to
the business of the Employer, will use his best efforts to promote
the success of the Employer’s business, and will cooperate
fully with the Board of Directors, CEO and the President in the
advancement of the best interest of the Employer. Employee agrees
to abide by all bylaws, policies, practices, procedures or rules of
Employer. Employee may be reassigned or transferred to another
management position, as designated by the Board of Directors, CEO
or the President, which may or may not provide the same level of
responsibility as the initial assignment, in accordance with the
terms and conditions of this Agreement.
(a)
Salary. The Employee will be paid for each of the twenty-six
pay periods approximately $10,919, which is the equivalent of
$283,889 per calendar year (the “Salary”).
Employee’s Salary may be adjusted from time to time by
agreement of the Employee and the CEO.
(b)
Benefits. The Employee will, during his employment, be
permitted to participate in such life insurance, hospitalization,
major medical, short term disability, long term disability, 401K
plan and other employee benefit plans of the Employer that may be
in effect from time to time, to the extent the Employee is eligible
under the terms of those plans (collectively, the
“Benefits”).
(c) The
Employer may withhold from any salary or benefits payable to
Employee all federal, state, local, and other taxes and other
amounts as permitted or required pursuant to law, rules or
regulations.
(d) In
accordance with the stock option letter Employee has received from
Employer before the date of execution hereof (the “Option
Letter”), Employee has received options to purchase common
stock of the Employer pursuant to the terms of the Option Letter
and related Stock Option Subscription Agreement executed in
connection therewith.
4. FACILITIES
AND EXPENSES
The Employer will
furnish the Employee office space, equipment, supplies, and such
other facilities and personnel as the Employer deems necessary or
appropriate for the performance of the Employee’s duties
under this Agreement. The Employer will pay the Employee’s
dues in such professional societies and organizations as the CEO or
President deems appropriate, and
6.
will pay on
behalf of the Employee (or reimburse the Employee for) reasonable
expenses incurred by the Employee at the request of, or on behalf
of, the Employer in the performance of the Employee’s duties
pursuant to this Agreement, and in accordance with the
Employer’s employment policies, including reasonable expenses
incurred by the Employee in attending conventions, seminars, and
other business meetings, in appropriat
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