Exhibit 10.266
Portions of this exhibit marked [*]
are requested to be treated confidentially.
EMPLOYMENT
AGREEMENT
THIS EMPLOYMENT
AGREEMENT (the “Agreement”), is made and entered into
on this 19 th day of May, 2009 (the
“Effective Date”), by and between Pharmaceutical
Product Development, Inc., a North Carolina corporation (the
“Company”), with a mailing address for notice purposes
of 929 North Front Street, Wilmington, North Carolina 28401,
Attention: Executive Chairman of the Board, and David L. Grange
(“Employee”), an individual whose mailing address for
notice purposes is 929 North Front Street, Wilmington, North
Carolina 28401.
RECITALS
A. The Company is a clinical
research organization engaged in the business of providing drug
discovery and development services to pharmaceutical,
biotechnology, medical device, government and academic
organizations throughout the world (the
“Business”).
B. The Company desires to employ
Employee and Employee desires to be employed by the Company, all
upon the terms and conditions set forth herein.
NOW, THEREFORE
, in consideration of the foregoing
recitals, the mutual covenants of the parties hereinafter set forth
and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby
agree as follows:
ARTICLE 1
EMPLOYMENT AND
DUTIES
1.1 Employment of Employee .
On the Effective Date, the Company agrees to employ Employee and
Employee accepts such employment pursuant and subject to the terms
and conditions of this Agreement.
1.2. Duties and Powers .
During the Employment Period (as defined herein), Employee shall
serve as Chief Executive Officer of the Company and will have such
responsibilities, duties and authority, and will render such
services for and in connection with the Company and its affiliates
as are customary in such position and as the Executive Chairman or
the Board of Directors of the Company (the “Board”)
shall from time to time reasonably direct. Employee shall devote
Employee’s full business time and attention exclusively to
the Business of the Company and shall use best efforts to
faithfully carry out Employee’s duties and responsibilities
hereunder. Employee shall comply with all personnel policies and
procedures of the Company as the same now exist or may be hereafter
implemented by the Company from time to time, including those
policies contained in the Company’s employee manual or
handbook which sets forth policies and procedures generally for
employees of the Company and its subsidiaries and affiliates (the
“Handbook”) to the extent not inconsistent with this
Agreement.
ARTICLE 2
TERM OF EMPLOYMENT
Unless sooner terminated as provided
elsewhere in this Agreement, Employee’s employment under this
Agreement shall begin on July 1, 2009 and end at 11:59 p.m.
Eastern Time on June 30, 2011 (“Initial Employment
Period”). Thereafter, this Agreement shall automatically
renew for successive one-year periods, unless either the Company or
Employee provides written notice to the other at least sixty
(60) days prior to the termination of the Initial Employment
Period or any renewal period stating said party’s desire to
terminate this Agreement. The Initial Employment Period and any
extension or renewal thereof shall be referred to herein together
as the “Employment Period”. Notwithstanding anything to
the contrary contained herein, the Employment Period is subject to
termination pursuant to Article 4 hereof.
ARTICLE 3
COMPENSATION AND
BENEFITS
3.1 Base Salary . The Company
will pay Employee an annual base salary at a rate of $575,000 per
annum (the “Base Salary”), payable in accordance with
the Company’s regular payroll policy for salaried employees.
The Base Salary of Employee may be subject to increase annually
during the Employment Period by the Company. If the Employment
Period is terminated pursuant to Article 4 hereof or is otherwise
shorter than a full contract year, then the Base Salary for any
partial year will be prorated based on the number of days elapsed
in such year during which services were actually performed by
Employee.
3.2 Sign-On Bonus .
Contemporaneously with the execution of this Agreement, the Company
will pay Employee a one-time bonus of $430,000 in cash in
accordance with the terms of a separate sign-on bonus agreement to
be entered into simultaneously with this Agreement.
3.3 Benefits .
a. During the Employment Period,
Employee shall be eligible to participate in and/or receive
benefits under the health insurance, group term life/AD&D,
short and long-term disability, retirement, paid-time off and other
plans maintained from time to time by the Company, subject in each
instance to Employee meeting all eligibility and qualification
requirements of such plans. During the Employment Period, Employee
shall be entitled to twenty-seven (27) days of paid-time-off,
subject to the provisions of the Handbook.
b. In addition to the benefits
provided in (a) above, except as provided below, during the
Employment Period, Employee shall be entitled to participate in
(i) the employee incentive compensation plan maintained for
employees of the Company, as the same may be amended from time to
time (the “Incentive Compensation Plan”), and
(ii) the 1995 Equity Compensation Plan maintained by PPD, as
the same has been and may be amended from time to time, or any
successor plan (the “ECP”), subject
in each instance to Employee meeting all
eligibility and qualification requirements of such plans. For the
calendar year 2009, Employee shall not participate in or receive
any compensation under the Incentive Compensation Plan.
3.4 Initial Stock Option
Grant . The Company shall grant to Employee on the first day of
the Initial Employment Period non-qualified options to purchase
200,000 shares of PPD’s common stock. Said stock options
shall be granted under the terms and conditions of the ECP and
subject to Employee’s execution or acceptance of all
documents, terms and conditions customarily required by PPD to
effectuate the grant of stock options. In addition to the other
terms and conditions of the ECP and the Stock Option Award
Agreement, said stock options shall be subject to a four-year
linear vesting schedule and will be priced based on the Nasdaq
closing price on the first day of the Initial Employment
Period.
3.5 Restricted Stock Grant .
The Company shall grant to Employee on the first day of the Initial
Employment Period a restricted stock award for 50,000 shares of
PPD’s common stock. Said restricted stock award shall be
granted under the terms and conditions of the ECP and the
Company’s standard Restricted Stock Award Agreement to be
entered into by PPD and Employee. In addition to the other terms
and conditions of the ECP and the Restricted Stock Award Agreement,
said restricted stock award shall be subject to a four-year linear
vesting schedule.
3.6 Expenses . The Company
will reimburse Employee, in accordance with and subject to
Employee’s compliance with the Company’s policy, for
Employee’s necessary and reasonable out-of-pocket expenses
incurred in the course of performance of Employee’s duties
hereunder. All reimbursement of expenses to Employee hereunder
shall be conditioned upon presentation of sufficient documentation
evidencing such expenses.
3.7 Working Facilities .
Employee shall work out of the Company’s worldwide
headquarters located in Wilmington, North Carolina. The Company
shall furnish Employee with such office space, equipment,
technical, secretarial and clerical assistance and such other
facilities, services and supplies as shall be reasonably necessary
to enable Employee to perform the duties required of Employee
hereunder in an efficient and professional manner.
3.8 Use of Aircraft .
Employee shall be entitled to use the Company’s aircraft for
personal use up to a maximum of 17,500 miles in calendar year 2009
and 35,000 miles in calendar years thereafter, or such other
maximum amount as the Board may from time to time establish
pursuant to the Company’s aircraft policy.
ARTICLE 4
TERMINATION OF
EMPLOYMENT
4.1 Basis for Termination .
Notwithstanding any other provision in this Agreement to the
contrary, the Employment Period and Employee’s employment
hereunder shall terminate effective on the date indicated upon the
happening of any of the following events:
a. Upon the death of Employee,
effective immediately on the date of death without any
notice;
b. Upon a determination by the
Executive Chairman of the Board, acting in good faith and not in an
arbitrary or capricious manner, but made in his sole discretion,
that Employee is unable due to a physical or mental disability to
perform the essential functions of his job, with or without a
reasonable accommodation, which disability continues for a period
of ninety (90) days during any twelve-month period hereunder,
effective upon the date said determination is communicated to
Employee or such later date as specified by the Chairman of the
Board of the Company; or
c. Upon a determination by the
Executive Chairman of the Board of the Company, acting in good
faith but made in his sole discretion, that Employee: (i) has
failed to substantially perform his duties under or otherwise
breached any of the material terms of this Agreement; (ii) has
demonstrated negligence or willful misconduct in the execution of
his duties; or (iii) has been convicted of a felony; in each
case effective upon the date said determination is communicated to
Employee or such later date as specified by the Executive Chairman
of the Board of PPD.
4.2 Compensation After
Termination During Employment Period . If the Company
terminates Employee’s employment during the Employment Period
pursuant to Section 4.1 hereof or if either party terminates
this Agreement pursuant to Article 2 hereof, then the Company shall
have no further obligations hereunder or otherwise with respect to
Employee’s employment from and after the termination or
expiration date, except that the Company shall pay Employee’s
Base Salary accrued through the date of termination or expiration
and shall provide such benefits as are required by applicable law.
From and after such termination or expiration date, the Company
shall continue to have all other rights available hereunder,
including without limitation all rights under Article 5 hereof, the
Proprietary Agreement (as defined below), the Non-Competition
Agreement (as defined below), and at law or in equity.
ARTICLE 5
PROPRIETARY
INFORMATION
Prior to or coincident with the
commencement date of this Agreement, Employee shall execute and
deliver to the Company (i) a Proprietary Information and
Inventions Agreement substantially in the form attached hereto as
Annex A (the “Proprietary Agreement”) and
(ii) a Non-Competition and Non-Solicitation
Agreement
substantially in the form attached hereto as
Annex B (the “Non-Competition
Agreement”).
ARTICLE 6
MISCELLANEOUS
6.1 Withholding Taxes . All
amounts payable under this Agreement, whether such payment is to be
made in cash or other property, shall be subject to applicable
withholding requirements for Federal, state and local income taxes,
employment and payroll taxes, and other legally required
withholding taxes and contributions to the extent appropriate in
the determination of the Company, and Employee shall report all
such amounts as ordinary income on Employee’s personal income
returns and for all other purposes.
6.2 Assignment . No party
hereto may assign or delegate any of its rights or obligations
hereunder without the prior written consent of the other party
hereto; provided, however, that the Company shall have the right to
assign all or any part of its rights and obligations under this
Agreement (i) to any member, subsidiary or affiliate of the
Company or any surviving entity following any merger or
consolidation of any of those entities with any entity other than
the Company, or (ii) in connection with the sale of the
Business by the Company.
6.3 Binding Effect . All
covenants and agreements contained in this Agreement by or on
behalf of any of the parties hereto shall be binding upon and inure
to the benefit of the respective legal representatives, heirs,
successors and permitted assigns of the parties hereto.
6.4 Entire Agreement . This
Agreement, together with the Proprietary Agreement and the
Non-Competition Agreement, sets forth the entire understanding of
the parties and supersedes and preempts all prior oral or written
understandings and agreements with respect to the subject matter
hereof.
6.5 Severability . Whenever
possible, each provision of this Agreement shall be interpreted in
such manner as to be effective and valid under applicable law, but
if any provision of this Agreement is held to be prohibited by or
invalid under applicable law, such provision shall be ineffective
only to the extent of such prohibition or invalidity, without
invalidating the remainder of this Agreement.
6.6 Amendment; Modification .
No amendment or modification of this Agreement and no waiver by any
party of the breach of any covenant contained herein shall be
binding unless executed in writing by the party against whom
enforcement of such amendment, modification or waiver is sought. No
waiver shall be deemed a continuing waiver or a waiver in respect
of any subsequent breach or default, either of a similar or
different nature, unless expressly so stated in writing.
6.7 Governing Law . This
Agreement shall be governed by and construed and enforced in
accordance with the laws of the State of North Carolina, without
giving effect to provisions thereof regarding conflict of
laws.
6.8 Arbitration . Except for
disputes, controversies or claims under Article 5, the Proprietary
Agreement and the Non-competition Agreement, any dispute,
controversy or claim arising out of or relating to this Agreement,
including but not limited to its existence, validity,
interpretation, performance or non-performance, or breach, shall be
decided by a single neutral arbitrator agreed upon by the parties
hereto in Wilmington, North Carolina in binding arbitration
pursuant to the commercial arbitration rules of the American
Arbitration Association then in effect. The parties to any such
arbitration shall be limited to the parties to this Agreement or
any successor thereof. The written decision of the arbitrator shall
be final and binding and may be entered and enforced in any court
of competent jurisdiction. Each party waives any right to a jury
trial in any such forum. Each party to the arbitration shall pay
its fees and expenses, unless otherwise determined by the
arbitrator.
6.9 Notices . All notices,
demands or other communications to be given or delivered hereunder
or by reason of the provisions of this Agreement shall be in
writing and shall be deemed to have been properly served if
(a) delivered personally, (b) delivered by a recognized
overnight courier service, (c) sent by certified mail, return
receipt requested and first class postage prepaid, or (d) sent
by facsimile transmission followed by a confirmation copy delivered
by a recognized overnight courier service the next day. Such
notices, demands and other communications shall be s
