EXHIBIT 10.12
PAIN THERAPEUTICS,
INC.
EMPLOYMENT
AGREEMENT
This Employment Agreement (the
“Agreement”) is made by and between Pain Therapeutics,
Inc., a Delaware corporation (the “Company”) and Remi
Barbier (“Executive”) as of July 1,
1998.
RECITALS
A. The Company desires to have
Executive’s active services as President, Chief Executive
Officer and Chairman of the Board of the Company for the period set
forth in this Agreement.
B. The Company and Executive desire
to enter into this Agreement on the terms and conditions set forth
in this Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of
the mutual covenants herein contained, and in consideration of
Executive’s continued employment by the Company, the parties
hereto agree as follows:
1. Duties and Scope of
Employment
(a) Duties. The Company shall employ
Executive to render services to the Company. Executive agrees that
he will devote his full business time and efforts to the business
of the Company, excluding up to four (4) weeks paid vacation
per year, and, in addition, sick leave in accordance with the
Company’s policies. In the course of Executive’s
employment, Executive shall perform the duties of President and
Chief Executive Officer of the Company under the direction of the
Board of Directors.
(b) Term of Employment.
Executive’s employment with the Company pursuant to this
Agreement shall commence on the date hereof and shall continue
until thirty-six (36) months thereafter (the “Employment
Period”), provided that such term shall automatically renew
for an additional 12 months at the end of such initial term and
each subsequent renewal, unless ninety (90) days prior to the
date of such renewal either party shall give written notice to the
other party of cancellation, and in such event the
Executive’s employment hereunder shall terminate. Subject to
Executive’s right to severance compensation under certain
circumstances as set forth herein, the employment relation of
Executive with the Company shall be terminable upon sixty
(60) days prior written notice by either party.
(c) Director. As long as Executive
serves as President and Chief Executive Officer, Executive shall be
nominated to serve on the Company’s Board of Directors.
Executive agrees to submit his resignation immediately as a
director if Executive ceases to be President and Chief Executive
Officer, unless removed as President and Chief Executive Officer
without Cause as defined below.
2. Compensation
(a) Base Compensation. The Company
shall pay the Executive as compensation for his service a base
salary at the annualized rate of Two Hundred Fifty Thousand Dollars
($250,000) (“Salary”). Such Salary shall increase each
anniversary date by the greater of the Company’s Consumer
Price Index or five percent (5%), whichever is greater, and shall
be reviewed at least annually and may be increased from time to
time subject to accomplishment of such performance and contribution
goals and objectives as may be established and agreed upon from
time to time by the Board of Directors and the Executive. Such
Salary shall be paid periodically in accordance with normal Company
payroll. The annual compensation (including bonus and benefit
amounts pursuant to Section 2(b) and (c) below) specified
in this Section 2(a), together with any increases in such
compensation that the Board of Directors may grant from time to
time, is referred to in this Agreement as “Base
Compensation.”
(b) Deferment of Salary. One Hundred Thousand
Dollars ($100,000) of the Executive’s annual Salary shall be
deferred until such time as the Company raises a total of Four
Million Dollars ($4,000,000) or more in any combination of debt or
equity capital from outside investors, corporate partners,
alliances, mergers, etc, The Executive shall automatically forgive
the Company any deferred compensation in month 36 of this
Employment Agreement, provided Executive is still an employee in
good standing at such time. Any deferred compensation shall be
immediately due upon termination of the Executive’s
employment without Cause (as defined below).
(c) Bonuses. Beginning with the
Company’s 1998 fiscal year and for each fiscal year
thereafter during the Employment Period, the Executive will be
eligible to receive an annual bonus based upon certain criteria to
be agreed upon by Executive and the Board of Directors to be paid
on January 15 of each calendar year hereafter, provided that
Executive is employed by the Company on such dates.
(d) Executive Benefits. The
Executive shall be eligible to participate in the employee benefit
plans and executive compensation programs maintained by the Company
applicable to other key executives of the Company, including
(without limitation) retirement plans, savings or profit-sharing
plans, deferred compensation plans, supplemental retirement or
excess benefit plans, life, disability, health, accident and other
insurance programs, paid vacations, and similar plans or programs,
subject in each case to the generally applicable terms and
conditions of the plan or program in question and to the
determination of any committee administering such plan or
program.
(e) Expenses During Employment. The
Company shall reimburse the Executive for all reasonable business,
entertainment and travel expenses actually incurred or paid by the
Executive in the performance of his services on behalf of the
Company, in accordance with the Company’s expense
reimbursement policy as from time to time in effect.
3. Termination of
Employment
(a) By Death. The Employment Period
shall terminate automatically upon the death of the Executive. In
such event, the Company shall pay to Executive’s
beneficiaries or his estate, as the case may be, any accrued
Salary, the pro rata amount of the guaranteed annual bonus, any
vested deferred compensation (other than pension plan or
profit-sharing plan benefits which will be paid in accordance with
the applicable plan), any benefits under any plan of the Company in
which Executive is a participant to the full extent of
Executive’s rights under such plan, any accrued vacation pay
and any appropriate business expenses incurred by Executive in
connection with his duties hereunder, all to the date of
termination (collectively “Accrued Compensation”), but
no other compensation or reimbursement of any kind, including,
without limitation, severance compensation, and thereafter, the
Company’s obligations hereunder shall terminate. Nothing in
this Section shall affect any entitlement of the Executive’s
heirs to the benefits of any life insurance provided by the Company
as set forth above.
(b) By Disability. If the Executive
is prevented from properly performing his duties hereunder by
reason of any physical or mental incapacity for a period of more
than sixty (60) days in the aggregate in any 365-day period,
then, to the extent permitted by law, the Company may terminate the
Employment Period on the 60th day of such incapacity. In such
event, the Company shall pay to Executive all Accrued Compensation,
and shall continue to pay to Executive the Salary and the pro rata
amount of the guaranteed annual bonus until such time as Executive
shall become entitled to receive disability insurance payments
under the disability insurance policy maintained by the Company
(but not more than ninety (90) days following termination),
but no other compensation or reimbursement of any kind, including
without limitation, severance compensation, and thereafter the
Company’s obligations hereunder shall terminate. Nothing in
this Section shall affect Executive’s rights under any
disability plan in which he is a participant.
(c) By Resignation or By Company for
Cause. If Executive’s employment with the, Company terminates
due to his voluntary resignation or if the Company terminates
Executive’s employment due to Cause (as defined below), the
Company shall pay Executive all Accrued Compensation less the pro
rata, amount of the annual guaranteed bonus (which shall not be
paid to Executive), but no other compensation or reimbursement of
any End, including without limitation, severance compensation, and
thereafter the Company’s obligations hereunder shall
terminate. Termination shall be for “Cause” in the
event of the occurrence of any of the following: (i) any
intentional action or intentional failure to act that was performed
in bad faith and to the detriment of the Company; (ii) any
intentional refusal or intentional failure to act in accordance
with any lawful and proper direction or order of the Board;
(iii) any willful and habitual neglect of the duties of full
or part-time employment as assigned by the Board from time to time;
or (iv) any conviction of a felony crime under the state or
federal laws of the United States of America; provided that, in the
event that any of the foregoing events is capable of being cured,
the Company shall provide written notice to the Purchaser
describing the nature of such event, and the Purchaser shall
thereafter have five (5) business days to cure such
event.
(d) By Company for Other Than Cause. If the
Company terminates Executive’s employment with the Company
for any reason other than Cause, Executive shall be entitled to
receive: (i) Accrued Compensation to the date of termination;
(ii) severance compensation equal to Executive’s Base
Compensation, immediately prior to the termination, for twelve
(12) months after the date of termination (the
“Termination Date”); (iii) continued participation
in the Company medical and disability plans, at the Company’s
expense, for twelve (12) months after the date of termination;
and (iv) all insurance coverages, at the Company’s
expense, in effect immediately prior to the termination.
“Other Than Cause” shall include, but not be limited to
the following: (i) without the Executive’s express
written consent, the assignment to the Executive of any duties or
the reduction of the Executive’s du
