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Exhibit 10.27
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this "Agreement") is made as of
December 6, 2006, by Endo Pharmaceuticals Inc., a Delaware
corporation (the "Employer"), and Joyce N. LaViscount (the
"Employee").
Intending to be legally bound, and in consideration of the
mutual agreements contained herein, the parties agree as
follows:
ARTICLE 1. DEFINITIONS .
For the purposes of this Agreement, the following terms have the
meanings specified or referred to in this Article 1.
"Agreement" means this Employment Agreement, including
the Exhibits hereto, as amended from time to time.
"Basic Compensation" means Salary and Benefits.
"Benefits" shall have the meaning set forth in
Section 3.1(b).
"Board of Directors" means the board of directors of the
Employer.
"Confidential Information" means any and all:
(a) trade secrets concerning the business and affairs of the
Employer, product specifications, data, know-how, formulae,
compositions, processes, designs, sketches, photographs, graphs,
drawings, samples, inventions and ideas, past, 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);
(b) information concerning the business and affairs of the
Employer (which includes unpublished financial statements,
financial projections and budgets, unpublished and projected sales,
capital spending budgets and plans, the names and backgrounds of
key personnel, to the extent not publicly known, personnel training
and techniques and materials) however documented; and
(c) 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.
"disability" shall have the meaning set forth in
Section 6.2.
"Effective Date" means January 1, 2007.
"Employment Period" shall have the meaning set forth in
Section 2.2.
"Fiscal Year" means the Employer’s fiscal year, as
it exists on the Effective Date or as changed from time to
time.
"for cause" shall have the meaning set forth in
Section 6.3.
"for good reason" shall have the meaning set forth in
Section 6.4.
"Incentive Compensation" shall have the meaning set forth
in Section 3.2.
"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.
"Post-Employment Period" shall have the meaning set forth
in Article 8.
"Renewal Term" shall have the meaning set forth in
Section 2.2.
"Salary" shall have the meaning set forth in
Section 3.1(a).
ARTICLE 2. EMPLOYMENT TERMS AND
DUTIES.
Section 2.1 Employment . The Employer hereby
employs the Employee, and the Employee hereby accepts employment by
the Employer, upon the terms and conditions set forth in this
Agreement.
Section 2.2 Term . Subject to the provisions
of Article 6, the initial term of the Employee’s employment
under this Agreement will be one (1) year, beginning on the
Effective Date and ending on December 31, 2007 (the "Initial
Term"). The term of this Agreement shall be renewed by the Employee
and the Employer for additional periods of one year (each, a
"Renewal Term";) unless either party gives the other party written
notice prior to the end of the Initial Term or any Renewal Term (in
which event this Agreement will continue for a period of thirty
(30) days from such notice) or unless sooner terminated in
accordance with the provisions of Section 6. The Initial Term
together with all Renewal Terms, if any, are hereinafter referred
to as the "Employment Period".
Section 2.3 Duties . The Employee will have
such duties as are assigned or delegated to the Employee by the
Chief Financial Officer, and will serve as Chief Accounting Officer
of the Employer. The Employee will devote the Employee’s
business, time, attention, skill, and energy to the business of the
Employer, will promote the success of the Employer’s
business, and will cooperate with the Chief Financial Officer, the
Chief Executive Officer and the Board of Directors in the
advancement of the best interests of the Employer. Nothing in this
Section 2.3, however, will prevent the Employee from engaging
in additional activities in connection with personal investments
and community affairs that are not inconsistent with the
Employee’s duties under this Agreement. If, at any time, the
Employee is elected as a director of the Employer or as a director
or officer of any of Employer’s subsidiaries, the Employee
will fulfill the Employee’s duties as such director or
officer without additional compensation.
Section 2.4 Director’s and Officer’s
Liability Coverage . The Employer shall cause the Employee
to be (a) indemnified as an officer and/or director of the
Employer or any of its affiliates, to the extent applicable, to the
maximum extent permitted by applicable law, and (b) covered by
director’s and officer’s liability insurance in
connection with the Employee serving as an officer and/or director
of Employer or any of its affiliates. The provisions of this
Section 2.4 shall survive termination of this Agreement for
any reason.
ARTICLE 3. COMPENSATION.
Section 3.1 Basic Compensation .
(a) Salary . The Employee will be paid an annual
salary of $275,000, subject to adjustment as provided below (the
"Salary"), which will be payable in equal periodic installments
according to the Employer’s customary payroll practices, but
no less frequently than the 15 th
and the last day of each month. The Salary, upon a
recommendation by the Chief Financial Officer, will be reviewed by
the Compensation Committee of the Board of Directors (the
"Committee") not less frequently than annually, and be adjusted in
the sole discretion of the
Committee, but in no event will the Salary be
less than $275,000 per year. In determining the amount of any
adjustment to Salary, the Committee shall take into account
inflation, merit, changes in responsibilities and industry salary
practices for executives. Any increase in Salary shall not serve to
limit or reduce any other obligation to the Employee under this
Agreement. Salary shall not be reduced after such increase unless
such reduction is part of a reduction in salaries of specified
management personnel of the Employer undertaken in a program
approved by the Employer’s Board of Directors.
(b) Benefits . The Employee will, during the
Employment Period, be permitted to participate in such incentive,
savings, pension, profit sharing, bonus, life insurance,
hospitalization and major medical, and other employee benefit
plans, practices, policies and programs, 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) Stock Options . To the extent the Employer
determines to award stock options or other similar consideration to
management personnel based upon duration of employment or achieving
performance targets, or both, the Employee shall be permitted to
participate in such programs. For each Fiscal Year or part thereof
during the Employment Period the Employee shall be eligible to earn
as additional compensation (the "Long-Term Compensation") for the
services to be rendered by the Employee pursuant to this Agreement,
long-term equity incentives in an amount equal up to sixty
(60%) of the Salary for such Fiscal Year (or such lesser
(including zero) percent of the Salary for such Fiscal Year as is
recommended in good faith to the Committee by the Chief Executive
Officer of the Employer and approved by the Committee).
Section 3.2 Incentive Compensation . For each
Fiscal Year or part thereof during the Employment Period the
Employee shall be eligible to earn as additional compensation (the
"Incentive Compensation") for the services to be rendered by the
Employee pursuant to this Agreement, an amount equal to thirty
percent (30%) of the Salary for such Fiscal Year (or such
lesser (including zero) or greater (not to exceed two hundred)
percent of the Salary for such Fiscal Year as is recommended in
good faith to the Committee by the Chief Executive Officer of the
Employer and approved by the Committee) if the Employer achieves
certain performance targets set by the Committee (the "Performance
Targets") for such Fiscal Year. Incentive Compensation for each
Fiscal Year or part thereof shall be paid as soon as practicable
following the receipt by the Employer of its audited financial
statements for the Fiscal Year for which the Incentive Compensation
is being paid.
ARTICLE 4. FACILITIES AND EXPENSES.
Section 4.1 Reimbursement . 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 are
appropriate, and 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 and in appropriate business entertainment
activities. The Employee must file expense reports with respect to
such expenses in accordance with the Employer’s
policies.
Section 4.2 Motor Vehicle Allowance . As of
the Effective Date, the Employee will be entitled to use of an
automobile, and a replacement thereof, mutually acceptable to the
Employee and the Employer, at least every three (3) fiscal
years after the Effective Date during the Employment Term. The
Employer will reimburse the Employee for all operating expenses
relating thereto upon the Employee’s submission of
appropriate documentation as set forth in Section 4.1. The
Employer will determine the actual value, if any, of the
Employee’s non-business use of such automobile and will
furnish the Employee with a W-2 Wage and Tax Statement, to be
included in the Employee’s income tax returns, in accordance
with prevailing Internal Revenue Service regulations.
ARTICLE 5. VACATIONS AND HOLIDAYS .
The Employee will be entitled to paid vacation each Fiscal Year
in accordance with the vacation policies of the Employer in effect
for its executive officers from time to time, provided that in no
event shall such number of paid vacation days be fewer than twenty.
Vacation must be taken by the Employee at such time or times as
approved by the Chief Financial Officer. The Employee will also be
entitled to the paid holidays and other paid leave set forth in the
Employer’s policies. Vacation days and holidays during any
Fiscal Year that are not used by the Employee during such Fiscal
Year may be used in any subsequent Fiscal Year.
ARTICLE 6. TERMINATION AND ELECTION NOT TO RENEW
.
Section 6.1 Events of Termination . The Employment
Period, the Employee’s Basic Compensation and Incentive
Compensation, and any and all other rights of the Employee under
this Agreement or otherwise as an employee of the Employer will
terminate (except as otherwise provided in this Article 6):
(a) upon the death of the Employee;
(b) upon the disability of the Employee (as defined in
Section 6.2);
(c) for cause (as defined in Section 6.3),
immediately upon notice from the Employer to the Employee, or at
such later time as such notice may specify, unless otherwise
provided in Section 6.3;
(d) for good reason (as defined in Section 6.4) upon
not less than thirty days’ prior notice from the Employee to
the Employer; or
(e) by the Company other than for cause
upon not less than thirty days’ prior notice from the
Employer to the Employee or by the Employee for good reason, in
each case within 12 months following the occurrence of a Change of
Control (as defined in Section 6.5(e)).
Section 6.2 Definition of Disability . For
purposes of Sections 6.1 and 6.3, the Employee will be deemed
to have a "disability" if, as a result of the Employee’s
incapacity due to reasonably documented physical illness or injury
or mental illness, the Employee shall have been unable for more
than six months in any twelve month period
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