EXHIBIT 10.1 EMPLOYMENT AGREEMENT

 

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                                                                    Exhibit 10.1

 

                              EMPLOYMENT AGREEMENT

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         THIS AGREEMENT is effective as of the 1st day of April, 2002 by and

between GENEREX BIOTECHNOLOGY CORPORATION (the "Company"), a Delaware

corporation and GERALD BERNSTEIN, M.D. ("Executive"), an individual residing at

48 Carleon Avenue, Larchmont, New York 10538.

 

                                   WITNESSETH:

 

         WHEREAS, the Company is engaged, directly and through subsidiary

corporations (all of which, for the purposes of this Agreement, are included and

encompassed by any reference in this Agreement to the Company) in the research,

development, testing and commercialization of drug delivery technologies,

including drug technologies for oral administration of pharmaceuticals such as

peptidic drugs, vaccines and hormones using a buccal spray device (collectively,

the "Technology"); and

 

         WHEREAS, the Company wishes to engage the Executive to provide certain

services, as more particularly described below, and the Executive agrees to

provide such services, all on the terms and conditions set forth herein.

 

         NOW THEREFORE, in consideration of the mutual promises and covenants

contained herein, and for other good and valuable consideration, receipt of

which is hereby acknowledged, the parties hereto, intending to be legally bound,

agree as follows:

 

1.       Employment

 

         1.1      The Company agrees to employ the Executive and the Executive

                  agrees to serve the Company pursuant to the terms of this

                  Agreement as Vice President of Medical Affairs of the Company

                  (hereinafter the "Employment"), reporting to Anna E. Gluskin,

                  President of the Company.

 

         1.2      The term of this Agreement shall be for the period commencing

                  on the date hereof and expiring three years thereafter,

                  subject to earlier termination in accordance with the

                  provisions of Section 5 of this Agreement.

 

         1.3      The Executive hereby warrants and undertakes to the Company

                  (in the knowledge that the Company is relying on such

                  undertaking by agreeing to enter into this Agreement) that:

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                  1.3.1    by entering into this Agreement and performing his

                           obligations hereunder, he is not and will not be in

                           breach of any other contract of employment or other

                           agreement (whether still in effect or not) and

                           neither he nor the Company will be liable to any

                           action relating to any such contract; and

 

                  1.3.2    he is not or will not on commencement of this

                           Agreement and thereafter be subject to any

                           restriction or obligation, howsoever arising, which

                           may hinder or restrict him from performing fully any

                           of the duties required under the terms of this

                           Agreement.

 

         1.4      The Company hereby warrants and undertakes to the Executive

                  (in the knowledge that the Executive is relying on such

                  undertaking by agreeing to enter into this Agreement) that

                  during the Employment the Executive shall be primarily based

                  in the State of New York, unless the Executive otherwise

                  agrees with the Company, and that the Executive shall be

                  insured from liability arising from his status, actions or

                  omissions as an officer of the Company to the extent of the

                  coverage provided by the Company's directors' and officers'

                  liability insurance policy as in effect from time to time and

                  subject to the limitations and exclusions set forth in such

                  policy. Notwithstanding anything to the contrary herein, the

                  Company, without limiting the rights of Executive to

                  compensation and benefits hereunder, shall have the right at

                  any time to assign this Agreement and the Executive's

                  Employment hereunder to any business entity which is

                  controlling, controlled by or under common control with the

                  Company ("Affiliates"). In the event of such assignments, (i)

                  any amounts paid to or for the benefit of Executive by the

                  Affiliate shall be credited against amounts payable to

                  Executive by the Company under this Agreement, and (ii)

                  references to the "Company" in Sections 2, 5 and 6 of this

                  Agreement shall be deemed to include, in addition to the

                  Company, any Affiliate to which this Agreement shall have been

                  assigned.

 

2.       Duties

 

         The Executive covenants and agrees that during the Employment he will:

 

         2.1      faithfully and diligently perform the duties of Vice President

                  of Medical Affairs as may be assigned to or vested in him from

                  time to time by the Company and which shall be consistent with

                  the responsibilities generally entrusted to senior management

                  of a corporation in the same business as that of the Company,

                  and will use his best efforts to promote the interests of the

                  Company and its shareholders;

 

                                       2

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         2.2      comply with all laws, rules and regulations applicable to the

                  Company's business and in accordance with all applicable

                  policies or guidelines (including any applicable policies or

                  guidelines pertaining to disclosure of conflicts of interest)

                  of any institution or organization with which the Executive is

                  affiliated;

 

         2.3      give to the President and/or the Board of Directors such

                  information regarding the affairs of the Company as they may

                  request;

 

         2.4      agree to comply with all laws and regulations under the U.S.

                  federal securities laws and regulations against misuse or

                  miscommunication of material non-public information about the

                  Company and acknowledge that he is aware of these

                  prohibitions;

 

         2.5      devote the whole of his business time, attention and skills to

                  the business and affairs of the Company and will not, except

                  with the prior consent by the President and/or the Board of

                  Directors, be directly or indirectly engaged or concerned in

                  the conduct of any other business, whether or not competing in

                  any respect with the business of the Company; provided,

                  however, that the Executive (a) may continue to serve during

                  the term of this Agreement as a director or trustee of the

                  American Diabetes Association or of any affiliated foundation

                  thereof, (b) may serve during the term of this Agreement,

                  subject to the prior consent of the President and/or the Board

                  of Directors (which may be withheld for any reason or no

                  reason), as a director or trustee of any other organization,

                  (c) may maintain or establish during the term of this

                  Agreement an affiliation with any medical institution or

                  educational institution (including, without limitation, as an

                  adjunct or emeritus faculty member or as a physician with

                  admitting privileges), provided that such affiliation does not

                  detract in any material way from the available time and the

                  ability of the Executive to fulfill his obligations under this

                  Agreement, and (d) may continue to serve as a consultant in

                  connection with a legal proceeding for which he was engaged as

                  a medical expert prior to the effective date of this Agreement

                  until the resolution or conclusion of such proceeding,

                  provided that such activity does not detract in any material

                  way from the available time and the ability of the Executive

                  to fulfill his obligations under this Agreement.

 

 

                                       3

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3.       Compensation

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         3.1      During the Employment the Company will pay to the Executive, a

                  base salary at the annual rate of $150,000 (or such higher

                  rate as may from time to time be determined by the Company and

                  notified to the Executive), which salary will be payable in

                  equal monthly installments (less customary withholdings) in

                  arrears.

 

         3.2      In addition to payments provided in Paragraph 3.1, the Company

                  shall pay to the Executive advances, bonuses, options and

                  other compensation in such amounts and on such terms as are

                  described in Exhibit A hereto.

 

         3.3      The Company will be entitled at any time during the

                  Employment, and in all events on termination howsoever

                  arising, to deduct from the Executive's compensation under

                  this Agreement or from any other sums owed by the Company to

                  the Executive any monies due from him to the Company,

                  including, but not limited to, any outstanding loans or

                  advances taken (including advances pursuant to Exhibit A).

 

4.       Benefits.

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         4.1       During the Employment, the Executive will be entitled:

 

                  4.1.1    to paid vacation during each year to be accrued and

                           taken in accordance with the Company's vacation

                           policy as set forth in the Company's Employee Manual;

 

                  4.1.2    to payment of or reimbursement for health insurance

                           premiums to continue (i) Executive's health insurance

                           in the form of his Medicare Supplement (at an annual

                           cost at the present time of approximately $4,100.00)

                           and (ii) his wife's individual health insurance

                           policy (at an annual cost at the present time of

                           approximately $6,900.00);

 

                  4.1.3    to reimbursement for the cost of Executive's

                           professional expenses (e.g. journals, professional

                           societies) in the amount of no more than $4,000

                           annually; and

 

                  4.1.4    for the Company to bear the costs of any reasonable

                           and necessary costs for travel and lodging incurred

                           by the Executive at the request of the Company. To

                           the extent practicable, the Executive will make

                           travel and lodging arrangements through the Company

                           or agents designated by the Company. To the extent

                           practicable, the Company shall bear such expenses for

 

 

 

                                       4

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                           its own account. If it is not feasible for the

                           Company to bear an expense directly for its own

                           account, the Executive will submit expenses borne by

                           the Executive for reimbursement of expenses. The

                           Executive shall provide receipts in support of any

                           request hereunder for reimbursement of expenses.

                           Individual expenses in excess of $200 must be

                           arranged through the Company or agents of the Company

                           and approved in advance by the Company in order to be

                           eligible for reimbursement. Notwithstanding anything

                           to the contrary set forth herein, the Executive will

                           not be entitled to reimbursement for expenses

                           incurred by the Executive (regardless of the dollar

                           amount) that could reasonably have been arranged

                           through the Company or agents of the Company and were

                           not.

 

5.       Termination

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         5.1