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Exhibit
99.3
TERMINATION
AGREEMENT
This Agreement is made as of
the 29th day of March 2004, between MGI PHARMA, INC., a Minnesota
corporation, with its principal offices at 5775 W. Old Shakopee
Road, Suite 100, Bloomington, Minnesota 55437 (the
“Company”) and Richard M. Rodgers
(“Employee”), residing at 101 George Street, Excelsior,
Minnesota.
WITNESSETH THAT:
WHEREAS, this Agreement is
intended to specify the financial arrangements that the Company
will provide to the Employee upon Employee’s separation from
employment with the Company under any of the circumstances
described herein; and
WHEREAS, this Agreement is
entered into by the Company in the belief that it is in the best
interests of the Company and its shareholders to provide stable
conditions of employment for Employee notwithstanding the
possibility, threat or occurrence of certain types of change in
control, thereby enhancing the Company’s ability to attract
and retain highly qualified people.
NOW, THEREFORE, to assure the
Company that it will have the continued dedication of Employee
notwithstanding the possibility, threat or occurrence of a bid to
take over control of the Company, and to induce Employee to remain
in the employ of the Company, and for other good and valuable
consideration, the Company and Employee agree as
follows:
1. Term of Agreement .
The term of this Agreement shall commence on the date hereof as
first written above and shall continue through December 2004;
provided that commencing on January 1, 2005 and each
January 1 thereafter, the term of this Agreement shall
automatically be extended for one additional year unless not later
than twelve months prior to such January 1, the Company shall have
given notice that it does not wish to extend this Agreement (which
notice may not, in any event, be given sooner than January 1,
2005); and provided , further , that
notwithstanding any such notice by the Company not to extend, this
Agreement shall continue in effect for a period of 12 months beyond
the term provided herein if a Change in Control (as defined in
Section 3(i) hereof) shall have occurred during such
term.
2. Termination of
Employment
(i) Prior to a Change in
Control . Prior to a Change in Control (as defined in Section
3(i) hereof), the Company may terminate Employee from employment
with the Company at will, with or without Cause (as defined in
Section 3(iii) hereof), at any time.
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(ii) After a Change in
Control
(a) From and after the date
of a Change in Control (as defined in Section 3(i) hereof) during
the term of this Agreement, the Company shall not terminate
Employee from employment with the Company except as provided in
this Section 2(ii) or as a result of Employee’s Disability
(as defined in Section 3(iv) hereof) or his death.
(b) From and after the date
of a Change in Control (as defined in Section 3(i) hereof) during
the term of this Agreement, the Company shall have the right to
terminate Employee from employment with the Company at any time
during the term of this Agreement for Cause (as defined in Section
3(iii) hereof), by written notice to the Employee, specifying the
particulars of the conduct of Employee forming the basis for such
termination.
(c) From and after the date
of a Change in Control (as defined in Section 3(i) hereof) during
the term of this Agreement: (x) the Company shall have the right to
terminate Employee’s employment without Cause (as defined in
Section 3(iii) hereof), at any time; and (y) the Employee shall,
upon the occurrence of such a termination by the Company without
Cause, or upon the voluntary termination of Employee’s
employment by Employee for Good Reason (as defined in Section 3(ii)
hereof), be entitled to receive the benefits provided in Section 4
hereof. Employee shall evidence a voluntary termination for Good
Reason by written notice to the Company given within 60 days after
the date of the occurrence of any event that Employee knows or
should reasonably have known constitutes Good Reason for voluntary
termination. Such notice need only identify the Employee and set
forth in reasonable detail the facts and circumstances claimed by
Employee to constitute Good Reason.
Any notice given by Employee pursuant to
this Section 2 shall be effective five business days after the date
it is given by Employee.
3.
Definitions
(i) A “Change in
Control” shall mean:
(a) a change in control of a
nature that would be required to be reported in response to Item
6(e) of Schedule 14A of Regulation 14A promulgated under the
Securities Exchange Act of 1934, as amended (the “Exchange
Act”), or successor provision thereto, whether or not the
Company is then subject to such reporting requirement;
(b) any “person”
(as such term is used in Sections 13(d) and 14(d) of the Exchange
Act) is or becomes the “beneficial owner” (as defined
in Rule 13d-3 promulgated under the Exchange Act), directly or
indirectly, of securities of the Company representing 35% or more
of the combined voting power of the Company’s then
outstanding securities;
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(c) the Continuing Directors
(as defined in Section 3(v) hereof) cease to constitute a majority
of the Company’s Board of Directors; provided
that such change is the direct or indirect result of a proxy
fight and contested election or elections for positions on the
Board of Directors; or
(d) the majority of the
Continuing Directors (as defined in Section 3(v) hereof) determine
in their sole and absolute discretion that there has been a change
in control of the Company.
(ii) “Good
Reason” shall mean the occurrence of any of the following
events, except for the occurrence of such an event in connection
with the termination or reassignment of Employee’s employment
by the Company for Cause (as defined in Section 3(iii) hereof), for
Disability (as defined in Section 3(iv) hereof) or for
death:
(a) the assignment to
Employee of employment responsibilities which are not of comparable
responsibility and status as the employment responsibilities held
by Employee immediately prior to a Change in Control;
(b) a reduction by the
Company in Employee’s base salary as in effect immediately
prior to a Change in Control;
(c) an amendment or
modification of the Company’s incentive compensation program
(except as may be required by applicable law) which affects the
terms or administration of the program in a manner adverse to the
interest of Employee as compared to the terms and administration of
such program immediately prior to a Change in Control;
(d) the Company’s
requiring Employee to be based anywhere other than within 50 miles
of Employee’s office location immediately prior to a Change
in Control, except for requirements of temporary travel on the
Company’s business to an extent substantially consistent with
Employee’s business travel obligations immediately prior to a
Change in Control;
(e) except to the extent
otherwise required by applicable law, the failure by the Company to
continue in effect any benefit or compensation plan, stock
ownership plan, stock purchase plan, bonus plan, life insurance
plan, health-and-accident plan or disability plan in which Employee
is participating immediately prior to a Change in Control (or plans
providing Employee with substantially similar benefits), the taking
of any action by the Company which would adversely affect
Employee’s participation in, or materially reduce
Employee’s benefits under, any of such plans or deprive
Employee of any material fringe benefit enjoyed by Employee
immediately prior to such Change in Control, or the failure by the
Company to provide Employee with the number of paid vacation days
to which Employee is entitled immediately prior to such Change in
Control in accordance with the Company’s vacation policy as
then in effect; or
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(f) the failure by the
Company to obtain, as specified in Section 5(i) hereof, an
assumption of the obligations of the Company to perform this
Agreement by any successor to the Company.
(iii) “Cause”
shall mean termination by the Company of Employee’s
employment based upon (a) the willful and continued failure by
Employee substantially to perform his duties and obligations (other
than any such failure resulting from his incapacity due to physical
or mental illness or any such actual or anticipated failure
resulting from Employee’s termination for Good Reason) or (b)
the willful engaging by Employee in misconduct which is materially
injurious to the Company, monetarily or otherwise. For purposes of
this Section 3(iii), no action or failure to act on
Employee’s part shall be considered
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