Exhibit 10.4
SEVERANCE PROTECTION AGREEMENT
SEVERANCE PROTECTION AGREEMENT dated
February 25, 2008 by and between Northfield Laboratories Inc.,
a Delaware corporation (the “ Company ”), and
(the “ Executive ”), and is amended and restated
solely to comply with Section 409A of the Internal Revenue
Code of 1986, as amended (“Code Section 409A”)
effective as of this 25th day of February, 2008.
The Board of Directors of the Company
(the “ Board ”) recognizes that the possibility
of a Change in Control (as hereinafter defined) of the Company
exists and that the threat or occurrence of a Change in Control may
result in the distraction of its key management personnel because
of the uncertainties inherent in such a situation.
The Board has determined that it is
essential and in the best interests of the Company and its
stockholders to retain the services of the Executive in the event
of the threat or occurrence of a Change in Control and to ensure
the Executive’s continued dedication and efforts in such
event without undue concern for the Executive’s personal
financial and employment security.
In order to induce the Executive to
remain in the employ of the Company, particularly in the event of
the threat or occurrence of a Change in Control, the Company
desires to enter into this Agreement to provide the Executive with
certain benefits in the event the Executive’s employment is
terminated as a result of, or in connection with, a Change in
Control.
NOW , THEREFORE , in
consideration of the respective agreements of the parties contained
herein, it is agreed as follows:
Section 1.
Definitions . For purposes of this Agreement, the following
terms have the meanings set forth below:
“ Board ” means
the Board of Directors of the Company.
“ Cause ” for the
termination of the Executive’s employment with the Company
will be deemed to exist if the Executive is convicted of any felony
or the Executive fails to comply in all material respects with any
material term of the Proprietary Information and Inventions
Agreement dated as of December 5, 2005 between the Company and
the Executive, which conduct or failure is materially injurious to
the Company, monetarily or otherwise.
“ Change in Control
” means a change in control of the Company of a nature that
would be required to be reported in response to Item 1(a) of the
Current Report on Form 8- K, as in effect as of the original
date of this Agreement, promulgated pursuant to Section 13 or
15(d) of the Securities Exchange Act, whether or not the Company is
then subject to the reporting requirements of the Securities
Exchange Act; provided that, without limitation, such a
change in control will be deemed to have occurred if:
(a) there is consummated any sale,
lease, exchange or other transfer (in one transaction or a series
of related transactions) of all or substantially all of the
Company’s assets;
(b) the stockholders of the Company
approve any plan or proposal of liquidation or dissolution of the
Company;
(c) there is consummated any
consolidation or merger of the Company in which the Company is not
the surviving or continuing corporation, or pursuant to which
shares of the Company’s Common Stock would be converted into
cash, securities or other property, other than a merger of the
Company in which the holders of the Company’s Common Stock
immediately prior to the merger have, directly or indirectly, at
least an 80% ownership interest in the outstanding Common Stock of
the surviving corporation immediately after the merger;
(d) any “person” or
“group” (as such terms are used in Section 13(d) and
14(d) of the Exchange Act) becomes the “beneficial
owner” (as defined in Rule 13d-3 under the Securities
Exchange Act), directly or indirectly, of securities of the Company
representing 15% or more of the combined voting power of the
Company’s then outstanding voting securities ordinarily
having the right to vote for the election of directors;
provided that no change in control will be deemed to occur
as a result of any acquisition of voting securities directly from
the Company (or as a result of the exercise, conversion or exchange
of any securities acquired directly from the Company) if the
transaction pursuant to which such voting securities or
exercisable, convertible or exchangeable securities are issued is
approved by vote of at least three-quarters of the directors
comprising the Incumbent Board (as defined below); or
(e) individuals who, as of the
original date of this Agreement, constitute the Board (the “
Incumbent Board ”) cease for any reason to constitute
a majority of the Board; provided that any individual
becoming a director subsequent to the original date of this
Agreement whose election, or nomination for election by the
Company’s stockholders, was approved by a vote of at least
three-quarters of the directors comprising the Incumbent Board will
be, for purposes of this Agreement, considered as though such
individual were a member of the Incumbent Board; provided
further that, notwithstanding the foregoing, an individual
whose initial assumption of office as a director is in connection
with any actual or threatened “solicitation” of
“proxies” (as such terms are defined in Rule 14a-1
of Regulation 14A promulgated under the Securities Exchange
Act) by any “person” or “group” (as such
terms are used in Section 13(d) and 14(d) of the Securities
Exchange Act) other than the Incumbent Board will not be considered
as a member of the Incumbent Board for purposes of this
Agreement.
“ Code ” means the
Internal Revenue Code of 1986, as amended.
“ Company ” means
Northfield Laboratories Inc., a Delaware corporation, and includes
its Successors.
“ Continuation Period
” has the meaning set forth in
Section 3.1(b)(iii).
“ Disability ”
means the Executive’s incapacity due to physical or mental
illness or accident such that the Executive is absent from his
duties for the Company on a full-time basis for the entire period
of six consecutive months or for 270 days in any 365-day
period.
2
“ Good Reason ”
for the Executive’s termination of employment with the
Company will be deemed to exist if, within 24 months after the
occurrence of a Change in Control one of the following events
occurs without the Executive’s consent and the event is not
cured by the Company subject to the rules below:
(a) the Executive is reassigned to a
position of lesser rank or status whereby the Executive’s
duties or authorities are materially inconsistent with his position
immediately before the reassignment;
(b) there is a material change in the
geographic location at which the Executive must perform services;
or
(c) the Executive’s annual base
salary is materially reduced.
The Executive shall not be deemed to
have terminated for Good Reason unless (i) within 45 days
of the initial condition giving rise to Good Reason, the Executive
provides the Company with written notice of such condition,
(ii) the Company does not cure the condition within
30 days following receipt of such notice to cure the
condition, and (iii) such 30 day cure period expires
within 24 months after the Change in Control. If the Company
does not cure such condition within the 30 day period, then
the Executive’s Termination Date shall be the first day after
the 30 day cure period expires.
“ Notice of Termination
” means a written notice from the Company of the termination
of the Executive’s employment which indicates the specific
termination provision in this Agreement relied upon and which sets
forth in reasonable detail the facts and circumstances claimed to
provide a basis for termination of the Executive’s employment
under the provision so indicated.
“ Person ” has the
meaning as used in Section 13(d) or 14(d) of the Securities
Exchange Act and will include any “group” as such term
is used in such sections.
“ Securities Exchange
Act ” means the Securities Exchange Act of 1934, as
amended.
“ Successor ”
means a corporation or other entity acquiring all or substantially
all the assets and business of the Company, whether by operation of
law, by assignment or otherwise.
“ Termination Date
” means (a) in the case of the Executive’s death,
the Executive’s date of death, (b) in the case of the
termination of the Executive’s employment with the Company by
the Executive for Good Reason, the first day after the
Company’s 30 day cure period expires (referenced above
under “Good Reason”), and (c) in all other cases,
the date specified in the Notice of Termination; provided
that if the Executive’s employment is terminated by the
Company for Cause or due to Disability, the date specified in the
Notice of Termination will be at least 30 days after the date the
Notice of Termination is given to the Executive.
Sectio
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