Attached files
| file | filename |
|---|---|
| 8-K - HI TECH PHARMACAL CO INC | v182554_8k.htm |
| EX-99.2 - HI TECH PHARMACAL CO INC | v182554_ex99-2.htm |
Exhibit
99.1 Employment Agreement of Kamel Egbaria
EMPLOYMENT AGREEMENT, as of
April 16, 2010, by and between HI-TECH PHARMACAL CO., INC., a Delaware
corporation with offices at 369 Bayview Avenue, Amityville, New York 11701 (the “Corporation”), and KAMEL
EGBARIA, an individual
residing at 2736 Muir Woods Drive, Owens Cross Road, Huntsville, Alabama 35763
(“Executive”).
WITNESSETH
WHEREAS, the Corporation
desires to secure the services of Executive upon the terms and conditions
hereinafter set forth; and
WHEREAS, Executive desires to
render services to the Corporation upon the terms and conditions hereinafter set
forth.
NOW, THEREFORE, the parties
mutually agree as follows:
Section
1. Employment. Commencing
on April 26, 2010 or such date as shall be agreed upon by Executive and the
Corporation (hereinafter referred to as the “Effective Date”), but in no event
later than April 30, 2010, the Corporation shall employ Executive and Executive
shall commence such employment, as an executive of the Corporation, subject to
the terms and conditions set forth in this Agreement. This Agreement
shall be of no force and effect until the Effective Date. In the
event the Effective Date does not take place on or before April 30, 2010, then
this Agreement shall be deemed null and void, and neither party shall have any
liability to the other.
Section
2. Duties. As
of the Effective Date, Executive shall serve as Chief Scientific Officer –
Executive Vice President of the Corporation and shall, among other things, be
responsible for all aspects of product development and regulatory affairs, and
shall properly perform such duties as may be assigned to him from time to time
by the Chief Executive Officer and/or Board of Directors of the
Corporation. From and after the Effective Date and during the term of
this Agreement, Executive shall devote all of his available business time to the
performance of his duties hereunder unless otherwise authorized by the Board of
Directors.
Section
3. Term of
Employment. The term of Executive’s employment shall commence
as of the Effective Date and shall continue until one day prior to the third
anniversary of the Effective Date, unless earlier terminated pursuant to the
provisions of Section 5 hereof.
Section
4. Compensation of
Executive.
4.1. Compensation. As compensation
for his services hereunder the Corporation shall pay Executive an annual salary
(“Salary”) equal to Three Hundred Fifty Thousand ($350,000)
Dollars. The Salary shall be payable weekly less such deductions as
shall be required to be withheld by applicable law and
regulations. Upon each anniversary of the Effective Date during the
term of this Agreement, Executive’s Salary shall be increased to 105% of the
Salary as in effect immediately prior to the increase.
4.2. Bonus; Stock
Options.
(a) In
addition to the annual Salary, Executive shall be eligible to receive certain
bonuses during his employment as follows:
(i) Executive
shall receive a $5,000 bonus for each Abbreviated New Drug Application (“ANDA”)
submitted under Executive’s supervision and accepted for filing by the Federal
Drug Administration (“FDA”);
(ii) Executive
shall receive a $10,000 bonus for each ANDA that is submitted under Executive’s
supervision and approved by the FDA;
(iii) Executive
shall receive a $5,000 bonus for each ANDA that is, as of the Effective Date
pending with the FDA for at least twelve (12) months and which is approved by
the FDA; and
(iv) Executive
shall receive a $10,000 bonus for each ANDA that is, as of the Effective Date
pending with the FDA for less than twelve (12) months and which is approved by
the FDA; and
(v) Executive
shall be entitled to participate in the Corporation’s executive bonus
pool.
(b) All
bonuses payable pursuant to Section 4.2(a) shall be calculated and payable at
such time as bonuses for the Corporation’s executives are regularly calculated
and payable. Executive shall be entitled to only one bonus for each
ANDA approved by the FDA, such bonus to be payable under only one of Section
4.2(a)(ii), Section 4.2(a)(iii), or Section
4.2(a)(iv). The bonuses payable under Section 4.2(a) shall not, in
the aggregate, exceed 50% of Executive’s Salary for the year in which such
bonuses are payable.
(c) Executive
shall receive, on the Effective Date, an option to purchase forty thousand
(40,000) shares of the Corporation’s Common Stock (the “Stock Option”), subject
to and in accordance with the terms and provisions of the Corporation’s Amended
and Restated Stock Option Plan (the “Plan”). The Stock Option shall
vest in 25% increments on the first through fourth anniversaries of the grant
date and shall be governed by the terms of the Plan, a copy of which has been
provided to Executive.
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(d) On
or after each of the first and second anniversaries of the Effective Date,
executive shall receive an option to purchase forty thousand (40,000) shares of
the Corporation’s Common Stock (the “Stock Option”), subject to and in
accordance with the terms and provisions of the Plan. However, the
Compensation Committee and Stock Option Committee shall make the final
determination.
4.3. Signing and Relocation
Bonus. Upon the Effective Date, Executive shall receive a
signing bonus of Fifty Thousand ($50,000) Dollars, less such deductions as shall
be required to be withheld by applicable law and regulations. Upon
Executive’s relocation to the New York area, Executive shall receive a
relocation payment of Sixty-Five Thousand ($65,000) Dollars, less such
deductions as shall be required to be withheld by applicable law and
regulations. Other than as set forth in this Section, Executive shall
not be reimbursed for any relocation expenses incurred by him.
4.4. Expenses.
(a) From
the Effective Date through July 31, 2010, the Corporation shall pay or reimburse
Executive for reasonable and necessary travel and lodging expenses, upon proper
documentation thereof, , up to a maximum of $1,000 per week, which may be
incurred by him in connection with his travel from Huntsville, Alabama to the
location of the Corporation’s offices and temporary lodging
expenses. Thereafter, only Executive’s pre-approved travel and
lodging expenses shall be paid or reimbursed by the Company.
(b) Other
than as set forth above, the Corporation shall pay or reimburse Executive for
all pre-approved reasonable and necessary business, travel or other expenses
incurred by him, upon proper documentation thereof, which may be incurred by him
in connection with the rendition of the services contemplated
hereunder.
4.5. Car
Allowance. Executive shall receive a $700 per month automobile
allowance.
4.6. Benefits. From
and after the Effective Date and during the term of this Agreement and all
extensions thereof, Executive shall be entitled to participate in such pension,
profit sharing, group insurance, option plans, hospitalization, and group health
benefit plans and all other benefits and plans as the Corporation provides to
its senior executives, consistent with the terms of such plans.
4.7. Vacations. Executive
shall be entitled to a vacation of four (4) weeks during each calendar year of
this Agreement and all extensions thereof, during which period his Salary shall
be paid in full. Executive shall take his vacation at such time or
times as Executive and the Corporation shall determine is mutually
convenient.
4.8. Discretionary
Payments. Nothing herein shall preclude the Corporation from
paying Executive such bonus or bonuses or other compensation, as the Board of
Directors, in its discretion, may authorize from time to time.
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Section
5.
Termination.
5.1. Termination. This
Agreement and Executive’s employment hereunder shall terminate immediately upon:
(i) Executive’s death or Total Disability; or (ii) termination of employment of
Executive For Cause; or (iii) a Discretionary Termination; or (iv) a Change in
Control Termination; or (iv) termination Executive’s employment by Executive for
Good Reason, all as hereinafter defined.
5.2. Disability. From
and after the Effective Date, in the event Executive is unable to perform his
duties hereunder by reason of a disability, which disability does not constitute
a Total Disability, the Corporation shall continue to pay Executive his Salary
during the continuance of such disability. To the extent any proceeds
from a disability insurance policy owned by the Corporation are paid to
Executive or his designee, the Corporation shall receive a credit against its
obligations under this Section in an amount equal to the proceeds received by
Executive or his designee. Executive shall be deemed to be suffering
from a “Total Disability” if Executive is mentally or physically incapable or
unable to perform his regular and customary duties of employment with the
Corporation for a period of ninety (90) days in any one hundred twenty (120) day
period. In the event Executive shall be deemed to be suffering from a
Total Disability, the Corporation shall be entitled to terminate this
Agreement.
5.3. Termination Upon Death or
Total Disability. In the event of a termination upon the death
or Total Disability of Executive, the Corporation shall pay to Executive, or any
person designated by Executive in writing or, if no such person is designated,
to his estate, the Salary which would otherwise have been payable to Executive
for the balance of the month in which Executive’s death or Total Disability
occurs.
5.4. Termination For
Cause. In the event Executive’s employment is terminated For
Cause, Executive shall be paid his Salary through the date of
termination. As used herein, the term “For Cause” shall mean (i)
Executive’s substantiated misappropriation of the Corporation’s assets or
substantiated perpetration of fraud against or proven dishonesty in dealings
with the Corporation; (ii) Executive’s guilty plea or conviction in a court of
law of any crime or offense involving willful misappropriation of money or other
property or any other crime which constitutes a felony, in each case whether or
not involving the Corporation; (iii) Executive’s willful misconduct; (iv)
Executive’s habitual drunkenness or habitual use of illegal substances; (v)
Executive’s failure to cooperate with a governmental or regulatory investigation
concerning the Corporation or Executive; (vi) Executive’s behavior which is
materially detrimental to the Corporation’s reputation; (vii) Executive’s
termination of his employment, except for Good Reason; (viii) Executive’s
disobedience of a material directive from the Corporation’s Chief Executive
Officer or Board of Directors or Executive’s willful refusal to follow, or
reckless disregard of, the policies and directives of the Corporation; or (ix)
Executive’s material breach of his responsibilities under this Agreement, which
material breach is not cured within five (5) calendar days after notice thereof
by the Corporation.
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5.5.
Discretionary Termination;
Termination for Good Reason.
(a) As
used herein, the term “Discretionary Termination” shall mean the termination by
the Corporation of this Agreement and Executive’s employment hereunder upon the
giving to Executive of six (6) months’ prior written notice by the Corporation;
provided however, that a Discretionary Termination shall not include a
termination by the Corporation For Cause and/or as a result of Executive’s death
or Total Disability or as a result of a Change in Control.
(b) Executive
may terminate this Agreement, upon notice to the Corporation, for Good Reason,
which Good Reason is not remedied by the Corporation within five (5) calendar
days after notice thereof by Executive. Good Reason shall include any
of the following, (i) any assignment of Executive’s duties inconsistent with
Executive’s position of Chief Scientific Officer – Executive Vice President or
which constitutes a significant reduction in authority, responsibilities, or
status; (ii) any demotion, including, but not limited to reporting to an
individual in the Corporation who is not the Corporation’s CEO or Board of
Directors; (iii) requiring Executive to have his principal place of employment
more than 15 miles beyond the Corporation’s principal place of business as of
the Effective Date, without providing Executive with relocation benefits for
relocation expenses; (iv) any attempted reduction in Executive’s base
salary, or other benefit plans available to executive officers of the
Corporation, or the level, amount or value of any accrued benefit; or (v) any
attempted reduction, of Executive’s bonus or stock option grants which are
inconsistent with the provisions of this Agreement.
(c) If
Executive’s employment is terminated during the term of this Agreement by the
Corporation as a result of a Discretionary Termination or by Executive as a
result of Good Reason, then the Corporation shall pay to Executive after such
termination, severance payments (“Severance”) equal to (i) the
greater of (A) six (6) months of Executive’s Salary for the year in which the
Discretionary Termination or termination for Good Reason occurs or (B)
Executive’s Salary for the balance of the term of the Agreement, plus (ii) an
amount equal to the bonus granted to Executive under Section 4.2(a) hereof for
the year prior to the Discretionary Termination or termination for Good
Reason. The Severance shall be payable weekly less such deductions as
shall be required to be withheld by applicable law and regulations and the bonus
shall be payable on the anniversary of the date such bonus was paid in the prior
year. In addition, the Corporation will continue to keep in effect
all health insurance and welfare benefits for a period of the lesser of (i) the
balance of the term of this Agreement or (ii) until Executive obtains similar
benefits from a new employer.
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Section
6. Confidential Information;
Restrictive Covenants.
6.1. Disclosure. Executive
hereby acknowledges that the principal business of the Corporation is the
marketing and distribution of generic and branded pharmaceutical products and
such other businesses as the Corporation may conduct from time to time (the
“Business”). Executive acknowledges that he will acquire confidential
information concerning the Corporation, the Business, its products, product
development, formulas, research and development, know-how, names and contact
information of the Corporation’s customers, suppliers, contract manufacturers,
and vendors, and the Corporation’s current and future business plans and that,
among other things, his knowledge of the Business will be enhanced through his
employment by the Corporation. Executive acknowledges that such
information is of great value to the Corporation, is the sole property of the
Corporation, and has been and will be acquired by him in
confidence.
6.2. Confidentiality. In
consideration of the obligations undertaken by the Corporation herein, Executive
will not, at any time during or after the term of Executive’s employment with
the Corporation, directly or indirectly, use for Executive’s own benefit or any
other party’s benefit, or reveal, divulge or make known to any person, any
information which is treated as confidential by the Corporation and not
otherwise in the public domain. Confidential information shall not
include information which was previously known by Executive, information which
was given to Executive by any third party under no obligation of
confidentiality, or information which Executive is required to disclose as a
result of a governmental investigation or by a court order. Executive
agrees that all materials or copies thereof containing confidential information
of the Corporation in Executive’s custody or possession will not, at any time,
be removed from the Corporation’s premises without the prior written consent of
the Chief Executive Officer of the Corporation and shall be delivered to the
Corporation upon the earlier of (i) a request by the Corporation or
(ii) the termination of Executive’s employment with the
Corporation. After such delivery, Executive shall not retain any such
materials or copies thereof.
6.3. Restrictive
Covenants. Executive recognizes that the services to be
performed by him hereunder are special, unique and extraordinary. The
parties confirm that it is reasonably necessary for the protection of the
Corporation that Executive agrees, and, accordingly, Executive does hereby
agree, that he will not, either on Executive’s own behalf or as an officer,
director, stockholder, partner, principal, consultant, associate, employee,
owner, agent, creditor, independent contractor, or co-venturer of any third
party or in any other relationship or capacity, directly or indirectly, at any
time during his employment and for the Restricted Period (as defined
below):
(a) engage
in the development of products competitive with the products marketed, under
development or planned for development by the Corporation at the time of the
termination or expiration of employment;
(b) employ
or engage, or cause to authorize, directly or indirectly, to be employed or
engaged, for or on behalf of himself or any third party, any employee,
representative or agent of the Corporation; or
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(c) solicit,
directly or indirectly, on behalf of himself or a third party, any supplier,
vendor or contract manufacturer of the Corporation and its
affiliates.
6.4. Restricted
Period. “Restricted Period” shall mean the term following
Executive’s employment to last for as long as Executive receives his regular
Salary and benefits from the Corporation.
6.5. Modification of
Restrictions. If any of the restrictions contained in this
Section 6 shall be deemed to be unenforceable by reason of the extent,
duration or geographical scope thereof, or otherwise, then after such
restrictions have been reduced so as to be enforceable, in its reduced form this
Section shall then be enforceable in the manner contemplated
hereby.
Section
7. Work for
Hire.
7.1. Executive
agrees to make full and prompt disclosure to the Corporation of all inventions,
improvements, discoveries, methods, developments, formulas, computer software
(and programs and code) and works of authorship, whether or not patentable or
copyrightable, which were or are created, made, conceived or reduced to practice
by Executive or under Executive’s direction or jointly with others during
Executive’s employment by the Corporation, whether or not during normal working
hours or on the premises of the Corporation (all of which are collectively
referred to in this Agreement as “Developments”).
7.2. Executive
agrees to assign and, by executing this Agreement, Executive does hereby assign,
to the Corporation (or to any person or entity designated by the Corporation)
all of Executive’s rights, titles and interests, if any, in and to all
Developments and all related patents, patent applications, copyrights and
copyright applications. However, this Section 7.2 shall not apply to
Developments (i) which do not relate to the present or planned business or
research and development of the Corporation and (ii) which are made and
conceived by Executive: (A) at a time other than during normal
working hours, (B) not on the Corporation’s premises and (C) not using
the Corporation’s tools, devices, equipment or proprietary
information. Executive understands that to the extent that the terms
of this Agreement shall be construed in accordance with the laws of any state
which precludes a requirement in an employment agreement to assign certain
classes of inventions made by an employee, this Section 7 shall be interpreted
not to apply to any invention which a court rules and/or the Corporation agrees
falls within such class or classes. Executive also agrees to waive
all claims to moral and/or equitable rights in any Developments.
7.3. Executive
agrees to cooperate fully with the Corporation, both during and after
Executive’s employment with the Corporation, with respect to the procurement,
maintenance and enforcement of copyrights, patents and other intellectual
property rights (both in the United States and foreign countries) relating to
Developments. Executive agrees that he will sign all papers, including, without
limitation, copyright applications, patent applications, declarations, oaths,
formal assignments, assignments of priority rights, and powers of attorney,
which the Corporation may deem necessary or desirable in order to protect its
rights and interests in any Development. Executive further agrees
that if the Corporation is unable, after reasonable effort, to secure
Executive’s signature on any such papers, any executive officer of the
Corporation shall be entitled to execute any such papers as Executive’s agent
and attorney-in-fact, and Executive hereby irrevocably designates and appoints
each executive officer of the Corporation as Executive’s agent and
attorney-in-fact to execute any such papers on Executive’s behalf, and to take
any and all actions as the Corporation may deem necessary or desirable, in order
to protect its rights and interests in any Development, under the conditions
described in this sentence.
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Section
8. Conflicts of Interest;
Insider Trading.
8.1. Conflicts of
Interest. In order to avoid actual or apparent conflicts of
interest, except with the Corporation’s consent, Executive shall not have any
direct or indirect ownership or financial interest in any company, person or
entity which is: (i) a service provider to, or vendor of, the Corporation; (ii)
a customer of the Corporation; or (iii) a competitor of the
Corporation. Executive shall not be deemed to have any direct or
indirect ownership or financial interest for any such interest that does not
exceed two (2%) percent of the issued and outstanding voting securities of any
class of any corporation whose voting capital stock is traded on a national
securities exchange or in the over-the-counter market.
8.2. General
Requirements. Executive shall observe such lawful policies of
the Corporation as may from time to time apply.
8.3. Insider
Trading. Considering that the Corporation is a publicly-traded
corporation, Executive hereby agrees that Executive shall comply with the
Corporation’s Insider Trading Policy and any and all federal and state
securities laws, including but not limited to those that relate to
non-disclosure of information, insider trading and individual reporting
requirements and shall specifically abstain from discussing the non-public
aspects of the Corporation’s business affairs with any individual or group of
individuals (e.g., Internet chat rooms) who does not have a business need to
know such information for the benefit of the Corporation. Executive
hereby agrees to immediately notify the Corporation’s Compliance Officer in
accordance with the Corporation’s Insider Trading Policy prior to Executive’s
acquisition or disposition of the Corporation’s securities.
Section
9.
Indemnification.
9.1. Indemnification. The
Corporation hereby agrees to indemnify and hold harmless Executive to the
fullest extent permitted by the Corporation’s Certificate of Incorporation,
By-Laws, the Delaware General Corporation Law or any other applicable law, as
any or all may be amended from time to time. Such reimbursements shall include
but not be limited to Executive’s reasonable and necessary out of pocket
expenses including attorneys and expert fees, losses, judgments, claims,
and settlement payments and any other such costs and
expenses.
9.2. Undertaking. To
the extent that the Corporation advances payment for any fees or expenses to
Executive pursuant to this Section 9, such advance shall be accompanied by a
written undertaking by Executive to repay such amounts if it shall be ultimately
determined by a court of competent jurisdiction in a final disposition, that
Executive (i) is not entitled to be indemnified by the Corporation or (ii) that
the amount advanced exceeded the indemnification to which he is entitled, in
which case the amount of such excess shall be repaid to the
Corporation.
8
9.3. Notice. As
a condition precedent to his right to be indemnified hereunder, Executive shall
give the Corporation notice in writing as soon as practicable of any claim made
against him for which indemnity will or could be sought under this
Agreement.
9.4. Cooperation. Executive
shall fully cooperate with the Corporation in connection with any matter, which
results in the assertion of a claim by Executive for indemnification
hereunder. The Corporation shall be entitled at its own expense to
participate in the defense of any proceeding, claim or action, or, if it shall
elect, to assume such defense, in which event such defense shall be conducted by
counsel chosen by the Corporation, subject to the consent of Executive, which
consent shall not be unreasonably withheld or delayed.
9.5. Exceptions. The
Corporation shall not be liable under this Agreement to make any payment in
connection with any claim:
(a) For
which payment is actually made to Executive under valid and collectable
insurance policies, the premiums of which are paid by the Corporation or any of
its affiliates, except in respect of any deductible and excess beyond the amount
of payment under such insurance;
(b) For
which Executive is indemnified by the Corporation otherwise than pursuant to
this Agreement, provided such amount has previously been paid to
Executive;
(c) Brought
about or contributed to by the dishonesty of Executive;
(d) For
which Executive fails to cooperate in a criminal or civil investigation
involving the claim; and
(e) By
Executive who acts as a plaintiff suing the Corporation, its affiliates or
directors, officers or shareholders of the Corporation or its affiliates, except
with regard to Executive’s successful enforcement of Section 9.1 hereof.
9.6. Survival. The
obligations of the Corporation hereunder will survive (i) any actual or
purported termination of this Agreement by the Corporation or its successors or
assigns, whether by operation of law or otherwise, (ii) any change in the
Corporation’s Certificates of Incorporation or By-laws, and (iii) termination of
Executive’s services to the Corporation or its affiliates (whether such services
were terminated by the Corporation, such affiliate or Executive), if such claim
arises as a result of an occurrence prior to the termination of this Agreement,
whether or not a claim is made or an action or proceeding is threatened or
commenced before or after the actual or purported termination of this Agreement,
change in the Corporation’s Certificate of Incorporation or By-laws, or
termination of Executive’s services.
9
Section
10. Change in
Control.
10.1. Payment on Change in Control
Termination. The Corporation will provide or cause to be
provided to Executive the rights and benefits described below if, during the
term of this Agreement, within the six (6) month period following a Change in
Control, (x) Executive terminates his employment for Good Reason, or (y) the
Corporation or its successor terminates Executive’s employment (“Change in
Control Termination”); provided however, that a Change in Control Termination
shall not include a termination For Cause or a termination as a result of
Executive’s death or Total Disability. In the event of a Change in
Control Termination, the Corporation shall pay or cause its successor to pay to
Executive, in cash, in a lump sum within 15 days after the Change in Control
Termination, an amount equal to two (2) times Executive’s base compensation
which equals the sum of the following: (i) Executive’s annual Salary on the day
preceding the Change in Control Termination, plus (ii) an amount equal to the
aggregate bonus received by Executive for the year immediately preceding the
Change in Control Termination. In addition, following a Change in
Control Termination, at no cost to Executive, the Corporation shall maintain for
Executive and Executive’s dependents, all health, insurance and welfare benefits
for the lesser of one year or until Executive and his dependents are eligible
for similar health, insurance and welfare benefits from Executive’s new
employer.
10.2. Change in Control
Defined. A “Change in Control” shall be deemed to occur upon
the earliest to occur after the date of this Agreement of any of the following
events;
(a) Acquisition of Stock by
Third Party. Any Person (as hereinafter defined) is or becomes
the Beneficial Owner (as hereinafter defined), directly or indirectly, of
securities of the Corporation representing forty (40%) percent or more of the
combined voting power of the Corporation’s then outstanding securities and such
Person initiates actions to cause the Corporation to enter into a transaction or
series of transactions with such Person or a third party without the prior
consent or request of the Board of Directors;
(b) Change in Board of
Directors. The date when Continuing Directors cease to be a
majority of the Directors then in office, it being understood that it shall not
be deemed a Change in Control as long as the majority of the Directors were
nominated by the Continuing Directors;
(c) Corporate
Transactions. The effective date of a merger or consolidation
of the Corporation with any other entity where the Corporation is not the
surviving entity, and the surviving entity has the power to elect at least a
majority of the board of directors or other governing body of such surviving
entity; and
(d) Liquidation. The
approval by the shareholders of the Corporation of a complete liquidation of the
Corporation or an agreement for the sale or disposition by the Corporation of
all or substantially all of the Corporation’s assets.
(e) Certain
Definitions. For purposes of this Section 10, the following
terms shall have the following meanings:
10
(i) “Person”
shall have the meaning as set forth in Section 13(d) and 14(d) of the Securities
Exchange Act of 1934, as amended (“Exchange Act”); provided, however, that
Person shall exclude (i) the Corporation, (ii) any trustee or other fiduciary
holding securities under an employee benefit plan of the Corporation, (iii) any
corporation owned, directly or indirectly, by the shareholders of the
Corporation in substantially the same proportions as their ownership of stock of
the Corporation, and (iv) any members of the Seltzer family, including
affiliates, trusts and foundations for the benefit of Seltzer family
members.
(ii) “Beneficial
Owner” shall have the meaning given to such term in Rule 13d-3 under the
Exchange Act.
(iii) “Continuing
Directors” as used in this Agreement shall mean the persons who constitute the
Board of Directors of the Corporation on the date hereof together with their
successors whose nominations were approved by a majority of the then Continuing
Directors.
Section
11. Miscellaneous.
11.1. Survival. The
provisions of Sections 6.1, 6.2, 6.4, 7, 8, 10 and 11 shall indefinitely survive
Executive’s employment with the Corporation. The provisions of
Section 6.3 shall survive for the Restricted Period, as defined
therein.
11.2. Injunctive
Relief. Executive agrees that any breach or threatened breach
by him of Sections 6, 7 or 8 of this Agreement shall entitle the Corporation, in
addition to all other legal remedies available to it, to apply to any court of
competent jurisdiction to enjoin such breach or threatened breach without
proving actual damage or posting a bond or other security. The
parties understand and intend that each restriction agreed to by Executive
herein shall be construed as separable and divisible from every other
restriction, that the unenforceability of any restriction shall not limit the
enforceability, in whole or in part, of any other restriction, and that one or
more or all of such restrictions may be enforced in whole or in part as the
circumstances warrant. In the event that any restriction in this
Agreement is more restrictive than permitted by law in the jurisdiction in which
the Corporation seeks enforcement thereof, such restriction shall be limited to
the extent permitted by law.
11.3. Impact of Restatement of
Financial Statements Upon Previous Awards. If any of the
Corporation’s financial statements are required to be restated, resulting from
errors, omissions, or fraud, the Corporation may (in its sole discretion, but
acting in good faith) recover all or a portion of any performance bonus paid to
Executive with respect to any fiscal year of the Corporation the financial
results of which are negatively affected by such restatement. The
amount to be recovered from Executive shall be the amount by which the affected
bonus exceeded the amount that would have been payable to Executive had the
financial statements been initially filed as restated, or any greater or lesser
amount (including, but not limited to, the entire award) that the Corporation
shall determine. The Compensation Committee of the Corporation shall
determine whether the Corporation shall effect any such recovery (i) by seeking
repayment from Executive; (ii) by reducing (subject to applicable law and the
terms and conditions of the applicable agreement, plan, program or arrangement)
the amount that would otherwise be payable to Executive; (iii) by withholding
payment of future increases in compensation (including the payment of any
discretionary bonus amount) or grants of compensatory awards that would
otherwise have been made in accordance with the Corporation’s otherwise
applicable compensation practices; or (iv) by any combination of the
foregoing. This Section shall survive the termination of this
Agreement.
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11.4. Entire
Agreement. This Agreement constitutes and embodies the entire
and complete understanding and agreement of the parties with respect to
Executives’ employment by the Corporation, supersedes all prior understandings
and agreements, if any, whether oral or written, between Executive and the
Corporation and shall not be amended, modified or changed except by an
instrument in writing executed by the party to be charged. An e-mail
intending to amend or modify this Agreement shall not be binding on the
parties. The invalidity or partial invalidity of one or more
provisions of this Agreement shall not invalidate any other provision of this
Agreement. No waiver by either party of any provision or condition to
be performed shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or any prior or subsequent time.
11.5. Assignment; Binding
Effect. Executive may not assign or delegate any of his or
duties under this Agreement. This Agreement shall inure to the
benefit of, be binding upon and enforceable against, the parties hereto and
their respective successors and permitted assigns.
11.6. Captions. The
captions contained in this Agreement are for convenience of reference only and
shall not affect in any way the meaning or interpretation of this
Agreement.
11.7. Notices. All
notices, requests, demands and other communications required or permitted to be
given hereunder shall be in writing and shall be deemed to have been duly given
when personally delivered or sent by fax or certified, mail, postage prepaid, to
the party at the address set forth above or to such other address as either
party may hereafter give notice of in accordance with the provisions
hereof.
11.8. Governing
Law. This Agreement shall be governed by and interpreted under
the laws of the State of New York applicable to contracts made and to be
performed therein without giving effect to the principles of conflict of laws
thereof. Except in respect of any action commenced by a third party
in another jurisdiction, the parties hereto agree that any legal suit, action,
or proceeding against them arising out of or relating to this Agreement may be
brought in the United States Federal Courts in the State of New York or the
state courts, in the State of New York. The parties hereto hereby
accept the jurisdictions of such courts for the purpose of any such action or
proceeding, and agree that venue for any action or proceeding brought in the
State of New York shall lie in the United States Federal Courts in the Eastern
District or any state court located in Nassau County, New York, as the case may
be. By its execution hereof, the parties hereby irrevocably waive any
objection and any right of immunity on the ground of venue, the convenience of
the forum or the jurisdiction of such courts or from the execution of judgments
resulting therefrom. The parties hereby irrevocably accept and submit
to the jurisdiction of the aforesaid courts in any such suit, action or
proceeding.
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11.9. Waiver of Jury
Trial. THE PARTIES HEREBY WAIVE ANY RIGHT TO TRIAL BY JURY IN
ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY
TRANSACTION CONTEMPLATED HEREBY, WHETHER NOW EXISTING OR HEREAFTER ARISING, AND
WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE. THE PARTIES AGREE
THAT ANY OF THEM MAY FILE A COPY OF THIS PARAGRAPH WITH ANY COURT AS WRITTEN
EVIDENCE OF THE KNOWING, VOLUNTARY AND BARGAINED-FOR AGREEMENT AMONG THE PARTIES
IRREVOCABLY TO WAIVE TRIAL BY JURY AND THAT ANY ACTION OR PROCEEDING WHATSOEVER
BETWEEN THEM RELATING TO THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY
SHALL INSTEAD BE TRIED IN A COURT OF COMPETENT JURISDICTION BY A JUDGE SITTING
WITHOUT A JURY.
11.10. Counterparts. This
Agreement may be executed and delivered in counterparts, including by facsimile
transmission or portable document format (“.pdf”), each of which shall be deemed
an original, but all of which together shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the
parties hereto have executed this Agreement as of the date set forth
above.
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HI-TECH
PHARMACAL CO., INC.
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/s/ David Seltzer
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By:
David Seltzer, President and Chief
Executive
Officer
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Dated:
April 16, 2010
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/s/ Kamel Egbaria
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KAMEL
EGBARIA
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Dated:
April 20, 2010
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