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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
____________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT: MAY 18, 1998
(Date of earliest event reported)
CORTECH, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 0-20726 84-0894091
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
6850 N. BROADWAY, SUITE G, DENVER, COLORADO 80221
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (303) 650-1200
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ITEM 5. OTHER EVENTS.
On May 18, 1998, Cortech, Inc. ("Cortech") issued a press release
announcing that Kenneth R. Lynn had left all positions with Cortech. Mr.
Lynn had most recently served as Cortech's Chairman of the Board of
Directors, Chief Executive Officer, President and Acting Chief Financial
Officer. A copy of the press release is incorporated herein by reference and
attached to this Report as Exhibit 99.1. Copies of amended severance
arrangements between Mr. Lynn and Cortech are also incorporated herein by
reference and attached to this Report as Exhibit 99.2.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) Exhibits
Exhibit No. Description
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99.1 Press Release dated May 18, 1998, announcing changes in the
management of Cortech
99.2 Amended Severance Arrangements between Cortech and Kenneth R.
Lynn
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: May 19, 1998 CORTECH, INC.
By: /s/ DIARMUID F. BORAN
------------------------
Diarmuid F. Boran
Chief Operating Officer
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INDEX TO EXHIBITS
Exhibit
Number Description
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99.1 Press Release dated May 18, 1998 announcing
changes in the management of Cortech
99.2 Amended Severance Arrangements between Cortech and Kenneth R.
Lynn
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EXHIBIT 99.1
PRESS RELEASE DATED MAY 18, 1998 ANNOUNCING CHANGES IN THE MANAGEMENT OF
CORTECH
CORTECH ANNOUNCES CHANGES IN MANAGEMENT
Denver, Colo. -- May 18, 1998 -- Cortech, Inc. (Nasdaq: CRTQ) a Denver-based
biopharmaceutical company, today announced that Kenneth R. Lynn had left all
positions with Cortech. Mr. Lynn had most recently served as Chairman of the
Board of Directors, Chief Executive Officer, President and Acting Chief
Financial Officer. Bert Fingerhut, a Cortech Director since 1988 and
Chairman from June 1991 to April 1997, was appointed Chairman and Acting
Chief Executive Officer, and Diarmuid F. Boran, Vice President, Corporate
Development and Planning, was appointed Chief Operating Officer and Acting
Chief Financial Officer.
Commenting on the changes, Mr. Fingerhut stated, "We appreciate Ken Lynn's
loyal service to Cortech. With the substantial contraction of Cortech's
organization and operations, the recent termination of the BioStar
transaction and the renewed focus on strategic alternatives potentially
available to Cortech, the Board of Directors, with Ken's concurrence,
determined that Cortech's interests would be best served by this action. We
are most grateful for Ken's dedicated leadership and his tireless efforts on
behalf of Cortech."
Mr. Lynn commented, "Notwithstanding the challenges Cortech has faced, it has
been a privilege to serve Cortech and to support its endeavors. I am very
grateful to have had the opportunity and I maintain the highest regard for
the Directors and employees continuing in association with Cortech."
Cortech's principal focus has been the discovery and development of novel
therapeutics for the treatment of inflammatory disorders. Specifically,
Cortech has directed its research and development efforts towards protease
inhibitors and bradykinin antagonists. In response to disappointing test
results and its loss of collaborative partner support, Cortech has
substantially reduced its staffing and has effectively discontinued all
internal research and development activities.
Statements regarding Cortech's strategic alternatives, and all other forward
looking statements, involve risks and uncertainties which include, but are
not limited to, the possible inability to pursue or achieve strategic
alternatives, risks associated with the business of Cortech and those factors
discussed in Cortech's filings with the Securities and Exchange Commission
(including Cortech's Annual Report on Form 10-K for the year ended December
31, 1997).
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EXHIBIT 99.2
AMENDED SEVERANCE ARRANGEMENTS BETWEEN CORTECH AND KENNETH R. LYNN
CORTECH, INC.
6850 NORTH BROADWAY, SUITE G
DENVER, COLORADO 80221
May 18, 1998
Kenneth R. Lynn
Re: Severance Arrangements
Dear Ken:
This letter agreement will confirm the arrangements agreed to between
Cortech, Inc., a Delaware corporation (THE "COMPANY"), and yourself regarding
your severance from the Company as an executive officer, director and
employee with reference to the Executive Compensation and Benefits
Continuation Agreement dated as of October 14, 1997 (THE "EXECUTIVE
AGREEMENT"). Specifically, in consideration of the arrangements confirmed by
this letter agreement, including execution of the Indemnity Agreement
attached as "EXHIBIT A," you have this date ceased to serve as an executive
officer, director and employee of the Company, its subsidiaries and
affiliates.
The Board of Directors has determined that by execution of this letter
agreement your severance will constitute a Termination Event under the
Executive Agreement and will entitle you to receive the benefits provided by
Article III of the Executive Agreement; however, we have agreed to modify
such benefits (as provided under the Executive Agreement) as follows:
(i) Your lump sum salary continuation benefit provided by Section 3.2
of the Executive Agreement shall be twenty (20) months of salary and no more;
(ii) You will not be paid a pro-rata bonus pursuant to Section 3.5 of
the Executive Agreement;
(iii) All outstanding stock options held by you are hereby terminated
and extinguished effective this date; and
(vi) You will be available, as reasonably requested by a director or
executive officer of the Company, to consult with the Company on such matters
as the Company may reasonably request to assist in a transition of your
duties and responsibilities as an executive officer, director and employee of
the Company to others. Such consulting services will be limited to the
period ending June 30, 1998 (THE "CONSULTING PERIOD") and will be limited to
no more than twenty (20) hours of consultation (in any capacity and on any
matter) per week on a non-cumulative basis. You will, during the Consulting
Period, be paid for such consulting services at one-half of your current rate
of compensation and you will be reimbursed for ordinary and necessary
expenses incurred in providing
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consulting services to the Company upon presentation of confirmation of such
expenses sufficient for the Company's income tax and accounting purposes.
In all other respects, the terms of the Executive Agreement are ratified
and confirmed. You will, in implementation of the provisions of the
Executive Agreement and against the promise of performance by the Company of
its obligations thereunder (as modified hereby), execute and deliver the form
of Employee Agreement and Release attached hereto as EXHIBIT B. As part of
the arrangements contemplated by this letter agreement the Board of Directors
has also authorized the execution of the Indemnity Agreement attached hereto
as EXHIBIT A.
If the foregoing correctly sets forth our agreements with regard to the
subject matter hereof, please so indicate by signing the enclosed copy of
this letter below in the space indicated.
Very truly yours,
/s/ Allen Misher, Ph. D.
Allen Misher, Ph.D.
on behalf of the Board of Directors
Acknowledged and Agreed:
/s/ Kenneth R. Lynn
- ----------------------
Kenneth R. Lynn
EXHIBIT A
INDEMNITY AGREEMENT
THIS INDEMNITY AGREEMENT, effective as of May 18, 1998, between CORTECH,
INC., a Delaware corporation (the "Corporation"), and KENNETH R. LYNN (the
"Indemnitee"),
W I T N E S S E T H:
WHEREAS Indemnitee has been a member of the board of directors of the
Corporation (the "Board of Directors") and an officer and employee of the
Corporation and in such capacity has been performing a valuable service for
the Corporation; and
WHEREAS the parties have entered into that certain Letter Agreement
dated as of May 18, 1998 (the "Letter Agreement"), modifying, in part, and
confirming in all other respects, the Corporation's obligations under that
certain Executive Compensation and Benefits Continuation Agreement, dated as
of October 14, 1997 and pursuant to the Letter Agreement the Indemnitee will
continue to provide certain services to the Corporation as a consultant; and
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WHEREAS it is intended that Indemnitee shall be paid promptly by the
Corporation all amounts necessary to effectuate in full the indemnity provided
herein:
Now, Therefore, in consideration of the premises and the covenants in
this Agreement and in the Letter Agreement, and intending to be legally bound
hereby, the parties hereto agree as follows:
1. INDEMNIFICATION.
(a) The Corporation shall indemnify Indemnitee against Expenses
and Liabilities in connection with any Proceeding arising out of any past,
present or future acts or omissions (including negligence) of Indemnitee
occurring during Indemnitee's service as a director or as an officer or as an
employee, agent or consultant of the Corporation or any subsidiary or
affiliate of the Corporation or any corporation, partnership, joint venture,
trust or other enterprise for which Employee has served as a director,
officer, employee or agent at the request of the Corporation (including
CP-0127 Development Corporation) to the fullest extent permitted by
applicable law or the Certificate of Incorporation of the Corporation in
effect on the date hereof or as such law or Certificate of Incorporation may
from time to time be amended (but, in the case of any such amendment, only to
the extent such amendment permits the Corporation to provide broader
indemnification rights than the law or Certificate of Incorporation permitted
the Corporation to provide before such amendment). The right to
indemnification provided in the Certificate of Incorporation shall be
presumed to have been relied upon by Indemnitee in serving or continuing to
serve the Corporation and shall be enforceable as a contract right. Without
diminishing the scope of the indemnification provided by this Section 1, the
Corporation shall indemnify Indemnitee whenever he is or was a party or is
threatened to be made a party to any Proceeding, including without limitation
any such Proceeding brought by or in the right of the Corporation, because he
is or was a director or officer or an employee, agent or consultant of the
Corporation or any subsidiary or affiliate of the Corporation or any
corporation, partnership, joint venture, trust or other enterprise for which
Employee has served as a director, officer, employee or agent at the request
of the Corporation (including CP-0127 Development Corporation) or because of
anything done or not done by Indemnitee in such capacity, against Expenses
and Liabilities actually and reasonably incurred by Indemnitee or on his
behalf in connection with such Proceeding, including the costs of any
investigation, defense, settlement or appeal, except that no indemnification
shall be made with respect to any claim, issue or matter if such
indemnification is prohibited by applicable Delaware law, unless and to the
extent that a Delaware Court of Chancery or the court in which the action was
heard determines that Indemnitee is entitled to indemnification for such
amounts as the court deems proper. In addition to, and not as a limitation
of, the foregoing, the rights of indemnification of Indemnitee provided under
this Agreement shall include those rights set forth in Sections 2, 6, 7 and
11 below.
(b) Indemnitee shall be paid promptly by the Corporation all
amounts necessary to effectuate the foregoing indemnity.
2. ADVANCEMENT OF EXPENSES. All reasonable Expenses incurred by or on
behalf of Indemnitee shall be advanced from time to time by the Corporation
to Indemnitee within thirty (30) days after the Corporation's receipt of a
written request for an advance of Expenses, whether prior to or after final
disposition of a Proceeding (except to the extent that there has been a Final
Adverse Determination that Indemnitee is not entitled to be indemnified for
such Expenses), including without limitation any Proceeding brought by or in
the right of the Corporation. The written request for an advancement of any
and all Expenses under this paragraph shall contain reasonable detail of the
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Expenses incurred by Indemnitee. Indemnitee hereby agrees to repay the
amounts advanced if it is ultimately determined that Indemnitee is not
entitled to be indemnified pursuant to the terms of this Agreement.
3. LIMITATIONS. The foregoing indemnity and advancement of Expenses
shall apply only to the extent that Indemnitee has not been indemnified and
reimbursed pursuant to such insurance as the Corporation may maintain for
Indemnitee's benefit, or otherwise; provided, however, that notwithstanding
the availability of such other indemnification and reimbursement, Indemnitee
may claim indemnification and advancement of Expenses pursuant to this
Agreement by assigning to the Corporation, at its request, Indemnitee's
claims under such insurance to the extent Indemnitee has been paid by the
Corporation.
4. INSURANCE AND FUNDING. The Corporation may purchase and maintain
insurance to protect itself and/or Indemnitee against any Expenses and
Liabilities in connection with any Proceeding to the fullest extent permitted
by applicable laws and, to the extent the Corporation in the future obtains
liability insurance to cover its directors and officers, it shall identify
Indemnitee as a past director and officer for purposes of coverage under any
such liability insurance. The Corporation may create a trust fund, grant an
interest or use other means (including, without limitation, a letter of
credit) to ensure the payment of such amounts as may be necessary to effect
indemnification or advancement of Expenses as provided in this Agreement.
5. PROCEDURE FOR DETERMINATION OF ENTITLEMENT TO INDEMNIFICATION.
(a) Whenever Indemnitee believes that he is entitled to
indemnification pursuant to this Agreement, Indemnitee shall submit a written
request for indemnification to the Corporation. Any request for
indemnification shall include sufficient documentation or information
reasonably available to Indemnitee to support his claim for indemnification.
Indemnitee shall submit such claim for indemnification within a reasonable
time not to exceed five years after any judgment, order, settlement,
dismissal, arbitration award, conviction, acceptance of a plea of nolo
contendere or its equivalent, final termination or other disposition or
partial disposition of any Proceeding, whichever is the later date for which
Indemnitee requests indemnification. The President or the Secretary or other
appropriate officer shall, promptly upon receipt of Indemnitee's request for
indemnification, advise the Board of Directors in writing that Indemnitee has
made such request. Determination of Indemnitee's entitlement to
indemnification shall be made not later than ninety (90) days after the
Corporation's receipt of his written request for such indemnification.
(b) The Indemnitee shall be entitled to select the forum in which
Indemnitee's request for indemnification will be heard, which selection shall
be included in the written request for indemnification required in Section
5(a). The forum shall be any one of the following:
(i) The stockholders of the Corporation;
(ii) A quorum of the Board of Directors consisting of Disinterested
Directors; or
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(iii) Independent Legal Counsel, who shall make the determination
in a written opinion.
If Indemnitee fails to make such designation, his claim shall be
determined by an appropriate court of the State of Delaware.
6. FEES AND EXPENSES OF INDEPENDENT LEGAL COUNSEL. The Corporation
agrees to pay the reasonable fees and expenses of Independent Legal Counsel
should such Counsel be retained to make a determination of Indemnitee's
entitlement to indemnification pursuant to Section 5 of this Agreement, and
to fully indemnify such Counsel against any and all expenses and losses
incurred by any of them arising out of or relating to this Agreement or their
engagement pursuant hereto.
7. REMEDIES OF INDEMNITEE.
(a) In the event that (i) a determination pursuant to Section 5
hereof is made that Indemnitee is not entitled to indemnification, (ii)
advances of Expenses are not made pursuant to this Agreement, (iii) payment
has not been timely made following a determination of entitlement to
indemnification pursuant to this Agreement, or (iv) Indemnitee otherwise
seeks enforcement of this Agreement, Indemnitee shall be entitled to a final
adjudication of his rights in an appropriate court of the State of Delaware
or other court having jurisdiction over Indemnitee and the Corporation. The
Corporation shall not oppose Indemnitee's right to seek any such adjudication.
(b) In the event that a determination that Indemnitee is not
entitled to indemnification, in whole or in part, has been made pursuant to
Section 5 hereof, the decision in the judicial proceeding provided in
paragraph (a) of this Section 7 shall be made de novo and Indemnitee shall
not be prejudiced by reason of a determination that he is not entitled to
indemnification.
(c) If a determination that Indemnitee is entitled to
indemnification has been made pursuant to Section 5 hereof or otherwise
pursuant to the terms of this Agreement, the Corporation shall be bound by
such determination in the absence of (i) a misrepresentation of a material
fact by Indemnitee or (ii) a specific finding (which has become final) by an
appropriate court of the State of Delaware that all or any part of such
indemnification is expressly prohibited by law.
(d) In any court proceeding pursuant to this Section 7, the
Corporation shall be precluded from asserting that the procedures and
presumptions of this Agreement are not valid, binding and enforceable. The
Corporation shall stipulate in any such court that the Corporation is bound
by all the provisions of this Agreement and is precluded from making any
assertion to the contrary.
(e) Expenses reasonably incurred by Indemnitee in connection with
his request for indemnification under this Agreement, seeking enforcement of
this Agreement or to recover damages for breach of this Agreement shall be
borne by the Corporation.
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8. MODIFICATION, WAIVER, TERMINATION AND CANCELLATION. No supplement,
modification, termination, cancellation or amendment of this Agreement shall
be binding unless executed in writing by both of the parties hereto. No
waiver of any of the provisions of this Agreement shall be deemed or shall
constitute a waiver of any other provisions hereof (whether or not similar),
nor shall such waiver constitute a continuing waiver.
9. NOTICE BY INDEMNITEE AND DEFENSE OF CLAIM. Indemnitee shall promptly
notify the Corporation in writing upon being served with any summons,
citation, subpoena, complaint, indictment, information or other document
relating to any matter, whether civil, criminal, administrative or
investigative, but the omission so to notify the Corporation will not relieve
it from any liability which it may have to Indemnitee if such omission does
not prejudice the Corporation's rights. If such omission does prejudice the
Corporation's rights, the Corporation will be relieved from liability only to
the extent of such prejudice; nor will such omission relieve the Corporation
from any liability which it may have to Indemnitee otherwise than under this
Agreement. With respect to any Proceeding as to which Indemnitee notifies
the Corporation of the commencement thereof:
(a) The Corporation will be entitled to participate therein at its
own expense; and
(b) The Corporation jointly with any other indemnifying party
similarly notified will be entitled to assume the defense thereof, with
counsel reasonably satisfactory to Indemnitee; provided, however, that the
Corporation shall not be entitled to assume the defense of any Proceeding if
Indemnitee shall have reasonably concluded that there may be a conflict of
interest between the Corporation and Indemnitee with respect to such
Proceeding. After notice from the Corporation to Indemnitee of its election
to assume the defense thereof, the Corporation will not be liable to
Indemnitee under this Agreement for any Expenses subsequently incurred by
Indemnitee in connection with the defense thereof, other than reasonable
costs of investigation or as otherwise provided below. Indemnitee shall have
the right to employ his own counsel in such Proceeding but the fees and
expenses of such counsel incurred after notice from the Corporation of its
assumption of the defense thereof shall be at the expense of Indemnitee
unless:
(i) The employment of counsel by Indemnitee has been authorized
by the Corporation;
(ii) Indemnitee shall have reasonably concluded that counsel
engaged by the Corporation may not adequately represent Indemnitee or
that there may be a conflict of interest between Indemnitee and the
Corporation with respect to such Proceeding; or
(iii) The Corporation shall not in fact have employed counsel to
assume the defense in such Proceeding or shall not in fact have
assumed such defense and be acting in connection therewith with
reasonable diligence;
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in each of which cases the fees and expenses of such counsel shall be at the
expense of the Corporation.
(c) The Corporation shall not settle any Proceeding in any manner
which would impose any penalty or limitation on Indemnitee without
Indemnitee's written consent; provided, however, that Indemnitee will not
unreasonably withhold his consent to any proposed settlement.
10. NOTICES. All notices, requests, demands and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
(i) delivered by hand and receipted for by the party to whom said notice or
other communication shall have been directed, or (ii) mailed by certified or
registered mail with postage prepaid, on the third business day after the
date on which it is so mailed:
(a) If to Indemnitee, to:
Kenneth R. Lynn
(b) If to the Corporation, to:
Cortech, Inc.
6850 N. Broadway, Suite G
Denver, CO 80221
Attention: President
or to such other address as may have been furnished to Indemnitee by the
Corporation or to the Corporation by Indemnitee, as the case may be.
11. NONEXCLUSIVITY. The rights of Indemnitee hereunder shall not be
deemed exclusive of any other rights to which Indemnitee may now or in the
future be entitled under the Delaware General Corporation Law, the
Corporation's Certificate of Incorporation or By-Laws, or any agreements,
vote of stockholders, resolution of the Board of Directors or otherwise.
12. CERTAIN DEFINITIONS.
(a) "Disinterested Director" shall mean a director of the
Corporation who is not or was not a party to the Proceeding in respect of
which indemnification is being sought by Indemnitee.
(b) "Expenses" shall include all direct and indirect costs
(including, without limitation, attorneys' fees, retainers, court costs,
transcripts, fees of experts, witness fees, travel expenses, duplicating
costs, printing and binding costs, telephone charges, postage, delivery
service fees, all other disbursements or out-of-pocket expenses and
reasonable compensation for time spent by Indemnitee for which he is
otherwise not compensated by the Corporation) actually and reasonably
incurred in connection with a Proceeding or establishing
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or enforcing a right to indemnification under this Agreement, applicable law
or otherwise; provided, however, that "Expenses" shall not include any
Liabilities.
(c) "Final Adverse Determination" shall mean that a determination
that Indemnitee is not entitled to indemnification shall have been made
pursuant to Section 5 hereof and either (1) a final adjudication in a court
pursuant to Section 7(a) hereof shall have denied Indemnitee's right to
indemnification hereunder, or (2) Indemnitee shall have failed to file a
complaint in a court pursuant to Section 7(a) for a period of one hundred
eighty (180) days after the determination made pursuant to Section 5 hereof.
(d) "Indemnification Period" shall mean the period of time during
which Indemnitee shall continue to serve as a director or as an officer or as
an employee, agent or consultant of the Corporation or any subsidiary or
affiliate of the Corporation or any corporation, partnership, joint venture,
trust or other enterprise for which Employee has served as a director,
officer, employee or agent at the request of the Corporation (including
CP-0127 Development Corporation), and thereafter so long as Indemnitee shall
be subject to any possible Proceeding arising out of acts or omissions of
Indemnitee as a director or as an officer or as an employee, agent or
consultant of the Corporation or any subsidiary or affiliate of the
Corporation or any corporation, partnership, joint venture, trust or other
enterprise for which Employee has served as a director, officer, employee or
agent at the request of the Corporation (including CP-0127 Development
Corporation).
(e) "Independent Legal Counsel" shall mean a law firm or a member
of a law firm selected by the Corporation and approved by Indemnitee (which
approval shall not be unreasonably withheld) and that neither is presently
nor in the past five years has been retained to represent: (i) the
Corporation, in any material matter, or (ii) any other party to the
Proceeding giving rise to a claim for indemnification hereunder.
Notwithstanding the foregoing, the term "Independent Legal Counsel" shall not
include any person who, under the applicable standards of professional
conduct then prevailing, would have a conflict of interest in representing
either the Corporation or Indemnitee in an action to determine Indemnitee's
right to indemnification under this Agreement.
(f) "Liabilities" shall mean liabilities of any type whatsoever
including, but not limited to, any judgments, fines, ERISA excise taxes and
penalties, penalties and amounts paid in settlement (including all interest
assessments and other charges paid or payable in connection with or in
respect of such judgments, fines, penalties or amounts paid in settlement) of
any proceeding.
(g) "Proceeding" shall mean any threatened, pending or completed
action, claim, suit, arbitration, alternate dispute resolution mechanism,
investigation, administrative hearing or any other proceeding whether civil,
criminal, administrative or investigative, including any appeal therefrom.
13. BINDING EFFECT, DURATION AND SCOPE OF AGREEMENT. This Agreement
shall be binding upon and inure to the benefit of and be enforceable by the
parties hereto and their respective successors and assigns (including any
direct or indirect successor by purchase,
<PAGE>
merger, consolidation or otherwise to all or substantially all of the
business or assets of the Corporation), spouses, heirs and personal and legal
representatives. This Agreement shall continue in effect during the
Indemnification Period, regardless of whether Indemnitee continues to serve
as a director or as an officer or as an employee, agent or consultant for the
Corporation or for any other corporation, partnership, joint venture, trust
or other enterprise.
14. SEVERABILITY. If any provision or provisions of this Agreement (or
any portion thereof) shall be held to be invalid, illegal or unenforceable
for any reason whatsoever:
(a) the validity, legality and enforceability of the remaining
provisions of this Agreement shall not in any way be affected or impaired
thereby; and
(b) to the fullest extent legally possible, the provisions of this
Agreement shall be construed so as to give effect to the intent of any
provision held invalid, illegal or unenforceable.
15. GOVERNING LAW AND INTERPRETATION OF AGREEMENT. This Agreement shall
be governed by and construed and enforced in accordance with the laws of the
State of Delaware, as applied to contracts between Delaware residents entered
into and to be performed entirely within Delaware. If the laws of the State
of Delaware are hereafter amended to permit the Corporation to provide
broader indemnification rights than said laws permitted the Corporation to
provide prior to such amendment, the rights of indemnification and
advancement of expenses conferred by this Agreement shall automatically be
broadened to the fullest extent permitted by the laws of the State of
Delaware, as so amended.
16. CONSENT TO JURISDICTION. The Corporation and Indemnitee each
irrevocably consent to the non-exclusive jurisdiction of the courts of the
State of Delaware for all purposes in connection with any action or
proceeding which arises out of or relates to this Agreement and agree that
any action instituted under this Agreement may be brought in the state courts
of the State of Delaware.
17. ENTIRE AGREEMENT. This Agreement represents the entire agreement
between the parties hereto, and there are no other agreements, contracts or
understandings between
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the parties hereto with respect to the subject matter of this Agreement,
except as specifically referred to herein or as provided in Section 11
hereof.
18. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall for all purposes be deemed to be an
original but all of which together shall constitute one and the same
Agreement.
Dated as of the 18th day of May, 1998.
CORTECH, INC.
/s/ Diarmuid F. Boran
By: Diarmuid F. Boran
Title: Chief Operating Officer
INDEMNITEE
/s/ Kenneth R. Lynn
---------------------------------
KENNETH R. LYNN
EXHIBIT B
EMPLOYEE AGREEMENT AND RELEASE
I understand and agree completely to the terms set forth in the letter
agreement of even date herewith (the "Letter Agreement") insofar as the same
modifies in certain respects, and confirms, in all other respects, the
Executive Compensation and Benefits Continuation Agreement dated as of
October 14, 1997 (the "Executive Agreement").
Except as otherwise set forth in the Letter Agreement or the Executive
Agreement, I hereby release, acquit and forever discharge Cortech, Inc., its
parents and subsidiaries (the "Company"), and their officers, directors,
agents, servants, employees, shareholders, successors, assigns and
affiliates, of and from any and all claims, liabilities, demands, causes of
action, costs, expenses, attorneys fees, damages, indemnities and obligations
of every kind and nature, in law, equity, or otherwise, known and unknown,
suspected and unsuspected, disclosed and undisclosed (other than any claim
for indemnification I may have as a result of any third party action against
me based on my employment with the Company), arising out of or in any way
related to the termination of my employment with the Company, including, but
not limited to, claims of intentional and negligent infliction of emotional
distress, any and all
<PAGE>
tort claims for personal injury, claims or demands related to salary,
bonuses, commissions, stock, stock options, or any other ownership interests
in the Company, vacation pay, fringe benefits, expense reimbursements,
severance pay, or any other form of compensation; claims pursuant to any
federal, state or local law or cause of action including, but not limited to,
the federal Civil Rights Act of 1964, as amended; the federal Age
Discrimination in Employment Act of 1967, as amended ("ADEA"); the federal
Americans with Disabilities Act of 1990; tort law; contract law; wrongful
discharge; discrimination; fraud; defamation; emotional distress; and breach
of the implied covenant of good faith and fair dealing; provided, however,
that nothing in this paragraph shall be construed in any way to release the
Company from its obligation to indemnify me pursuant to statute or any
indemnification agreement, including the requirements of the Certificate of
Incorporation or Bylaws of the Company.
I acknowledge that I am knowingly and voluntarily waiving and releasing any
rights I may have under the ADEA. I also acknowledge that the consideration
given for the waiver and release in the preceding paragraph hereof is in
addition to anything of value to which I was already entitled. I further
acknowledge that I have been advised by this writing, as required by the ADEA,
that: (A) my waiver and release do not apply to any rights or claim that may
arise after the Effective Date of this Agreement and Release; (B) I have the
right to consult with an attorney prior to executing this Agreement and Release;
(C) I have twenty-one (21) days to consider this Agreement and Release (although
I may choose to voluntarily execute this Agreement and Release earlier); and (D)
I have seven (7) days following the execution of this Agreement and Release by
the parties to revoke this Agreement and Release.
Dated: May 18, 1998 /s/ Kenneth R. Lynn
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Kenneth R. Lynn
