Exhibit 10.15
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AMENDED EMPLOYMENT AGREEMENT
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THIS AMENDED EMPLOYMENT AGREEMENT ("Agreement"), made and entered into
as of November 15, 1996, by and between LabOne, Inc., with offices in Lenexa,
Kansas (hereinafter referred to as "LabOne"), and Xxxx X. Xxxxxxxxx, Xx.,
a resident of the State of Kansas (hereinafter referred to as "Officer");
WITNESSETH:
WHEREAS, Officer and LabOne are presently parties to an Employment
Agreement, dated August 15, 1993 ("Employment Agreement"); and
WHEREAS, the parties desire to amend and restate said Employment
Agreement in its entirety;
NOW, THEREFORE, in consideration of the employment of Officer by
LabOne for the term of this Agreement and of the mutual promises, covenants,
representations and warranties contained herein , the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending
to be legally bound, agree that the Employment Agreement is hereby amended
and restated in its entirety to read as follows:
SECTION I
EMPLOYMENT AND TERM
1.1 Employment. LabOne hereby employs Officer and Officer hereby
accepts such employment and agrees to perform the duties described in
Section 2 of this Agreement.
1.2 Term.
(a) Base Term. The term of employment shall commence on
the date hereof and shall continue for a period of two (2) years therefrom
(the "Base Term"), or until terminated as otherwise provided herein.
(b) Termination Subsequent to Change of Control.
Notwithstanding any other provision of this Agreement to the contrary, in
the event that (i) a Change of Control of LabOne, as defined below, shall
occur at any time during which Officer is in the full-time employment of
LabOne or its successor and (ii) within one (1) year after such a Change
of Control, Officer's employment with LabOne or its successor is terminated
by LabOne or its successor for any reason other than permanent disability,
death or normal retirement, or is voluntarily terminated by Officer for
any reason at his sole discretion, LabOne will promptly pay to Officer
(A) the installments of his base salary through the date of termination
of employment, (B) any annual incentive bonus for the previous year if such
has been approved but not paid, and (C) a lump sum severance payment equal
to three (3) times the sum of (x) Officer's Average Annual Base Salary, as
defined below, and (y) Officer's Average Annual Incentive Bonus, as defined
below, and upon such payment any remaining term of this Agreement shall be
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cancelled. To the extent that any amount required to be paid hereunder
would constitute an "excess parachute payment" within the meaning of
Section 280G(b) of the Internal Revenue Code of 1986, that excess amount
need not be paid.
For purposes of this Section 1.2(b):
(i) A "Change of Control" shall be deemed to have taken place
if there shall have occurred (A) a sale of other disposition resulting in
the transfer of legal or beneficial ownership of, or the right to vote, more
than fifty percent (50%) of the outstanding capital stock of LabOne to one
or more third-party purchasers unaffiliated with Seafield Capital
Corporation, its shareholders or affiliates (as the term "affiliate" is
defined in Rule 12b-2 promulgated by the Securities and Exchange Commission
under the Securities Exchange Act of 1934), except in connection with an
underwritten public offering of the common stock of LabOne, (B) a merger
or consolidation of LabOne with or into any entity other than Seafield
Capital Corporation or its affiliates, or (C) a sale or other transfer of
substantially all of the assets of LabOne to any person or entity other
than Seafield Capital Corporation or its affiliates;
(ii) "Officer's Average Annual Base Salary" shall equal the
average annual base salary paid to Officer by LabOne during the five
fiscal years immediately prior to the fiscal year in which the Change of
Control occurs, or if Officer was not an employee of LabOne for the full
five year period, during such portion of the five year period that Officer
was employed by LabOne; and
(iii) "Officer's Average Annual Incentive Bonus" shall equal
the average annual incentive bonus paid to Officer by LabOne with respect
to the five fiscal years immediately prior to the fiscal year in which
the Change of Control occurs, or if Officer was not an employee of LabOne
for the full five year period, during such portion of the five year period
that Officer was employed by LabOne.
The payments to Officer under this Section and the arrangements
provided for by any stock option or other agreement between LabOne and
Officer in effect at the time and by any other applicable plan of LabOne
will constitute the entire obligation of LabOne to Officer with respect to
such termination, and will also constitute full settlement of any claim
under law or in equity that Officer might otherwise assert against LabOne
or any of its employees on account of such termination.
(c) Annual Extension. Commencing on the first anniversary
of this Agreement and on each succeeding anniversary thereafter, unless
LabOne notifies Officer in accordance with the immediately following
sentence that Officer's employment under this Agreement will not be
extended, this Agreement and Officer's employment under this Agreement
shall automatically and without further action be extended for an additional
twelve (12) months to a date two (2) years from such anniversary, on the
same terms and conditions as are set forth herein. If LabOne elects not
to extend Officer's employment under this Agreement as provided in the
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preceding sentence, it shall do so by notifying Officer in writing within
six (6) months prior to the applicable anniversary date of this Agreement.
If LabOne elects not to extend Officer's employment under this Agreement
as provided above, such election shall be treated as a termination of
Officer without cause within the meaning of Section 9.1(e) of this Agreement
and LabOne shall pay to Officer, in addition to any other sums which may be
due to Officer, the lump sum severance payment provided for in Section
9.1(e).
SECTION 2
DUTIES
2.1 General Duties. Officer shall serve LabOne in the capacities
of Executive Vice President-New Business Development and Chief Pathologist.
Officer shall be responsible for performing the duties generally required
of such positions and such other duties in relation to LabOne as shall from
time to time be assigned to Officer by the Board of Directors or the
Chairman of the Board of Directors.
2.2 Full Time. During the term hereof, Officer agrees to devote
his full time, attention and skill to the performance of the foregoing
duties.
2.3 Best Efforts. Officer agrees that he will at all times
faithfully, industriously and to the best of his ability, experience
and talents, perform all of the duties that may be required of him as
described above.
2.4 Indemnification and D & 0 Insurance. LabOne shall provide
to Officer coverage under LabOne, Inc.'s director and officer liability
insurance and indemnification By-laws, as fully and to the same extent
as the same are provided to similar executive officers of LabOne.
SECTION 3
BASE SALARY
3.1 Annual Base Salary. LabOne shall pay Officer, and Officer
shall accept from LabOne in full payment for Officer's full time services
hereunder, compensation at the rate of Two Hundred Thirty Two Thousand
Nine Hundred Dollars ($232,900) per annum, payable monthly in periodic
equal installments during the year. Such salary shall be reviewed from
time to time, but not less often than annually, by the Board of Directors
of LabOne and will be subject to such increases, but not decreases, as the
Board of Directors of LabOne may determine, having due regard for the
efforts of Officer and the results, both financial and otherwise, of
LabOne's operations during Officer's tenure.
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3.2 Reimbursement of Expenses. LabOne shall reimburse Officer
for such reasonable out-of-pocket expenses as are incurred by Officer in
order to render the services contemplated hereunder.
3.3 Tax Withholdings. LabOne shall deduct from the compensation
payable to Officer all federal, state, and local income tax, social
security, FICA, FUTA and other withholdings as required by law.
SECTION 4
BONUSES AND FRINGE BENEFITS
4.1 Annual Incentive Bonus. During the term hereof, Officer shall
be eligible to receive an annual incentive bonus based upon the performance
of LabOne in relation to pre-determined financial goals established by the
compensation Committee of the Board of Directors of LabOne. Bonuses for
less than a full year of service may be granted at the discretion of the
Compensation Committee.
4.2 Other Fringe Benefits. Officer shall be entitled to an
annual vacation consistent with LabOne's vacation policies for similar
executive officers and to participate in such fringe benefit programs as
LabOne may make available from time to time to similar executive officers,
which shall include reasonable hospital and major medical insurance
coverage, long term disability and life insurance in amounts and on terms
no less favorable than those provided to similar executive officers of
LabOne.
SECTION 5
NON-COMPETITION
5.1 Restrictive Covenants. In consideration for Officer's
employment with LabOne and in further consideration for the compensation
provided for in Sections 1, 3 and 4 hereof and the post-termination
payment, if any, provided for in Section 9(e) hereof, Officer agrees
that during the term of employment pursuant to this Agreement, and for
a period of two (2) years after the termination for any reason of employment
pursuant to this Agreement, Officer will not, without the prior written
consent of LabOne, directly or indirectly, individually or in concert with
others, or through the medium of any other corporation, partnership,
syndicate, association, joint venture, or other entity or as an employee,
officer, director, agent, consultant, partner, member or otherwise:
(a) solicit, accept, divert or service, or attempt to
solicit, accept, divert or service, any business similar to the type
and character or business then engaged in by LabOne from any person,
corporation or other entity who was as of the date of the termination
of Officer's employment a customer of LabOne,
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(b) solicit, induce or encourage any employee, contractor or
agent of LabOne to terminate employment or other relationship with
LabOne or to compete with LabOne in any manner, or
(c) compete with LabOne in the clinical or insurance laboratory
testing businesses or any other businesses of LabOne at the date of
termination of Officer's employment.
It is understood and agreed that Section 5.1(c) shall apply only with
respect to the following geographic area: All territory in which LabOne
or its representatives or agents, as of the date of the termination of
Officer's employment pursuant hereto, sells or offers for sale LabOne's
products or services.
5.2 Injunctive Relief. LabOne shall be entitled to appropriate
injunctive relief in any court of competent jurisdiction to enforce its
rights under Sections 5, 6, 7 and 8 of this Agreement, in addition to
any other rights and remedies available to LabOne at law or in equity,
it being agreed that any violation of Sections 5, 6, 7 or 8 of this
Agreement by Officer is reasonably likely to cause irreparable damage
to LabOne which will be difficult or impossible to value in monetary
damages.
5.3 Charitable Activities. Nothing in this Section 5 shall
be construed as preventing Officer from engaging in charitable,
professional, religious or civic activities such as serving on a school
board, or as a member of or officer of a professional organization,
provided such activity or organization does not compete directly with
LabOne.
SECTION 6
CONFIDENTIAL INFORMATION
6.1 Confidentiality. During the term of and at any time after
the termination of this Agreement, Officer will hold in trust and
confidence and will not divulge, disclose or convey to any person, firm,
corporation or other entity and will keep secret and confidential all
trade secrets, proprietary information and confidential information
heretofore or hereafter acquired by Officer concerning LabOne, Head
Office Reference Laboratory Ltd., or Seafield Capital Corporation, and
will not use for himself or others the same in any manner, except to the
extent that such information should become no longer a trade secret,
proprietary or confidential. Such trade secrets, proprietary
information and confidential information shall be deemed to include,
but shall not be limited to, information, whether written or not:
(a) of a technical nature, such as but not limited to,
technology, inventions, discoveries, improvements, processes, formulae,
ideas, know-how, methods, compositions, computer software programs or
research projects, including the identity of research organizations and
researchers,
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(b) of a business nature, such as but not limited to
information concerning costs, profits, supplies, suppliers, marketing,
sales or lists of customers, and
(c) pertaining to future developments, such as but not
limited to information concerning research and development or future
marketing methods.
The restrictions contained above shall not apply to:
(i) information which at the time of disclosure by LabOne
to Officer is in the public domain; or
(ii) information which at the time of disclosure by LabOne
to Officer constituted confidential information hereunder, but which
thereafter becomes part of the public domain by publication or otherwise
through no fault of Officer.
SECTION 7
INVENTIONS
7.1 All inventions, products, discoveries, improvements, processes,
manufacturing, marketing and service methods and techniques, formulae,
design, styles, specifications, data bases, computer programs (whether
in source code or object code), know-how, strategies and data, whether
or not patentable or registerable under copyright or similar statutes,
made, developed or created by Officer (whether or not at the request or
suggestion of LabOne, alone or in conjunction with others, and whether
during regular hours at work or otherwise) during Officer's period of
employment with LabOne (collectively, "Inventions") , shall be promptly
and fully disclosed by Officer to an appropriate executive officer of
LabOne. Officer hereby assigns, transfers and conveys to LabOne all
rights in and to all Inventions as its exclusive property. Officer
shall give evidence and promptly execute and/or deliver to an
appropriate executive officer of LabOne, without any additional
compensation therefor, all papers, drawings, models, programs, data,
documents and other material:
(a) pertaining to or in any way relating to or evidencing
any Inventions, or
(b) necessary or desirable to document such transfer, or to
enable LabOne to file and process applications for and to acquire,
maintain and enforce any and all patents, trademarks, registrations
or copyrights with respect to any such Inventions, or to obtain any
extension, validation, reissue continuance or renewal of any such
patent, trademark or copyright.
LabOne will be responsible for the preparation of any such instruments,
documents and papers and for the implementation of any such proceedings
and will reimburse Officer for all reasonable expenses incurred by
Officer in compliance with the provisions of this Section. OFFICER IS
HEREBY NOTIFIED THAT the provisions of this Section 7.1 shall not apply
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to an Invention for which no equipment, supplies, facility or trade
secret information of LabOne was used and which was developed entirely
on Officer's own time, unless:
(i) the Invention relates directly to the business of
LabOne or to its actual or demonstratively anticipated research or
development, or
(ii) the Invention results from any work performed by
Officer for LabOne.
SECTION 8
PROPERTY OF LABONE
8.1 All correspondence, notes, recordings, documents and other
materials and reproductions thereof pertaining to any aspect of the
business of LabOne shall be the property of and shall be delivered to
and retained by LabOne upon termination of this Agreement.
SECTION 9
TERMINATION
9.1 Termination. Officer's employment pursuant to this Agreement
shall terminate upon the occurrence of any of the following events:
(a) Death. In the event that Officer dies during the term of
this Agreement, LabOne shall pay to his executors or administrators an
amount equal to the installments of his base salary payable for the month
in which he dies and any annual incentive bonus for the previous year if
such has been approved but not paid, and such payments, together with the
arrangements provided for by any stock option or other agreement between
LabOne and Officer in effect at the time and by any other applicable plan
of LabOne will constitute the entire obligation of LabOne to Officer and
will also constitute full settlement of any claim under law or in equity
that Officer's executors, heirs or assigns or any other person claiming
under or through him might otherwise assert against LabOne or any of its
employees on account of his death.
(b) Disability. In the event that Officer continues unable
to fully perform his duties and responsibilities hereunder by reason of
illness, injury or mental or physical disability or incapacity for
ninety (90) consecutive days, during which time he shall continue to
be compensated for monthly installments of base salary and any annual
incentive bonus for the previous year if such has been approved but not
paid, Officer's employment pursuant to this Agreement may be terminated
by LabOne, and such payments, together with the arrangements provided
for by and stock option or other agreement between LabOne and Officer in
effect at the time and by any other applicable plan of LabOne will
constitute the entire obligation of LabOne to Officer and will also
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constitute full settlement of any claim under law or in equity that
Officer might otherwise assert against LabOne, or any of its employees
on account of such termination. Officer agrees, in the event of any
dispute under this Section 9.1, to submit to a physical examination
by a reputable licensed physician selected by LabOne and to accept
LabOne's decision based on the results thereof.
(c) Voluntary Termination. Officer's employment may be
voluntarily terminated upon Officer giving sixty (60) days' prior
written notice to LabOne. In the event Officer voluntarily terminates
his employment, LabOne shall pay to Officer an amount equal to his base
salary payable through the date of termination of employment and any
annual incentive bonus for the previous year if such has been approved
but not paid, and such payments, together with the arrangements provided
for by any stock option or other agreement between LabOne and Officer in
effect at the time and by any other applicable plan of LabOne will
constitute the entire obligation of LabOne to Officer and will also
constitute full settlement of any claim under law or in equity that
Officer might otherwise assert against LabOne or any of its employees
on account of his termination.
(d) Termination for Cause. Officer's employment may be
terminated by LabOne at any time for cause. In the event that Officer
is terminated by LabOne for cause, LabOne shall pay to Officer his base
salary which may have accrued to the date of termination and any annual
incentive bonus for the previous year if such has been approved but not
paid, and such payments, together with the arrangements provided for by
any stock option or other agreement between LabOne and Officer in effect
at the time and by any other applicable plan of LabOne will constitute
the entire obligation of LabOne to Officer and will also constitute full
settlement of any claim under law or in equity that Officer might
otherwise assert against LabOne or any of its employees on account of
his termination. Only the following actions, failures or events by or
affecting Officer shall constitute "cause" for termination of Officer
by LabOne (i) willful and continued failure by Officer to substantially
perform his duties provided herein after a written demand for substantial
performance is delivered to Officer by the Board of Directors of LabOne
which demand identifies with reasonable specificity the manner in which
Officer has not substantially performed his duties, and Officer fails to
comply with such demand within a reasonable time; (ii) the engaging by
Officer of gross misconduct or gross negligence materially injurious to
LabOne; or (iii) Officer's conviction of having committed a felony.
Notwithstanding the foregoing, Officer shall not be deemed to have been
terminated by LabOne for cause unless and until there shall have been
delivered to him a copy of a resolution duly adopted by the affirmative
vote of not less than a majority of the entire membership of the Board
of Directors of LabOne finding that, in the -good faith opinion of the
Board of Directors, LabOne has cause for the termination of employment
of Officer, as set forth in any of clauses (i) through (iii) above and
specifying the particulars thereof in reasonable detail. The findings
of the Board of Directors shall not be binding on the arbitrators or
other finds of fact in connection with any litigation or dispute arising
out of this Agreement.
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(e) Termination Without Cause. In the event that LabOne,
Inc. terminates Officer's employment for reasons other than death,
disability, or cause as listed in subsection (d) above, LabOne shall
pay Officer, on or before the last day of employment, his base salary
which may have accrued to the date of termination, any annual incentive
bonus for the previous year if such has been approved but not paid, and
a lump sum severance payment equal to ( i) the installments of base
salary due for the balance of the then current term of this Agreement,
plus (ii) fifty percent (50%) of the annual base salary payable to
Officer by LabOne immediately prior to termination of employment,
which payments, together with the arrangements provided for by any
stock option or other agreement between LabOne and Officer in effect
at the time and by any other applicable plan of LabOne, will constitute
the entire obligation of LabOne to Officer and will also constitute
full settlement of any claim under law or in equity that Officer might
otherwise assert against LabOne or any of its employees on account of
his termination.
SECTION 10
SURVIVAL
10.1 Notwithstanding the termination of Officer's employment
pursuant to the provisions of Section 9 hereof, or the expiration of
the term of this Agreement, Officer's obligations under Sections 5, 6,
7 and 8 hereof, the provisions for injunctive relief against Officer
in Sections 5.2 and 12.2 hereof and the provisions for arbitration in
Section 12.1 hereof shall continue in full force and effect. Any
right, power or obligation imposed or conferred upon LabOne or the
Board of Directors of LabOne by the terms of this Agreement shall
inure to the benefit of and be binding upon any person or entity into
which LabOne is consolidated or merged and the Board of Directors or
other governing body of any such corporation or other entity.
SECTION 11
ASSISTANCE IN LITIGATION
11.1 Officer shall, upon reasonable notice, furnish such
information and assistance to LabOne as may reasonably be required
by LabOne, Inc. in connection with any litigation in which LabOne or
any of its subsidiaries or affiliates is or may become a party.
SECTION 12
ARBITRATION
12.1 Methods. Except as provided in Section 12.2 below, any
difference, controversy, claim or dispute between the parties arising
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out of this Agreement, or the breach thereof, shall be settled by
binding arbitration before a panel of three arbitrators selected as
follows: each party shall select one neutral arbitrator from the
American Arbitration Association's approved list of arbitrators.
The two arbitrators so selected by the parties shall select a third
neutral arbitrator and the three so selected shall settle the dispute
under the duly promulgated Commercial Arbitration Rules of the
American Arbitration Association or its successor. The arbitration
shall be conducted in Lenexa, Kansas. The award of the arbitrators
may be entered as a judgment in any Court in the State of Kansas or
in any court having jurisdiction thereof.
12.2 Injunctive Relief. Notwithstanding Section 12.1 above,
LabOne shall be entitled to seek judicial injunctive relief to
enforce its rights under Section 5, 6, 7 and 8 of this Agreement as
provided in Section 5.2 hereof.
SECTION 13
MISCELLANEOUS
13.1 Assignment by Officer. This is a personal Agreement
on the part of Officer and may not be sold, assigned, transferred or
conveyed by Officer. This Agreement may not be sold, assigned,
transferred or conveyed by LabOne except in connection with a merger,
consolidation or sale of all or substantially all of the assets of
LabOne and then only to the successor to LabOne's operations.
13.2 Entire Agreement. This Agreement contains the entire
agreement among the parties hereto and there are no representations,
inducements, promises, agreements, arrangements, or undertakings,
oral or written, among the parties as to the subject matter covered.
13.3 Severability. Should any part of this Agreement be
declared invalid for any reason, such invalidity shall not affect the
validity of any remaining portion hereof and such remaining portion
shall continue in full force and effect as if this Agreement had been
originally executed without including the invalid part.
13.4 Governing Law. This Agreement and its performance shall
be interpreted and construed in accordance with the laws of the State
of Kansas.
13.5 Titles. Titles and captions in no way define, limit,
extend or describe the scope of this Agreement or the intent of any
provision hereof.
13.6 Amendments. No changes, alterations, modifications,
additions, or qualifications of the terms of this Agreement shall
be made or be binding unless made in writing and executed by the
parties in the same manner as the Agreement.
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13.7 No Waiver. Failure by either party to enforce any
right granted by this Agreement shall not constitute a waiver of
such right and waiver of any provision of this Agreement shall not
constitute a waiver of any other provision.
13.8 Notices. Any notice, instrument or communication
required or permitted under this Agreement shall be deemed to have
been effectively given and made if in writing and when served by
personal delivery to the party for whom it is intended, or three (3)
business days after being deposited, postage prepaid, registered or
certified mail, return receipt requested, in the United States mail,
addressed to the party for whom it is intended at the following
addresses, or at such other addresses as the party to be notified
may have designated in writing to the other:
Officer: Xxxx X. Xxxxxxxxx, Xx.
000 Xxxxxxxxx
Xxxx Xxxxxxx, Xxxxxx 00000
LabOne: LabOne, Inc.
00000 X. 00xx Xxxxxxx
Xxxxxx, Xxxxxx 00000
Attn: W. Xxxxxx Xxxxx XX, President
and Chief Executive Officer
13.9 Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the undersigned have executed this
Agreement as of the day and year first above written.
LABONE, INC.
By: /s/ W. Xxxxxx Xxxxx XX
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W. Xxxxxx Xxxxx XX
President and Chief Executive
Officer
/s/ Xxxx X. Xxxxxxxxx Xx.
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XXXX X. XXXXXXXXX, XX.
BY EXECUTING THIS AGREEMENT, OFFICER ACKNOWLEDGES RECEIPT OF THE
NOTIFICATION TO OFFICER SET FORTH IN THE LAST SENTENCE OF SECTION
7.1 HEREOF.
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