Exhibit 10.15
CHANGE OF CONTROL AGREEMENT
This Change of Control Agreement (the "Agreement") is made and entered into
as of July 30, 2002 (the "Execution Date"), by and between Cytyc Corporation
("Company") and XXXXXXXXXXXX (the "Executive").
WHEREAS, Executive is employed by Company and possesses extensive and
essential knowledge about Company and its operations;
WHEREAS, in order to induce Executive to remain employed with Company,
Company desires to provide severance benefits to Executive in the event
Executive's employment is terminated without "Cause" upon a "Change of Control"
(as each is defined below), and the Employee desires to be so induced;
WHEREAS, Company and Executive desire to set forth in writing the terms and
conditions of their agreement with respect to Company's provision of severance
benefits to Executive in the event Executive's employment is terminated without
Cause upon a Change of Control;
NOW, THEREFORE, in consideration of the mutual covenants and obligations
below, it is mutually agreed between the parties hereto as follows:
1. Term. This Agreement shall continue for a term commencing on the
Execution Date and ending on the date three years thereafter ("Initial Term"),
and shall be automatically renewed from year to year thereafter for successive
one-year terms (each a "Renewal Term") unless thirty (30) days prior to the
expiration of the Initial Term or any Renewal Term, either party gives written
notice of non-renewal to the other. If such notice of non-renewal is given as
permitted hereunder, the Agreement will expire at the conclusion of either the
Initial Term or the Renewal Term, whichever is applicable. The "Term" of this
Agreement shall include the Initial Term, as well as any Renewal Term, if
applicable. Notwithstanding the foregoing, this Agreement may be terminated at
any time prior to the expiration of either the Initial Term or Renewal Term as
provided in Section 2 hereof.
2. At-Will Status. Notwithstanding any provision of this Agreement,
Executive is employed at-will, so that Executive or the Company (as hereinafter
defined) may terminate Executive's employment at any time, with or without
notice, for any or no reason, subject only to the terms of Paragraph 4 herein.
3. Definitions. As used in this Agreement, the following terms shall have
the meanings set forth herein:
a. "Cause" shall mean conduct involving one or more of the following:
(i) the substantial and continuing failure of the Employee, after written notice
thereof, to render services to the Company in accordance with the terms or
requirements of his or her employment; (ii) disloyalty, gross negligence,
willful misconduct, dishonesty or breach of fiduciary duty to the Company; (iii)
the commission of any crime; (iv) deliberate disregard of the rules or policies
of
the Company which results in direct or indirect loss, damage or injury to the
Company; (v) the unauthorized disclosure of any trade secret or confidential
information of the Company; (vi) the commission of an act which constitutes
unfair competition with the Company or which induces any customer or supplier to
breach a contract with the Company; or (vii) a violation of federal or state
securities laws or regulations.
b. "Company" shall mean Cytyc Corporation and its subsidiaries,
affiliates, assigns and successors.
c. "Change of Control" shall mean the occurrence of any of the
following events:
(i) The acquisition by any "person" (as such term is used in
Sections 13(d) and 14(d) of the Exchange Act) (other than the Company or a
person that directly or indirectly controls, is controlled by, or is under
common control with, the Company) of the "beneficial ownership" (as defined in
Rule 13d-3 under said Act), directly or indirectly, of securities of the Company
representing fifty percent (50%) or more of the total voting power represented
by the Company's then outstanding voting securities; or
(ii) A change in the composition of the Board of Directors of the
Company (the "Board") occurring within a rolling two-year period, as a result of
which fewer than a majority of the directors are Incumbent Directors. "Incumbent
Directors" shall mean directors who either (A) are members of the Board as of
the Execution Date, or (B) are elected, or nominated for election, to the Board
with the affirmative votes of at least a majority of the Incumbent Directors at
the time of such election or nomination (but shall not include an individual not
otherwise an Incumbent Director whose election or nomination is in connection
with an actual or threatened proxy contest relating to the election of directors
to the Board); or
(iii) A merger or consolidation of the Company with any other
corporation, other than a merger or consolidation which would result in the
voting securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity (including the parent corporation
of such surviving entity)) at least fifty percent (50%) of the total voting
power represented by the voting securities of the Company or such surviving
entity outstanding immediately after such merger or consolidation, or the
approval by the stockholders of the Company of a plan of complete liquidation of
the Company or of an agreement for the sale or disposition by the Company of all
or substantially all the Company's assets.
d. "Involuntary Termination Upon Change of Control" shall mean the
termination of the employment of Executive by the Company, without Cause (as
such term is defined herein), at any time within the one-year period following
the effective date of a Change of Control.
4. Effect of Involuntary Termination Without Cause Upon Change of Control.
In the event of an Involuntary Termination Upon Change of Control, Executive
shall be entitled to the following:
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x. Xxxxxxxxx benefits as follows, subject to Section 5 hereof: (i)
continuation of Executive's base salary in effect on the date of such
termination for a period of twelve (12) months (the "Severance Period"), payable
monthly or otherwise in accordance with the Company's prevailing compensation
practice, as such practice may be modified from time to time; (ii) payment in an
amount equal to the higher of the amount of executive incentive pay that
Executive would have received for the year in which Executive's employment is
terminated had she/he met 100% of the target for such pay or the amount of
executive incentive pay that the Executive received in the year prior to the
termination of Executive's employment or 100% of the projected annual bonus; and
(iii) a continuation of all Company provided benefits received by Executive
prior to such termination, during the Severance Period, so long as Executive was
eligible to receive such benefits under the terms of each of the benefit plans
then in effect, and/or should Executive elect continued medical insurance
coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985
("COBRA"), payment of Executive's COBRA premiums during the Severance Period,
subject to and in accordance with the provisions of COBRA.
b. Executive shall also be entitled to the unpaid compensation and
benefits, and unused vacation, accrued through the date of Executive's
termination of employment. Executive shall also be entitled to receive
reimbursement for final expenses that Executive reasonably and necessarily
incurred on behalf of the Company prior to Executive's termination of
employment, provided that Executive submits expense reports and supporting
documentation of such expenses as required by Company practice or policy.
c. If Executive's employment is terminated at any time for any reason
that does not constitute an Involuntary Termination Without Cause Upon Change of
Control, Executive shall not be entitled to, and shall not receive, any
severance payments or benefits under this Agreement, but Executive shall be
entitled to receive the payments and benefits set forth in Section 4(b) hereof.
5. Conditions of Severance Benefits. Executive shall receive the severance
benefits set forth in Section 4(a) hereof if Executive: (a) executes a general
release of the Company, in a form and of a scope acceptable to the Company in
its discretion; (b) presents satisfactory evidence to the Company that she/he
has returned all Company property, confidential information and documentation to
the Company; (c) complies with, and does not violate, any provision of the
Employee Non-Disclosure and Developments Agreement ("Confidentiality Agreement")
or the Employee Non Competition Agreement ("Non Compete Agreement") that
Executive has entered into with the Company; and (d) provides the Company with a
signed, written resignation of Executive's status as an officer and/or director
of the Company or any of its affiliates, if applicable. In the event the Company
reasonably believes that Executive has breached, or has threatened to breach,
any provision of the Confidentiality Agreement or the Non Compete Agreement or
any other obligations, the Company shall immediately terminate all severance
benefits and Executive shall no longer be entitled to such benefits. Such
termination of benefits shall be in addition to any and all legal and equitable
remedies available to the Company, including injunctive relief.
6. Taxes. All payments and benefits described in this Agreement shall be
subject to any and all applicable federal, state and local withholding, payroll,
income and other taxes.
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7. Exclusive Remedy. Except as expressly set forth herein or otherwise
required by law, Executive shall not be entitled to any compensation, benefits,
or other payments from the Company as a result of or in connection with the
termination or resignation of Executive's employment at any time, for any
reason. The payments and benefits set forth in Section 4 hereof shall constitute
Executive's sole and exclusive remedy for any claims, causes of action or
demands arising under or in connection with this Agreement or its alleged
breach, or the termination or resignation of Executive's employment
relationship.
8. Governing Law/Interpretation. Executive and the Company agree that this
Agreement and any claims arising out of or in connection with this Agreement
shall be governed by and construed in accordance with the laws of the
Commonwealth of Massachusetts, and shall in all respects be interpreted,
enforced and governed under the internal and domestic laws of such State,
without giving effect to the principles of conflicts of laws thereof.
9. Entire Agreement. This Agreement shall constitute the sole and entire
agreement between the parties with respect to the subject matter hereof, and
supersedes and cancels all prior, concurrent and/or contemporaneous
arrangements, understandings, promises, offers, agreements and/or discussions,
including, but not limited to, those concerning employment agreements and/or
severance benefits, whether written or oral, by or between the parties,
regarding the subject matter hereof; provided, however, that this Agreement is
not intended to, and shall not, supersede, affect, limit, modify or terminate
any of the following, all of which shall remain in full force and effect in
accordance with their respective terms: (i) stock option agreements; (ii) the
Confidentiality Agreement; or (iii) any written agreement or arrangement between
Executive and the Company that does not relate to termination of employment,
severance pay or the other subject matter hereof.
10. Assignment. Executive acknowledges that the services to be rendered
hereunder are unique and personal in nature. Accordingly, Executive may not
assign any rights or delegate any duties or obligations under this Agreement.
The rights and obligations of the Company under this Agreement shall
automatically be assigned to the successors and assigns of the Company, and
shall inure to the benefit of, and be binding upon, such successors and assigns,
as well as Executive's heirs and representatives.
11. Notices. All notices required hereunder shall be in writing and shall
be delivered in person, by facsimile or by certified or registered mail, return
receipt requested, and shall be effective upon sending if by facsimile, or upon
receipt if by personal delivery or certified or registered mail. All notices
shall be addressed as follows or to such other address as the parties may later
provide in writing:
To the Company:
Attention: Chief Executive Officer
00 Xxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
with a copy to:
Cytyc Corporation
Attention: General Counsel
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00 Xxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
To Executive:
XXXXXXXXXXXX
12. Severability/Reformation. If any one or more of the provisions (or any
part thereof) of this Agreement shall be held invalid, illegal or unenforceable
in any respect, the validity, legality and enforceability of the remaining
provisions (or any part thereof) shall not in any way be affected or impaired
thereby, and this Agreement shall be construed and reformed to the maximum
extent permitted by law. The language of all parts of this Agreement shall in
all cases be construed as a whole according to its fair meaning and not strictly
for or against either of the parties.
13. Modification. This Agreement and the rights, remedies and obligations
contained in any provision hereof, may be modified or waived only in accordance
with this Section 13. No waiver by either party of any breach by the other or
any provision hereof shall be deemed to be a waiver of any later or other breach
thereof or as a waiver of any other provision of this Agreement. This Agreement
and its terms may not be waived, changed, discharged or terminated orally or by
any course of dealing between the parties, but only by a written instrument
signed by the party against whom any waiver, change, discharge or termination is
sought. No modification or waiver by the Company is effective without written
consent of the Chief Executive Officer in office at the time of such
modification or waiver.
14. Arbitration. Any dispute, controversy or claim arising out of, or in
connection with this Agreement shall be exclusively subject to arbitration
before the American Arbitration Association ("AAA"). Such arbitration shall take
place in the Commonwealth of Massachusetts before a single arbitrator in
accordance with AAA's then current National Rules for the Resolution of
Employment Disputes. The Company shall be responsible for the payment of the
arbitrator's fees. Judgment upon any arbitration award may be entered in any
court of competent jurisdiction. All parties shall cooperate in the process of
arbitration for the purpose of expediting discovery and completing the
arbitration proceedings. Nothing contained in this Section or elsewhere in this
Agreement shall in any way deprive the Company of its right to obtain injunctive
relief in a court of competent jurisdiction for purposes of enforcing the
Confidentiality Agreement.
15. Survival of Obligations and Rights. The obligations and rights
contained herein shall survive the termination of Executive's employment for any
reason.
16. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
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17. Section Headings. The descriptive section headings herein have been
inserted for convenience only and shall not be deemed to define, limit, or
otherwise affect the construction of any provision hereof.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date and year first written above.
CYTYC Corporation
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Xxxxxxx X. Xxxxxxxx
Chairman, President and CEO
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Executive Signature
Address for Notice to Executive:
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