EMPLOYMENT AGREEMENT
This AGREEMENT made effective September 1, 1996 between Dianon Systems,
Inc., a Connecticut corporation, and any successor thereto, hereinafter referred
to as the "Company," and Xxxxx X. Xxxxxxxx, M.D., residing in Weston,
Connecticut, hereinafter referred to as "Employee."
WITNESSETH:
WHEREAS, the Company wishes to reinforce the capacity of Employee, a
senior management official of the Company, to implement the policies and
programs established by the Company, and to provide for the protection of the
goodwill, confidential information, and proprietary rights and interests of the
Company, in each case on the terms and subject to the conditions set forth
below; and
WHEREAS, Employee's business contacts and relationships are crucial to
the financial and business success of the Company, and the services that
Employee should render hereunder to the Company are unique and valuable; and
WHEREAS, the parties desire to reduce the terms and conditions of
Employee's employment to writing;
NOW, THEREFORE, in consideration of the terms and conditions and the
mutual covenants contained in this Agreement, the Company and Employee hereby
agree as follows:
1. Employment
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The Company hereby employs Employee and Employee hereby accepts
such employment upon the terms and conditions hereinafter set forth. The parties
acknowledge that Employee's employment with the Company is at will and
terminable by either party at any time for any reason.
2. Duties and Responsibilities
---------------------------
Employee shall perform with continuous diligence those activities
assigned to Employee by the Company including: active participation in
laboratory and market research, keeping full and complete records of all
business and/or research activities in which Employee engages and surrendering
all such records and materials on request, improving strategies for achieving
the Company's goals, motivating co-worker performance, keeping abreast of all
new developments in Employee's area of expertise, participating actively in
research and business meetings, and abiding by all Company policies.
3. Term
----
This Agreement shall begin on the effective date hereof and
continue until terminated under the terms contained herein.
4. Salary
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The Company shall compensate Employee for Employee's services
during the term of this Agreement on a salaried basis paid bi-weekly at a rate
determined by the Company from time to time.
5. Fringe Benefits
---------------
During the term of this Agreement, Company shall provide Employee
all benefits and emoluments as authorized for all other salaried employees of
the Company as they may be modified from time to time by the Company during the
term of this Agreement, including health and medical insurance, disability
insurance, life insurance, sick leave, vacation, holidays and retirement plan
participation.
6. Termination
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a. This Agreement shall terminate on any of the following
occurrences:
(i) Employee's death;
(ii) Employee's disability for a period of 90 days or more;
(iii) mutual agreement of the parties reduced to writing
signed by both parties;
(iv) voluntary resignation by Employee;
(v) termination by the Company without Stated Cause;
(vi) termination by the Company with Stated Cause.
b. Cause shall mean Employee's
(i) gross negligence;
(ii) insubordination;
(iii) willful misconduct.
c. "Stated Cause" shall mean Cause communicated to Employee by the
Company in a Notice of Termination.
d. "Notice of Termination" shall mean written notice given by
either party to the other of an intention to terminate this Agreement pursuant
to subparagraphs (a)(iv), (v) or (vi) of this Paragraph of this Agreement.
e. Notice of Termination shall be sent by certified mail or
registered mail, return receipt requested, first class postage prepaid, to the
residence in the case of Employee, and to its principal office in the City of
Stratford, Connecticut, to the attention of the President in the case of the
Company.
7. Compensation after Termination
------------------------------
(a) The "Termination Date" shall be the date Employee ceases
providing services to the Company as an employee. In the event Employee provides
Notice of Termination to the Company less than four weeks prior to the date such
Notice identifies as the Termination Date, then the date said Notice of
Termination is received by the Company shall be the Termination Date.
(b) Employee will not receive any compensation from the Company
after the Termination Date other than accrued, unused vacation, except as
described under Paragraphs (c) and (d) of this Section 7 of this Agreement, if
applicable. Employee's participation in all fringe benefits offered by the
Company to its employees will cease immediately on the Termination Date except
as described in Paragraph (c) of this Section 7 of this Agreement, if
applicable. Nothing in this Agreement, however, is intended to impair any rights
vested under law in any benefit plan of the Company.
(c) If this Agreement and Employee's employment with the Company
is terminated by the Company without stated cause, the Company will pay
Employee:
(i) For a period of six months beginning with the
Termination Date at Employee's current rate of pay as of
the day preceding the Termination Date, less amounts
equivalent to income Employee earns during said six
month period from other employment or independent
consulting.
(ii) During said six month period, Employee shall act as a
consultant to the Company as requested by the Company
for up to six days per month.
(iii)During said six month period, the Company will
contribute towards the premium cost of medical
continuation coverage for Employee and/or Employee's
dependents on the same basis as it then contributes
towards the medical coverage of active employees and/or
their dependents, for any months in said period during
which Employee and/or Employee's dependents are eligible
and elect to continue such coverage.
(iii)During said six month period, the Company will continue
to provide Employee any car allowance Employee was
receiving at the time of the Termination Date.
(d) Employee's participation in all incentive plans, including
bonus and commission, stock options, restrictive stock purchase plans and other
incentive compensation programs will terminate on the Termination Date. If this
Agreement terminates (i) by Employee's voluntary resignation with at least four
weeks' notice to the Company or (ii) by termination by the Company without
Stated Cause, the Company will make its best efforts to allocate on a pro rata
basis based upon the number of days from January 1 to the Termination Date
divided by 365, a portion of each such incentive award to be paid or awarded to
Employee or his estate at the time payment or awards under any such program are
made to active employees for the year or other related time period in which the
Termination Date falls.
8. Company Property
----------------
On the Termination Date, or at any earlier point in time after a
Notice of Termination is received when a request is made by the Company for
same, Employee will turn over to the Company all notes, reports, memoranda,
books, records, chemicals, devices and documents, whether in written,
typewritten, computerized or any other form, which are in Employee's possession
or under Employee's control, whether prepared by Employee or others, related to
the Company or relating to the business of the Company. At the conclusion of the
six month period described in paragraph (c) of Section 6 of this Agreement, or
at any earlier point in time when a request is made by the Company for same,
Employee shall also return to the Company any Company car, keys, parking card,
credit card, business cards or other materials related to Employee's employment
with the Company or the operation of the Company.
9. Remedy for Breach
-----------------
Employee acknowledges:
(a) that Employee may be a director and officer of the
Company and as such Employee would be conversant with,
and have access to, the business affairs, records, trade
secrets, customers and customer lists, suppliers,
supplier lists, patents, technical know-how, chemicals,
devices, sales or distribution agents and
representatives, sales or distribution agents and
representatives' lists, and other confidential and
proprietary information of the Company;
(b) that Employee's compliance with the covenants and
agreements in this Agreement is necessary to protect the
goodwill and other proprietary interest of the Company;
and
(c) that a breach of Employee's covenants and agreements in
this Agreement will result in continuing and irreparable
damage to the Company for which there will be no
adequate remedy at law.
Both the parties recognize that the services to be rendered under
this Agreement by Employee are special and unique and of an extraordinary
character, and that in the event there is a breach by Employee of the terms and
conditions of this Agreement to be performed by Employee, then the Company shall
be entitled, if it so elects, to institute and prosecute proceedings in any
court of competent jurisdiction either in law or in equity, to obtain damages
for any breach of this Agreement, or to enforce the specific performance thereof
by Employee.
10. Employee Representation
-----------------------
Employee warrants and represents that neither the execution and
delivery nor the performance of this Agreement by Employee will in any way
violate, or conflict with, any other agreement by which Employee may be bound or
any duty or obligation to which Employee may be subject and that Employee will
take all steps necessary to comply with the representation.
11. Proprietary Information
-----------------------
Employee hereby agrees to all the terms and conditions of the
Company's Employee Proprietary Information Agreement attached hereto as Exhibit
A and incorporated herein and has executed a copy thereof concurrently with this
Agreement.
12. Assignments
-----------
The rights and obligations of Employee under this Agreement shall
be assignable to and binding upon the successors and assigns of the Company
including any corporation organized by the Company to carry on the business of
the Company.
13. Entire Agreement
----------------
This instrument contains the entire Agreement of the parties. It
may not be changed orally, but only by agreement in writing signed by the party
against whom enforcement of any waiver, change, modification, extension or
discharge is sought. This Agreement supersedes any other agreement or
understanding existing between Employee and the Company relating to his
employment or the other matters covered herein.
14. Severability
------------
If any provision of this Agreement shall be held invalid, such
invalidity shall not affect any other provisions of this Agreement not held so
invalid, and only such provisions shall to the full extent consistent with the
law remain in full force and effect.
15. Applicable Law
--------------
This Agreement shall be governed by the laws of the State of
Connecticut.
IN WITNESS WHEREOF, the parties have executed or caused to be
executed this Agreement as of the date first above written.
DIANON SYSTEMS INC.
BY: /s/ Xxxxxxx X. Xxxxxxxx
---------------------------
/s/ Xxxxx X. Xxxxxxxx
---------------------------
XXXXX X. XXXXXXXX, M.D.
Exhibit A
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AGREEMENT
---------
THIS AGREEMENT made this 1st day of September, 1996 by and between
DIANON SYSTEMS, INC., its affiliates, subsidiaries, successors and assigns
(collectively called hereinafter "DIANON") and Xxxxx X. Xxxxxxxx, an individual
residing in Weston, Connecticut (hereinafter called "Employee").
In consideration of Employment Agreement of this date Employee and
DIANON acknowledge, represent and agree to the terms and conditions set forth in
this Agreement.
(1) Employee's employment with DIANON creates a relationship of trust
and confidence between the parties. Employee agrees that, during and after
his/her employment with DIANON, Employee will not use or disclose, or allow
anyone else to use or disclose, any confidential information relating to the
products, sales and/or business affairs of DIANON or of any customer or supplier
of DIANON, or any information created, discovered, or developed by or for
DIANON, or acquired by DIANON, that has commercial value in DIANON's present or
future business ("Confidential Information"), except as may be necessary in the
performance of Employee's employment with DIANON or as may be authorized in
advance by appropriate officials of DIANON. By way of illustration, but not
limitation, Confidential Information includes processes, formulas, data,
know-how, inventions, improvements, techniques, marketing plans, product plans,
strategies, forecasts, customer lists and any other information Employee has
reason to know DIANON would like to treat as confidential for any purpose.
Employee agrees to keep Confidential Information secret whether or not any
document containing such information is marked confidential.
(2) All rights, title and interest in all records, documents, files and
the business of DIANON, whether or not produced by the Employee, shall be and
remain the property of DIANON. Upon termination of employment, the Employee
shall not have the right to remove any such records frorm the office of DIANON.
In addition, Employee agrees to promptly return to DIANON all things of
whatsoever nature that belongs to DIANON, and all records (in whatsoever form,
format or medium) containing or related to Confidential Information of DIANON.
(3) The Employee shall, while employed by DIANON, devote his/her best
efforts and his/her full time to the business of DIANON.
(4) In the event of a breach or threatened breach of the provisions in
this Agreement, DIANON shall be entitled to an injunction restraining such
breach, it being recognized that any injury arising from a breach would be
irreparable and would have no adequate remedy at law; but nothing herein shall
be construed as prohibiting DIANON from pursuing any other remedy available for
such breach of threatened breach. In the event that Employee breaches or
threatens a breach of this Agreement, DIANON shall be entitled to have its
reasonable legal fees and costs paid by the Employee for any legal services
relating to the breach or threatened breach.
(5) This Agreement is not intended, and should not be construed in any
way, as a contract of employment for a definite period of time or to limit or
restrain DIANON's or the Employee's right to terminate the employment
relationship at any time.
(6) In the event any provision or paragraph of this Agreement is
declared to be invalid or unenforceable, then the balance of this Agreement
shall remain in full force and effect.
(7) This Agreement shall be construed and enforced in accordance with
the laws of the State of Connecticut.
(8) The foregoing contains the entire Agreement between the parties
pertaining to confidential DIANON documents and information. No modification
thereof shall be binding upon the parties unless the same is in a writing signed
by the respective parties. This Agreement and all of the terms and conditions
contained herein shall remain in full force during the period of employment
notwithstanding any change in compensation.
(9) Employee represents and warrants that he/she has no other
agreements or commitments that would hinder or prevent performance of his/her
job responsibilities with DIANON. Unless authorized to do so, Employee agrees
not to disclose to DIANON or use in his/her employment with DIANON any invention
or confidential information belonging to any former employer or to any other
person other than DIANON.
IN WITNESS WHEREOF, the parties have entered into this Agreement as of
the date set forth above.
Employee: DIANON SYSTEMS, INC.
/s/ Xxxxx X. Xxxxxxxx By: /s/ Xxxxxxx X. Xxxxxxxx
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Date: 9/1/96 Date: 9/1/96
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