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EXHIBIT 10.4
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into as
of the 6th day of July, 1998, by and between COMPDENT CORPORATION, a Delaware
corporation (the "Company") and XXXXX X. XXXXXXXX (the "Employee").
I. STATEMENT OF BACKGROUND INFORMATION
The Employee has been an officer and a key employee of the Company and
the parties desire to ensure that the Employee's expertise, knowledge and
experience will continue to be available to the Company in providing
full-service dental benefits and offering network-based dental care, reduced
fee-for-service, third party administration and dental practice management (the
"Business").
II. STATEMENT OF AGREEMENT
In consideration of the mutual covenants, promises and conditions set
forth in this Agreement, and for other good and valuable consideration, the
parties hereto hereby agree as follows:
1. Employment. The Company hereby employs Employee in the position of
Executive Vice President and General Counsel of the Company and/or such
other position(s) as determined by the Board of Directors or its
designees and consistent with the Employee's general area of
experience, knowledge and skill, and Employee hereby accepts such
employment upon the terms and conditions set forth in this Agreement.
For purposes of Sections 6, 7 and 8 of this Agreement, "employment"
shall mean any period of time during the term hereof which the Company
is paying the Employee salary or wages. By execution of this Agreement,
the parties hereby: (a) terminate, as of the date hereof, that certain
Employment Agreement between the Company and Employee dated February 1,
1996 (the "Prior Employment Agreement") and (b) acknowledge and agree
that no provisions of the Prior Employment Agreement shall survive the
execution and delivery of this Agreement.
2. Duties of Employee. Employee agrees to perform and discharge the duties
which may be assigned to Employee from time to time by the Company's
Board of Directors or its designees and consistent with the Employee's
general area of experience, knowledge and skill. Employee also agrees
to materially comply with all of the Company's material policies,
standards and regulations and to follow the reasonable instructions and
directives of Employee's superiors within the Company, as promulgated
by the Board of Directors or its designees. Employee will devote his
full professional and business related time, skills and commercially
reasonable efforts to the Business and Employee will not, during the
term of this Agreement, be engaged (whether or not
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during normal business hours) in any other business or professional
activity (excluding reasonable and appropriate charitable activities),
whether or not such activity is pursued for gain, profit or other
pecuniary advantage without the prior written consent of the Chief
Executive Officer of the Company, which consent will not be
unreasonably withheld.
3. Term. The term of this Agreement will be for a period commencing on the
date hereof and expiring on the later of the fifth anniversary of such
date or, if there is a Change in Control (as defined herein) before
such fifth anniversary date, the date which is 25 months following any
Change in Control, subject to earlier termination as provided for in
Section 4 below.
4. Termination.
(a) By the Company. Notwithstanding anything contained in
Section 3 to the contrary, the Company may terminate this Agreement and
all of its obligations hereunder immediately if any of the following
events (any of which shall constitute "cause" for purposes of this
Agreement) occur:
(i) Employee (A) materially breaches any of the terms or
conditions set forth in Sections 6, 7 or 8 of this Agreement including,
without limitation, the failure to use commercially reasonable efforts
in the performance of duties assigned to the Employee on a full time
basis, or (B) materially breaches any of the other terms and conditions
set forth in this Agreement and fails to cure such breach within twenty
days after Employee's receipt from the Company of written notice of
such breach, which notice shall describe in reasonable detail the basis
for the Company's belief that Employee is in breach hereof;
(ii) Employee commits any act in bad faith materially
detrimental to the business or reputation of the Company;
(iii) Employee is convicted of any crime involving fraud,
deceit or moral turpitude or Employee intentionally engages in
dishonest or illegal activities that have a material adverse effect
upon the business or reputation of the Company; or
(iv) Employee dies or becomes mentally or physically
incapacitated or disabled so as to be unable to perform Employee's
duties under this Agreement. For purposes of this Agreement, Employee
shall be deemed to be mentally or physically incapacitated or disabled
so as to be unable to perform his duties if and to the extent he
becomes permanently disabled under the Company's long-term disability
policy then in effect.
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The Company may also terminate the Employee's employment, upon
reasonable written notice to the Employee, at any time subject to the
fulfillment of the Company's obligations under this Agreement and such
termination by the Company for any other reason shall be deemed
termination "without cause."
(b) By Employee. The Employee may terminate this Agreement:
(i) if the Company materially breaches any of the terms or
conditions set forth in this Agreement and fails to cure its breach
within twenty days after its receipt from Employee of written notice of
such breach, which notice describes in reasonable detail Employee's
belief that the Company is in breach hereof; or
(ii) for "good reason" (as herein defined) at any time during
the two-year period following a Change in Control upon written notice
to the Company.
The Employee may also resign and terminate his employment on reasonable
written notice at any time and such termination by Employee for any
other reason (other than as provided in Sections 4(b)(i) or (ii)) and
in such event, the Employee shall receive no severance benefits under
this Agreement as a result of such termination.
(c) Certain definitions.
(i) For purposes of this Agreement, "good reason" shall mean
the following:
(A) any material diminution of the Employee's duties or a
reassignment of the Employee to a position not
consistent with the Employee's general area of
knowledge, experience and skills, or the assignment
of substantial additional responsibilities to the
Employee;
(B) any material diminution of the Employee's
compensation or a material diminution of the
Employee's bonus, long-term incentives, employee
benefits or perquisites as in effect immediately
preceding the Change in Control;
(C) any relocation of Employee's principal place of
employment to more than 35 miles from the principal
place of employment immediately preceding the Change
in Control;
(D) any material increase in Employee's travel
obligations;
(E) any failure of any successors to the Company to
assume this agreement; or
(F) any breach of this Agreement by the Company not cured
within ten
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days after its receipt of notice from Employee of
such breach (in the event of such a breach and a
termination of this Agreement by Employee following a
Change in Control, such termination shall be deemed
to have occurred under this Section 4(c)(i)(F) and
not under Section 4(b)(i) of this Agreement).
(ii) For purposes of this Agreement, "Change in Control" shall
mean any of the following events:
(A) the direct or indirect beneficial ownership (within
the meaning of Section 13(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act")
and Regulation 13D thereof) of a majority of the
outstanding common stock of the Company is acquired
or becomes held by any person or group of persons
(within the meaning of Section 13(d)(3) of the
Exchange Act);
(B) a change of stock ownership of the Company of a
nature that would be required to be reported in
response to Item 6(e) of Schedule 14A promulgated
under the Exchange Act, and any successor Item of a
similar nature;
(C) the acquisition of beneficial ownership, directly or
indirectly, by any person (as such term is used in
Sections 13(d) and 14(d) of the Exchange Act) of
securities of the Company representing 25 percent or
more of the voting power of the then outstanding
securities of the Company;
(D) the stockholders of the Company shall approve
(provided, however, if the transaction approved by
the stockholders is subsequently terminated, and the
Employee is still employed by the Company at the
termination of the transaction, then no "Change in
Control" shall be deemed to have taken place): (1)
any consolidation, merger, share exchange or other
extraordinary transaction related to the Company
where the stockholders of the Company, immediately
prior to the consolidation, merger, share exchange or
other extraordinary transaction would not,
immediately after the consolidation, merger, share
exchange or other extraordinary transaction,
beneficially own (as such term is defined in Rule
13d-3 under the Exchange Act), directly or
indirectly, shares representing in the aggregate 50
percent of the voting securities of the corporation
issuing cash or securities in the consolidation,
merger, share exchange or other extraordinary
transaction (or of its ultimate parent corporation,
if any), (2) any lease, exchange, mortgage or other
transfer (in one transaction or
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series of transactions contemplated or arranged by
any party as a single plan) of all or substantially
all of the assets of the Company and its subsidiaries
(taken as a whole), or (3) any plan or proposal for
the liquidation or dissolution of the Company; or
(E) the following individuals cease for any reason to
constitute a majority of the number of directors then
serving: individuals who, on the date hereof,
constitute the Board of Directors and any new
director (other than a director whose initial
assumption of office is in connection with an actual
or threatened election contest, including but not
limited to a consent solicitation, relating to the
election of directors of the Company) whose
appointment or election by the Board of Directors or
nomination for election by the Company's stockholders
was approved or recommended by a vote of at least
two-thirds of the directors then still in office who
either were directors on the date hereof or whose
appointment, election or nomination for election was
previously so approved or recommended.
(iii) For purposes of this Agreement, "termination of
employment," "termination of Employee" and "termination of this
Agreement" shall have the same meaning unless otherwise agreed to in
writing by the parties hereto.
(d) Severance Payments.
(i) In the event of termination of the Employee by the Company
without cause or termination by Employee pursuant to Section 4(b)(i)
hereof, the Company shall: (A) pay to Employee an amount equal to two
times the Employee's annual salary in effect at the time of the
termination (not giving effect to any salary reduction giving rise to
such termination) and (B) either continue the Employee's health
(medical and dental) insurance as provided in Section 5(c) for two
years following the date of such termination to the extent permitted
under applicable law and the Company's group health insurance policies
or reimburse the Employee for his cost for comparable coverage to the
extent such coverage cannot be provided under such policies. Such
severance pay shall be payable in equal monthly installments over the
two-year period beginning on the date of termination of this Agreement
and shall be subject to tax withholding to the extent required under
applicable law. Notwithstanding anything herein to the contrary, the
Company shall not be required to continue to provide Employee with
health benefits under this paragraph if Employee becomes entitled to
receive benefits substantially similar to those which Employee
otherwise would have been entitled to receive hereunder. This severance
pay and continuation of health benefits contemplated by this paragraph
are agreed by the parties hereto to be in full satisfaction and
compromise of any claim arising out of any termination of Employee's
employment without cause or pursuant to Section 4(b)(i).
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(ii) Notwithstanding anything herein to the contrary, in the
event of termination of the Employee by the Company without cause
within the two-year period following a Change in Control or termination
by Employee under Section 4(b)(i) or (ii) of this Agreement, then in
lieu of the severance pay and benefit continuation provided in Section
4(d)(i) above, the Company shall: (A) pay to Employee an amount equal
to two and one-half times the Employee's annual salary in effect at the
time of the termination (not giving effect to any salary reduction
giving rise to such termination) plus two and one-half times the
greater of (1) the average bonus received by the Employee for the three
fiscal years preceding such termination (or such shorter time if the
Employee has been employed by the Company for less than three years) or
(2) the bonus earned by Employee for the most recently ended fiscal
year, (B) either continue the Employee's health (medical and dental)
insurance as provided in Section 5(c) for two and one-half years
following the date of such termination to the extent permitted under
applicable law and the Company's group health insurance policies or
reimburse the Employee for his cost for comparable coverage to the
extent such coverage cannot be provided under such policies and (C) pay
to Employee the prorated portion of the greater of (1) the average
bonus received by the Employee for the three fiscal years preceding
such termination (or such shorter time if Employee has been employed by
the Company for less than three years) or (2) the bonus earned by
Employee for the most recently ended fiscal year. Such severance pay
shall be payable in equal monthly installments over the two and
one-half year period beginning on the date of termination of this
Agreement and shall be subject to tax withholding to the extent
required under applicable law. Notwithstanding anything herein to the
contrary, the Company shall not be required to continue to provide
Employee with health benefits under this paragraph if Employee becomes
entitled to receive benefits substantially similar to those which
Employee otherwise would have been entitled to receive hereunder.
Notwithstanding anything herein to the contrary, the Company shall not
be required to pay any amount (the "Excess Amount") that, upon advice
of the Company's independent tax advisor or counsel, would be in excess
of 2.99 times Employee's Base Amount, as defined in Section 280G(b)(3)
of the Internal Revenue Code of 1986, as amended (the "Code"), and,
therefore, would trigger the tax (the "Excise Tax") imposed by Section
4999 of the Code, unless Employee agrees to be bound by the
noncompetition provisions of Section 7 hereof for one additional year
following the termination. Payment of the Excess Amount shall be
consideration for the Employee agreeing to be bound by such
noncompetition provision for such additional year. Election by the
Employee to receive the Excess Amount and to be bound by the
noncompetition provision shall be given in writing to the Company not
later than five days after the date on which the Company notifies
Employee in writing that an Excess Amount may be payable absent such
agreement, and, upon receipt of such notice, the Company shall be
obligated to pay the Excess Amount to Employee.
(e) Gross-Up. If any payment or other benefit (a "Termination
Payment") received or to be received by Employee in connection with a
Change in Control event
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(whether or not this Agreement is terminated) or Employee's termination
of employment (whether pursuant to the terms of this Agreement or any
other plan, arrangement or agreement with the Company, with any person
whose actions result in a Change in Control event or with any person
affiliated with the Company or such person) is or will be subject to
the Excise Tax, the Company shall pay to Employee a Gross-Up Payment
(as herein defined) to the extent provided by the second paragraph of
this Section 4(e), provided Employee agrees to be bound by the
noncompetition provisions imposed by Section 7 as extended by Section
4(d)(ii) and/or Section 4(f).
A Gross-Up Payment shall be payable pursuant to this Section
4(e) on and subject to the following terms and conditions:
(i) At the time the applicable Termination Payment is made, an
additional amount (the "Gross-Up Payment") shall be paid by the Company
such that the net amount retained by Employee, after deduction of any
Excise Tax on such Termination Payment and any federal, state and local
income tax, employment tax and Excise Tax on the Gross-Up Payment,
shall be equal to the amount or value of such Termination Payment. For
purposes of determining whether any such Termination Payment will be
subject to the Excise Tax, all Termination Payments shall be treated as
"parachute payments" within the meaning of Section 280G(b)(2) of the
Code, and all "excess parachute payments" within the meaning of Section
280G(b)(1) of the Code shall be treated as being subject to the Excise
Tax, unless in the opinion of tax counsel reasonably acceptable to
Employee and selected by the accounting firm which, immediately prior
to the Change in Control event, was the Company's independent auditors,
such payments (in whole or in part) do not constitute "parachute
payments" within the meaning of Section 280G of the Code or represent
reasonable compensation for services actually rendered in excess of the
"base amount" allocable to such reasonable compensation. The full
amount of the Gross-Up Payment shall be treated as being subject to the
Excise Tax. The value of any non-cash benefits or any deferred payment
or benefit shall be determined in accordance with the principles of
Sections 280G(d)(3) and (4) of the Code.
(ii) For purposes of determining the amount of any Gross-Up
Payment, Employee shall be deemed to pay federal income taxes at the
highest marginal rate of federal income taxation in the calendar year
in which the applicable Termination Payment or Gross-Up Payment is
made, and shall be deemed to pay state and local income taxes at the
highest marginal rates of taxation in the state and locality of his
residence on the date the applicable Termination Payment or Gross-Up
Payment is made, net of the maximum reduction in federal income taxes
that could be obtained from deduction of such state and local taxes.
(iii) If the Excise Tax or income tax payable with respect to
a Gross-Up Payment as finally determined exceeds the amount taken into
account or paid to Employee at the time the applicable Termination
Payment or Gross-Up Payment is
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made (including by reason of any payment the existence or amount of
which cannot be determined at the time of the applicable Gross-Up
Payment), the Company shall make an additional Gross-Up Payment in
respect of such excess (plus any interest payable by Employee with
respect to such excess) at the time that the amount of such excess is
finally determined.
(f) Consulting Agreement. If this Agreement is terminated
after a Change in Control and prior to the third anniversary of such
Change in Control, Employee shall be entitled to receive payments in
the amount of $200,000 annually for the Extended Period (as herein
defined), provided that Employee (i) agrees to make himself reasonably
available to provide up to 600 hours (an aggregate of 1,500 hours for
the Extended Period (as herein defined)) of consulting services (the
"Consulting Services") per year during the Extended Period and (ii)
agrees to be bound by the noncompetition provisions of Section 7 of
this Agreement for the Extended Period. For purposes of this paragraph,
the Extended Period shall mean the two and one-half year period
beginning on the date of termination of this Agreement. Amounts payable
pursuant to this Section 4(f) shall be paid in equal monthly
installments. It is acknowledged and agreed that the above Consulting
Services shall not unreasonably interfere with other employment and/or
service activities in which Employee may engage. Employee shall be
reasonably free to arrange his own time, pursuits, and work schedule
and will not be required to unreasonably observe any routine or
requirement as to working hours. It is acknowledged that the purpose
and intent of these Consulting Services is to assure the Company of
Employee's ability to impart his knowledge and experience in the
business of the Company and industry generally to the Company and its
personnel.
In addition to the fees being paid above, Employee shall be
entitled to reimbursement of all reasonable expenses incurred in
rendering of said Consulting Services.
(g) Security Obligation. The Company shall establish and fund,
not later than 30 days prior to the consummation of a Change in
Control, a grantor trust in an amount sufficient to satisfy the
Company's obligations under Sections 4(d), (e) and (f). If the Company
fails to fund such trust within such thirty day period, the entire
amount of the Company's severance obligations to the Employee will
accelerate and become immediately due and payable.
(h) Outplacement Services. If, pursuant to or within 24 months
following a
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Change in Control, Employee terminates this Agreement pursuant to
Sections 4(b)(i) or 4(b)(ii) or the Company terminates this Agreement
without cause, the Company shall provide Employee with the services of
an outplacement firm for a period of one year from the date of such
termination.
5. Compensation and Benefits.
(a) Annual Salary. For all services rendered by Employee under
this Agreement, the Company will pay Employee a base salary of at least
two hundred thousand dollars ($200,000) per annum in equal monthly
installments, or a greater amount as determined by the Board of
Directors of the Company.
(b) Annual Bonus Payment. Upon completion of each fiscal year
and as determined by the Board of Directors of the Company, Employee
shall be eligible to receive a bonus ("Bonus") in accordance with any
bonus plan then in effect for executives of the Company of equivalent
position and title, provided Employee is employed by the Company at the
end of such fiscal year. Notwithstanding anything herein to the
contrary, Employee's bonus for any fiscal year ending after a Change in
Control shall not be less than 30% of his base salary then in effect.
(c) Other Benefits. Employee will be entitled to such fringe
benefits as may be provided from time-to-time by the Company to its
employees, including, but not limited to, group health insurance,
disability, dental, retirement and any other fringe benefits now or
hereafter provided by the Company to its employees, if and when
Employee meets the eligibility requirements for any such benefit. The
Company reserves the right to change or discontinue any employee
benefit plans or programs now being offered to its employees; provided,
however, that all benefits provided for employees of the same position
and status as Employee will be provided to Employee on an equal basis
and the aggregate of such benefits shall not be less than those
currently in effect or otherwise be materially less favorable to the
Employee.
(d) Business Expenses. Employee will be reimbursed for all
reasonable expenses incurred in the discharge of Employee's duties
under this Agreement pursuant to the Company's standard reimbursement
policies.
(e) Vacation. Employee shall receive paid vacation annually in
accordance with the Company's practices for employees of the Company of
the same position and status as Employee.
(f) Car Allowance. Employee shall receive a car allowance of
$800 per month during the term of this Agreement. Employee otherwise
shall bear all expenses
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and liabilities with respect to such car.
(g) Withholding. The Company will deduct and withhold from the
payments made to Employee under this Agreement, state and federal
income taxes, FICA and other amounts normally withheld from
compensation due employees.
6. Non-Disclosure and Use of Confidential Information. Employee recognizes
and acknowledges that the trade secrets and confidential information of
the Company (the "Proprietary Information"), as they may exist from
time-to-time, are valuable, special and unique assets of the Business.
Employee further acknowledges that access to such Proprietary
Information relating to the Business of the Company is essential to the
performance of Employee's duties under this Agreement. Therefore, in
order to obtain access to such Proprietary Information, Employee agrees
that Employee will not, in whole or in part, disclose such Proprietary
Information to any person, firm, corporation, association or any other
entity for any reason or purpose whatsoever, nor will Employee make use
of any such information for Employee's own purposes or for the benefit
of any person, firm, corporation, association or other entity (except
the Company). For purposes of this Agreement, the term "trade secrets"
means the whole or any portion of any scientific or technical or
non-technical information, design, process, procedure, formula,
computer software product, documentation or improvement relating to the
Business which: (1) derives economic value, actual or potential, from
not being generally known to other persons who can obtain economic
value from its disclosure or use; and (2) is the subject of efforts
that are reasonable under the circumstances to maintain its secrecy or
confidentiality. The term "confidential information" means any and all
other data and information relating to the Business which: (1) has
value to the Company; (2) is not generally known by its competitors or
the public; and (3) is treated as confidential by the Company. The
provisions of this Section 6 will apply during Employee's employment by
the Company and, with respect to trade secrets, at any and all times
thereafter and, with respect to confidential information, for three
years thereafter. These restrictions will not apply to any Proprietary
Information which: (i) is in the public domain, provided that Employee
was not responsible, directly or indirectly, for such Proprietary
Information entering the public domain without the Company's consent;
(ii) becomes known to Employee, during the term of this Agreement, from
a third party not known to Employee to be under a confidential
relationship with the Company; or (iii) is required by law or
governmental tribunal to be disclosed; provided, however, that if
Employee is legally compelled to disclose any Proprietary Information,
Employee will provide the Company with prompt written notice of such
legal compulsion so that the Company may seek a protective order or
other available remedy.
7. (a) Non-Competition Covenant. During the term of this Agreement
and for a period of two years following termination of this
Agreement for any reason, Employee
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will not, directly or indirectly, on Employee's own behalf or
in the service of or on behalf of any other individual or
entity, compete with the Company in the Business within the
Geographical Area (as hereinafter defined); provided, however,
that the noncompetition period imposed under this Section 7(a)
shall not apply if the noncompetition period imposed under
Section 4(f) of this Agreement applies. The term "compete"
means to engage, directly or indirectly, on Employee's own
behalf or in the service of or on behalf of any other
individual or entity, either as a proprietor, employee, agent,
independent contractor, consultant, director, officer, partner
or stockholder (other than a stockholder of a corporation
listed on a national securities exchange or whose stock is
regularly traded in the over-the-counter market, provided that
Employee at no time owns, directly or indirectly, in excess of
five percent of the outstanding stock of any class of any such
corporation) in providing management, executive, marketing, or
other services. For purposes of this Agreement, the term
"Geographical Area" means those areas in the United States and
in foreign countries in which Employee is or has engaged in
providing or marketing Business products or services as of the
date of this Agreement. The Geographical Area currently
includes Alabama, Arkansas, Colorado, Florida, Georgia,
Illinois, Indiana, Kansas, Kentucky, Louisiana, Maryland,
Mississippi, Missouri, New Jersey, North Carolina, Ohio,
Oklahoma, Pennsylvania, South Carolina, Tennessee, Texas,
Virginia and West Virginia. The Company may, from time to time
and after giving Employee notice (but only while the Employee
is employed by the Company), amend this Agreement to expand
the Geographical Area to include additional areas in which the
Company may conduct the Business after the date hereof.
(b) Non-Interference. During the term of this Agreement and for a
period of two years following termination of this Agreement
for any reason (and during the Extended Period, if any),
Employee will not, directly or indirectly, on Employee's own
behalf or in the service of or on behalf of any other
individual or entity, interfere with, disrupt, or attempt to
disrupt the past, present or prospective relationships,
contractual or otherwise, between the Company and any
supplier, consultant, or client of the Company with whom
Employee had material business contact during the two-year
period ending on the date of the termination of this
Agreement. The term "prospective relationship" is defined as
any relationship where the Company has actively sought an
individual or entity as a prospective supplier, consultant, or
client.
(c) Construction. The parties hereto agree that any judicial
authority construing all or any portion of this Section 7 or
Section 8 below will be empowered to sever any portion of the
Geographical Area, Business or time period, client base,
prospective relationship or prospect list or any prohibited
business activity from the coverage of such Section and to
apply the provisions of such Section to the
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remaining portion of the Geographical Area, Business or time
period, the client base or the prospective relationship or
prospect list, or the remaining business activities not so
severed by such judicial authority. In addition, it is the
intent of the parties that the judicial authority replace each
such severed provision with a provision as similar in terms to
such severed provision as may be possible and be legal, valid
and enforceable. It is the intent of the parties that Sections
7 and 8 be enforced to the maximum extent permitted by law. In
the event that any provision of either such Section is
determined not to be specifically enforceable, the Company
shall nevertheless be entitled to bring an action to seek to
recover monetary damages as a result of the breach of such
provision by Employee.
8. Non-Solicitation of Employees Covenant. Employee further agrees and
represents that during Employee's employment by the Company and for a
period of two years following any termination of this Agreement for
whatever reason (and during the Extended Period, if any), Employee will
not, directly or indirectly, on Employee's own behalf or in the service
of, or on behalf of any other individual or entity, divert or solicit,
or attempt to divert or solicit, to or for any individual or entity
which is engaged in providing Business services, any person employed by
the Company (a) who was employed by the Company during the two-year
period ending on the date of the termination of this Agreement and (b)
with whom Employee was familiar, whether or not such employee is a
full-time employee or temporary employee of the Company whether or not
such employee is employed pursuant to a written agreement and whether
or not such employee is employed for a determined period or at-will,
except as agreed to by the Company.
9. Existing Restrictive Covenants. Employee represents and warrants that
Employee's employment with the Company does not and will not breach any
agreement which Employee has with any individual or entity to keep in
confidence confidential information or not to compete with any such
individual or entity. Employee will not disclose to the Company or use
on either of their behalf any confidential information of any other
party required to be kept confidential by Employee.
10. Return of Confidential Information. Employee acknowledges that as a
result of Employee's employment with the Company, Employee may come
into the possession and control of Proprietary Information, such as
proprietary documents, drawings, specifications, manuals, notes,
computer programs, or other proprietary material. Employee
acknowledges, warrants and agrees that Employee will return to the
Company all such items and any copies or excerpts thereof, and any
other properties, client lists, client contracts, files or documents
obtained as a result of Employee's employment with the Company,
immediately upon the termination of Employee's employment with the
Company.
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11. Remedies. Employee agrees and acknowledges that the violation of any of
the covenants or agreements contained in Sections 6, 7, 8, 9 and 10 of
this Agreement would cause irreparable injury to the Company, that the
remedy at law for any such violation or threatened violation thereof
would be inadequate, and that the Company will be entitled, in addition
to any other remedy, to temporary and permanent injunctive or other
equitable relief without the necessity of proving actual damages
including, without limitation, the right to terminate all payments
under this Agreement. Sections 4, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15,
16 and 17 of this Agreement, shall survive termination of the
Employee's employment under this Agreement.
12. Notices. Any notice or communication under this Agreement will be in
writing and sent by registered or certified mail addressed to the
respective parties as follows:
If to the Company: If to the Employee:
CompDent Corporation Xxxxx X. Xxxxxxxx
000 Xxxxxxx Xxxxx Xxxx, Xxxxx 000 00 Xxxx Xxxxxxx Xxxxx XX
Xxxxxxx, Xxxxxxx 00000 Apartment 329
Attention: Xxxxx X. Xxxxx Xxxxxxx, Xxxxxxx 00000
13. Severability. Subject to the application of Section 7(c) to the
interpretation of Sections 7 and 8, in case one or more of the
provisions contained in this Agreement is for any reason held to be
invalid, illegal or unenforceable in any respect, the same will not
affect any other provision in this Agreement, and this Agreement will
be construed as if such invalid or illegal or unenforceable provision
had never been contained therein. It is the intent of the parties that
this Agreement be enforced to the maximum extent permitted by law.
14. Entire Agreement. This Agreement embodies the entire agreement of the
parties relating to the subject matter hereof and supersedes all prior
agreements, oral or written, regarding such subject matter. Except as
otherwise provided in Section 7(a) of this Agreement, no amendment or
modification of this Agreement will be valid or binding upon the
parties unless made in writing and signed by the parties.
15. Binding Effect. This Agreement will be binding upon the parties and
their respective heirs, representatives, successors, transferees and
permitted assigns, as applicable.
16. Assignment. This Agreement is one for personal services and is not
assignable by Employee. The Company may assign this Agreement to any of
its affiliates; provided that the Company shall remain liable for the
obligations of its affiliates under this Agreement.
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17. Governing Law. This Agreement is entered into and will be interpreted
and enforced pursuant to the laws of the State of Delaware. The parties
hereto hereby agree that the appropriate forum and venue for any
disputes between any of the parties hereto arising out of this
Agreement shall be any federal court in the State of Delaware and each
of the parties hereto hereby submits to the personal jurisdiction of
any such court. The foregoing shall not limit the rights of any party
to obtain execution of judgment in any other jurisdiction. The parties
further agree, to the extent permitted by law, that a final and
unappealable judgment against either of them in any action or
proceeding contemplated above shall be conclusive and may be enforced
in any other jurisdiction within or outside the United States by suit
on the judgment, a certified or exemplified copy of which shall be
conclusive evidence of the fact and amount of such judgment.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
COMPDENT CORPORATION XXXXX X. XXXXXXXX
By: /s/ Xxxxx Xxxxx /s/ Xxxxx X. Xxxxxxxx
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Title: Chairman
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