Exhibit 10.4.1
EMPLOYMENT AGREEMENT
This Employment Agreement ("Agreement") is made effective as of March
11, 1999, (the "Effective Date") by and between InterDent, Inc., a Delaware
corporation (the "Company"), and L. XXXXXXXX XXX XXXXXX ("Employee").
RECITALS
Pursuant to that certain Agreement and Plan of Reorganization and
Merger by and between the Company, Wisdom Holdings Acquisition Corp. I, Wisdom
Holdings Acquisition Corp. II, Gentle Dental Service Corporation ("GDSC") and
Dental Care Alliance, Inc. ("DCA") dated October 15, 1998, the Company was
formed and has determined to employ Employee as its Chief Development Officer,
Executive Vice President and Secretary. The parties desire that this Agreement
supersede any and all prior employment agreements employee may have with GDSC
and that such prior agreements be cancelled.
AGREEMENT
In consideration of the promises, covenants, and representations below,
the parties agree as follows:
1. Base Compensation. The Company will pay Employee as compensation for
Employee's services a base salary at the annual rate of $140,000 or at such
higher rate as the Company may determine from time to time ("Base Salary").
Employee's Base Salary will be payable in accordance with the Company's standard
payroll procedures.
2. Duties. Employee shall serve as Chief Development Officer, Executive
Vice President and Secretary of the Company and shall perform such customary,
appropriate and reasonable duties as are usually performed by persons in these
positions or as may be delegated to Employee by the Board of Directors (the
"Board") or Chief Executive Officer of the Company. Employee shall be employed
on a full-time basis and shall devote all of Employee's working time, attention
and energies to the Company during the term of Employee's employment.
Notwithstanding the preceding, Employee will not be precluded from engaging in
appropriate professional, educational, civic, charitable or religious activities
or from devoting a reasonable amount of time to private investments that do not
interfere or conflict with Employee's responsibilities to the Company. Employee
shall principally perform Employee's duties hereunder at the West Coast Regional
Offices of the Company in Vancouver, Washington.
3. Term of Employment. Employee's employment with the Company is
"at-will" and, therefore, either Employee or the Company can terminate
Employee's employment at any time for any reason or no reason at all, with or
without cause.
4. Employee Benefits. During the term of Employee's employment,
Employee will be eligible to participate in the employee benefit plans and
executive compensation programs (including any bonus plan(s) established by the
Compensation Committee) maintained from time to time for other senior executive
officers of the Company to the extent that other senior executive officers of
similar level and duties are eligible to participate in such programs and if
Employee qualifies for participation in any such programs. These benefits may
change from time to time.
5. Business Expenses. During the term of Employee's employment, the
Company shall reimburse Employee for necessary and reasonable travel,
entertainment and other business expenses appropriately incurred by Employee in
connection with performing Employee's duties. The Company will reimburse
Employee for such expenses upon presentation of an itemized account and
appropriate supporting documentation, all in accordance with the Company's
generally applicable policies.
6. Proprietary Information Agreement. Employee has signed and will
abide by the terms of the Proprietary Information Agreement, the form of which
is attached hereto as Exhibit A.
7. Vacation and Holidays. Employee will be entitled to fully-paid
vacation time and holidays consistent with the Company's policy as may be in
place from time to time.
8. Severance Compensation.
(a) In the event Employee's employment is terminated by
Employee for "good reason" (as defined below) or by the Company for any reason
other than "cause" (as defined below), and provided that Employee complies with
the provisions of Section 10 hereof, Employee will be entitled to continue to
receive from the Company Employee's Base Salary then in effect for a period of
12 months following the effective date of such termination (the "Termination
Date"), payable in equal monthly installments.
(b) For purposes of this Agreement, "cause" shall mean (i)
Employee's continuous and willful inattention to Employee's duties after at
least one written notice of same has been given to Employee and Employee has
been given an opportunity to cure the same within thirty days after such notice;
(ii) any breach by Employee of Section 10 of this Agreement; (iii) any act
committed by Employee with respect to the property or the business of the
Company which constitutes gross recklessness, willful or gross misconduct or
fraud; or (iv) criminal conduct which has caused material injury to the Company
and which could reasonably result in conviction of a felony which involves
fraud, dishonesty or moral turpitude, excluding from the definition of "cause,"
without limitation, such events as are stated not to constitute "cause" in the
following sentence. Employee shall not be considered to have been terminated for
"cause" if terminated by the Company solely (a) as a result of Employee's bad
judgment or negligence, (b) because of any act or omission believed by Employee
in good faith to have been in or not opposed to the best interests of the
Company (without intent of gaining therefrom directly or indirectly a profit to
which Employee was not legally entitled) and reasonably believed by Employee not
to have been improper or unlawful, (c) because of an act or omission in respect
of which a determination could properly have been made by the Board that
Employee met the applicable standard of conduct prescribed for indemnification
or reimbursement under the bylaws or charter of the Company, or the laws of the
State of Delaware, in each case in effect at the time of such acts or omissions,
or (d) because of any act or omission with respect to which notice of
termination is given more than twelve months after the earliest date on which a
non-employee director of the Company who is not a party to such act or omission
knew or should have known of such act or omission.
(c) For purposes of this Agreement, "good reason" shall mean
termination of Employee's employment by Employee within thirty days following
(x) any relocation of the Company's executive offices where Employee is employed
on the Effective Date to a new location which is in excess of 25 miles from its
current location, (y) a demotion in position from Chief Development Officer,
Executive Vice President and Secretary of the Company, or (z) the assignment of
duties and responsibilities of materially lesser status, dignity and character,
or a substantial reduction in the nature or status of Employee's duties and
responsibilities.
(d) During any period in which Employee receives severance
compensation pursuant to subsection (a) of this Section 8 or, with respect to
benefits other than medical insurance, such shorter period following the
Termination Date that Employee is eligible to participate in Employer's employee
benefit plans, Employee shall further be entitled to medical, life insurance,
disability insurance and any other similar benefits to the same extent as
theretofore provided by the Company to Employee prior to the Termination Date.
9. Accelerated Vesting of Stock Options and Restricted Stock. In the
event that (i) Employee's employment with the Company is terminated by the
Company for any reason other than "cause", (ii) Employee's employment with the
Company is terminated by Employee for "good reason", (iii) Employee's employment
with the Company is terminated because of death or physical disability within
the meaning of Section 22(e)(3) of the Internal Revenue Code of 1986, or (iv) a
"change in control" (as defined below) of the Company occurs, all shares of the
Company's Common Stock subject to outstanding options or shares subject to
restrictions held by Employee at the time of the event shall be fully vested as
of the date of such event.
For purposes of this Agreement, a "change in control" of the Company
shall mean the approval by the shareholders of the Company of:
(a) any consolidation, merger or plan of share exchange
involving the Company (a "Merger") in which the Company is not the continuing or
surviving corporation or pursuant to which shares of Common Stock of the Company
would be converted into cash, securities or other property, other than a Merger
in which the holders of shares of Common Stock of the Company immediately prior
to the Merger have the same proportionate ownership of common stock of the
surviving corporation immediately after the Merger or a Merger in which
Employee's rights under stock options or restricted stock awards held by
Employee are assumed or remain in effect;
(b) any sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all, or substantially all,
the assets of the Company other than a transaction in which Employee's rights
under stock options or restricted stock awards held by Employee are assumed or
remain in effect; or
(c) the adoption of any plan or proposal for the liquidation or
dissolution of the Company.
10. Restrictive Covenants and Confidentiality.
(a) Non-Solicitation. Employee agrees that during the term of
Employee's employment and for a period of one year following any termination
thereof (for any reason), Employee shall not (either directly or indirectly)
solicit, entice, encourage or induce any person who at any time within one year
prior to Employee's termination of employment shall have been an employee of the
Company or any of its subsidiaries, or who is a dentist who is employed by or
performing professional services for any dental practice managed by the Company
or one of its subsidiaries, to become employed by or associated with any person,
firm or corporation other than the Company, and Employee shall not approach any
such employee or dentist for such purpose or encourage the taking of such
actions by any other person, firm or corporation or assist any such person, firm
or corporation in taking such action.
(b) Non-Compete. Employee agrees that during the term of
Employee's employment and during any period in which Employee is receiving
severance compensation pursuant to Section 8 hereof, Employee shall not,
directly or indirectly, within a 5 mile radius of any location where the Company
or any of its subsidiaries owns, manages, develops, or operates any dental
practice or assets, engage or participate or make any financial investments in,
or become employed by, or act as an agent or principal of, or render advisory or
other services to or for, any person, firm or corporation that is engaged,
directly or indirectly, in any line of business then engaged in, or planned to
be engaged in, by the Company (a "Competing Enterprise"). Nothing herein
contained shall restrict Employee from holding investments in not more than
three percent of the voting securities of any Competing Enterprise whose stock
is listed on a national securities exchange or is actively traded on the
National Association of Securities Dealers Automated Quotation System, so long
as in connection with such investments Employee does not render services to a
Competing Enterprise.
(c) Compliance with Proprietary Information Agreement.
Employee agrees that during the term of Employee's employment and during any
period in which Employee is receiving severance compensation pursuant to Section
8 hereof, Employee shall, in all respects, comply with the terms and provisions
of the Proprietary Information Agreement, the form of which is attached hereto
as Exhibit A.
11. Survival. The provisions of this Agreement shall survive the
termination of Employee's employment with the Company, irrespective of the
reason therefor.
12. Remedies. Employee acknowledges that the services to be rendered by
Employee are of a special, unique and extraordinary character and, in connection
with such services, Employee will have access to confidential information vital
to the Company's and its subsidiaries' businesses. By reason of this access,
Employee consents and agrees that if Employee violates any of the provisions of
this Agreement, the Company and its subsidiaries shall be entitled, without the
need to show actual damages, to an injunction and a temporary restraining order
from any court of competent jurisdiction restraining Employee from committing or
continuing any such violation of this Agreement. Employee acknowledges that
damages at law would not be an adequate remedy for violation of this Agreement,
and Employee therefore agrees that the provisions of this Agreement may be
specifically enforced against Employee in any court of competent jurisdiction.
The rights, powers and remedies of the Company under this Agreement are
cumulative and not exclusive of any other right, power or remedy which the
Company may have under any other agreement or by law.
13. Miscellaneous.
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(a) Successors and Assigns. This Agreement shall be binding on
and inure to the benefit of the parties hereto and their heirs, executors, legal
representatives, successors and assigns. Neither party shall have the right to
assign its obligations, or all or any portion of their rights or interests under
this Agreement without the prior written consent of the other party hereto, and
any attempt to do so will be null and void.
(b) Governing Law. This Agreement is made and entered into and
is to be governed by the internal laws of the State of California, applicable to
agreements made and to be performed entirely within such state without regard to
the conflicts of law principles of such State.
(c) Waiver. The failure of either party at any time to require
performance by the other party of any provision hereof shall not affect in any
way the full right to require such performance at any time thereafter, nor shall
a waiver by either party of a breach of any provision hereof be taken or held to
be a continuing waiver of such provision, or waiver of any other breach under
any other provision of this Agreement.
(d) Entire Agreement. This Agreement and the Proprietary
Information Agreement set forth the entire agreement and understanding between
the parties hereto with respect to the subject matter hereof and supersede all
prior contracts, agreements, arrangements, communications, discussions,
representations and warranties, whether oral or written, between the parties
with respect to such subject matter. This Agreement may be amended only by a
written instrument signed by both parties hereto making specific reference to
this Agreement and expressing the plan or intention to modify it.
(e) Severability. If any provision of this Agreement shall be
adjudicated to be invalid, ineffective or unenforceable, the remaining
provisions of this Agreement shall not be affected thereby. The invalid,
ineffective and unenforceable provision shall, without further action by the
parties, be automatically amended to effect the original purpose and intent of
the invalid, ineffective or unenforceable provision; provided, however, that
such amendment shall apply only with respect to the operation of such provision
in the particular jurisdiction with respect to which such adjudication is made.
(f) Prior Agreement Superseded. This Agreement supersedes and
replaces in its entirety any prior employment agreement ("Prior Agreement")
between Employee and GDSC, which Prior Agreement is hereby terminated and
rendered null and void. In addition, and as part of the consideration for the
Company entering into this Agreement, notwithstanding anything to the contrary
contained in any Prior Agreement, Employee hereby waives any entitlement to any
and all compensation, of any type or kind whatsoever, which Employee is or may
be entitled to upon termination of any Prior Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
Effective Date.
InterDent, Inc..
By: XXXXXXX XXXXXX XXXXX
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Xxxxxxx Xxxxxx Xxxxx
Chief Executive Officer
L. XXXXXXXX XXX XXXXXX
L. Xxxxxxxx Xxx Xxxxxx
