EXECUTIVE EMPLOYMENT AGREEMENT
Exhibit
10.21
This Executive Employment Agreement (“Agreement”) is made effective as of March 18, 2009
(“Effective Date”), by and between Pet DRx Corporation, a Delaware corporation (“Company”), and
Xxxx X. Xxxxxxxx (“Executive”).
R E C I T A L S
WHEREAS, the Company desires to employ the Executive and retain his services, experience and
abilities; and
WHEREAS, the Executive desires to accept such employment upon the terms and conditions
hereinafter set forth.
NOW, THEREFORE, in consideration of the promises and the mutual covenants contained herein, it
is agreed as follows:
1. Duties/Position. The Company hereby employs the Executive and the Executive hereby
accepts such employment under all of the terms and conditions of this Agreement. The Executive’s
principal place of business shall be at an office in Atlanta, Georgia, subject to periodic travel
to the Company’s corporate office located in Brentwood, Tennessee and other required business
travel. The Executive shall be an officer of the Company, and shall hold the office of Chief
Executive Officer, reporting to the Board of Directors of the Company (the “Board”).
2. Employment Term. The term of Executive’s employment under this Agreement shall
commence as of the Effective Date and shall continue until the date of termination of employment in
accordance with Section 5 (the “Employment Term”).
3. Executive’s Duties, Responsibilities, and Authority.
a. The Executive shall have and perform diligently the duties of Chief Executive
Officer and such other such duties as may be directed by the Board and commensurate with
such position and in accordance with the Company’s By-laws. Executive will be responsible
for working with the Board and management team in setting and implementing the Company’s
strategic direction, as well as serving as the Company’s leading representative. Executive
will also oversee and guide the management team in fulfilling its duties.
b. During the Employment Term, Executive shall perform his duties consistent with his
experience and abilities in furtherance of the Company’s interests and shall devote his
time, attention, skill and energy to his duties and the performance of the services, and the
Company will be entitled to all of the benefits and profits arising from or incident to all
such work and services.
c. The Executive will expend his best efforts on behalf of the Company, and will abide
by all Company policies and procedures of which he has been given notice, as well as all
applicable laws and regulations.
4. Compensation. In consideration of the services to be rendered by the Executive,
the Company agrees to compensate and to provide benefits to the Executive as follows:
a. Base Salary. As compensation for Executive’s performance of all of his
duties hereunder, Company shall pay to Executive an annual base salary of Three Hundred
Sixty Thousand Dollars ($360,000) (“Annual Base Salary”), payable in installments at such
times as the Company shall pay its other senior level executive officers, less required
deductions for state and federal withholding tax, social security and all other employment
taxes and payroll deductions. The Board shall review the Annual Base Salary at least
annually for merit increases; provided, however, that any increase in Executive’s Annual
Base Salary shall be at the Board’s sole discretion.
b. Bonus Opportunity. The Board may, in its sole and absolute discretion,
award the Executive an annual cash bonus.
c. Benefits. Executive shall be eligible for participation in, and shall
receive all benefits under, the benefit plans, practices, policies and programs provided by
Company to the extent generally applicable to senior level executives of the Company,
subject to the terms and conditions of the Company’s benefit plan documents, policies or
programs, as adopted from time to time. The Company reserves the right to change or
eliminate the Company’s benefit plans, practices, policies or programs at any time.
d. Vacation. From and after the Effective Date, Executive shall be entitled to
four (4) weeks annual paid vacation per full calendar year worked in accordance with the
plans, policies, and programs of the Company as in effect for senior level executives of the
Company. For 2008, vacation entitlement shall be prorated based on days worked in 2008 from
November 18, 2008.
e. Expenses. Executive shall be entitled to receive prompt reimbursement in
accordance with the Company’s reimbursement policies for all reasonable, out-of-pocket
business expenses incurred in the performance of his duties on behalf of Company (including
mobile telephone usage). To obtain reimbursement, expenses must be submitted promptly with
appropriate supporting documentation in accordance with Company’s policies.
5. Termination. Notwithstanding any other provision of this Agreement, the Agreement
and the Executive’s employment hereunder shall be terminated as follows:
2
a. Termination by the Company With Cause.
i. The Company may terminate this Agreement and the Executive’s employment for
Cause, as defined herein, upon written notice to the Executive setting forth in
reasonable detail the facts and circumstances upon which the Board shall have
determined, following reasonable inquiry, that Cause exists.
ii. As used herein, “Cause” shall mean (i) any willful, material violation of
any law or regulation applicable to the business of the Company or any affiliate of
the Company; (ii) conviction for, or guilty plea to, a felony or a crime involving
moral turpitude, or any willful perpetration of a common law fraud; (iii) commission
of any act of personal dishonesty which involves personal profit in connection with
the Company or any affiliate of the Company; (iv) any material breach of any
provisions of any agreement or understanding between the Company or any affiliate of
the Company and Executive regarding the terms of Executive’s service as an employee,
officer, director or consultant to the Company or any affiliate of the Company,
including, without limitation, the willful and continued failure or refusal to
perform the material duties required of Executive as an employee, officer, director
or consultant of the Company or any affiliate of the Company (other than as a result
of Disability) or a breach of any applicable creative works assignment and
confidentiality agreement or similar agreement between the Company or any affiliate
of the Company and Executive; (v) disregard of the policies of the Company or any
affiliate of the Company, so as to cause material loss, damage or injury to the
property, reputation or employees of the Company or any affiliate of the Company; or
(vi) the Executive is in breach of the terms of Sections 6, 7 and/or 8 hereof;
provided, however, for purposes of subclauses (iv), (v) and (vi), no such action for
omission, separately or together, shall constitute an event of “Cause” unless the
Board gives written notice to the Executive specifying the act(s) or omission(s) the
Board believes to be Cause and gives the Executive an opportunity to cure or amend
such contract to the reasonable satisfaction of the Board.
iii. If the Company terminates the Executive’s employment for Cause, then the
Executive shall be entitled only to the “Accrued Obligations.” For purposes of this
Agreement, the Accrued Obligations shall mean: (i) all accrued but unpaid Annual
Base Salary as of the date of termination; (ii) any unpaid or unreimbursed expenses
incurred in accordance with Company policy, including amounts due under Section 4(c)
and (e) hereof, to the extent incurred during the Employment Term; (iii) any
benefits provided under the Company’s employee benefit plans upon a termination of
employment, in accordance with the terms therein, including vested stock options and
rights to equity in the Company to the extent provided pursuant to the applicable
plan or agreement; and (iv) rights to indemnification by virtue of the Executive’s
position as an officer or director of the Company or its subsidiaries and coverage
under any directors’ and officers’ liability insurance policy maintained by the
Company, in accordance with its terms thereof.
3
b. Termination by the Executive for Good Reason. The Executive may terminate
this Agreement and his employment for Good Reason, as defined herein; upon written notice to
the Board setting forth in reasonable detail the facts and circumstances upon which the
Executive shall have determined that Good Reason exists. For purposes herein, “Good Reason”
shall mean the occurrence of any of the following without the Executive’s express, written
consent:
i. the assignment to the Executive of any duties or the reduction of the
Executive’s duties, either of which results in a significant diminution in the
Executive’s position or responsibilities with the Company in effect immediately
prior to such assignment, or the removal of the Executive from such position and
responsibilities;
ii. in the event of a Change in Control (as defined below), the Executive is
not appointed as the Chief Executive Officer of the acquirer, unless the Executive
rejects the offer of the position;
iii. a reduction by the Company in the Annual Base Salary of the Executive;
iv. the Company requires the Executive to have a principal office other than
within the Atlanta, Georgia greater metropolitan area; or
v. a material breach by the Company of this Agreement, including, without
limitation, the failure of the Company to pay any material item of compensation
substantially when due;
provided, however, that for a termination of employment by the Executive to be for Good
Reason, the Executive must notify the Company in writing of the event giving rise to Good
Reason within sixty (60) days following the occurrence of the event (or if later the
Executive’s knowledge of occurrence of the event), the event must remain uncured after the
expiration of thirty (30) days following the delivery of written notice of such event to the
Company by the Executive, and the Executive must resign effective no later than thirty (30)
days following the Company’s failure to cure the event. In the event that the Executive’s
employment is terminated by the Executive for Good Reason, the Executive shall be entitled
to the same payments and benefits described in Section 5(c).
As used in clause (ii) above, “Change in Control” means the occurrence of either of the
following events:
(A) the acquisition by any one person, or more than one person acting as a
group (other than any person or more than one person acting as a group who is
considered to own more than fifty percent (50%) of the total fair market value or
total voting power of the stock of Company prior to such acquisition), of stock of
Company, that, together with stock held by such person or group, constitutes more
than fifty percent (50%) of the total fair market value or total voting power of the
stock of Company; or
4
(B) within any twelve-month period (beginning on or after the Effective Date)
the acquisition by any one person, or more than one person acting as a group, of the
assets of Company, that have a total gross fair market value of sixty-five percent
(65%) or more of the total gross fair market value of all of the assets of Company,
immediately before such acquisition or acquisitions;
provided, however, that transfers to the following entities or person(s) shall not be deemed
to result in a Change of Control:
(I) an entity as to which the shareholders of Company immediately before the
transfer continue to own, directly or indirectly, immediately after the transfer,
more than fifty percent (50%) of the total fair market value or total voting power
of the stock, immediately after the transfer;
(II) an entity, more than fifty percent (50%) of the total fair market value or
total voting power of the stock of which is owned, directly or indirectly, by
Company; or
(III) any employee benefit plan maintained by or contributed to by Company.
For purposes of this definition of Change in Control, persons will be considered to be
acting as a group if they are owners of a corporation that enters into a merger,
consolidation, purchase or acquisition of stock, or similar business transaction with
Company. Notwithstanding the foregoing, no Change in Control shall be deemed to have
occurred for purposes of this Agreement by reason of any actions or events in which the
Executive participates in a capacity other than in the Executive’s capacity as an employee.
It is intended that this definition of Change in Control be consistent with the definition
of a “change in the ownership of a corporation” or a “change in a substantial portion of the
assets of a corporation” within the meaning of Code Section 409A, and this definition shall
be construed consistent with such intent.
c. Termination by the Company Without Cause. The Company may terminate this
Agreement and the Executive’s employment without Cause at any time. In the event that the
Executive’s employment is terminated by the Company without Cause (other than due to the
Executive’s death or Disability), the Executive shall be entitled to:
i. the Accrued Obligations, which shall be paid when such amounts would have
been paid if the Executive has remained employed following such termination by the
Company without Cause;
ii. an amount equal to twelve (12) months of Annual Base Salary which shall be
paid in accordance with the Company’s payroll practices; provided, however that if
such termination of employment occurs within twelve (12) months following a Change
in Control, such total amount shall be paid in a single lump sum;
5
iii. effective on the date of the termination of employment, all stock options
granted to Executive that are unvested shall become fully vested and exercisable as
of the effective date of the Executive’s termination of employment; and
iv. continuation of the health benefits (only under the Company’s or its
successor’s medical and dental insurance plans, if any) in accordance with this
paragraph for the lesser of two (2) years or the period that the Executive is
entitled to continuation of health coverage under the Consolidated Omnibus Budget
Reconciliation Act of 1985 (“COBRA”); provided that the Executive must elect COBRA
coverage to be entitled to this benefit, and provided further that:
(A) if any such plan is fully insured, then the Executive shall be
required to pay as each COBRA premium an amount equal to the allocable share
of the cost of coverage for similarly situated active employees of the
Company under such plan; or
(B) if any such plan is not fully insured, the Executive shall be
required to pay the full COBRA premium and the Company will reimburse the
Executive for a portion of the COBRA premium charged to the Executive that
represents the Company’s allocable share of the cost of coverage for
similarly situated active employees of the Company under such plan;
provided, however, that as a condition of receiving the payments and benefits in clauses
(ii), (iii), and (iv), the Executive shall execute, date and return to the Company on or
within twenty-one (21) days after the delivery date (and not timely revoke during any
revocation period provided therein) a comprehensive release, covenant not to xxx, and
non-disparagement agreement from the Executive in favor of the Company, its executives,
officers, directors, affiliates, and all related parties, in the form attached hereto as
Exhibit A; provided, however, that the release will not apply to the payment and
benefits described in clauses (i) through (iv).
d. Termination By Reason of Death or Disability.
i. This Agreement will terminate automatically upon the Executive’s death. The
Company may terminate Executive’s employment at the expiration of the Disability
Period (as defined below), such termination to be effective upon Executive’s receipt
of written notice of such termination.
ii. In the event the Executive’s employment is terminated due to his death or
at the expiration of the Disability Period (as defined below), the Company shall not
be obligated to provide the Executive any compensation or benefits (other than the
Accrued Obligations) after the effective date of such termination except as required
by law or regulation.
iii. For purposes of this Agreement, “Disability” shall mean any physical or
mental disability or infirmity that prevents the performance of the
6
Executive’s duties. Any question as to the existence, extent or potentiality
of the Executive’s Disability upon which the Executive and the Company cannot agree
shall be determined by a qualified, independent physician selected by the Company
and approved by the Executive (or the Executive’s duly appointed representative),
which approval shall not be unreasonably withheld. The determination of any such
physician shall be final and conclusive for all purposes of this Agreement.
iv. For purposes of this Agreement, “Disability Period” means a period,
beginning on the date the Company determines that the Executive is subject to a
Disability and ending on the earlier of the date the Executive begins receiving
income replacement benefits under any long term disability plan or policy maintained
by the Company or the date that is six (6) months after such determination, during
which the Executive remains subject to a Disability
e. Effect of Termination. If the Company terminates this Agreement as provided
herein, it shall not be obligated to provide the Executive any compensation or benefits
after the effective date of such termination except as otherwise set forth in this Section 5
and as required by law or regulation. The Executive’s entitlement to any amount of
severance or other post-termination benefits under this Agreement shall be subject to the
following conditions:
i. All payments of severance and other post-termination benefits under this
Agreement shall accrue from the date of termination and shall be made or commence no
later than the sixtieth (60th) day following the Executive’s termination of
employment, with any accrued but unpaid severance or benefits being paid or provided
on the date of the first payment; provided, however, that if the Executive is a
“specified employee” within the meaning of Code Section 409A, at the date of his
termination of employment, then such portion of the payments or benefits under
Section 5(b) or 5(c) that would result in a tax under Code Section 409A if paid
during the first six (6) months after termination of employment shall be withheld,
starting with the payments latest in time during such six (6) month period, and paid
to the Executive during the seventh month following the date of his termination of
employment; and
ii. For purposes of Sections 5(b) and (c), the Executive will have experienced
a termination of employment only if either (i) the Executive has ceased to perform
any services for the Company and all affiliated companies that, together with the
Company, constitute the “service recipient” within the meaning of Section 409A of
the Internal Revenue Code of 1986, as amended, and the regulations thereunder
(collectively, the “Service Recipient”) or (B) the Service Recipient and the
Executive reasonably anticipate that the level of bona fide services the Executive
will perform for the Service Recipient after a given date (whether as an employee or
as an independent contractor) will permanently decrease (excluding a decrease as a
result of military leave, sick leave, or other bona fide leave of absence if the
period of such leave does not exceed six months, or if longer, so long as the
Executive retains a right to reemployment with the
7
Service Recipient under an applicable statute or by contract) to no more than
twenty percent (20%) of the average level of bona fide services performed for the
Service Recipient (whether as an employee or an independent contractor) over the
immediately preceding 36-month period (or the full period of service if the
Executive has been providing services to the Service Recipient for less than 36
months).
f. Employment Status. Executive’s continued employment with the Company is
subject to the ongoing review and approval of the Company and its Board in their sole and
absolute discretion. Except as otherwise provided for herein, all terms and conditions of
employment (such as hours of work, job duties and benefits, etc.) are subject to change by
the Company at any time and for any reason. Similarly, the Company has the same right to
terminate the employment relationship at any time and for any reason, or for no reason, with
or without Cause. Executive further understands that he is an “at-will” employee of the
Company, and that this “at-will” relationship cannot be modified except by written agreement
between the Executive and the Company. Nothing in this Section shall be construed to take
away any rights that the Executive has during the Employment Term pursuant to this
Agreement, including his rights pursuant to Sections 5(b) and 5(c) hereof.
6. Confidentiality. Concurrently herewith, Executive shall execute the Company’s
standard form Confidentiality and Assignment of Creative Works Agreement (the “Confidentiality
Agreement”), a copy of which is attached hereto as Exhibit B. The Confidentiality
Agreement shall remain in full force and effect in accordance with the terms thereof and shall
survive the termination of this Agreement.
7. Non-Competition; Non-Solicitation.
a. The Executive agrees that, during his employment with the Company and for one (1)
year following his termination of employment for any reason (the “Applicable Period”), the
Executive will not (except on behalf of or with the prior written consent of the Company,
which consent may be withheld in Company’s sole discretion), within the Area (as defined
below), either directly or indirectly, on his own behalf, or in the service of or on behalf
of others, provide managerial services or management consulting services substantially
similar to those Executive provides for the Company to any person, firm, corporation, joint
venture, or other business that is engaged in the same or a substantially similar business
as the business of the Company, other than the Company or an affiliate of the Company. The
Executive acknowledges and agrees that the business of the Company is conducted in the Area.
For purposes of this Section 7(a), the “Area” means any area within a fifty (50) mile
radius of the Company’s principal corporate offices in the State of Tennessee; any area
within a twenty-five (25) mile radius of any location where the Company or an Affiliate
conducting the business of the Company opens a veterinary clinic on or after the Effective
Date and prior to the termination of the Executive’s employment hereunder; and any area
within a fifty (50) mile radius of any location where the Company or an Affiliate conducting
the business of the Company
8
opens a specialty veterinary hospital on or after the Effective Date and prior to the
termination of the Executive’s employment hereunder.
b. The Executive agrees that during the Applicable Period, he will not, either directly
or indirectly, on his own behalf or in the service of or on behalf of others, solicit any
individual or entity which is an actual or, to his knowledge, actively sought prospective
client of the Company or any of its Affiliates (determined as of date of termination of
employment) with whom he had material contact during the last two (2) years of the
Executive’s employment with the Company, for the purpose of offering services substantially
similar to those offered by the Company.
c. Executive understands and agrees that the Company’s employees and any information
regarding the Company’s employees is confidential and constitutes trade secrets.
Accordingly, Executive agrees that during the Applicable Period, Executive will not, either
directly or indirectly, separately or in association with others, interfere with, impair,
disrupt or damage the Company’s business by soliciting or attempting to hire or hiring any
of Company’s employees or causing others to solicit or encourage any of the Company’s
employees to discontinue their employment with the Company; provided, however, that
Executive being named as a referral on the resume of a Company employee and Executive
responding to inquiries resulting therefrom shall not violate this Agreement.
d. Executive agrees that these covenants are reasonable with respect to their duration,
geographical area and scope. Executive acknowledges that Executive’s breach of the
covenants contained in this Section would cause irreparable injury to the Company and agrees
that in the event of any such breach, the Company shall be entitled to seek temporary,
preliminary and permanent injunctive relief without the necessity of proving actual damages
or posting any bond or other security. Executive also acknowledges that each of these
covenants survives termination of this Agreement for any reason.
e. In the event that this Section 7 is determined by a court which has jurisdiction to
be unenforceable in part or in whole, the court shall be deemed to have the authority to
strike any unenforceable provision, or any part thereof or to revise any provision to the
minimum extent necessary to be enforceable to the maximum extent permitted by law.
8. Executive Representations. The Executive represents that:
a. Executive is entering into this Agreement voluntarily and that his employment
hereunder and compliance with the terms and conditions hereof will not conflict with or
result in the breach by him of any agreement to which he is a party or by which he may be
bound;
9
b. he has not, and in connection with his employment with the Company will not, violate
any non-solicitation or other similar covenant or agreement by which he is or may be bound;
and
c. in connection with his employment with the Company he will not use any confidential
or proprietary information he may have obtained in connection with employment with any prior
employer.
9. Indemnification of the Executive. The Company shall indemnify the Executive to the
extent provided under the Company’s Articles of Incorporation or By-laws, and any separate
indemnification agreement between the Company and the Executive, if any.
10. Taxes. Notwithstanding anything contained herein to the contrary, all payments
made under this Agreement shall be subject to withholding for all applicable taxes, including, but
not limited to, income, employment and social insurance taxes, as shall be required by law. The
Company and the Executive desire that the benefits and payments described in this Agreement be
exempt from, or comply with, the requirements of Code Section 409A. To that end, if the Executive
suggests any amendments to this Agreement that the Executive believes will make certain benefits or
payments under this Agreement exempt from or compliant with Code Section 409A, the Company will
use reasonable efforts to cooperate with the Executive in negotiating and implementing any such
amendments, provided that such amendments do not, in the sole discretion of the Company, have a
cost to the Company (apart from legal fees associated with negotiating, drafting and submitting any
required regulatory filings), or adversely affect the Company in any manner. Notwithstanding the
foregoing, the Company makes no guarantee as to any tax consequences relating to this Agreement,
and the Company does not represent or warrant that any payments or benefits under this Agreement
are exempt from or compliant with Code Section 409A. Further, the Executive shall be responsible
for his own taxes under this Agreement, including, if and to the extent applicable, taxes under
Section 409A and 4999 of the Internal Revenue Code.
11. Governing Law; Arbitration; Expenses.
a. This Agreement shall be governed and construed in accordance with the laws of the
State of Delaware without regard to its principles regarding choice of law. Subject to
Section 11(b), the parties hereto consent to venue in the courts of the State of Delaware or
in the Federal courts sitting in the State of Delaware with respect to any dispute regarding
the subject matter hereof.
b. In the event of any dispute under the provisions of this Agreement other than a
dispute pursuant to Section 6 or 7, the parties shall be required to have the dispute,
controversy or claim settled by binding arbitration in Atlanta, Georgia in accordance with
the commercial arbitration rules then in effect of the American Arbitration Association,
before either one arbitrator jointly agreed to by the parties, or if they cannot agree, a
panel of three arbitrators, one of whom shall each be selected by the Company and Executive,
respectively, and the third of whom shall be selected by the other two arbitrators. Any
award entered by the arbitrators shall be final, binding and nonappealable and judgment may
be entered thereon by either party in accordance with
10
applicable law in any court of competent jurisdiction. This arbitration provision shall
be specifically enforceable. The fees of the American Arbitration Association and the
arbitrators shared equally by the parties, subject to Section 11(c) hereof.
c. The party that materially prevails in any dispute litigated or arbitrated pursuant
to Section 11(a) or 11(b) hereof shall be entitled to reimbursement for all of such party’s
fees and costs (including, without limitation, the fees of the American Arbitration
Association and the arbitrators and reasonable attorneys’ fees and expenses) that are
incurred during the Employment Term or thereafter during the Executive’s lifetime, and which
shall be reimbursed promptly following submission of proof of the expenses but not later
than March 15 of the year following the year in which the judgment on arbitration award
becomes final.
Executive
must initial here: __________ Company representative must initial here:
__________
12. Miscellaneous.
a. Notices. All notices, requests, demands and other communications which are
required or permitted hereunder shall be in writing and shall be deemed to have been duly
given (i) when delivered personally, (ii) one (1) business day after being deposited with a
reputable, nationally known overnight delivery service for service the next business day, or
(iii) upon receipt after having been mailed by registered or certified mail, postage prepaid
and return receipt requested; in each case addressed to the relevant address below or to
such address as either party may hereafter designate by written notice to the other party in
accordance herewith.
If to the Executive:
|
Xx. Xxxx X. Xxxxxxxx 000 Xxxxxxx Xxxxx Xxxxxxx, Xxxxxxx 00000 |
|
If to the Company:
|
ATTN: Chairman of Compensation Committee Board of Directors Pet DRx Corporation 000 Xxxxxxxxxx Xxxxx Xxxxxxxx Xxxxx, Xxxxx 000 Xxxxxxxxx, XX 00000 Fax # (000) 000-0000 |
|
With a Copy to:
|
General Counsel Pet DRx Corporation 000 Xxxxxxxxxx Xxxxx Xxxxxxxx Xxxxx, Xxxxx 000 Xxxxxxxxx, XX 00000 Fax # (000) 000-0000 |
11
b. Entire Agreement; Assignment. This Agreement supersedes all prior
agreements and negotiations and sets forth the entire understanding between the parties
hereto with respect to the subject matter hereof and cannot be changed, modified, extended
or terminated except upon written amendment approved by the Company and executed on its
behalf by a duly authorized officer. The rights and obligations of the Company under this
Agreement shall inure to the benefit of and shall be binding upon the successors and assigns
of the Company, as applicable, including without limitation, a purchaser of all or
substantially all the assets of the Company. If the Agreement is assigned pursuant to the
foregoing sentence, the assignment shall be by novation and the entity defined as the
“Company” herein prior to such assignment shall have no further liability hereunder, and the
successor or assign, as applicable, shall become the “Company” hereunder. Further, the
Executive shall not be deemed to have incurred a termination of employment hereunder as a
result of such assignment. The Agreement is a personal contract and the rights and
interests of the Executive may not be assigned by the Executive. This Agreement shall inure
to the benefit of and be enforceable by the Executive and the Executive’s personal or legal
representatives, executors, administrators, successors, heirs, distributees, devisees and
legatees.
c. Severability. The invalidity, illegality or unenforceability of any
provision of this Agreement shall not in any way affect, impair or render unenforceable any
other provision of this Agreement, all of which shall remain in full force and effect.
d. Survival. Section 6 through 12 hereof shall survive the termination of this
Agreement and shall not be extinguished thereby.
e. Modification. This Agreement may not be amended or modified except by a
document signed by the Executive and an authorized representative of the Board which
specifically states that it is amending this Agreement.
f. Authority. The signatories below on behalf of the Company have the full
legal authority to bind the Company to all of the terms of this Agreement.
g. Executed Counterparts. This Agreement may be executed in one or more
counterparts, all of which when fully-executed and delivered by all parties hereto and taken
together shall constitute a single agreement, binding against each of the parties. To the
maximum extent permitted by law or by any applicable governmental authority, any document
may be signed and transmitted by facsimile with the same validity as if it were an
ink-signed document. Each signatory below represents and warrants by his signature that he
is duly authorized (on behalf of the respective entity for which such signatory has acted)
to execute and deliver this instrument and any other document related to this transaction,
thereby fully binding each such respective entity.
12
THE PARTIES TO THIS AGREEMENT HAVE READ THE FOREGOING AGREEMENT AND FULLY UNDERSTAND EACH AND EVERY
PROVISION CONTAINED HEREIN. WHEREFORE, THE PARTIES HAVE EXECUTED THIS AGREEMENT ON THE DATES SHOWN
BELOW.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year
first above written.
Company:
|
PET DRX CORPORATION | |||
| By: | ||||
| Xxxxxxx Xxxxxxxx Chairman, Compensation Committee Board of Directors |
||||
Executive: |
||||
| Xxxx X. Xxxxxxxx | ||||
13
EXHIBIT A
SEPARATION AND RELEASE AGREEMENT
SEPARATION AND RELEASE AGREEMENT
THIS
AGREEMENT (this “Agreement”) is made and entered into as of the ___ day of
_________ ___, 200___, by and between PET DRX CORPORATION, a Delaware corporation (the
“Company”), and
____________ (“Executive”).
BACKGROUND
Pursuant
to Section 5(b) or 5(c) of that certain employment agreement dated _________ ___, 200___
between Executive and the Company (the “Employment Agreement”), Executive has resigned his
employment with the Company for Good Reason (as defined in the Employment Agreement) or the Company
has terminated Executive’s employment without Cause (as defined in the Employment Agreement),
effective as of _________ ___, 200___. In connection with the termination of Executive’s employment
and the execution of this Agreement, the Company agrees to provide Executive with the payments and
benefits and other consideration described in either Section 5(b) or 5(c) of the Employment
Agreement, as applicable (the “Severance Benefits”).
AGREEMENT
In consideration for the mutual promises contained in this Agreement, the Company and
Executive agree as follows:
| 1. | Employment Termination. |
(a) General Terms. The Company and Executive agree that:
(1) Executive shall cease to be an employee, officer, and director of, and to hold any
positions with, the Company as of
_________ ___, 200___;
(2) Executive’s
last day of employment with the Company shall be _________ ___, 200___, and on
that date, he shall have incurred a “separation from service” within the meaning of Section 409A of
the Internal Revenue Code of 1986, as amended (the “Termination Date”);
(3) Executive
hereby resigns, effective as of _________ ___, 200___, from any and all titles and
positions with the Company. Executive agrees to tender and memorialize his resignation from any
and all such positions in any other manner and form as the Company may reasonably request; and
(4) This
Agreement was first delivered to Executive on
_________ ___, 200___ (“Delivery
Date”).
(a) Satisfaction of Obligations. The Severance Benefits are in full and final
satisfaction of all obligations that the Company has to Executive. Without limiting the
-1-
foregoing, the Severance Benefits replace any and all obligations of the Company under any and all
letters, agreements, understandings, plans and policies, relating to Executive’s employment and
severance, except as otherwise provided in the Employment Agreement. Executive agrees that the
Severance Benefits are adequate consideration for (i) the agreements he makes in this Agreement,
and (ii) the releases he gives pursuant to this Agreement.
(b) No Other Payments or Benefits. Executive shall not be eligible for, and he will
not receive, any payments or benefits from the Company, or under any plan, agreement, or
arrangement in which Executive or the Company are a party or participate which are not expressly
set forth in Section 5(b) or 5(c) of the Employment Agreement.
| 2. | Payments and Benefits Following Executive’s Severance Date. |
(a) General Conditions. The Company shall provide to Executive the Severance Benefits
when required by the Employment Agreement. However, for these payments and benefits to be due,
Executive must have signed, dated and returned this Agreement to the Company on or within 21 days
after the Delivery Date, Executive must not revoke this Agreement, the Company must not revoke this
Agreement, and the revocation period described in Section 9 must have expired. This Agreement
shall become effective as of the latest of the date of the day after expiration of the revocation
period, or _________ ___, 200___ (the “Effective Date”). Notwithstanding any other provision
of this Agreement, Executive’s termination of employment will
become effective _________ ___, 200___,
regardless of the general effective date of this Agreement and regardless of whether Executive
revokes this Agreement.
(b) Taxes. Executive is solely responsible for paying any and all taxes he owes on
the Severance Benefits. The preceding provision does not, and shall not be construed to make
Executive responsible for taxes that are imposed on any person or entity other than himself. The
Company will withhold all taxes that it determines are legally required to be withheld.
| 3. | Cooperation. |
(a) Transition. Executive shall cooperate with the Company in ensuring an orderly
transition of matters handled by Executive. Executive shall sign any documents and do anything
that is reasonably necessary in the future to implement his agreements in this Agreement.
(b) Non-disparagement. Executive agrees that he shall not, directly or indirectly,
make, cause, encourage or assist to be made any statements, comments or remarks, whether oral, in
writing or electronically transmitted, which might reasonably be considered to be derogatory or
defamatory, or to malign, harm, defame, disparage or damage the reputation of the Company or any of
the other Released Parties (as defined below). This subsection shall not apply to any
communications that are (i) intended to comply with the requirements and policies of any federal or
state agency, (ii) intended to cooperate with any investigation or request for information from any
state or federal government agency, or (iii) made in connection with any judicial or administrative
proceeding. Executive agrees that he will not make any statements about the Company or any of the
other Released Parties to the press (including without limitation any
-2-
newspaper, magazine, radio station or television station) without the prior written consent of
the Chairman of the Board of Directors of the Company.
(c) Cooperation as a Witness. Executive shall cooperate with the Company as a witness
in all matters about which he has knowledge as a result of his prior positions with the Company if
the Company requests his testimony. To the extent practicable and within the control of the
Company, the Company will use reasonable efforts to schedule the timing of his participation in any
such witness activities in a reasonable manner to take into account his then-current employment,
and will pay the reasonable documented out-of-pocket expenses that the Company pre-approves and
that Executive incurs for travel required by the Company with respect to those activities.
| 4. | General Release of Claims by Executive. |
(a) Release. As a material inducement for the Company to enter into this Agreement,
Executive hereby forever, irrevocably and unconditionally, releases and discharges the Company and
the other Released Parties (as defined below) from any and all charges, claims, liabilities,
agreements, damages, causes of action, suits, costs, losses, debts and expenses (including
attorneys’ fees and costs actually incurred) of any nature whatsoever, known or unknown, which he
now has, or claims to have, or which Executive at any time had, or claimed to have, or which
Executive at any time hereafter may have, or claim to have, against the Company, in each case as
to acts or omissions occurring up to and including the day before the Effective Date, including,
without limitation, any claim of breach of fiduciary duty, rights arising out of alleged violations
of any contracts, express or implied, any covenant of good faith and fair dealing, express or
implied, or any tort, or any legal restrictions on the Company’s right to terminate employees, or
any federal, state or other governmental statute, regulation, or ordinance (all such matters hereby
released, collectively referred to as “Claims”).
This release will not apply to any claim for payments or benefits Executive may have in connection
with the Severance Benefits, any rights he may have with respect to vested stock options or any
rights to the “Accrued Obligations” as defined in the Employment Agreement.
(b) Released Parties. As used in this Agreement, the “Released Parties” are
the Company and all of its related companies, partnerships or joint ventures, including but not
limited to, direct and indirect parent and subsidiary companies, and their predecessors and
successors; and, with regard to each of those entities, except for Executive, all of its past and
present employees, officers, directors, stockholders, owners, representatives, assigns, attorneys,
agents, insurers, employee benefit programs (and the trustees, administrators, fiduciaries and
insurers of these programs) and any other persons acting by, through, under or in concert with any
of the persons or entities listed in this subsection. Executive understands that this release
covers him and anyone who might have a claim through him or because of him, such as a past, current
or future spouse, his family, heirs, executors, representatives, agents and their successors and
assigns.
(c) No Lawsuits. Executive has not filed or caused to be filed any lawsuit, complaint
or charge with respect to any Claim he is releasing in this Agreement. Executive agrees never to
-3-
institute, or participate in any action against any of the Releasees with respect to any Claim
released by this Agreement, except as required by subpoena, court order, or other compulsory
process and except that he may participate in an investigation or proceeding conducted by an agency
of the United States government or of any state. Executive has not assigned or transferred any
Claim he is releasing, nor has he purported to do so. Notwithstanding any language herein to the
contrary, Executive understands that nothing in this Release prohibits Executive from filing or
pursuing a charge of discrimination with the Equal Employment Opportunity Commission (“EEOC”) or a
claim with the National Labor Relations Board (“NLRB”); provided that, by signing this Agreement,
Executive agrees to waive and relinquish any personal or monetary gain that would otherwise result
from such EEOC or NLRB claim.
(d) Release of Age Claims. Executive expressly and specifically waives any and all
rights or claims which he may have under the Age Discrimination in Employment Act of 1967, 29
U.S.C. Section 621 et seq. (“ADEA”). Executive acknowledges that this
waiver is knowingly and voluntarily made and specifically agrees that: (i) this waiver is written
in a manner that he understands; (ii) this waiver specifically relates to rights and claims under
the ADEA; (iii) he does not waive any rights or claims that may arise after the date he signs this
Agreement; (iv) he is waiving these rights or claims in exchange for substantial consideration in
excess of anything of value to which he is otherwise entitled to receive; (v) he has been advised
in writing, and given the opportunity, to consult with an attorney before signing this Agreement;
(vi) he has been given a period of 21 days to review this Agreement; and (viii) after Executive has
signed this Agreement, he or the Company may revoke this Agreement by providing written notice as
provided in Section 9 hereof within 7 days following his execution of the Agreement or if later by
_________ ___, 200___. Notwithstanding the foregoing, Executive’s termination of employment at
_________ ___, 200___ shall be unaffected by his revocation of this Agreement. Executive
specifically agrees that the 21-day period that he has to review this Agreement (including this
release) and to consult an attorney began to run on the date he executed the Amendment, and that
any changes made since that date have not extended or restarted that 21-day period.
| 5. | Consequences of Violating Executive’s Agreements or Breaching Executive’s Release. |
Executive understands that his agreements in Sections 3 and 4 and the releases
provided in this Agreement are especially important reasons why the Company offered Executive the
Severance Benefits. Therefore, Executive agrees that if he breaches any of those agreements or the
releases, then, along with all other rights and remedies available to the Company and their
affiliates at law or in equity, the Company also can stop all payments and benefits arising under
the Severance Benefits to Executive immediately and can recover from Executive any payments and
benefits that he already received. Executive agrees that, in the event of his breach of any
agreement, any release or any other terms of this Agreement, the Company, in addition to all other
rights and remedies available to it at law or in equity, may recover damages from Executive, and
will be entitled to an injunction restraining Executive from breaching his agreements, the releases
or any other terms of this Agreement. Executive also agrees to pay, promptly upon demand, but in
no event later than thirty (30) days after a final judicial determination that the Executive has
breached this Agreement, the reasonable attorneys’ fees and related damages the Company may incur
as a result of Executive breaching his agreements, a
-4-
release or any other term(s) of this Agreement or if any representation Executive made in this
Agreement was false when made. Executive understands that no provision in this Agreement is to be
construed as a waiver or prohibition against the Company pursuing any other legal or equitable
remedy for a breach of this Agreement. Executive understands, however, that this section will not
apply to any challenge of the validity of the release given under the ADEA.
| 6. | Consequences of Breach by the Company. |
The Company agrees that, in the event of its breach of this Agreement, Executive, in
addition to all other rights and remedies available to him at law or in equity, may recover damages
from the Company. The Company also agrees to pay, promptly upon demand, but in no event later than
thirty (30) days after a judicial determination that the Company has breached this Agreement, the
reasonable attorneys’ fees and related damages that Executive may incur as a result of the Company
breaching this Agreement.
7. Non-disparagement by the Company. The Company agrees that the Company will provide
directives, as appropriate, to the current members of the Boards of Directors and executive
officers of the Company to not make any statements which are derogatory to Executive. This
directive shall not apply to any communications that are (a) between the Company and its auditors,
(b) intended to comply with the requirements and policies of any federal or state agency, (c)
intended to cooperate with any investigation or request for information from any state or federal
government agency, (d) made in connection with any judicial or administrative proceeding, or (e)
between members of the Boards of Directors and/or executive officers of the Company in the course
of operating the Company’s business, provided the communications are not published to third
parties.
| 8. | Miscellaneous Provisions. |
(a) Binding Agreement. This Agreement is final and binding. Executive has carefully
read and fully understands all of the provisions of this Agreement.
(b) Entire Agreement. This Agreement forms the entire agreement between the Company
and Executive and supersede all other agreements, understandings, plans or arrangements relating to
the subject matter hereof, except that (1) the provisions of Sections 6 through 12 of the
Employment Agreement shall survive Executive’s termination of employment pursuant to Section 12(d)
thereof, and (2) this Agreement does not supersede or affect the Confidentiality and Assignment of
Creative Works Agreement between Company and Executive dated
_________ ___, 200___. Executive
acknowledges that the Company has made no representations or promises to Executive, written or
oral, other than those in this Agreement.
(c) Amendment. This Agreement may not be modified, amended, supplemented or
terminated except by a written instrument executed by the parties hereto.
(d) Assignment. The rights and obligations of the Company under this Agreement shall
inure to the benefit of the Company’s successors and assigns. This Agreement may be assigned by the
Company to an affiliate, to any legal successor to all or a portion of the business
-5-
of the Company or an affiliate, or to an entity which purchases assets from either of the
Company or an affiliate. In the event the Company assigns this Agreement as permitted by this
Agreement, “the Company” as defined herein will refer to the assignee. Executive may not assign
this Agreement.
(e) Waiver. The waiver by the Company of any breach of this Agreement by any party
shall not be effective unless in writing, and no such waiver shall constitute the waiver of the
same or another breach on a subsequent occasion.
(f) Arbitration. In the event of any dispute under this Agreement, other than a
dispute pursuant to Section 8(b) that relates to Section 6 through 12 of the Employment Agreement
or the Confidentiality Agreement, the parties shall be required to have the dispute resolved by
binding arbitration in Atlanta, Georgia in accordance with the commercial arbitration rules then in
effect of the American Arbitration Association, before either one arbitrator jointly agreed to by
the parties, or if they cannot agree, a panel of three arbitrators, one of whom shall each be
selected by the Company and Executive, respectively, and the third of whom shall be selected by the
other two arbitrators. Any award entered by the arbitrator shall be final, binding and
unappealable, and judgment may be entered thereon by either party in accordance with applicable law
in any court of competent jurisdiction. This arbitration provision shall be specifically
enforceable. The fees of the American Arbitration Association and the arbitrators shall be shared
equally by the parties; provided, however, that the party that materially prevails in any dispute
arbitrated pursuant to this Agreement shall be entitled to reimbursement for all of such party’s
fees and costs (including, without limitation, the fees of the American Arbitration Association and
the arbitrators and reasonable attorneys’ fees and expenses) that are incurred at any time, and
such fees and costs shall be reimbursed promptly following submission of proof the expenses but not
later of March 15 of the year following year in which the judgment on the arbitration award becomes
final.
(g) Governing Law. This Agreement will be governed by and construed in accordance
with Delaware law.
(h) Interpretation. Captions and section and subsection headings used herein are
provided for convenience only and are not part of this Agreement and shall not be used in
construing it. Executive acknowledges that this Agreement is not an admission of guilt or
wrongdoing by the Company.
(i) Blue Penciling. If any court or arbitrator determines that any of the provisions
contained in this Agreement, or any part of it, are unenforceable because of the length of any
period of time, the size of any area or the scope of activities contained in those provision(s),
then that period of time, area or scope will be considered to be adjusted to a period of time, area
or scope which would cure that invalidity, and those provisions in their revised form will then be
enforced to the maximum extent permitted by applicable law.
(j) Severability. Each of the covenants and agreements hereinabove contained shall be
deemed separate, severable and independent covenants, and in the event that any covenant shall be
declared invalid by any court of competent jurisdiction, such invalidity shall not in any
-6-
manner affect or impair the validity or enforceability of any other part or provision of such
covenant or of any other covenant contained herein.
(k) Counterparts. This Agreement may be signed in counterparts, and the signed
counterparts will form a single agreement.
| 9. | Notice and Acknowledgement. |
Executive acknowledges that, before signing this Agreement, he was given a period of 21 days
in which to consider this Agreement. Executive understands this Agreement and is entering into it
voluntarily. If Executive chooses to sign this Agreement before the 21 days have elapsed since
this Agreement was delivered to him, he agrees that he has done so knowingly and voluntarily
without coercion or duress of any kind. Executive further acknowledges that the Company has
encouraged and does encourage him to discuss this Agreement with an attorney before signing it and
that Executive did so to the extent he deemed appropriate. In any event, before Executive signs
this Agreement, he will have thoroughly reviewed, carefully considered and understood its effect.
Also, after Executive has signed this Agreement, he has until the later of 7 days after signing or
_________ ___,
200___ to reconsider and revoke it, but he must do so within that period by providing
written notice received by the Company during that period at Pet DRx Corporation, 000 Xxxxxxxxxx
Xxxxx, Xxxxx 000, Xxxxxxxxx, XX 00000, Attention: General Counsel. Notwithstanding the foregoing,
Executive’s termination of employment at
_________ ___, 200___, shall be unaffected by his revocation
of this Agreement.
| PET DRX CORPORATION | ||||||
Date:
|
By: | |||||
| Title: | ||||||
| Executive | ||||||
Date: |
||||||
-7-
EXHIBIT B
CONFIDENTIALITY AGREEMENT
CONFIDENTIALITY AGREEMENT
EMPLOYEE CONFIDENTIALITY AND ASSIGNMENT
OF CREATIVE WORKS AGREEMENT
OF CREATIVE WORKS AGREEMENT
This Employee Confidentiality and Assignment of Creative Works Agreement is entered into as of
the last date set forth on the signature page hereto, by and between Pet DRx Corporation, a
Delaware corporation (“Company”), and the individual and/or entity identified on the signature page
hereto (“Employee”). For purposes of this Agreement, the “Company” shall include any company which
controls or is controlled by the Company, as well as all other affiliates of Company and/or its
principals and each such company is an intended third-party beneficiary of this Agreement.
RECITALS
A. Employee understands and acknowledges that Company has developed and used and will be
developing and using Confidential Information (as defined below) in connection with its business.
This information was developed and will be developed by Company at great expense and constitutes,
among other things, trade secrets of Company. To safeguard this Confidential Information, Company
has instituted policies and procedures to protect such information. In connection with his or her
employment by Company, Employee will come into contact with the Confidential Information and shall
be under a duty to protect that information from unauthorized disclosure or use.
B. “Confidential Information” means any Company proprietary information, technical data, trade
secrets or know-how, including, but not limited to, proprietary business plans, product plans,
products, services, customer lists, software, developments, inventions, processes, technology,
information pertaining to suppliers or customers of the Company and marketing, financial or other
business information, which becomes known to Employee in writing, orally, electronically or through
observation. Confidential Information does not include any of the foregoing items which has become
publicly known and made generally available through no wrongful act of Employee or of others who
were under confidentiality obligations as to the item or items involved.
C. During the term of his or her employment by Company, Employee may, either solely or in
cooperation with others, create Creative Works. All such Creative Works shall be the sole and
exclusive property of Company.
D. “Creative Works” include, but are not limited to, all original works of authorship,
inventions (whether patentable or not), discoveries, designs, computer hardware and software,
algorithms, programming, scripts, or other proprietary information and related improvements and
devices, which are conceived, developed, or made by Employee, either alone or with others, in whole
or in part, on or off Company’s premises: (i) during Employee’s employment with Company, (ii) with
the use of the time, materials, or facilities of Company, and (iii) relating to any product,
service, or activity of Company of which Employee has knowledge, or (iv) suggested by or resulting
from any work performed by Employee for Company.
-8-
AGREEMENT
In consideration of the foregoing Recitals (which are incorporated herein by reference) and
the promises and covenants set forth below, the parties agree as follows:
1. Confidentiality Obligations. During and after his or her term of engagement,
Employee shall:
(a) Hold in trust, keep confidential, and not disclose to any third party or make any use
whatsoever of Confidential Information except as expressly authorized in writing by Company;
(b) Not cause the transmission, removal, or transport by any means, including electronic, of
Confidential Information outside of Company;
(c) Take all reasonable actions to assure proper precautions have been taken to prevent
unauthorized access to, the disclosure of, or loss or destruction of Confidential Information;
(d) Not use, or cause or permit others to use, any Confidential Information for any purpose
except as expressly authorized in writing by Company in connection with his employment by the
Company; and
(e) Promptly deliver to Company, upon termination of Employee’s engagement or at any other
time requested by Company, all Confidential Information in Employee’s possession or control,
including, without limitation, any and all software, data, memoranda, notes, e-mail, records, and
other documents, electronic or otherwise, including all copies thereof, constituting or relating to
the Confidential Information in Employee’s possession or control; provided that Employee shall be
entitled to retain one (1) copy of such Confidential Information for the sole purpose of defending
himself in connection with any lawsuit filed by the Company, its officers, shareholders, directors
or employees, against the Employee.
2. Ownership of Confidential Information. Employee acknowledges that all Confidential
Information is and shall remain the property of Company and that the Company is the sole owner of
all rights in connection therewith. Employee hereby assigns and transfers to Company any and all
right, title and/or interest he may have or acquire in all Confidential Information over the course
of the employment relationship.
3. Disclosure of Creative Works. Employee agrees to disclose promptly and fully to
the Company all Creative Works, current or proposed.
4. Ownership of Creative Works.
4.1. Copyrights. In addition to the rights granted by Employee to the Company
elsewhere in this Agreement, the following interests in copyright shall vest in Company:
-9-
(a) All Creative Works that are first created and prepared by Employee under this Agreement
that are encompassed by the definition of a “work made for hire” under 17 U.S.C. § 101 of the U.S.
Copyright Act of 1976 will be considered a “work made for hire,” and Company will be deemed the
sole author and owner of all copyrights in any such works.
(b) With respect to all Creative Works that are first created and prepared by Employee under
this Agreement that are not covered by the definition of a “work made for hire” under 17 U.S.C. §
101 of the U.S. Copyright Act of 1976, such that Employee would be regarded as the copyright author
and owner, Employee hereby assigns to Company Employee’s entire right, title, and interest in and
to such works, including all copyrights therein.
4.2. Other Proprietary Rights. In addition to the rights granted by Employee to
Company elsewhere in this Agreement, Employee agrees to and herby does, assign and transfer to
Company, and agrees that Company shall be the sole owner of all Creative Works, including, but not
limited to, all patent rights, know-how, trade secrets, confidential information, and any other
intellectual property related thereto recognized in the United States, any foreign jurisdiction or
any international treaty regime. Company shall have the right to use all Creative Works, whether
original or derivative, in any manner whatsoever.
4.3. Effectuating Company’s Rights. Employee agrees, during employment and at any
time thereafter, to execute any written documents necessary to effectuate the assignment to Company
of any and all Creative Works to which Company is entitled as provided in this Agreement, and to
execute all papers and perform any other lawful acts requested by Company for the preparation,
prosecution, procurement, and maintenance of any trademark, copyright, and/or patent rights in and
for the Creative Works, and will execute all papers and perform any other lawful acts necessary to
vest title in Company to the Creative Works, including, but not limited to, all trademarks,
copyrights, and patents. In the event Company is unable for any reason to secure Employee’s
signature to any document Company requests Employee to execute under this Section, Employee hereby
irrevocably designates and appoints Company and Company’s duly designated authorized officers and
agents as Employee’s agents and attorneys-in-fact to act for and in Employee’s behalf and instead
of Employee to execute such document and to file such application and to do all other lawfully
permitted acts with the same legal force and effect as if executed by Employee. Employee agrees
that he or she will not be entitled to any compensation in addition to the salary provided for his
or her employment for providing any of the services in this Section 4, but Employee shall be
reimbursed for actual expenses incurred in rendering the services.
4.4. To the extent, if any, that any intellectual property rights in the Creative Works are
not assignable or that, notwithstanding Section 4.3, Employee for any reason retains any right,
title or interest in and to any Creative Works, Employee (a) unconditionally and irrevocably waives
the enforcement of such rights, and all claims and causes of action of any kind against Company
with respect to such rights; (b) agrees, at Company’s request and expense, to consent to and join
in any action to enforce such rights; and (c) hereby grants to Company a perpetual, irrevocable,
fully paid-up, royalty-free, transferable, sublicensable (through multiple levels of sublicensees),
exclusive, worldwide right and license under such intellectual property rights to use, reproduce,
distribute, display and perform (whether publicly or otherwise), prepare derivative works of and
otherwise modify, make, sell, offer to sell, import and otherwise use and
-10-
exploit (and have others exercise such rights on behalf of Company) all or any portion of such
Creative Works. The license granted herein shall commence on creation of the Creative Works and
shall continue in perpetuity and without regard to the term of this Agreement or the term of
Employee’s employment with the Company. Employee hereby waives and quitclaims to Company any and
all claims, of any nature whatsoever, which Employee now or may hereafter have for infringement of
any rights in the Creative Works assigned hereunder to Company.
5. Notice to Employ. The assignment provided in Section 4 (Ownership of Creative
Works) does not apply to an invention that Employee developed entirely on his or her own time
without using Company’s equipment, supplies, facilities, or trade secret information except for
those inventions that either: (a) relate at the time of conception or reduction to practice of the
invention to Company’s business, or actual or demonstrably anticipated research or development of
Company; or (b) result from any work performed by Employee for Company.
6. Equitable Remedies. The parties recognize that irreparable injury will result to
Company if Employee breaches any provision of this Agreement, and Employee agrees that if it should
engage, or directly cause any other person or entity to engage, in any act in violation of any
provision of this Agreement, then Company shall be entitled, in addition to any other remedies,
damages and relief as may be available under applicable law, to seek an injunction prohibiting the
Employee from engaging in any such act or specifically enforcing this Agreement, as the case may
be. It is understood and agreed that no failure or delay by Company in exercising any right, power
or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the exercise of any
right, power or privilege under this Agreement.
7. Notice Regarding Compelled Disclosure. In the event Employee is requested pursuant
to, or required by, applicable law or regulation or by legal process to disclose any Confidential
Information, Employee shall provide Company with prompt notice of such request(s) to enable Company
to seek an appropriate protective order or pursue other authorized procedures to challenge the
attempt to compel disclosure. Employee shall cooperate with Company, at Company’s expense, in its
efforts to challenge such compelled disclosure.
8. Entire Agreement. This Agreement contains the entire agreement of the parties
hereto, supersedes all prior agreements, and understandings, whether oral or in writing, if any,
relating to the subject matter hereof, and may be amended only by written agreement of the parties
hereto.
9. Severability. If for any reason a court of competent jurisdiction finds any
provision of this Agreement, or portion thereof, to be unenforceable, that provision shall be
enforced to the maximum extent permissible so as to effect the intent of the parties and the
remainder of this Agreement shall continue in full force and effect. This Agreement is the result
of negotiations between the parties, each of whom shall be deemed to have drawn this Agreement. No
negative interference or interpretation shall be made by a court against the draftsman of this
Agreement.
-11-
10. Effective Date. This Agreement shall be effective on the earlier of the date of
Employee’s signature as written below, or the first date any Confidential Information was or is
first disclosed to Employee.
11. Attorney’s Fees. In the event that any proceeding or action is brought by either
party to enforce or interpret the terms of this Agreement, the prevailing party in such proceeding
or action shall be entitled to recover its costs of suit, including reasonable attorney’s fees.
12. Survival. The provisions of Sections 1, 2, 4, 5, 6, 7, 8, 9 and 11 through 13
shall survive the termination of this Agreement and/or termination of Employee’s employment with
the Company.
13. Governing Law. The terms of this Agreement shall in all respects be governed by,
construed, and interpreted in accordance with the laws of the State of Delaware, without giving
effect to its conflicts of laws, principles or rules and the Federal and State Courts in Delaware
shall have jurisdiction over any dispute relating to the Agreement.
[Remainder of page intentionally left blank]
-12-
IN WITNESS WHEREOF, the parties have executed this Agreement to become effective as provided
in Section 10.
“Company”
|
PET DRX CORPORATION, a Delaware corporation |
|||
| By: | ||||
| Xxxxxxx Xxxxxxxx Chairman, Compensation Committee Board of Directors |
||||
| Dated: | ||||
“Employee” |
||||
| Xxxx X. Xxxxxxxx, in his individual capacity | ||||
| Dated: | ||||
[Signature Page to Employee Confidentiality and Assignment of Creative Works Agreement]
