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EXHIBIT 10.1
EMPLOYMENT AGREEMENT
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THIS EMPLOYMENT AGREEMENT is made and entered into by and between
Collaborative Clinical Research, Inc., an Ohio corporation (the "Corporation"),
and Xxxxxxx Xxxxxxxxxx ("Employee").
WHEREAS, the Corporation and Employee desire to enter into an agreement
providing for the Corporation to retain the services of the Employee.
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
SECTION 1. - PARTIES. The Corporation is engaged in the business of
conducting biopharmaceutical and medical device clinical research and data
collection projects. The Corporation hereby agrees to employ, and the Employee
hereby accepts such employment, on the terms set forth in this Agreement.
SECTION 2. - EMPLOYMENT AND DUTIES. During the term of this Agreement,
Employee shall, under the general supervision of the Corporation's Chief
Executive Officer or his assign (the "Chief Executive Officer"), serve as an
executive officer, with a title and specific job description as set forth on
Exhibit A to this Agreement, of the Corporation and its wholly-owned subsidiary,
Data TRAK, Inc., and to provide such additional services for the Corporation as
the Chief Executive Officer may designate. In such capacity, Employee shall
devote his/her skill and experience to serving the interests of the Corporation,
expressly including Data TRAK, Inc. Employee agrees to accept election to and
serve as an Officer of the Corporation and/or Data TRAK, Inc., as designated by
the Board of Directors of each Corporation. The parties hereby acknowledge and
agree that Employee will devote his/her full time and efforts toward the success
of the Corporation, including Data TRAK, Inc., as may be determined by the Chief
Executive Officer.
SECTION 3. - COMPENSATION AND BENEFITS.
3.1 BASE SALARY. During the term of this Agreement, the
Corporation shall pay Employee an annual base salary ("Base Salary") of One
Hundred Fifty Thousand Dollars ($150,000) to be paid in equal installments in
accordance with Data TRAK, Inc.'s customary payroll practices. Increases in
Employee's Base Salary shall be in such amounts as may be determined by the
Corporation's Board of Director's Compensation Committee. Such Base Salary may
be altered from time to time by mutual agreement of the parties evidenced by a
written memorandum executed by the parties, but which shall not affect or vary
the other provisions of this Agreement.
3.2 STOCK OPTION PLAN. Employee shall receive a stock option
plan to receive 30,000 shares (at _____/share) of the Corporation's Common Stock
("stock option") with the execution of this employment agreement. Employee shall
have 10,000 shares vest on each of the
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first, second, and third anniversary dates of this Agreement. A separate Stock
Option Agreement shall be executed in parallel with this Agreement.
3.3 BENEFITS. During the term of this Agreement the
Corporation shall provide Employee with such benefits as are currently provided
by the Corporation to its employees, subject to all eligibility requirements.
The Corporation shall have the right periodically to review such benefits and
make such adjustments or modifications as may be necessary at any time during
Employee's employment with the Corporation.
3.4 VACATION. Employee shall be entitled to three (3) weeks
paid vacation during each fiscal year of the Corporation and such additional
time as the Chief Executive Officer approves. Vacations shall be scheduled, and
Employee shall make his request for vacation periods, reasonably in advance.
3.5 EXPENSES. Employee shall be reimbursed for expenses
reasonably incurred in connection with the business of the Corporation and Data
TRAK, Inc., subject to approval of the Chief Executive Officer.
SECTION 4. - TERMINATION.
4.1 DEATH. If Employee dies while employed by Corporation,
his/her employment shall terminate immediately and (a) his/her Base Salary shall
continue through the last day of the month following death, and (b) he/she shall
be entitled to any accrued and unpaid expense reimbursement as of the date of
death. Any payments to be made hereunder by the Corporation after Employee's
death shall be payable to Employee's estate or heirs as Employee may designate.
4.2 DISABILITY. Employee shall be considered absent from
employment because of disability if, as a result of disease, mental or emotional
illness or physical injury, (i) he/she becomes unable or (ii) he/she is deemed
by the Chief Executive Officer, in his judgment reasonably and in good faith
exercised, to have become unable, during the term of this agreement or any
renewal term, to perform the essential functions of Employee's position
hereunder for a period of one hundred twenty (120) days or more, in the
aggregate, during any twelve (12) month period. Notwithstanding the foregoing,
however, the Employee shall not be terminated under this subsection based on any
period of time during which she has taken advantage of the provisions of the
Family and Medical Leave Act. In the event of such termination, Employee shall
be entitled to (a) Base Salary through the date of such termination, and (b) any
accrued and unpaid expense reimbursement as of the date of termination.
4.3 TERMINATION FOR CAUSE. The Corporation may terminate
Employee's employment hereunder at any time during the original term of this
Agreement or any renewal term in the event Employee is convicted of a felony or
if the Chief Executive Officer determines, in his judgment reasonably and in
good faith exercised, that Employee was engaged in: (i) fraud
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related to his/her duties as an employee or the conviction of the Employee of a
felony against the Corporation (or a written confession thereof given by
Employee); (ii) breach of the material provisions of this Agreement; or (iii) a
willful failure to perform his/her duties as required under this Agreement;
provided however, that in the case of (ii) or (iii) above, the Corporation shall
first give written notice to Employee of such breach or failure to perform and
thereafter Employee shall have a period of not less than thirty (30) days to
cure such breach or to perform. In the event of such termination, Employee shall
be entitled to (a) his/her Base Salary through the date of such termination and
(b) any accrued and unpaid expense reimbursement as of the date of termination.
Any termination under this Section 4.3 shall not affect any vested vacation,
pension or profit sharing benefits or any conversion privileges which Employee
might have under any benefit programs in which he/she is a participant.
4.4 TERMINATION BY EMPLOYEE FOR GOOD REASON. Employee may
terminate his/her employment hereunder for "Good Reason" as hereinafter defined,
by giving written notice to such effect to the Corporation. For these purposes,
Employee shall be deemed to have "Good Reason" for terminating his/her
employment if at any time, (a) the Corporation commits a breach of any material
provision of this Agreement, or (b) except in connection with the termination by
the Corporation of Employee's employment in strict compliance with the terms of
this Agreement, the Board of Directors of the Corporation shall have (i) failed
to elect Employee as an officer of the Corporation or Data TRAK, Inc. or shall
have removed him/her from any of such offices, (ii) failed to vest Employee with
the powers and authority customarily associated with such offices, or (iii) in
any other way significantly diminished Employee's responsibilities, duties,
powers or authority. In the event of any termination under this Section 4.4,
Employee shall be entitled to receive (a) his/her Base Salary through the date
of such termination and for a period of one (1) year following the date of such
termination, and (b) any accrued and unpaid expense reimbursement as of the date
of termination.
4.5 SALE OF THE CORPORATION. If (i) a majority of the
outstanding shares of capital stock of the Corporation entitled to vote are sold
and/or transferred in a single transaction or a series of related transactions
(except with respect to a public offering of the Corporation's shares of capital
stock), (ii) all or substantially all of the assets of the Corporation are sold
and/or transferred (other than to an affiliate of the Corporation) in a single
transaction or a series of related transactions, or (iii) a merger or
consolidation having either of the effects described in clauses (i) or (ii)
above is effected, and Employee's employment is not continued by the purchaser
or successor, Employee shall be entitled to receive (a) his/her Base Salary for
one (1) year following the date of Employee's termination following the sale of
the Corporation, and (b) any accrued and unpaid expense reimbursement as of the
date of termination.
4.6 VOLUNTARY TERMINATION WITHOUT GOOD REASON. Employee may
terminate his/her employment with the Corporation for other than Good Reason at
any time upon at least ninety (90) days advance written notice to such effect to
the Corporation. In the event of such termination, Employee shall be entitled to
receive his/her Base Salary through the date of termination.
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4.7 TERMINATION BY CORPORATION FOR SUFFICIENT REASON. The
Corporation may terminate Employee's employment hereunder at any time during the
original term of this agreement or any renewal term for Sufficient Reason.
"Sufficient Reason" shall mean the good faith determination by the Chief
Executive Officer that Employee shall have failed (i) to adequately perform
his/her duties as an officer of the Corporation or Data TRAK, Inc. following
sixty (60) days' notice from the Chief Executive Officer of dissatisfaction with
Employee's performance; (ii) to exercise and employ a level of judgment and
skill in the management of the Corporation and the supervision of its employees
commensurate with his/her position and comparable to the judgment and skill
employed by executives of companies of similar size and development, following
sixty (60) days' notice from the Chief Executive Officer of dissatisfaction with
Employee's performance; or (iii) to achieve the business objectives for Employee
or the Corporation mutually established from time to time by the Chief Executive
Officer and Employee (with such business objectives initially being as provided
on Exhibit A attached hereto and made a part hereof). In the event of any
termination under this Section 4.7, Employee shall be entitled to receive (a)
his/her Base Salary through the date of such termination and for a period of one
(1) year following the date of such termination and (b) any accrued and unpaid
expense reimbursement as of the date of termination.
4.8 TERMINATION WITHOUT CAUSE OR SUFFICIENT REASON. The
Corporation may, at any time during the original term of this Agreement or any
renewal term, terminate Employee's employment hereunder, upon not less than
thirty (30) days' notice, without cause or Sufficient Reason. In the event of
any termination under this Section 4.8, Employee shall be entitled to receive
(a) his/her Base Salary through the date of such termination and for a period of
two (2) years following the date of such termination and (b) any accrued and
unpaid expense reimbursement as of the date of termination.
4.9 EFFECT OF TERMINATION. Except for (i) the rights of the
Corporation to enforce the covenants of Employee under Section 6 below, which
covenants shall survive the termination of employment in accordance with the
terms thereof, and (ii) the obligations of the Corporation under this Section 4
and under other benefit plans, policies and programs with respect to which
Employee is a participant, the Corporation will have no further rights or
obligations under this Agreement from and after the termination date of
Employee's employment. Except for (a) Employee's rights under this Section 4 and
Employee's rights to receive all other benefits in accordance with the terms of
the plans, policies and programs providing such benefits, and (b) the covenants
of Employee under Section 6 hereof, which covenants shall survive the
termination of employment in accordance with the terms thereof, Employee will
have no further rights or obligations under this Agreement from and after the
termination date of Employee's employment.
4.10 BINDING ARBITRATION. In the event, upon termination of
Employee's employment, a disagreement exists between Employee and the
Corporation as to which section of this Section 4 governs such termination
(i.e., if the party terminating Employee's employment
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(the "Terminating Party") claims that "Cause", "Good Reason" or "Sufficient
Reason" or "Disability" exists and the other party (the "Disputing Party")
disputes such claim), the issue of which section should govern such termination
shall be submitted by the parties to binding arbitration in accordance with the
provisions of this Section 4.10. Within thirty (30) days after termination of
Employee's employment the Disputing Party may challenge the claimed basis for
termination by giving written notice (the "Dispute Notice") of such challenge to
the Terminating Party. Within fourteen (14) days after delivery of such Dispute
Notice, the parties shall appoint an independent arbitrator experienced in
employment matters who shall determine which section of this Section 4 applies
to the termination. In the event the parties cannot agree on an arbitrator
within fourteen (14) days after delivery of the Dispute Notice, then each party
shall appoint one arbitrator, and the two arbitrators shall appoint a third
arbitrator. In either case, the determination of the arbitrator or the majority
of the arbitrators, as the case may be, shall be final and binding upon both
Employee and the Corporation. The authority of the arbitrators hereunder shall
be limited to determining which section of this Section 4 governs, and the
arbitrators shall not have authority to reinstate Employee, to alter the amount
of the payment due to Employee under the applicable section of this Section 4,
or to award Employee or the corporation any other amounts by way of damages or
otherwise. Any arbitration hereunder shall be conducted in Cleveland, Ohio in
accordance with the Rules of the American Arbitration Association. In the event
the Disputing party fails to give the Dispute Notice within the thirty (30) day
period provided above, all rights of the Disputing Party to challenge the
claimed basis for termination shall expire.
SECTION 5. - TERM OF EMPLOYMENT. Except as otherwise provided herein,
this Agreement shall become effective on the effective date set forth in Section
3.1, and shall continue for a term of three (3) years. This Agreement shall
renew automatically for successive one (1) year terms unless either party gives
notice of non-renewal at least one hundred twenty (120) days prior to the
commencement of such a renewal term.
SECTION 6. - RESTRICTIVE COVENANTS OF EMPLOYEE.
6.1 NONCOMPETITION. During the period of Employee's employment
by the Corporation and, (i) in the case of the termination of Employee's
employment under either Section 4.3 or 4.6 hereof, for a period of fifteen (15)
months thereafter or (ii) in the case of the termination of Employee's
employment under Section 4.7 hereof, for a period of twelve (12) months
thereafter (the "Noncompetition Period"), Employee shall not, directly or
indirectly, whether as an individual on his own account, or as a shareholder,
partner, joint venturer, director, officer, employee, consultant, creditor
and/or agent or otherwise, in any State of the United States in which the
Corporation now or hereafter conducts business:
(i) enter into or engage in any business including, without
limitation, for a contract research organization (a "CRO"), or
otherwise perform any contract clinical research, which competes with
the business now or hereafter carried on by the Corporation or any
parent or subsidiary of, or entity controlled by the Corporation
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("Corporation Affiliates");
(ii) solicit customers, business patronage or orders on
behalf of, or perform other services for, any business, including,
without limitation, any CRO, which directly or indirectly competes with
the business of the Corporation or any Corporation Affiliate; or
(iii) promote or assist, financially or otherwise, any person,
firm, association, corporation or other entity, including, without
limitation, any CRO, engaged in the business which competes with the
current or future business of the Corporation or any Corporation
Affiliates;
provided, however, that the foregoing covenant shall not be deemed to have been
violated solely by (a) the ownership of equity securities of any entity which
competes with a future business of the Corporation or any Corporation Affiliate,
to the extent that such securities are acquired prior to the date that the
Corporation or Corporation Affiliate commences such future business; or (b) the
ownership for investment purposes of less than five percent (5%) of the equity
securities of an entity which has equity securities listed on a national
securities exchange or publicly traded in the over-the-counter-market.
6.2 CONFIDENTIALITY AND WORK PRODUCT. Employee acknowledges
that during his/her employment with the Corporation he/she has had and will have
access to confidential information, knowledge, and data regarding the business
of the Corporation and Corporation Affiliates, whether received, acquired or
developed by him/her or otherwise, including, without limitation, trade secrets,
design information, research methods and techniques, scientific data and
formulae, pricing data, customer information and all other information or data
relevant to the business of the Corporation (collectively, except any of the
foregoing which is at the time generally known to the public and which did not
become generally known through the breach of any agreement restricting its
disclosure, "Proprietary Information"). Employee further acknowledges that in
the course of his/her employment he/she may be producing designs, analyses,
recommendations, reports, complications, studies and other worth product,
acquiring information on behalf of the Corporation and any conceive of ideas,
innovations, processes and improvements relating to the business of the
Corporation (collectively, "Work Product"). As to the ownership, disclosure and
use of Proprietary Information and Work Product, Employee agrees that, from and
after the date hereof:
(i) he/she will promptly disclose in writing to the
Corporation all Work Product;
(ii) all Proprietary Information, all Work Product and all
rights therein are and shall be the sole and exclusive property of the
Corporation and all rights or interest of Employee therein are hereby
assigned by Employee to the Corporation, and Employee will cooperate
with and assist the Corporation from time to time, in any manner
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reasonably requested by the Corporation, in obtaining title or
ownership therein or evidence thereof;
(iii) Employee shall not divulge, disclose or communicate to
any third party in any manner, directly or indirectly, Proprietary
Information or Work Product;
(iv) Employee will not use for his/her own benefit or
purposes or for the benefit or purposes of any third party or permit or
assist, by acquiescence or otherwise, any third party to use in any
manner, directly or indirectly, Proprietary Information or Work
Product;
(v) upon the termination of his/her employment, Employee will
promptly deliver to the Corporation all Proprietary Information and
Work Product, including, without limitation, any reproductions, copies,
abstracts, summaries or other documents or records of Proprietary
Information or Work Product; and
(vi) Following termination of the Noncompetition Period, the
obligations of Employee in this Section 6.2 shall not apply to
Proprietary Information or Work Product of DATA TRAK, INC. as it
existed on the effective date hereof but shall continue for all
Proprietary Information of the Corporation or any Affiliate, whenever
developed, and any Proprietary Information and Work Product of Data
TRAK, Inc. for the period after such effective date.
6.3 NO INTERFERENCE. During the Noncompetition Period,
Employee agrees that he/she shall not:
(i) take any action which would:
(a) interfere with the contractual relationship of
the Corporation, any Corporation Affiliate,
customers, suppliers, employees or other which relate
to the business of the Corporation or any Corporation
Affiliate; or
(b) induce any employee or representative of the
Corporation or any Corporation Affiliate not to
continue as an employee or representative of the
Corporation or any Corporation Affiliate;
(ii) make remarks or take any other action which disparages
or diminishes the reputation of the Corporation or any Corporation
Affiliate;
(iii) without limiting the generality of the foregoing,
without the prior written consent of the Chief Executive Officer,
directly or indirectly employ, whether as an employee, officer,
director, agent, consultant or independent contractor, any person who
was an employee, representative, officer or director of the Corporation
or any
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Corporation Affiliate at any time during the six-month period prior to
the date of such proposed employment; provided, however, that the
covenants contained in this clause (iii) shall not apply with respect
to such person terminated by action of the Corporation or any
Corporation Affiliate or who has resigned their position with the
Corporation or any Corporation Affiliate.
6.4 INJUNCTIVE RELIEF. Both parties hereto recognize that the
services to be rendered by Employee to the Corporation are special, unique and
of extraordinary character, that the market for the Corporation's services and
products is worldwide, and that if Employee hereafter fails to comply with the
restrictions and obligations imposed upon him/her hereunder, the Corporation may
not have an adequate remedy at law. Accordingly, the Corporation, in addition to
any other rights which it may have, shall be entitled to seek injunctive relief
to enforce such restrictions and obligations without the necessity of posting
any bond.
SECTION 7. - MISCELLANEOUS
7.1 PARTIES BOUND. This Agreement shall be binding upon and be
for the benefit of Corporation and its successors and assigns. It shall be
binding upon and be for the benefit of Employee and his/her personal
representatives, executors, administrators, and heirs, but the right and
responsibility to render services shall be personal to Employee.
7.2 ENTIRE AGREEMENT AND AMENDMENT. This Agreement is the
entire employment agreement between the parties and shall be modified only by
written amendment signed by the party or parties upon whom the amendment imposes
or may impose any additional duties or obligations. Such amendment may be in the
form of minutes of a meeting of the Board of Directors or other document;
provided that such minutes or other document are signed by the Chief Executive
Officer of the Corporation and also signed by Employee if additional obligations
are imposed upon Employee or Employee's compensation or benefits are reduced.
7.3 TAXES. The Corporation shall have the right to withhold
any federal, state and local taxes from any compensation of any nature paid to
Employee.
7.4 APPLICABLE LAW. This Agreement shall be construed and
enforced in accordance with the laws of the State of Ohio.
7.5 CONSTRUCTION. The captions preceding the Sections in this
Agreement have been inserted for convenience only and shall not be used to
modify, expand or construe the provisions of this Agreement.
7.6 SEVERABILITY. In the event any one or more provisions of
this Agreement are deemed by a court of competent jurisdiction to be
unenforceable, such unenforceability shall not affect the other provisions of
this Agreement. It is the intention of the parties that, in the event a court
determines that any provision of this Agreement is unenforceable because it is
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overbroad as to scope of activity, geographic area or time, such overbroad
provision be reduced to the maximum enforceable scope and thereafter enforced as
so reduced.
7.7 COUNTERPARTS. This Agreement may be executed in one or
more counterparts and each of such counterparts shall for all purposes be deemed
to be an original and all of such counterparts shall for all purposes be deemed
to be an original and all of such counterparts shall constitute one and the same
instrument.
THE BALANCE OF THIS PAGE IS INTENTIONALLY BLANK
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EXECUTED the 6th day of July, 1997.
COLLABORATIVE CLINICAL RESEARCH, INC.
By: /s/ Xxxxxxx X. Xxxxx
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Xxxxxxx X. Xxxxx, President
"Corporation"
/s/ Xxxxxxx Xxxxxxxxxx
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Xxxxxxx Xxxxxxxxxx
"Employee"
