Exhibit 10.21
Schedule A
Pursuant to Item 601(a)(4), Instruction 2, of Regulation S-K, the
Company has not filed the Amendment to Executive Employment Letters for the
following named Executives:
Xx. Xxxxxxx X. Xxxxxxx
Xx. Xxxxx X. Xxxxxxxxx
Xx. Xxxxxxx X. Xxxxxxx
Such Amendments are substantially similar to the Amendment for Xx. Xxx
X. Xxxxx, attached hereto.
[Covance Letterhead]
20 November 1998
Xx. Xxx X. Xxxxx
[address]
Re: Employment Letter Agreement (the "Agreement")
Dear Xxx :
Please refer to that certain Employment Letter Agreement dated November 20, 1996
between Covance Inc. ("Covance" or, the "Company") and you (the "Letter
Agreement"). This letter will constitute Amendment No. 1 to the Letter Agreement
and will amend the Letter Agreement as follows:
1. The Section entitled "Severance" shall be amended to read in its entirety as
follows:
Severance
Except as provided below under the paragraph headed "Change-of-Control", Covance
guarantees that should you be involuntarily terminated for reasons other than
for Cause, you will receive an amount equal to the sum of (a) two years base
salary (payable on the normal payroll cycle) determined at the time of
termination, and (b) two years of the annual incentive bonus (payable on the
normal bonus cycles) in an amount equal for each such year to the product of
your base salary in effect at termination and 55% (the sum of (a) and (b) being,
collectively, the "Termination Payments").
"Cause" shall mean (i) your convictions of a felony or a misdemeanor if such
misdemeanor involves moral turpitude; (ii) your committing any act of gross
negligence or intentional misconduct in the performance or non-performance of
your duties as an employee of Covance or its affiliates, including, any actions
which constitute sexual harassment under applicable laws, rules or regulations;
(iii) your failure to perform your duties assigned for a period of thirty (30)
or more days unless such failure is caused by an Extended Disability; or (iv)
misappropriation of assets, personal dishonesty or intentional misrepresentation
of facts which may cause Covance or its affiliates financial or reputational
harm.
Should such involuntary termination occur because of an Extended Disability, and
not for any other reason that constitutes Cause, for 120 consecutive days where
you have not returned to your duties on a full-time basis after the expiration
of such 120 day period within 30 days after written notice of termination is
given to you, Covance shall pay to you the Termination Payments at the times
specified above.
Extended Disability shall (i) mean you are unable, as a result of a medically
determinable physical or mental impairment, to perform the duties and services
of your position, or (ii) have the meaning specified in any disability insurance
policy maintained by Covance, whichever is more favorable to you.
Except as may be otherwise provided in applicable Covance compensation and
benefit plans, Covance shall not be liable for any salary or benefit payments to
you beyond the date of your voluntary termination of employment with Covance. In
the event of a termination of employment for Cause or Extended Disability, you
shall not be entitled to any compensation or other benefits not already earned
and owing to you on account of your services on the date of such termination of
employment except as provided above with respect to a termination for Extended
Disability.
Medical, dental, disability and life insurance will be continued, to the extent
they are not otherwise prohibited under the respective plans, while you are
receiving the Termination Payments.
Change-of-Control
In the event of an Event of Termination (as defined below), you will be entitled
to a lump sum payment equal to the sum of (1) the product of (a) 3 and (b) your
base annual salary in effect at the time of the Event of Termination and (2) the
product of (a) 3 and (b) number that is 55% of your base annual salary in effect
at the time of the Event of Termination. Such payment will be made within 60
days of the Event of Termination. In addition to, and as a result of, the
foregoing (i) all of your stock options (including the Stock Options),
restricted stock (including the Restricted Stock), deferred compensation and
similar benefits which have not become vested on the date of an Event of
Termination shall become vested upon such event and (ii) you shall be entitled
to receive any payments calculated pursuant to the paragraph headed "Certain
Additional Payments by Covance".
For the purposes of this Agreement, an Event of Termination is defined to be a
termination of your employment by Covance (for reasons other than Cause) or a
Constructive Termination (as defined below) of your employment, in each case
within 24 months following a Change-of-Control (as defined below), or your
voluntary termination of your employment for any reason or no reason during the
one-month period commencing twelve months following a Change-of-Control and
ending thirteen months after such Change-of-Control (a "Voluntary Termination");
provided, however, that a Voluntary Termination shall not be an Event of
Termination if it arises from a Change-of-Control pursuant to clause (iv) under
the definition of Change-of-Control unless the tender offer or exchange offer is
a tender or exchange offer for securities representing 20% or more of the
combined voting power of Covance's then outstanding securities.
For purposes of this Agreement, a Change-of-Control is defined to occur when:
(i) any person (including as such term is used in Section 13(d) and
14(d)(2) of the Securities Exchange Act of 1934) becomes the beneficial owner,
directly or indirectly, of Covance's securities representing 20% or more of the
combined voting power of Covance's then outstanding securities; or
(ii) as a result of a proxy contest or contests or other forms of
contested shareholder votes (in each case either individually or in the
aggregate), a majority of the individuals elected to serve on Covance's Board of
Directors are different than the individuals who served on Covance's Board of
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Directors at any time within the two years prior to such proxy contest or
contests or other forms of contested shareholder votes (in each case either
individually or in the aggregate); or
(iii) Covance shareholders approve a merger, or consolidation (where in
each case Covance is not the survivor thereof), or sale or disposition of all or
substantially all of Covance's assets or a plan or partial or complete
liquidation; or
(iv) an offeror (other than Covance) purchases shares of Covance common
stock pursuant to a tender or exchange offer for such shares.
For purposes of this Agreement, a Constructive Termination is defined to be:
(i) a material breach by Covance of this Agreement, including, without
limitation, a reduction in your then current salary or the percentage of base
salary eligible for incentive compensation;
(ii) a diminution of your responsibilities, status, title or duties
hereunder;
(iii) a relocation of your work place which increases the distance
between your principal residence and your work place by more than 25 miles;
(iv) a failure by Covance to provide you with benefits which are as
favorable to you in all material respects as those provided immediately prior to
the Change-of-Control; or
(v) the failure of any acquiror or successor in interest to the business
of Covance to agree in writing to be bound by the terms of this Agreement within
four months of any Change-of-Control.
In the event you are involved in any dispute about your rights under this
Agreement arising on or after a Change-of-Control, Covance shall pay all legal
costs and fees incurred by you in connection with such dispute promptly upon
receipt of any invoice relating thereto.
The benefits set forth under the paragraph headed Auto and Financial Counseling
Allowance and medical, dental, disability and life insurance will be continued,
to the extent they are not otherwise prohibited under the respective plans,
until you find other employment but not longer than three years from the date of
the Event of Termination.
2. The Section entitled "Outplacement" shall be amended to read in its entirety
as follows:
Outplacement
If there has been an Event of Termination or if there has been no
Change-of-Control but you have been terminated without Cause, Covance shall
provide for you, at Covance's cost, executive outplacement support for one-year
following such termination.
3. The Section entitled "Release" shall be amended to read in its entirety as
follows:
Release
If there has been an Event of Termination or if there has been no
Change-of-Control but you have been terminated without Cause, the obligation of
Covance to make to you any or all of the payments specified under this Agreement
(including, without limitation, the Termination Payments or the payments
specified under the paragraph headed "Change of Control", as applicable) shall
be subject to your execution and delivery to Covance of a release in form and
substance reasonably satisfactory to Covance of all claims,
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demands, suits or actions, whether in law or at equity, you have or may have
relating to or giving rise from such Event of Termination or non-Cause
termination.
Please indicate your agreement with the terms and conditions of this Amendment
No. 1 by signing one copy of this letter and returning it to my attention.
Very truly yours,
Xxxxxxxxxxx X. Xxxxxxx
President and CEO
Accepted as of the date first above specified:
By: __________________________________
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