EXHIBIT 10.3
EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT, dated as of ______ __, 2003, is by and between
____________ (the “Executive”) and Digene Corporation, a Delaware
corporation (the “Company”). The Executive and the Company agree as follows:
1. Employment. The Company hereby employs the
Executive and the Executive hereby accepts employment with the Company, upon the terms
and conditions hereinafter set forth.
2. Term. Subject to the provisions for earlier termination as
provided herein, the term of this Agreement will be for a period beginning on
__________ __, 2003 and ending as set forth in the following sentence. The
Compensation Committee (the “Compensation Committee”) of the Company’s Board of
Directors (the “Board”) shall be entitled to terminate this Agreement at any
time by causing the Company to provide written notice to the Executive at least
twelve (12) months in advance of the termination date. The period of the
Executive’s employment under this Agreement, as it may be terminated as
provided herein, is hereinafter referred to as the “Term.” The termination of
this Agreement in accordance with this Section 2 shall not be a termination as
set forth in Section 5 hereof and shall not entitle the Executive to receive
any severance or other payments as provided for in Section 6 hereof.
3. Duties and Responsibilities. The Executive shall perform such
duties and functions as the Board may from time to time determine which are
consistent with the positions as set forth on Annex A, a copy of which
is attached hereto and the terms of which are incorporated by reference herein,
shall comply with the policies and reasonable directions of the Board and shall
discharge his responsibilities in a competent and faithful manner, consistent
with sound business practices. The Executive and the Company may amend
Annex A from time to time to document changes to the positions described
therein.
During the Term of this Agreement, the Executive shall devote all of his
business time, attention and energies to the performance of his duties for the
business of the Company, except to the extent that the Board may specifically
approve any outside interests; provided that the first part of this
sentence shall not preclude the Executive from (a) participating in civic
duties, (b) serving as a member of the board of directors of any other company
if the Company consents in writing to such service (such consent not to be
unreasonably withheld), (c) delivering lectures, fulfilling speaking
engagements or teaching at educational institutions, or (d) managing the
Executive’s personal investments, in each such case to the extent that such
activities do not materially impair the Executive’s ability to perform the
Executive’s duties hereunder. All current activities of the Executive as of
the date of this Agreement described in the proviso of the prior sentence are
approved. The Executive shall not, directly or indirectly, without the
approval of the Board, engage or become financially interested in any other
business activity which, in the reasonable judgment of the Board, conflicts
with the duties of the Executive hereunder, whether or not such activity is
pursued for gain, profit or pecuniary advantage.
4. Compensation.
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(a) Base Salary. During the Term, the Executive shall receive from
the Company (or, at the Company’s option, any subsidiary or affiliate
thereof) an annual base salary for services rendered hereunder in the
amount specified on Annex A, payable not less frequently than
semi-monthly consistent with the regular practices of the Company. The
Executive’s base salary shall be reviewed annually by the Compensation
Committee and shall be subject to change at the option and sole
discretion of the Compensation Committee. The Company may amend Annex
A from time to time to document any such change. |
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(b) Bonus. The Executive shall be entitled to receive, as
additional compensation, an annual cash bonus determined in accordance
with the Company’s executive bonus plan and approved by the Compensation
Committee in its sole discretion. |
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(c) Other Benefits. The Executive shall, in addition to the other
compensation described in this Section 4, be entitled to participate in
such employee benefit plans or programs of the Company and shall be
entitled to such other fringe benefits as are from time to time made
available by the Company generally to employees of the Executive’s
position, tenure, salary, age, health and other qualifications
(including, but not limited to, any profit-sharing, stock option,
incentive, pension, health insurance, major medical insurance and group
life insurance plans in accordance with the terms of such plans), all as
determined from time to time by the Compensation Committee. To the
extent available at reasonable cost, the Company will use its best
efforts to promptly obtain and maintain appropriate directors and
officers liability insurance (“D&O”); if the Company determines that it
cannot obtain appropriate D&O, it will promptly so notify the Executive
in writing, but in no event later than sixty (60) days after such
determination. The Executive acknowledges and agrees that the Company
does not guarantee the adoption or continuance of any particular employee
benefit plan or program or other fringe benefit during the Term, and
participation by the Executive in any such plan or program shall be
subject to the rules and regulations applicable thereto. |
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(d) Reimbursement for Expenses. The Company shall reimburse the
Executive, in a manner consistent with the regular practices of the
Company, for any and all reasonable and necessary business expenses
incurred by the Executive in connection with the performance of his
duties, upon presentation of proper vouchers by the Executive to support
said expenses. |
5. Termination. The Executive’s employment by the Company
hereunder shall terminate on the occurrence of:
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purpose hereof, the term “Disability” shall mean disability as
defined in the Company’s Long-Term Disability Plan or, if the Company
does not have such a plan, the Executive’s physical or mental inability
to perform his essential duties and responsibilities hereunder, with
reasonable accommodation, for a period of at least ninety (90)
consecutive days. Disability shall be determined by the Compensation
Committee or its designee. In the case of Disability, until the Company
terminates the Executive’s employment hereunder in accordance with the
foregoing, the Executive shall be entitled to receive compensation
provided for herein notwithstanding any such physical or mental inability
to perform his duties hereunder. |
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(b) Termination for Cause. The Company may, with the approval of a
majority of the Board, terminate the employment of the Executive
hereunder at any time during the Term and effective immediately for
“justifiable cause” (a “Termination for Cause”) by giving Executive
written notice of such Termination for Cause. For the purposes of the
Agreement, the term “justifiable cause” means: (i) the Executive’s
conviction of a felony (which, through lapse of time or otherwise, is not
subject to appeal); (ii) the Executive’s willful and substantial
misconduct; (iii) the Executive’s repeated, after written notice from the
Company and a reasonable opportunity to cure, neglect of duties or
failure to act which can reasonably be expected to affect materially and
adversely the business or affairs of the Company or any subsidiary or
affiliate; (iv) except in the normal course of business in the
performance of his duties, any material disclosure by the Executive to
any person, firm or corporation other than the Company, its subsidiaries
and its and their directors, officers, employees or professional
advisors, of any confidential information or trade secret of the Company
or any of its subsidiaries; (v) the Executive’s repeated pursuit, after
written notice from the Company and a reasonable opportunity to cure, of
activities or personal or professional conduct or action that in the sole
judgment of the Board is contrary to the best interests of the Company;
(vi) any material breach by the Executive of this Agreement or, to the
extent applicable, the Non Competition, Non Disclosure and Developments
Agreement between the Executive and the Company; (vii) any conduct or
action by the Executive prohibited under the policies of the Company,
including, but not limited to, policies regarding sexual harassment,
xxxxxxx xxxxxxx, corporate disclosure, substance abuse and conflicts of
interest; or (viii) the engaging by the Executive in any business other
than the business of the Company and its subsidiaries which, in the sole
judgment of the Board, interferes with the performance of his duties
hereunder. |
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(c) Termination Without Cause. The Company may terminate the
employment of the Executive hereunder at any time without “justifiable
cause” (a “Termination Without Cause”) by giving the Executive written
notice of such termination at least thirty (30) days prior to the
effective date of such termination. |
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(d) Voluntary Termination. Any termination of employment of the
Executive hereunder, otherwise than as a result of death, Disability, a
Termination for Cause or a Termination Without Cause will be deemed to be
a “Voluntary Termination.” A Voluntary Termination will be deemed to be
effective immediately upon such termination. |
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6. Effect of Termination of Employment.
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(a) Voluntary Termination; Termination for Cause. Upon termination
of the Executive’s employment hereunder pursuant to a Voluntary
Termination or a Termination for Cause, neither the Executive nor his
beneficiaries or estate will have any further rights or claims against
the Company under this Agreement except the right to receive: (i) the
unpaid portion of his then-current base salary provided for in Section
4(a) hereof, computed on a pro rata basis to the date of termination;
(ii) payment of his accrued but unpaid rights (including accrued vacation
time) in accordance with the terms of any incentive compensation, stock
option, retirement, employee welfare or other employee benefit plans or
programs of the Company in which the Executive is then participating in
accordance with Section 4(b) or Section 4(c) hereof; and (iii)
reimbursement for any unreimbursed expenses as provided in Section 4(d)
hereof. Nothing in this Agreement shall restrict or limit the right of
the Compensation Committee or the Board to determine whether the
forfeiture provisions of any of the Company’s stock option or incentive
compensation plans apply to vested stock options or stock awards held by
the Executive at the time of such termination for cause. |
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(b) Termination Without Cause. Upon termination of the Executive’s
employment hereunder pursuant to a Termination Without Cause, neither the
Executive nor his beneficiaries or estate will have any further rights or
claims against the Company under this Agreement except the right to
receive: (i) the payment and other rights provided for in Section 6(a)
hereof; (ii) severance payments in the form of semi-monthly payment of
the Executive’s then-current base salary for a period of twelve (12)
months following the effective date of such termination; (iii) monthly
payments of the Pro-Rata Bonus Amount (as defined below) for a period of
twelve (12) months following the effective date of such termination; and
(iv) continuation of the health care benefits coverage to which the
Executive is entitled under Section 4(c) hereof over the twelve (12)
month period described in clause (iii) above, with such coverage to be
provided at the same level and subject to the same terms and conditions
(including, without limitation, any applicable co-pay obligations, but
excluding any applicable tax consequences for the Executive) as in effect
for officers of the Company generally during such period. For purposes
of this Agreement, “Pro-Rata Bonus Amount” shall mean one twelfth (1/12)
of (x) the portion of the Executive’s annual bonus, as determined by the
Compensation Committee, applicable to that portion of the year arising
prior to termination of this Agreement in the year in which such
Termination Without Cause occurs, plus the greater of (y) the most recent
annual cash bonus paid to the Executive prior to the date of his
termination or (z) the average of the three most recent annual cash
bonuses paid to the Executive prior to the date of his termination. |
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(c) Death or Disability. Upon termination of the Executive’s
employment hereunder as a result of death or Disability, neither the
Executive nor his beneficiaries or estate will have any further rights or
claims against the Company under this Agreement except the right to
receive: (i) the payment and other rights provided for in Section 6(a)
hereof; (ii) in the case of death only, a lump sum payment equal to the
Executive’s annual base salary as in effect on the date of death; and
(iii) in the case of Disability only, continuation of health care
benefits coverage to which the Executive is |
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entitled under Section 4(c) hereof for the twelve (12) month period
following the effective date of such termination, with such coverage to
be provided at the same level and subject to the same terms and
conditions (including, without limitation, any applicable co-pay
obligations, but excluding any applicable tax consequences for the
Executive) as in effect for officers of the Company generally during such
period; provided, however that nothing in this Section 6(c)
shall provide any additional benefits or coverage than that in effect for
officers of the Company during such period under the Company’s Long-Term
Disability Plan. |
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(d) Forfeiture of Rights. In the event that, subsequent to
termination of employment hereunder, the Executive (i) breaches any of
the provisions of Sections 7, 8 or 9 hereof or (ii) directly or
indirectly makes or facilitates the making of any adverse public
statements or disclosures with respect to the business or securities of
the Company, all payments and benefits to which the Executive may
otherwise be entitled pursuant to Section 6(a), 6(b) or 6(c) hereof shall
immediately terminate and be forfeited, and any portion of such amounts
as may have been paid to the Executive shall forthwith be returned to the
Company. |
7. Confidentiality. Except in the normal course of business in the
performance of his duties, the Executive shall not, during the Term of this
Agreement, or at any time following the end of the Term of this Agreement,
directly or indirectly, disclose or permit to be known, to any person, firm or
corporation, any confidential information acquired by him during the course of,
or as an incident to, his employment hereunder, relating to the Company, the
directors of the Company, or any client of the Company, including, but not
limited to, the business affairs of each of the foregoing. Such confidential
information shall include, but shall not be limited to, proprietary technology,
trade secrets, patented processes, research and development data, know-how,
formulae, pricing policies, the substance of agreements with customers and
others, and arrangements, customer lists and any other documents embodying such
confidential information.
All information and documents relating to the Company shall be the
exclusive property of the Company, and the Executive shall use his best efforts
to prevent any publication or disclosure thereof. Upon termination of
Executive’s employment with the Company, all documents records, reports,
writings and other similar documents containing confidential information then
in the Executive’s possession or control shall be returned to and left with the
Company.
8. Restrictive Covenant.
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(a) The Executive hereby acknowledges and recognizes that, during
the Term, the Executive will be privy to trade secrets and confidential
proprietary information critical to the Company’s business and,
accordingly the Executive agrees that, in consideration of the benefits
to be received by him hereunder, the Executive will not, from and after
the date hereof until the first anniversary of the termination of the
Term, (i) directly or indirectly engage in the development, production,
marketing or sale of products that compete (or, upon commercialization,
would compete) with products of the Company being developed (so long as
such development has not been abandoned), |
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produced, marketed or sold at the time of the Executive’s
termination (hereinafter a “Competing Business”) whether such engagement
shall be as an owner, partner, investor, employee, officer, director,
affiliate or other participant in any Competing Business; (ii) assist
others in engaging in any Competing Business in the manner described in
clause (i) above; or (iii) induce other employees of the Company or any
subsidiary thereof to terminate their employment with the Company or any
subsidiary thereof or engage in any Competing Business. The ownership of
not more than 5% of the stock of any entity having a class of equity
securities actively traded on a national securities exchange or on the
Nasdaq Stock Market or any minority interest in any private entity shall
not be deemed, in and of itself, to violate the prohibitions of this
Section 8(a). |
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(b) During the Term of the Executive’s employment hereunder and for
five (5) years thereafter, the Executive shall not disparage, deprecate,
or make any comments or take any other actions, directly or indirectly,
that will reflect adversely on the Company or its officers, directors,
employees or agents or adversely affect their business reputation or
goodwill. |
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(c) The Executive understands that the foregoing restrictions may
limit the ability of the Executive to earn a livelihood in a business
similar to the business of the Company, but nevertheless believes that
the Executive has received and will receive sufficient consideration and
other benefits, as an employee of the Company and as otherwise provided
herein, to justify such restrictions which, in any event (given the
education, skills and ability of the Executive), the Executive believes
would not prevent the Executive from earning a living. |
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(d) If any portion of the restrictions set forth in this Section 8
should, for any reason whatsoever, be declared invalid by a court of
competent jurisdiction, the validity or enforceability of the remainder
of such restrictions shall not thereby be adversely affected. The
Executive declares that the territorial, time limitations and scope of
activities restricted as set forth in this Section 8 are reasonable and
properly required for the adequate protection of the business of the
Company. In the event that any such territorial, time limitation and
scope of activities restricted is deemed to be unreasonable by a court of
competent jurisdiction, the Company and the Executive agree to the
reduction of the territorial, time limitation or scope to the area or
period which such court shall have deemed reasonable. |
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(e) The existence of any claim or cause of action by the Executive
against the Company shall not constitute a defense to the enforcement by
the Company of the foregoing restrictive covenants, but such claim or
cause of action shall be litigated separately. |
9. Company Right to Inventions. The Executive will promptly
disclose, grant and assign to the Company, for its sole use and benefit
(including its subsidiaries) any and all inventions, improvements, technical
information and suggestions in any way relating to the business of the Company
which the Executive may develop or acquire during the Term (whether or not
during usual working hours), together with all patent applications, letters
patent, copyrights and reissues thereof that may at any time be granted for or
upon any such invention,
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improvement or technical information. In connection therewith: (i) the
Executive shall, without charge, but at the expense of the Company, promptly at
all times hereafter execute and deliver such applications, assignments,
descriptions and other instruments as may be necessary or proper in the opinion
of the Company to vest title to any such inventions, improvements, technical
information, patent applications, patents, copyrights or reissues thereof in
the Company and to enable it to obtain and maintain the entire right and title
thereto throughout the world; and (ii) the Executive shall render to the
Company, at its expense (including a reasonable payment for the time involved
in case the Executive is not then in its employ), all such assistance as it may
require in the prosecution of applications of said patents, copyrights or
reissues thereof, in the prosecution or defense of interferences which may be
declared involving any said applications, patents or copyrights and in any
litigation in which the Company may be involved relating to any such patents,
inventions, improvements or technical information. The provisions of this
Section 9 will survive any termination of this Agreement or the termination of
the Executive’s employment with the Company.
10. Impact on Other Agreements. To the extent the provisions of
Sections 7, 8 or 9 of this Agreement are similar to or duplicative of
provisions contained in other agreements between the Executive and the Company,
the provisions of this Agreement shall control; provided,
however, that in the event the provisions of Section 7, 8 or 9 of this
Agreement expire prior to similar provisions of any such other agreement, the
provisions of such other agreement will continue to apply after expiration of
the applicable terms of this Agreement.
11. Representations and Agreements of Executive. The Executive
represents and warrants that he is free to enter into this Agreement and to
perform the duties required hereunder, and that there are no employment
contracts or understandings, restrictive covenants or other restrictions,
whether written or oral, preventing the performance of his duties hereunder.
12. Enforcement. It is the desire and intent of the parties hereto
that the provisions of this Agreement be enforceable to the fullest extent
permissible under the laws and public policies applied in each jurisdiction in
which enforcement is sought. Accordingly, to the extent that a restriction
contained in this Agreement is more restrictive than permitted by the laws of
any jurisdiction where this Agreement may be subject to review and
interpretation, the terms of such restriction, for the purpose only of the
operation of such restriction in such jurisdiction, will be the maximum
restriction allowed by the laws of such jurisdiction and such restriction will
be deemed to have been revised accordingly herein.
13. Remedies; Survival.
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(a) The Executive acknowledges and understands that the provisions
of the covenants contained in Sections 7, 8 and 9 hereof, the violation
of which cannot be accurately compensated for in damages by an action at
law, are of crucial importance to the Company, and that the breach or
threatened breach of such provisions would cause the Company irreparable
harm. In the event of a breach or threatened breach by the Executive of
the provisions of Sections 7, 8 or 9 hereof, the Company will be entitled
to seek an injunction restraining the Executive from such breach.
Nothing herein contained will be construed as prohibiting the Company from pursuing any other
remedies available for any breach or threatened breach of this Agreement.
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(b) Notwithstanding anything contained in this Agreement to the
contrary, the provisions of Sections 6, 7, 8, 9, 10, 12 and 13 hereof
will survive the expiration or other termination of this Agreement until,
by their terms, such provisions are no longer operative. |
14. Notices. Any notices required or permitted to be given
hereunder shall be sufficient if in writing, and if delivered by hand, or sent
by registered or certified mail, return receipt requested, or overnight
delivery using a national courier service, or by facsimile or electronic
transmission, with confirmation as to receipt, to the Company at the address
set forth below and to the Executive at the address set forth in the personnel
records of the Company, or such other address as either party may from time to
time designate in writing to the other, and shall be deemed given as of the
date of the delivery or mailing:
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Digene Corporation
0000 Xxxxxxx Xxxx
Xxxxxxxxxxxx, Xxxxxxxx 00000
Attention: Chief Executive Officer |
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Xxxxxxx Xxxxx Xxxxxxx & Ingersoll, LLP
0000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attention: Xxxxxx Xxxxxxx, Xx., Esquire |
15. Severability. If any of the covenants contained in this
Agreement, any part of any such covenant, are hereafter construed to be invalid
or unenforceable, the same shall not affect the remainder of the covenant or
covenants, or the remainder of the Agreement, which shall be given full effect,
without regard to the invalid portions.
16. Non-Waiver. The waiver or breach of any term or condition of
this Agreement shall not be deemed to constitute a waiver or breach of any
other term or condition.
17. Entire Agreement. This Agreement, including Annex A
hereto, constitutes the entire agreement of the parties with respect to its
subject matter, and no modification or waiver of any provision hereof shall be
valid unless it be in writing and signed by all of the parties hereto. Subject
to Section 10 hereof, this Agreement supersedes all prior agreements or
understandings between the parties with respect to the subject matter hereof.
18. Assignment. This Agreement and the rights and obligations of
the parties hereto shall bind and inure to the benefit of any successor or
successors by reorganization, merger or consolidation and any assignee of all
or substantially all of its business and properties, but, except as to any such successor or
assignee of the Company, neither this Agreement nor any rights or benefits hereunder may be
assigned or transferred by either party without the prior written consent of
the other party.
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19. Binding Effect. This Agreement and all of the provisions
hereof shall be binding upon the legal representatives, heirs, distributees,
successors and assigns of the parties hereto.
20. Choice of Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Maryland without
reference to principles of conflicts of laws.
21. Headings. The Section headings appearing in this Agreement are
for purposes of easy reference and shall not be considered a part of this
Agreement or in any way modify, amend, or affect its provisions.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
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