1
EXHIBIT 10.1(A)
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT is made and entered into as of February 1,
1997, by and between CLINTRIALS RESEARCH, INC., a Delaware corporation
(hereinafter, the "Employer"), and _____________________, a resident of the
State of ________________ (the "Employee").
W I T N E S S E T H:
WHEREAS, Employer desires to continue to employ Employee, and Employee
desires to continue such employment on the terms and conditions set forth
herein.
WHEREAS, Employer desires to assure continuance of a full-time
employment relationship with Employee on certain terms and conditions which are
set forth herein; and
WHEREAS, Employee is willing to accept such employment and terms and
conditions;
NOW, THEREFORE, in consideration of the mutual promises, covenants and
agreements made herein, the receipt and sufficiency of which are hereby
acknowledged, the parties, intending to be legally bound hereby, agree as
follows:
1. Employment. Employer hereby continues to employ Employee, and
Employee hereby accepts employment with Employer on the terms and conditions
specified herein.
2. Term. The term of this Agreement shall be for a period commencing on
February 1, 1997 and ending January 31, 1998, except that the provisions of
Section 8 and 9 will survive the expiration or earlier termination of this
Agreement. This Agreement shall be automatically renewed for additional and
successive one (1) year periods unless either party provides ninety (90) days
notice prior to any anniversary date of its intent not to renew this Agreement
(the initial term and any and all renewal terms each being a "Period of
Employment"). In the event Employer elects not to renew this Agreement upon any
such anniversary date, Employee will be entitled to receive a severance payment
in an amount equal to Employee's base monthly compensation (not including
incentive compensation) at the time of non-renewal multiplied by six (6),
payable in a lump sum.
3. Duties of Employee. Employee's principal duties and
responsibilities shall be as follows: to serve as Vice President-Operations,
The Americas and be responsible for achieving annual revenue and profit goals,
as well as other quantitative and qualitative goals and plans. Employee shall
also perform such other executive duties and
2
responsibilities assigned to Employee from time to time in accordance with the
policies and objectives established by the Board of Directors, Executive Vice
President-Worldwide Operations or Chief Executive Officer of Employer. Employee
agrees to devote his full business time, attention and skill to his duties
hereunder. Employee shall be required to engage in travel from time to time in
connection with his duties for the Employer.
4. Compensation. For his employment hereunder, Employee shall be
paid $15,833.33 per month during a Period of Employment and in accordance with
the Employer's standard payroll practices.
Employee shall also be eligible to participate in a bonus program pool
based on individual and company-wide performance under such programs as may from
time to time be provided to employees of Employer of similar rank, and shall
also receive a merit review after close of the books for the calendar year then
ending.
5. Benefits. Employee shall be entitled to such medical, dental,
disability and life insurance, vacation, participation in any profit sharing
plan of Employer and other employee benefits as may be provided to employees of
Employer of similar rank from time to time. Employee shall be entitled to four
weeks vacation per calendar year, and shall be entitled to all other fringe
benefits offered to Employer's employees of similar rank.
6. Stock Option. From time to time Employee shall be eligible for
consideration for a stock option award (the "Stock Options"), which Stock
Options shall be formally awarded by the Board of Directors and which shall be
exercisable at the option price that is the price per share at the close of
trading on the date of the grant.
7. Termination. The employment of Employee will terminate as
follows:
(a) Termination on Death. The employment of Employee will
automatically terminate upon the death of Employee.
(b) Termination by Employer for Cause. Employer may terminate
the employment of Employee for "cause" at any time upon written notice to the
Employee. For the purpose of this subparagraph 7(b), the term "cause" shall mean
any act or omission which constitutes a refusal on the part of the Employee to
perform the services required of him under this Agreement, any breach by
Employee of his fiduciary duties to the Employer, abuse of office amounting to
breach of trust, fraud, any conviction of a felony or any crime involving moral
turpitude or any act of theft or dishonesty. Any dispute which shall arise
between the parties hereto regarding whether Employee has committed any act
which could give Employer "cause" to terminate this Agreement shall be settled
by arbitration as provided below. Upon such termination, Employee shall continue
to be bound by the provisions of Sections 8 and 9 hereof and all obligations of
Employer to Employee shall cease other than obligations to pay compensation
and/or provide benefits earned and/or vested as of the date of termination.
2
3
(c) Termination by Employer for Other Than Cause. Employer may
terminate the employment of Employee at any time upon written notice to the
Employee. In such event, Employee shall be paid an amount equal to Employee's
then current monthly base salary multiplied by twelve (12), payable in a lump
sum, and Employee shall continue to be bound by the provisions of Sections 8 and
9 hereof.
(d) Termination by Employee. Employee may terminate this
Agreement upon ninety (90) days written notice to Employer, in which case
Employer shall pay the Employee an amount equal to one months base salary on the
date the termination becomes effective, and Employee shall continue to be bound
by the provisions of Sections 8 and 9 hereof.
(e) Termination for Incapacity. If at any time during the term
of this Agreement, Employee becomes disabled or is unable for any reason
substantially to perform his duties hereunder, Employer may terminate his
employment, and provided he has not otherwise materially breached any of the
provisions of this Agreement, benefits shall be paid to him as delineated in the
Employer disability manual entitled "Your Disability Benefits" attached hereto
as Exhibit "B". In such event, Employee shall continue to be bound by the
provisions of Sections 8 and 9 hereof.
(f) Failure to Renew. If Employer gives Employee notice as
provided in Section 2 of its election not to renew this Agreement, Employee's
employment shall terminate upon the anniversary date. In such event, Employee
shall be paid an amount equal to Employee's then current monthly base salary
multiplied by six (6) in a lump sum, and Employee shall continue to be bound by
the provisions of Sections 8 and 9 hereof.
(g) Change in Control. In the event there is a "Change in
Control" of the ownership of the Employer, and the Employee's employment with
the Employer is terminated as a result of such Change in Control, the Employee
shall be entitled to receive as a severance payment following such termination
an amount equal to Employee's base monthly compensation (not including incentive
compensation) at the time of termination multiplied by twelve (12), payable in a
lump sum. In addition, any earned but unpaid base salary will be paid. Further,
any Stock Options granted to the Employee will be fully vested upon a Change of
Control, whether or not the Employee is terminated, notwithstanding any
previously stated vesting restrictions but subject to expiration or termination
pursuant to the governing stock option plan. Termination shall be deemed to be a
result of a Change in Control if such termination occurs within six months
following the Change in Control or if Employee's job responsibilities are
materially reduced in scope during such six month period.
A "Change in Control" shall be deemed to have occurred if (I)
a tender offer shall be made and consummated for the ownership of more than 50%
of the outstanding voting securities of the Employer, (ii) the Employer shall be
merged or consolidated with another corporation and as a result of such merger
or consolidation less than 50% of the
3
4
outstanding voting securities of the surviving or resulting corporation shall be
owned in the aggregate by the former shareholders of the Employer, as the same
shall have existed immediately prior to such merger or consolidation, (iii) the
Employer shall sell all, or substantially all, of its assets to another
corporation that is not a wholly-owned subsidiary, or (iv) a person, within the
meaning of Section 3(a)(9) or of Section 13 (d)(3) (as in effect on the date
hereof) of the Securities and Exchange Act of 1934 ("Exchange Act"), shall
acquire more than 50% of the outstanding voting securities of the Employer
(whether directly, indirectly, beneficially or of record). For purposes hereof,
ownership of voting securities shall take into account and shall include
ownership as determined by applying the provisions of Rule 13d-3(d)(1)(I) (as in
effect on the date hereof) pursuant to the Exchange Act.
(h) Supersedes Prior Benefits. The provisions of this Section
7 concerning payments to Employee upon termination of employment shall supersede
and replace all other severance and termination arrangements in effect prior to
or after the date hereof, including without limitation, the provisions of this
Agreement shall supersede the Employee Manual where inconsistent. Whenever
Section 7 of this Agreement requires or permits the payment of an amount of
money calculated by reference to the Employee's base salary, the payment of such
amount to Employee shall be deemed a severance and/or termination payment and
shall not be deemed to extend the period of employment during the time which
such payments are made or to require the provision of Employer of any benefits
to Employee during such period of time, other than those benefits which may be
required by applicable law to be provided.
8. Confidential Information. In consideration of the covenants of
Employer contained herein, Employee agrees as follows:
(a) Employee hereby agrees and acknowledges that he has and
has had access to or is aware of certain confidential, restricted and/or
proprietary information concerning operation by the Employer and its affiliates
of their businesses (collectively the "Business"). Employee hereby undertakes
and agrees that he shall have a duty to Employer and its affiliates to protect
such information from use or disclosure.
(b) For the purposes of this Section 8, the following
definitions shall apply:
(i) "Trade Secret" as related to the Business, shall
mean any specialized technical information or data relating to (I)
management of clinical trials, biostatistical services, or product
registration services; (ii) marketing strategy or plans of Employer or
its affiliates; (iii) proprietary computer software; and (iv) terms of
contracts and specific contract proposals with existing and potential
suppliers, employees and customers of Employer or its affiliates, which
are of value and not generally known to the competitors of Employer and
which are or were treated as confidential by Employer or its
affiliates.
4
5
(ii) "Confidential Information," as related to the
Business, shall mean any data or information, other than Trade Secrets,
which is material to Employer or its affiliates and not generally known
by the public and which are, or were treated as, confidential by
Employer or its affiliates. Confidential Information shall include,
without limitation, any information pertaining to the Business
Opportunities (as hereinafter defined) of Employer or its affiliates,
the details of this Agreement, and the business plans, financial
statements and projections of Employer or its affiliates.
(iii) "Business Opportunity" shall mean any
information or plans of Employer or its affiliates concerning the
purchase of or investment in any contract research organization
operations, or the availability of any such operations for purchase or
investment by Employer or its affiliates, together with all related
information, concerning the specifics of any contemplated purchase or
investment (including price, terms and the identity of such
operations), regardless of whether Employer or its affiliates have
entered into any agreement, made any commitment, or issued any bid or
offer to such operations.
(c) Employee shall not, without the prior written consent of
Employer, for so long as the information or data remain Trade Secrets, use or
disclose, or negligently permit any unauthorized person who is not an employee
of Employer to use, disclose, or gain access to, any Trade Secrets of Employer
or its affiliates or of any other person or entity making Trade Secrets
available for the use of Employer or its affiliates.
(d) Employee shall not, without the prior written consent of
Employer, use or disclose, or intentionally permit any unauthorized person who
is not employed by Employer or its affiliates to use, disclose, or gain access
to, any Confidential Information to which Employee obtained access by virtue of
his relationship with Employer or its affiliates.
(e) Employee hereby agrees to deliver to, or maintain on
behalf of, Employer and its affiliates all memoranda, notes, records, drawings,
manuals or other documents, including all copies of such materials, containing
Trade Secrets or Confidential Information, whether made or compiled by Employee
or furnished to him from any source by virtue of his relationship with Employer
or its affiliates.
9. Non-Compete, Etc. In consideration of the covenants of the Employer
contained herein, and provided he receives all payments and benefits due to him
upon termination, the Employee agrees as follows:
(a) During the Employee's employment with Employer, and for a
period of six (6) months immediately following the termination of his employment
with Employer, Employee shall not, except as an employee of Employer, either
directly or indirectly through any partnership, corporation or business entity
in which he has an ownership
5
6
interest or serves as an officer, employee or independent contractor of or as a
consultant for, solicit, divert or take away the business of, or attempt to
solicit, divert or take way the business of, any of the customers of Employer
with whom Employee had significant contact at any time within the last two years
of the term of his employment with Employer or any prospective customers of
Employer that the Employee solicited on behalf of Employer within such two-year
period.
(b) During the term of his employment with Employer, and for a
period of six (6) months immediately following the termination of his employment
with Employer, Employee shall not solicit, entice or persuade any other
employees or agents of Employer to leave the services of Employer for any
reason.
(c) During the term of his employment with Employer and for a
period of six (6) months immediately following the termination of his employment
with Employer: (I) Employee shall not make any statements or perform any acts
intended to advance the interest of any existing or prospective competitors of
Employer in any way that will injure the interest of Employer; and (ii) without
the prior express written approval by the Board, Employee shall not directly or
indirectly own or hold any proprietary interest in or be employed by or receive
compensation from any party engaged in the same or any similar business in the
same geographic areas Employer does business, both within and without the United
States. For the purposes of this Agreement, proprietary interest means legal or
equitable ownership, whether through stock holdings or otherwise, of a debt or
equity interest (including options, warrants, rights, notes and convertible
interests) in a business firm or entity, or ownership of more than 5% of any
class of equity interest in a publicly-held company. The Employee acknowledges
that the covenants contained in this Section 9 herein are reasonable as to
geographic and temporal scope. In the event a court considering this Agreement
concludes that such provisions are not enforceable due to their duration or
scope, the parties hereto expressly consent to the revision of such provisions
by such court to a duration or scope which shall be enforceable.
(d) Employee acknowledges and agrees that the covenants
contained in Section 9 of this Agreement shall survive any termination of
employment, with or without cause, at the instigation or upon the initiative of
either party. Employee further acknowledges and agrees that the ascertainment of
damages in the event of Employee's breach of any covenant contained in this
Section 9 of this Agreement would be difficult, if at all possible. Employee
therefore acknowledges and agrees that Employer (in addition to and without
limiting any other remedy or right which it might have) shall have the right,
upon submitting whatever pleadings the law may require, and posting any
necessary bond, to have a court of competent jurisdiction enjoin Employee from
committing any such breach. Employee hereby waives the defense in such a case
that Employer has, or will then have, an adequate remedy at law.
(e) The Employee will, with reasonable notice during or
after the Period of Employment, furnish information as may be in his possession
and cooperate with
6
7
Employer as may reasonably be requested in connection with any claims or legal
actions in which Employer is may become a party other than actions of Employee
against Employer.
10. Assignments; Successors and Assigns. The rights and obligations of
Employee hereunder are not assignable or delegable, and any prohibited
assignment or delegation will be null and void. The Employer may assign and
delegate this Agreement. The provisions hereof shall inure to the benefit of and
be binding upon the permitted successors and assigns of the parties hereto.
11. Governing Law. This Agreement shall be interpreted under, subject
to and governed by the laws of the State of Delaware and all questions
concerning its validity, construction, and administration shall be determined in
accordance thereby.
12. Counterparts. This Agreement may be executed simultaneously in any
number of counterparts, each of which will be deemed an original but all of
which will together constitute one and same instrument.
13. Invalidity. The invalidity or unenforceability of any provision of
this Agreement shall not affect any other provision hereof, and this Agreement
shall be construed in all respects as if such invalid or unenforceable provision
was omitted. Furthermore, in lieu of such illegal, invalid, or unenforceable
provision there shall be added automatically as a part of this Agreement a
provision as similar in terms to such illegal, invalid, or unenforceable
provision as may be possible and be legal, valid and enforceable.
14. Exclusiveness. This Agreement and the agreements referred to
herein constitute the entire understanding and agreement between the parties
with respect to the employment by Employer of Employee and supersedes any and
all other agreements, oral or written, between the parties.
15. Modification. This Agreement may not be modified or amended except
in writing signed by the parties. No term or condition of this Agreement will be
deemed to have been waived except in writing by the party charged with waiver. A
waiver shall operate only as to the specific term or condition waived and will
not constitute a waiver for the future or act on anything other than that which
is specifically waived.
16. Arbitration. Any dispute among the parties hereto shall be settled
by final and binding arbitration in Nashville, Tennessee, in accordance with the
then effective rules of the American Arbitration Association, and judgment upon
the award rendered may be entered in any court having jurisdiction thereof. In
any action or proceeding brought to enforce any provision of this Agreement, the
prevailing party shall be entitled to recover its costs from the opposing party,
including reasonable legal fees and expenses.
7
8
17. Notices. All notices, requests, consents and other communications
hereunder shall be in writing and shall be deemed to have been made when
delivered or mailed first-class postage prepaid by registered mail, return
receipt requested, or when delivered if by hand, overnight delivery service or
confirmed facsimile transmission, to the following:
(a) If to the Employer, at:
One Burton Hills Blvd., Suite 210
Nashville, Tennessee 37215-6104
Attn: William C. O'Neil, Jr.
with a copy to:
Harwell Howard Hyne Gabbert & Manner, P.C.
1800 First American Center
315 Deaderick Street
Nashville, Tennessee 37238
Attention: Mark Manner
or at such other address as may have been furnished to the Employee by the
Employer in writing; or
(b) If to Employee, at:
------------------
------------------
------------------
with a copy to:
---------------
---------------
---------------
or such other address as may have been furnished to Employer by Employee in
writing.
8
9
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
"EMPLOYER"
CLINTRIALS RESEARCH, INC.
By:__________________________________
Title:_______________________________
"EMPLOYEE"
_____________________________________
9