EXHIBIT 10.8
EMPLOYMENT AGREEMENT
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AGREEMENT dated as of March 3, 1997 between Exigent Diagnostics, Inc.,
a Delaware corporation with its principal place of business in Pennsylvania (the
"Company"), and X. XXXXXXX STOUGHTON, a Pennsylvania resident ("Employee").
W I T N E S S E T H:
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WHEREAS, the Company and Employee mutually desire to enter into this
Agreement with respect to Employee's employment with the Company on the terms
set forth herein; and
NOW, THEREFORE, in consideration of the mutual covenants hereinafter
contained, the Company and Employee agree as follows:
1. Employment and Term. The Company agrees to employ Employee and
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Employee agrees to serve the Company as Chief Executive Officer and Chairman or
in such other executive position as may be mutually agreed upon by Employee and
the Company, during the Term (as defined below). The term of this Agreement
(the "Term") shall commence on the date hereof and end on the date which is the
one-year anniversary thereof, or such later date to which Employee's employment
may be extended as provided in Section 11.
2. Duties. During the Term, Employee agrees to serve the Company
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faithfully, to devote his time, efforts, skills and ability to promote its
interests; and to perform such duties as from time to time may be assigned to
him by the Board of Directors of the Company (the "Board"), subject to Section 3
hereof. Notwithstanding the foregoing, Employee may engage in charitable and
public activities and other activities in the health care industry, including
board memberships, so long as such activities do not materially interfere with
the performance of his duties and responsibilities under this Agreement. During
the Term, Employee shall serve as a member of the Board of Directors of the
Company.
3. Responsibilities. Employee's area of responsibility shall be
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that of Chairman of the Board, President, and Chief Executive Officer of the
Company or such other executive position as may be mutually agreed upon by
Employee and the Company. During the Term, the Company shall not assign any
duties to or remove any duties from Employee inconsistent with Employee's
position. The Company shall at all times provide Employee with such executive
powers and authority as shall reasonably be required by him to enable him to
discharge such duties in an efficient manner, together with such facilities and
services as are suitable or customary to such position. During the Term,
Employee shall report directly to the Board.
4. Compensation. The Company agrees to pay Employee as compensation
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("Compensation") for all duties performed by him in any capacity during the
period of his employment under this Agreement:
(a) Base salary of $195,000 ("Base Salary"), for the calendar
year 1997, paid in accordance with the Company's normal payroll or in such other
installments as the Company shall pay its other executive officers, subject to
increases during future annual periods as mutually agreed to between Employee
and Company;
(b) An annual bonus (the "Bonus"), at the discretion of the
Board; and
(c) Stock options, pursuant to the Exigent Diagnostics Inc. 1996
Incentive and Non-Qualified Stock Option Plan, the Exigent Diagnostics Inc. 1996
Key Executive Stock Option Plan, and any other equity-based plan of the Company
(collectively the "Stock Plans"), to the extent determined by the Board or the
committee responsible for administering the Stock Plans and consistent with the
terms of the Stock Plans, provided that the determination of the level of
participation for the Employee shall be consistent with that which is customary
for the chief executive officer of similarly-situated companies.
5. Benefits; Reimbursement of Expenses. Employee shall also be
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entitled to:
(a) Participate in all of the benefit programs which are
presently or may hereafter be provided by the Company to any of its executives
and key employees, including, without limitation, all pension, thrift,
incentive, retirement, health insurance and life insurance programs.
(b) Reimbursement by the Company of all expenses reasonably
incurred by him in connection with the performance of his duties, including,
without limitation, travel and entertainment expenses reasonably related to the
business or interests of the Company, upon submission by him of written
documentation of such expenses.
(c) Such other benefits as the Board may determine from time to
time.
6. Termination Due to Death, Cause or Disability.
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Employee's rights to Compensation under this Agreement shall cease to
accrue as of the date of termination of employment due to death, Cause, or
Disability, the latter two of which are defined as follows:
(a) Cause. Employee will be considered to have been terminated
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for Cause if, during the Term, Employee is terminated because Employee (i) has
engaged in any type of disloyalty to the Company, including without limitation,
fraud, embezzlement, theft, or dishonesty in the course of his employment, or
has otherwise breached any fiduciary duty owed to the Company, or (ii) has been
convicted of a felony or (iii) breached Section 8 of this Agreement regarding
confidentiality or non-competition.
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(b) Disability. Employee may be considered to have been
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terminated on account of Disability if, during the Term of this Agreement,
Employee is terminated because Employee does not perform services for the
Company for either (i) 180 consecutive days or (ii) 180 days within a 210-day
period on account of the Employee's mental or physical disability.
7. Other Termination. Employee's rights to Compensation under this
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Agreement shall continue to accrue through the end of the then current Term that
would exist absent the termination, if:
(a) Employee is terminated by the Company for any other reason
than Cause, including termination for no reason;
(b) Employee terminates his employment for "good reason," which,
for purposes of this Agreement, shall mean a reduction in duties or breach of
the Agreement by the Company; or
(c) Employee terminates employment due to a Change of Control,
which, for purposes of this Agreement, shall mean the happening of an event,
which shall be deemed to have occurred upon the earliest to occur of the
following events:
(i) the date the stockholders of the Company (or the Board,
if stockholder action is not required) approve a plan or other arrangement
pursuant to which the Company will be dissolved or liquidated; or
(ii) the date the stockholders of the Company (or the Board,
if stockholder action is not required) and the stockholders of the other
constituent corporations (or their respective boards of directors, if and to the
extent that stockholder action is not required) have approved a definitive
agreement to merge or consolidate the Company with or into another corporation,
other than, in either case, a merger or consolidation of the Company in which
holders of shares of the Company's voting capital stock immediately prior to the
merger or consolidation will have at least 30% of the ownership of voting
capital stock of the surviving corporation immediately after the merger or
consolidation (on a fully diluted basis), which voting capital stock is to be
held in the same proportion (on a fully diluted basis) as such holders'
ownership of voting capital stock of the Company immediately before the merger
or consolidation; or
(iii) the date any entity, person or group (within the
meaning of Section 13(d)(3) or Section 14(d)(2) of the Securities Exchange Act
of 1934, as amended), other than (A) the Company, or (B) any of its
Subsidiaries, or (C) any of the holders of the capital stock of the Company, as
determined on the date of this Agreement, or (D) any employee benefit plan (or
related trust) sponsored or maintained by the Company or any of its Subsidiaries
or (E) any Affiliate (as such term is defined in Rule 405 promulgated under the
Securities Act of 1933, as amended) of any of the foregoing, shall have acquired
beneficial ownership of, or shall have
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acquired voting control over more than 70% of the outstanding shares of the
Company's voting capital stock (on a fully diluted basis), unless the
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transaction pursuant to which such person, entity or group acquired such
beneficial ownership or control resulted from the original issuance by the
Company of shares of its voting capital stock and was approved by at least a
majority of directors who shall have been either members of the Board on the
date of this Agreement or members of the Board for at least twelve (12) months
prior to the date of this Agreement; or
(iv) the first day after the date of this Agreement when
directors are elected such that there shall have been a change in the
composition of the Board such that a majority of the Board shall have been
members of the Board for less than twelve (12) months, unless the nomination for
election of each new director who was not a director at the beginning of such
twelve (12) month period was approved by a vote of at least sixty percent (60%)
of the directors then still in office who were directors at the beginning of
such period; or
(v) the date upon which the Board determines (in its sole
discretion) that based on then current available information, the events
described in clause (iii) are reasonably likely to occur.
8. Confidential Information; Non-Compete.
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(a) Confidential Information. Without the express prior written
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consent of the Company, Employee shall not disclose or make available to anyone
outside the Company, its subsidiaries or affiliated corporations or entities any
confidential or proprietary information of, or concerning, the Company,
including, without limitation, trade secrets, knowhow, customer lists,
inventions or other information not generally known to any competitor of the
Company, its subsidiaries or affiliated corporations or entities ("Confidential
Information"). Employee shall abide by this prohibition on disclosure of
Confidential Information during the Term of this Agreement and for one (1) year
commencing on the expiration or termination of the Term. Further, Employee
agrees that any Confidential Information developed or invented during the Term
or any period of employment preceding the Term shall be considered to be owned
by the Company.
(b) Non-Compete. In consideration of the compensation and other
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benefits payable to Employee hereunder, Employee agrees that he shall not,
without the prior written consent of the Company, engage in the point-of-care
diagnostics business ("Prohibited Business") during the Term (the "Non-
Compete"). The Non-Compete shall extend for one (1) year commencing on the
expiration or termination of the Term; provided, however, if the Term of this
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Agreement shall have continued for at least two (2) years from the date hereof,
the Non-Compete shall terminate simultaneously with the expiration or
termination of the Term. Employee shall be regarded as engaged in a Prohibited
Business if he engages as partner, owner, agent, representative, employee,
officer, director or consultant or participates, directly or indirectly, whether
through investment, partnership, license, joint venture, or otherwise, in any
Prohibited Business. Nothing set forth above shall be deemed to prevent
Employee from merely
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acquiring or owning five percent (5%) or less of any entity, whether public or
private, regardless of the business in which such entity is engaged. Anything
in this paragraph (b) to the contrary notwithstanding, in the event of the
termination of this Agreement by Employee pursuant to paragraph (b) or (c) of
Section 7, or in the event of the termination of this Agreement by the Company
other than for Cause, the Non-Compete shall thereafter be null and void and of
no further force or effect, and the Company shall not have any right to extend
the Non-Compete as set forth above.
9. Work Situs and Relocation. Except for travel consistent with the
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development of the Company's business, Employee shall not be required to perform
his duties under this Agreement outside of the Philadelphia or Los Angeles
metropolitan areas or any other area where the employee may choose to locate the
business.
10. Termination of Prior Agreements. This Agreement expressly
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supersedes all agreements and understandings between the parties regarding the
subject matter hereof and any such agreement is terminated as of the date first
above written.
11. Renewal/Non-renewal. This Agreement shall be automatically
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extended annually on each March 3 without further action by the parties, for
three-year rolling terms unless either party shall, at least 60 days prior to
the annual extension date, have given notice to the other party that this
Agreement shall not be so extended or otherwise terminated this Agreement. After
the first two years of employment, the Employee may resign with at least 90 days
notice subject to the discretion of the Board to shorten the notice time.
12. Binding Effect. This Agreement shall be binding upon and inure
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to the benefit of the parties hereto, their respective legal representatives and
to any successor of the Company, which successor shall be deemed substituted for
the Company under the terms of this Agreement. As used in this Agreement, the
term "successor" shall include any person, firm, corporation or other business
entity which at any time, whether by merger, purchase or otherwise, acquires all
or substantially all of the assets or business of the Company.
13. Waiver of Breach. The waiver by the Company of a breach of any
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provision of this Agreement by Employee shall not operate or be construed as a
waiver of any subsequent breach.
14. Notices. Any notice required or permitted to be given hereunder
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shall be sufficient if in writing and if sent by registered or certified mail to
Employee at his residence or to the Company at its principal place of business.
15. Entire Agreement. This document contains the entire agreement of
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the parties and may not be changed except in a writing signed by both parties.
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16. Governing Law. This Agreement shall be governed by and construed
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in accordance with the laws of the Commonwealth of Pennsylvania as applied to
contracts executed and performed wholly within the Commonwealth of Pennsylvania.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first set forth above.
EXIGENT DIAGNOSTICS, INC.
By: /s/ Xxxxxx X. Xxxxx
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Name:________________________
Title:_______________________
/s/ X. Xxxxxxx Stoughton
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X. XXXXXXX STOUGHTON
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