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Exhibit 10.6
EMPLOYMENT AGREEMENT
This Agreement is made by and between diaDexus, Inc. (the "Company"), and
Xxxxxxx Xxxxxxx ("Executive") effective as of June 4, 2000.
1. Duties and Scope of Employment.
(a) Positions; Employment Term; Duties. Executive's employment with
the Company commenced in October 1997, and as of June 4, 2000, the Executive was
appointed Chief Executive Officer, President, Chief Operating Officer and
Secretary of the Company, and he continues to be employed in such capacities in
accordance with the terms hereof. The period of Executive's employment hereunder
is referred to herein as the Employment Term. During the Employment Term,
Executive shall render such business and professional services in the
performance of his duties, consistent with Executive's position within the
Company, as shall reasonably be assigned to him by the Board of Directors (the
"Board").
(b) Obligations. During the Employment Term, Executive shall devote
his full business efforts and time to the Company. Executive agrees, during the
Employment Term, not to actively engage in any other employment, occupation or
consulting activity for any direct or indirect remuneration without the prior
approval of the Board; provided, however, that Executive may serve in any
capacity with any civic, educational or charitable organization, or as a member
of corporate Boards of Directors or committees thereof upon which Executive
currently serves, without the approval of the Board; provided, further that
Executive may devote a reasonable amount of time to managing his family
investments.
(c) Paid Time Off. Until the fifth anniversary of his commencement of
employment, which for purposes of vesting under this Section 1(c) shall be
measured based upon his initial employment by SmithKline Xxxxxxx Corporation,
Executive shall be entitled to twenty (20) days per year of paid time off.
Thereafter, Executive shall be entitled to twenty-five (25) days per year of
paid time off. For purposes of this Agreement "paid time off" includes vacation,
personal time off, sick leave, family illness, bereavement leave and religious
holiday observances. During such paid time off periods, Executive shall not be
relieved of his duties under this Agreement and there will be no abatement or
reduction of Executive's compensation hereunder.
2. Employee Benefits; Indemnification Agreement. During the Employment
Term, except as otherwise provided herein, Executive shall be eligible to
participate in the employee benefit plans maintained by the Company that are
applicable to other senior management to the full extent provided for under
those plans. Upon his commencement of employment with the Company, Executive
entered into an indemnification agreement comparable in form and substance to
indemnification agreements entered into by and between the Company and its
executive officers.
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3. At-Will Employment. Executive and the Company understand and
acknowledge that Executive's employment with the Company constitutes at-will
employment. Subject to the Company's obligation to provide severance benefits as
specified herein, Executive and the Company acknowledge that this employment
relationship may be terminated at any time, upon written notice to the other
party, with or without good cause or for any or no cause, at the option either
of the Company or Executive.
4. Compensation.
(a) Base Salary. While employed by the Company, the Company shall pay
the Executive as compensation for his services a base salary at the annualized
rate of $245,000 (the "Base Salary"). Such salary shall be paid periodically in
accordance with normal Company payroll practices and subject to the usual,
required withholding. Executive's Base Salary shall be reviewed annually by the
Compensation Committee of the Board for possible increases in light of
Executive's performance and competitive data.
(b) Bonuses. Executive shall be eligible to earn a bonus. Executive's
performance shall be evaluated by the Compensation Committee of the Board based
upon performance criteria specified by that committee. The payment of any bonus
under this Section 4(b) shall be subject to Executive's employment with the
Company through the end of the relevant evaluation period. Executive's bonus
shall be reviewed annually by the Compensation Committee of the Board for
possible increases in light of Executive's performance and competitive data.
(c) Equity Compensation.
(i) Stock Options. Executive has received certain past grants of
stock options and will be eligible to receive such future grants as are approved
by the Board in accordance with the Company's employee stock option plan.
(d) Severance.
(i) Voluntary Termination for Good Reason; Involuntary
Termination Other Than for Cause. If Executive's employment with the Company is
voluntarily terminated by Executive for Good Reason (as defined below) or is
involuntarily terminated by the Company other than for Cause (as defined below),
then, subject to Executive executing and not revoking a standard form of mutual
release of claims with the Company (i) Executive shall receive continued
payments of one year's Base Salary, less applicable withholding, in accordance
with the Company's standard payroll practices, (ii) all of Executive's then
outstanding options to purchase shares of Company common stock shall become
fully vested and exercisable, and/or the restrictions applicable to unvested
shares of common stock purchased by Executive upon exercise of options to
purchase shares of Company common stock shall lapse, immediately prior to the
date
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of Executive's termination of employment, (iii) the Company shall pay the group
health, dental and vision plan continuation coverage premiums for Executive and,
if relevant, his covered dependents under Title X of the Consolidated Budget
Reconciliation Act of 1985, as amended ("COBRA") for the lesser of (A) twelve
(12) months from the date of Executive's termination of employment, or (B) the
date upon which Executive and his covered dependents are covered by similar
plans of Executive's new employer and (iv) the Company shall reimburse Executive
for the costs of relocation, if any, of Executive; provided, however that such
reimbursement shall not exceed the relocation benefits paid to Executive in
connection with his initial commencement of employment with the Company.
For the purposes of this Agreement, "Cause" means (i) a material act of
dishonesty made by Executive in connection with Executive's responsibilities as
an employee, (ii) Executive's conviction of, or plea of nolo contendere to, a
felony, (iii) Executive's gross misconduct in connection with the performance of
his duties hereunder or (iv) Executive's material breach of his obligations
under this Agreement; provided, however, that with respect to clauses (iii) and
(iv), such actions shall not constitute Cause if they are cured by Executive
within thirty (30) days following delivery to Executive of a written explanation
specifying the basis for the Company's beliefs with respect to such clauses.
For the purposes of this Agreement, "Good Reason" means (i) a reduction in
Executive's Base Salary, (ii) a reduction in Executive's title (whether or not
material) or a material reduction in Executive's authority or duties, (iii) the
requirement that Executive relocate from his current place of residence or that
the company headquarters relocate more than 15 miles from its current location,
or (iv) the Company's material breach of its obligations under this Agreement;
provided, however, that with respect to clause (iv), such material breach shall
not provide a basis for termination for Good Reason if it is cured by the
Company within thirty (30) days following delivery to the Company of a written
explanation specifying the basis for the Executive's beliefs with respect to
such clause.
The Executive shall not be required to mitigate the value of any severance
benefits contemplated by Section 4 of this Agreement, nor shall any such
benefits be reduced by any earnings or benefits that the Executive may receive
from any other source.
5. Total Disability of Executive. If Executive becomes permanently and
totally disabled (as defined in accordance with Internal Revenue Code Section
22(e)(3) or its successor provision) during the term of this Agreement,
employment hereunder shall automatically terminate and Executive shall be
treated as having been terminated other than for Cause for purposes of Section 4
of this Agreement.
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6. Death of Executive. If Executive dies while employed by the Company
pursuant to this Agreement, Executive shall be treated as having been terminated
other than for Cause for purposes of Section 4 of this Agreement.
7. Assignment. This Agreement shall be binding upon and inure to the
benefit of (a) the heirs, beneficiaries, executors and legal representatives of
Executive upon Executive's death and (b) any successor of the Company. Any such
successor of the Company shall be deemed substituted for the Company under the
terms of this Agreement for all purposes. As used herein, successor shall
include any person, firm, corporation or other business entity which at any
time, whether by purchase, merger or otherwise, directly or indirectly acquires
all or substantially all of the assets or business of the Company. None of the
rights of Executive to receive any form of compensation payable pursuant to this
Agreement shall be assignable or transferable except through a testamentary
disposition or by the laws of descent and distribution upon the death of
Executive. Any attempted assignment, transfer, conveyance or other disposition
(other than as aforesaid) of any interest in the rights of Executive to receive
any form of compensation hereunder shall be null and void.
8. Notices. All notices, requests, demands and other communications
called for hereunder shall be in writing and shall be deemed given if (i)
delivered personally or by facsimile, (ii) one (1) day after being sent by
Federal Express or a similar commercial overnight service, or (iii) three (3)
days after being mailed by registered or certified mail, return receipt
requested, prepaid and addressed to the parties or their successors in interest
at the following addresses, or at such other addresses as the parties may
designate by written notice in the manner aforesaid:
If to the Company:
Attn: Chief Financial Officer
diaDexus, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxx Xxxxx, XX 00000
If to Executive:
Xxxxxxx Xxxxxxx
Xxx Xxxx, XX 00000
Tel:
Fax:
Or at the last residential address known by the Company.
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9. Severability. In the event that any provision hereof becomes or is
declared by a court of competent jurisdiction to be illegal, unenforceable or
void, this Agreement shall continue in full force and effect without said
provision.
10. Proprietary Information Agreement. Executive has entered into the
Company's standard Employee Proprietary Information Agreement (the "Proprietary
Information Agreement") upon commencing employment hereunder.
11. Entire Agreement. This Agreement, the indemnification agreement and
employee benefit plans referred to in Section 2 and the Proprietary Information
Agreement represent the entire agreement and understanding between the Company
and Executive concerning Executive's employment relationship with the Company,
and supersede and replace any and all prior agreements and understandings
concerning Executive's employment relationship with the Company.
12. Non-Binding Mediation, Arbitration and Equitable Relief.
(a) The parties agree to make a good faith attempt to resolve any
dispute or claim arising out of or related to this Agreement through
negotiation. In the event that any dispute or claim arising out of or related to
this Agreement is not settled by the parties hereto, the parties will attempt in
good faith to resolve such dispute or claim by non-binding mediation in Santa
Xxxxx County, California to be conducted by one mediator belonging to the
American Arbitration Association. The mediation shall be held within thirty (30)
days of the request therefor. The costs of the mediation shall be borne equally
by the parties to the mediation.
(b) Except as provided in Section 12(e) below, Executive and the
Company agree that, to the extent permitted by law, any dispute or controversy
arising out of, relating to, or in connection with this Agreement, or the
interpretation, validity, construction, performance, breach, or termination
thereof which has not been resolved by negotiation or mediation as set forth in
Section 12(a) shall be finally settled by binding arbitration to be held in
Santa Xxxxx County, California, in accordance with the National Rules for the
Resolution of Employment Disputes then in effect of the American Arbitration
Association (the "Rules"). The arbitrator may grant injunctions or other relief
in such dispute or controversy. The decision of the arbitrator shall be
confidential, final, conclusive and binding on the parties to the arbitration.
Judgment may be entered under a protective order on the arbitrator's decision in
any court having jurisdiction.
(c) The arbitrator shall apply California law to the merits of any
dispute or claim, without reference to rules of conflict of law. The arbitration
proceedings shall be governed by federal arbitration law and by the Rules,
without reference to state arbitration law. Executive hereby expressly consents
to the personal jurisdiction of the state and federal courts located in
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California for any action or proceeding arising from or relating to this
Agreement and/or relating to any arbitration in which the parties are
participants.
(d) Executive understands that nothing in Section 12 modifies
Executive's at-will status. Either the Company or Executive can terminate the
employment relationship at any time, with or without cause.
(e) EXECUTIVE HAS READ AND UNDERSTANDS SECTION 12, WHICH DISCUSSES
ARBITRATION. EXECUTIVE UNDERSTANDS THAT BY SIGNING THIS AGREEMENT, EXECUTIVE
AGREES, TO THE EXTENT PERMITTED BY LAW, TO SUBMIT ANY FUTURE CLAIMS ARISING OUT
OF, RELATING TO, OR IN CONNECTION WITH THIS AGREEMENT, OR THE INTERPRETATION,
VALIDITY, CONSTRUCTION, PERFORMANCE, BREACH, OR TERMINATION THEREOF TO BINDING
ARBITRATION, AND THAT THIS ARBITRATION CLAUSE CONSTITUTES A WAIVER OF
EXECUTIVE'S RIGHT TO A JURY TRIAL AND RELATES TO THE RESOLUTION OF ALL DISPUTES
RELATING TO ALL ASPECTS OF THE EMPLOYER/EXECUTIVE RELATIONSHIP, INCLUDING BUT
NOT LIMITED TO, THE FOLLOWING CLAIMS:
(i) ANY AND ALL CLAIMS FOR WRONGFUL DISCHARGE OF EMPLOYMENT;
BREACH OF CONTRACT, BOTH EXPRESS AND IMPLIED; BREACH OF THE COVENANT OF GOOD
FAITH AND FAIR DEALING, BOTH EXPRESS AND IMPLIED; NEGLIGENT OR INTENTIONAL
INFLICTION OF EMOTIONAL DISTRESS; NEGLIGENT OR INTENTIONAL MISREPRESENTATION;
NEGLIGENT OR INTENTIONAL INTERFERENCE WITH CONTRACT OR PROSPECTIVE ECONOMIC
ADVANTAGE; AND DEFAMATION.
(ii) ANY AND ALL CLAIMS FOR VIOLATION OF ANY FEDERAL STATE OR
MUNICIPAL STATUTE, INCLUDING, BUT NOT LIMITED TO, TITLE VII OF THE CIVIL RIGHTS
ACT OF 1964, THE CIVIL RIGHTS ACT OF 1991, THE AGE DISCRIMINATION IN EMPLOYMENT
ACT OF 1967, THE AMERICANS WITH DISABILITIES ACT OF 1990, THE FAIR LABOR
STANDARDS ACT, THE CALIFORNIA FAIR EMPLOYMENT AND HOUSING ACT, AND LABOR CODE
SECTION 201, et seq;
(iii) ANY AND ALL CLAIMS ARISING OUT OF ANY OTHER LAWS AND
REGULATIONS RELATING TO EMPLOYMENT OR EMPLOYMENT DISCRIMINATION.
13. No Oral Modification, Cancellation or Discharge. This Agreement may
only be amended, canceled or discharged in writing signed by the parties hereto.
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14. Withholding. The Company shall be entitled to withhold, or cause to be
withheld, from payment any amount of withholding taxes required by law with
respect to payments made to Executive in connection with his employment
hereunder.
15. Governing Law. This Agreement shall be governed by the laws of the
State of California.
16. Acknowledgment. Executive acknowledges that he has had the opportunity
to discuss this matter with and obtain advice from his private attorney, has had
sufficient time to, and has carefully read and fully understands all the
provisions of this Agreement, and is knowingly and voluntarily entering into
this Agreement.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement:
/s/ XXXXXX XXXXXX November 17, 2000
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(Name) Date
diaDexus, Inc.
/s/ XXXXXXX XXXXXXX November 17, 2000
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Xxxxxxx Xxxxxxx Date
Executive
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