Employment Agreement [Amendment] - eResearchTechnology Inc. and Joseph Esposito
[eResearchTechnology, Inc. Letterhead]
MANAGEMENT EMPLOYMENT AGREEMENT
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ADDENDUM
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This Amendment (this "Amendment") to Management Employment Agreement
dated March 4, 2004 is made this 16th day of August 2004 between
eResearchTechnology, Inc. ("Company") and Joseph Esposito ("Employee")
Company and Employee are parties to a certain Management Employment
Agreement dated March 4, 2004 (the "Agreement"). Company and Employee now desire
to amend certain provisions of the Agreement as set forth in this Amendment.
Capitalized terms used but not defined herein shall have the meaning
given to them in the Agreement.
NOW, THEREFORE, Company and Employee, each intending to be legally
bound hereby, agree as follows:
1. The Agreement is hereby amended as follows:
1.1 Section 11. c. is hereby amended and restated to read in its
entirety as follows:
"The Company may also terminate the Employee's employment
under this Agreement for Cause. For purposes of this Agreement
the Company shall have "Cause" to terminate the Employee's
employment if the Employee, in the reasonable judgment of the
Company: (i) fails to perform any reasonable directive of the
Company that may be given from time to time for the conduct of
the Company's business; (ii) materially breaches any of his
commitments, duties or obligations under this Agreement; (iii)
embezzles or converts to his own use any funds of the Company
or any business opportunity of the Company; (iv) destroys or
converts to his own use any property of the Company, without
the Company's consent; (v) is convicted of, or indicted for,
or enters a guilty plea or plea of no contest with respect to,
a felony; (vi) is adjudicated an incompetent; or (vii)
violates any federal, state, local or other law applicable to
the business of the Company or engages in any conduct which,
in the reasonable judgment of the Company, is injurious to the
business or interests of the Company. The Company must give
the Employee written notice of the Employee's breach under
sections 11.c.(i.), 11.c.(ii) and 11.c.(vii) and an
opportunity to cure within fifteen (15) days of such written
notice. If the Employee fails to cure, the Company may
terminate the Employee for Cause and shall give notice of
termination to the Employee as required under Section 11.a."
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1.2 Section 11. d. is hereby amended and restated to read in its
entirety as follows:
"Upon any termination of this Agreement, the Company shall
have no further obligation to Employee other than for annual
salary earned through the date of termination, and no
severance pay or other benefits of any kind shall be payable;
provided, however, that in the event the Company terminates
this Agreement other than for Cause or as a result of the
death or Disability of the Employee, the Employee shall
receive: (i) bonus based on 100% performance and prorated
based on the number of days worked during the year in which
the termination, death or Disability occurred, payable in one
lump sum in accordance with the Company's policy; (ii) a
payment equal to one year's then-current annual salary and
bonus, based on 100% performance, payable in one lump sum in
accordance with the Company's policy; (iii) continuation of
Benefits (as hereafter defined), subject to applicable plan
provisions, for one year; and (iv) accelerated vesting of all
stock options, such that all stock options held by Employee
immediately prior to the date of termination of this
Agreement, death or Disability shall thereupon become
exercisable in full."
1.3 Section 11. e. is hereby amended and restated to read in its
entirety as follows:
"Notwithstanding any contrary provision contained in this
Agreement, in the event that there is a "Change of Control"
(as hereafter defined), then subject to the condition in the
following sentence, the Employee shall receive: (i) bonus
based on 100% performance and prorated based on the number of
days worked during the year in which the resignation occurred,
payable in one lump sum in accordance with the Company's
policy; (ii) a payment equal to one year's then-current annual
salary and bonus, based on 100% performance, payable in one
lump sum in accordance with the Company's policy; (iii)
continuation of Benefits, subject to applicable plan
provisions, for one year; and (iv) accelerated vesting of all
stock options, such that all stock options held by Employee
immediately prior to the date of the Change of Control shall
become exercisable in full as of the date of the Change of
Control. The Employee shall be entitled to received the
benefits described in the foregoing sentence only if either
(i) the Employee shall accept employment offered at the time
of the Change of Control by either the Company or the other
party to the Change of Control (the "Buyer") for a period of
up to 12 months, as determined by the Company or the Buyer,
immediately following the Change of Control (the "Employment
Period") in a position with comparable compensation and
location and with responsibilities relating to the business of
the Company as conducted by the Company, the Buyer or any
division or subsidiary thereof after the Change of Control no
less than the Employee's responsibilities with the Company
immediately prior to the Change of Control or (ii) neither the
Company nor the Buyer shall offer the Employee a position with
comparable compensation and location and with responsibilities
relating to the business of the Company as conducted by the
Company, the Buyer or any division or subsidiary thereof after
the Change of Control no less than the Employee's
responsibilities with the Company immediately prior to the
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Change of Control and the Employee resigns his employment
within 60 days after the Change of Control. The Employee
acknowledges that if he does not remain employed during the
Employment Period as contemplated by clause (i) of the
preceding sentence other than as a result of the Employee's
death, Disability or termination without Cause and the
requirements of clause (ii) of the preceding sentence are not
otherwise met, then he shall be obligated to forfeit and
return to the Company the benefits received pursuant to the
first sentence of this Section 11(e), including any profits
realized upon the sale of any share options for which would
not have been exercisable as of the cessation of employment
but for the first sentence of this Section 11(e), net of any
taxes paid or payable by the Employee as a result of such
sale. The parties acknowledge that, following a Change of
Control, the Employee may not be given the same title with the
Buyer as he held with the Company prior to the Change of
Control if the business of the Company is conducted as part of
a larger business enterprise, and that certain
responsibilities traditionally performed by the individual
holding such title may be assigned to the individual holding
such title for the Buyer, and that such changes will not
constitute a reduction in responsibilities of the Employee
within the meaning of this Section 11.
The term "Benefits" as utilized in this Section 11, shall mean
standard health, dental, disability, life and accident
insurance benefits, all of which are subject to any applicable
premium co-pay, and car allowance.
The term "Change of Control", as utilized in this Section 11,
shall mean:
(i) A change of control of a nature that would be
required to be reported in the Company's proxy
statement under the Securities Exchange Act of
1934, as amended;
(ii) The approval by the Board of Directors of a sale,
not in the ordinary course of business, of all or
substantially all of the Company's assets and
business to an unrelated third party and the
consummation of such transaction; or
(iii) The approval by the Board of Directors of any
merger, consolidation, or like business combination
or reorganization of the Company, the consummation
of which would result in the occurrence of any
event described in clause (i) or (ii) above, and
the consummation of such transaction."
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2. Miscellaneous
2.1 All references to the Agreement in any documents and instruments
executed by the parties in connection with the Agreement shall be deemed to
refer to the Agreement as the same has been amended through the date hereof, and
as the same may be amended in the future.
2.2 This Amendment may be executed in any number of counterparts and
each such counterpart shall be deemed an original, but all such counterparts
shall constitute but one and the same agreement.
2.3 The Agreement and this Amendment may be modified or amended by the
parties hereto only by a written agreement executed by both parties.
2.4 Except as expressly amended hereby, all of the terms and provisions
of the Agreement shall remain in full force and effect and are hereby ratified
and confirmed in every aspect.
2.5 This Amendment shall be governed by and construed in accordance
with the internal laws of the Commonwealth of Pennsylvania, without regard to
conflicts of laws principles.
IN WITNESS WHEREOF, the undersigned have caused this Amendment to be
executed on the date first written above.
For Employee: For the Company:
Joseph Esposito Bruce Johnson
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Name: Bruce Johnson
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Date: August 18, 2004 Date: August 20, 2004
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