Exhibit 10.34
EMPLOYMENT
AGREEMENT
THIS AGREEMENT is made and entered
into as of December 1, 2005, by and between Alliance Imaging, Inc.,
a Delaware corporation (hereinafter called the
“Corporation”), and Howard K. Aihara (hereinafter
called the “Executive”). For purposes of this
Agreement, employment with the Corporation shall include employment
with any of its affiliated companies.
WITNESSETH THAT:
The Corporation desires to employ
the Executive as an Executive Vice President and Chief Financial
Officer (collectively, the “ CFO ”), and the
Executive desires to accept such employment;
NOW, THEREFORE, the Corporation and
the Executive, each intending to be legally bound, hereby mutually
covenant and agree as follows:
1. Employment and Term .
(a)
Employment. The Corporation shall employ the Executive as the
CFO of the Corporation, and the Executive shall so serve, for the
term set forth in Paragraph 1(b).
(b)
Term. The term of the Executive’s employment under this
Agreement shall commence on the date hereof (the “Effective
Time”) and shall end on the nine month anniversary of the
Effective Time, subject to the extension of such term as
hereinafter provided and subject to earlier termination as provided
in Paragraph 8. The expiration of the term of this Agreement
shall be extended automatically by an additional three months as of
the last day of each quarterly period following the Effective Time
unless either party desires to modify or terminate this Agreement
and notifies the other party of its desire to modify or terminate
this Agreement at least 30 days prior to any such quarterly renewal
date. The period of employment as provided in this Paragraph
1(b) is sometimes referred to herein as the
“Term”.
2. Duties .
During the Term, the Executive shall
serve as the CFO of the Corporation and have all powers and duties
consistent with such position. The Executive shall devote
substantially his entire time during reasonable business hours
(reasonable sick leave and vacations excepted) and use diligent
efforts to fulfill faithfully, responsibly and to the best of his
ability his duties hereunder; provided , however ,
that Executive may engage in and devote time to other
non-competitive activities such as serving as an expert witness to
the extent that such time spent is immaterial and does not
interfere with Executive’s obligations hereunder.
During the Term, Executive shall report to the Chief Executive
Officer of the Corporation. Executive’s duties shall be
performed, initially, principally at the Corporation’s
current offices located in Anaheim, California, or such other
locations agreed upon by the parties. Notwithstanding, the
foregoing, Executive may be required
to travel in the conduct of the
Corporation’s business and to discharge his duties hereunder,
provided that the amount and nature of such travel is reasonably
consistent with the amount and nature of travel engaged in by other
executive officers of the Corporation during the twelve-month
period immediately preceding the date of this Agreement.
3. Salary .
The Corporation shall pay to the
Executive as compensation for his services a salary of not less
than $210,000.00 per year effective December 1, 2005 through
December 31, 2006, payable in accordance with the
Corporation’s payroll procedures. From time to time,
the Board of Directors of the Corporation or a committee thereof
(the “Board”) will review the Executive’s
performance and compensation, and will consider adjustments
thereto.
4. Bonuses .
(a)
Annual. For calendar year 2006 and each calendar year
thereafter during the term of employment, the Executive shall be
eligible to receive a cash bonus based on the Corporation’s
achievement of certain operating and/or financial or other goals
established by the Board in its sole discretion, with an initial
annual target bonus amount equal to 75% (the “Target
Bonus”) of the Executive’s then current annual base
salary. The bonus plan shall be adopted and administered by
the Compensation Committee of the Board. Subsequent to 2006,
bonuses, if any, will be paid to Executive in accordance with the
terms and conditions of the Corporation’s Executive Incentive
Plan.
5. Equity Incentive Compensation
.
During the term of employment
hereunder the Executive shall be eligible to participate in the
Corporation’s Stock Option Plan in effect as of the date
hereof. Executive shall be entitled to a stock option grant
of one hundred fifty thousand shares to be granted as of the
Effective Time.
6. Other Benefits .
In addition to the compensation
described in Paragraphs 3 through 5, above, the Executive shall
also be entitled to the following:
(a) Expense
Reimbursement. Executive will be reimbursed all reasonable,
ordinary and necessary business expenses, including expenses for
entertainment, travel and similar items that are approved by the
Corporation in accordance with its regular policy(ies) for business
expense reimbursement. The Corporation will reimburse
Executive for all expenses upon presentation by Executive of
itemized accounts of such expenditures in accordance and in the
manner and on a form reasonably prescribed by the
Corporation.
(b) Car
Allowance. The Corporation shall pay to the Executive a
monthly automobile allowance (the “Automobile
Allowance”) of not less than $600, to help
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defray the costs associated with
Executive’s acquisition or maintenance (by lease or
otherwise) of an automobile and the related insurance and
maintenance therefor.
(c)
Vacation. The Executive shall be entitled to all legal
holidays, and three weeks paid vacation per annum, in accordance
with the Corporation’s current policies.
(d)
Insurance and Benefits. The Executive and his
“dependents,” to the extent eligible thereunder, shall
be entitled to participate in all employee and executive benefit
plans, programs and policies currently available to other
Corporation employees of comparable status, title and experience,
as well as any plans, programs and policies adopted by the
Corporation during the Term of this Agreement.
(e)
Participation in Other Benefit Plans. In addition to the
foregoing, the Executive shall be entitled to participate in all of
the other various retirement, welfare, fringe benefit, executive
perquisite, and expense reimbursement plans, programs and
arrangements of the Corporation to the same extent that employees
generally of the Corporation are eligible for participation under
the terms of such plans, programs and arrangements.
7. Confidentiality .
In view of the fact that
Executive’s work as an executive of the Corporation will
bring Executive into close contact with many confidential affairs
of the Corporation, including matters of a business nature, such as
information about customers (including pricing information), costs,
profits, markets, sales, strategic plans for future development and
any other information not readily available to the public,
Executive hereby agrees:
(a) To keep
secret all confidential matters of the Corporation (including
without limitation such matters which the Corporation notifies
Executive are confidential) learned prior to the date of this
Agreement and in the course of Executive’s employment
hereunder, and not to disclose them to anyone outside of the
Corporation, either during or after Executive’s employment
with the Corporation, or both, until such time as the Corporation
gives its written consent to such disclosure;
(b) To
deliver promptly to the Corporation on termination of
Executive’s employment by the Corporation or at any other
time the Corporation may so request, all memoranda, notes, records,
reports and other documents (and all copies thereof) relating to
the Corporation’s business which Executive may then possess
or have under Executive’s control; and
(c) That
violation of this Paragraph 7 would cause the Corporation
irreparable damage for which the Corporation cannot be reasonably
compensated in damages in an action at law, and therefore in the
event of any breach or threatened breach by Executive of this
Paragraph 7, the Corporation shall be entitled to make application
to a court of competent jurisdiction for equitable relief by way of
injunction or otherwise (without being required to post a
bond). This provision shall not, however, be construed as a
waiver of any of the rights which the Corporation may have for
damages under this
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Agreement or otherwise, and all of
the Corporation’s rights and remedies shall be unrestricted
and cumulative.
(d) For
purpose of this Paragraph 7, the term Corporation shall include
Alliance Imaging, Inc., its subsidiaries and its
affiliates.
(e) The
foregoing provisions of this Section 7 shall not apply to
information that (i) is not unique to the Corporation, (ii) is
generally known to the industry or the public (other than as a
result of Executive’s breach of this covenant), (iii) was
known by Executive prior to his becoming employed by the
Corporation, or (iii) is subsequently obtained by Executive other
than in the course of performing duties for the
Corporation.
8. Termination .
Unless earlier terminated in
accordance with the following provisions of this Paragraph 8, the
Corporation shall continue to employ the Executive and the
Executive shall remain employed by the Corporation during the
entire Term. Paragraph 9 hereof sets forth certain
obligations of the Corporation in the event that the
Executive’s employment hereunder is terminated. Certain
capitalized terms used in this Paragraph 8, Paragraph 9 and
Paragraph 10 hereof are defined in Paragraph 8(d),
below.
(a) Death or
Disability. Except to the extent otherwise provided in
Paragraph 9 with respect to certain post-Date of Termination
payment obligations of the Corporation, this Agreement shall
terminate immediately as of the Date of Termination in the event of
the Executive’s death or in the event that the Executive
becomes disabled. The Executive will be deemed to be disabled
upon the earlier of (i) the end of a six (6) consecutive month
period during which, by reason of physical or mental injury or
disease, the Executive has been unable to perform substantially all
of his usual and customary duties under this Agreement or (ii) the
date that a reputable physician selected by the Board, and as to
whom the Executive has no reasonable objection, determines in
writing that the Executive will, by reason of physical or mental
injury or disease, be unable to perform substantially all of the
Executive’s usual and customary duties under this Agreement
for a period of at least six (6) consecutive months. If any
question arises as to whether the Executive is disabled, upon
reasonable request therefor by the Board, the Executive shall
submit to reasonable medical examination for the purpose of
determining the existence, nature and extent of any such
disability. In accordance with Paragraph 14, the Board shall
promptly give the Executive written notice of any such
determination of the Executive’s disability and of any
decision of the Board to terminate the Executive’s employment
by reason thereof.
(b)
Discharge for Cause. In accordance with the procedures
hereinafter set forth, the Corporation may discharge the Executive
from his employment hereunder for Cause. Except to the extent
otherwise provided in Paragraph 9 with respect to certain post-Date
of Termination obligations of the Corporation, this Agreement shall
terminate immediately as of the Date of Termination in the event
the Executive is discharged for Cause. Any discharge of the
Executive for Cause shall be communicated by a Notice of
Termination to the Executive given in accordance with Paragraph 14
of this Agreement.
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For purposes of this Agreement, a
“Notice of Termination” means a written notice which
(i) indicates the specific termination provision in this Agreement
relied upon and (ii) if the Date of Termination is to be other than
the date of receipt of such notice, specifies the termination date
(which date shall in all events be within fifteen (15)
days
