Exhibit 10.6
VIASYS HEALTHCARE INC.
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made and entered
into as of November 29, 2004 by and among VIASYS Healthcare Inc., a
Delaware corporation (together with its successors and assigns
permitted under this Agreement, the “Company”), and
John F. Imperato (the “Executive”).
W I T N E S S E T H :
WHEREAS, the Company and the
Executive desire to enter into an employment agreement as set forth
herein to embody the terms and provisions of the Executive’s
employment (the “Agreement”); and
WHEREAS, the Agreement will replace
and supercede all prior employment agreements between the Executive
and the Company or its subsidiaries, including, without limitation,
the Employment Agreement between the Company and the Executive
dated November 1, 2003 (the “Prior Employment
Agreement”);
NOW, THEREFORE, in consideration of
the premises and mutual covenants contained herein and for other
good and valuable consideration, the receipt and sufficiency of
which is mutually acknowledged, the Company and the Executive
hereby agree as follows:
1.
DEFINITIONS.
(a)
“Affiliate” means a
person or other entity that directly or indirectly controls, is
controlled by, or is under common control with the person or other
entity specified.
(b)
“Base Salary” means the
salary provided for in Section 4 or any increased salary granted to
the Executive pursuant thereto.
(c)
“Board” means the Board
of Directors of the Company, or the Compensation Committee or other
applicable committees of the Board of Directors.
(d)
“Bonus Plan” means the
Company’s management incentive plan or such other annual
bonus plan in existence at the applicable time.
(e)
“Cause” means the
occurrence of any one or more of the following events:
(i)
the Executive’s repeated
failure to comply with the reasonable directives of the relevant
senior officers;
(ii)
the Executive’s commission of
a felony which is materially and demonstrably injurious to the
Company; or
(iii)
the Executive’s continued
gross neglect of the Executive’s duties with the Company
(other than any such occurrence resulting from incapacity due to
physical or mental illness).
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(f)
“Change in Control”
means an event or occurrence set forth in any one or more of
subsections (i) through (iv) below (including, without limitation,
an event or occurrence that constitutes a Change in Control under
one of such subsections but is specifically exempted from another
such subsection):
(i)
the acquisition by an individual,
entity or group (within the meaning of Section 13(d)(3) or 14(d)(2)
of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”)) (a “Person”) of beneficial
ownership of any capital stock of the Company if, after such
acquisition, such Person beneficially owns (within the meaning of
Rule 13d-3 promulgated under the Exchange Act) 40% or more of
either (i) the then-outstanding shares of common stock of the
Company (the “Outstanding Company Common Stock”), or
(ii) the combined voting power of the then-outstanding securities
of the Company entitled to vote generally in the election of
directors (the “Outstanding Company Voting
Securities”); provided, however, that for purposes of this
subsection (i), the following acquisitions shall not constitute a
Change in Control:
(A)
any acquisition by the Company,
or
(B)
any acquisition by any employee
benefit plan (or related trust) sponsored or maintained by the
Company or any corporation controlled by the Company;
(ii)
the Continuing Directors (as defined
below) do not constitute a majority of the Board (or, if
applicable, the Board of Directors of a successor corporation to
the Company), where the term “Continuing Director”
means at any date a member of the Board (A) who was a member of the
Board on the date of the execution of this Agreement or (B) who was
nominated or elected subsequent to such date by at least a majority
of the directors who were Continuing Directors at the time of such
nomination or election or whose election to the Board was
recommended or endorsed by at least a majority of the directors who
were Continuing Directors at the time of such nomination or
election; provided, however, that there shall be excluded from this
clause (B) any individual whose initial assumption of office
occurred as a result of an actual or threatened election contest
with respect to the election or removal of directors or other
actual or threatened solicitation of proxies or consents, by or on
behalf of a person other than the Board;
(iii)
the consummation of a merger,
consolidation, reorganization, recapitalization or statutory share
exchange involving the Company or a sale or other disposition of
all or substantially all of the assets of the Company in one or a
series of transactions (a “Business Combination”),
unless, immediately following such Business Combination the
beneficial owners of the Outstanding Company Common Stock and
Outstanding Company Voting Securities immediately prior to such
Business Combination beneficially own, directly or indirectly, more
than 50% of the then-outstanding shares of common stock and the
combined voting power of the then-outstanding securities entitled
to vote generally in the election of directors, respectively, of
the resulting or acquiring corporation in such Business Combination
(which shall include, without limitation, a corporation which as a
result of such transaction owns the Company or substantially all of
the Company’s assets either directly or through one or more
subsidiaries) (such resulting or acquiring corporation is referred
to herein as the “Acquiring Corporation”);
or
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(iv)
approval by the stockholders of the
Company of a complete liquidation or dissolution of the
Company.
(g)
“Code” means the
Internal Revenue Code of 1986, as amended.
(h)
“Disability” or
“disabled” means a disability which results in the
Executive’s entitlement to long-term disability benefits
under the Company’s applicable long-term disability
plan.
(i)
“Effective Date” means
November 15, 2004.
(j)
“Equity Grant” means any
compensatory grant of Stock, options with respect to Stock,
restricted Stock, Stock appreciation rights or any other
compensatory grant (whether or not such grant is payable in stock)
the value of which is determined with reference to Stock
valuation.
(k)
“Notice of Termination”
means a written notice from one party to the other party hereto
given in accordance with Section 24, terminating the
Executive’s employment hereunder. Any Notice of Termination
shall (i) indicate the specific termination provision hereunder
relied on by the party giving such notice and (ii) to the extent
applicable, set forth in reasonable detail the facts and
circumstances providing a basis for termination of the
Executive’s employment under the provision so indicated. The
failure by the Company to set forth any fact or circumstance that
contributes to a showing of Cause shall not waive any right of the
Company hereunder or preclude the Company from asserting any such
fact or circumstance in enforcing its rights hereunder.
(l)
“Pro-Rated Annual Bonus”
means an annual cash incentive bonus award for the year in which
the termination occurs, pro-rated through the Termination Date,
determined in accordance with the Bonus Plan and the provisions of
Section 5, which award, if and to the extent so determined to be
owed, shall be payable when incentive awards are normally paid to
comparable executives.
(m)
“Stock” means the common
stock, $0.01 par value per share, of the Company.
(n)
“Termination Date”
means, with respect to any termination of the Executive’s
employment hereunder, the effective date of such termination
pursuant to Section 9.
2.
TERM OF EMPLOYMENT.
This Agreement, and all rights and
obligations of the parties hereunder, shall take effect upon the
Effective Date and shall continue until the date that is two years
from the Effective Date (the “Initial Employment
Term”). In addition, the term of this Agreement shall
automatically renew for periods of two years (each an
“Extension Term”) unless either party gives written
notice to the other party, at least ninety (90) days prior to the
end of the Initial Employment Term or at least ninety (90) days
prior to the end of the relevant Extension Term, that the Agreement
shall not be further extended. The period commencing on the
Effective Date and ending on the date on which the term of the
Executive’s employment under the Agreement shall terminate is
hereinafter referred to as the “Employment
Term.”
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3.
POSITION, DUTIES AND
RESPONSIBILITIES.
(a)
Commencing on the Effective Date,
the Executive is employed as Corporate Vice President, Finance of
the Company, and the Executive has been assigned and shall be
assigned such duties and responsibilities as are reasonably
consistent with such position(s) or such other duties and
responsibilities as the CEO or the Executive’s direct
supervisor from time to time deems appropriate.
(b)
During the Employment Term, the
Executive shall devote the Executive’s entire business time,
attention and energies to the business and interest of the Company
in performing the Executive’s duties and responsibilities
under this Agreement, and to that end but without limitation of the
foregoing, the Executive shall not serve on the board of directors
of other corporations or entities without the prior approval of the
Board or the Chief Executive Officer.
(c)
Notwithstanding anything contained
in Section 3(b) to the contrary, nothing herein shall preclude the
Executive from (i) serving on the boards of directors of a
reasonable number of trade associations and/or charitable
organizations, (ii) engaging in charitable activities and community
affairs, and (iii) managing the Executive’s personal
investments and affairs, provided that such activities do not
materially interfere with the proper performance of the
Executive’s duties and responsibilities as set forth in this
Section 3.
4.
BASE SALARY.
The Executive shall be paid an
annualized base salary, payable in accordance with the regular
payroll practices of the Company, of $236,250.00, which amount may
be increased from time to time in the discretion of the
Board.
5.
ANNUAL CASH INCENTIVE
AWARD.
During the Employment Term, the
Executive shall participate in (a) the Bonus Plan with a target
bonus of 40% of the Base Salary, or such other amount as may be
determined in its discretion by the Board or the appropriate
committee or individual to which authority for these matters has
been assigned, and (b) any other incentive programs established by
the Company for its senior level executives generally.
6.
EMPLOYEE BENEFIT
PROGRAMS.
During the Employment Term, the
Executive shall be entitled to participate in all employee pension
and welfare benefit plans and programs made available to the
Company’s senior level executives.
7.
PERQUISITES.
During the Employment Term, the
Executive shall be entitled to participate in all of the
Company’s executive perquisites in accordance with the terms
and conditions of such arrangements as are in effect from time to
time for the Company’s senior-level executives.
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8.
REIMBURSEMENT OF BUSINESS AND OTHER
EXPENSES.
The Executive is authorized to incur
reasonable expenses in carrying out the duties and responsibilities
under this Agreement, and the Company shall promptly reimburse the
Executive for such expenses, subject to documentation in accordance
with the Company’s policies.
9.
TERMINATION OF
EMPLOYMENT.
The Executive’s employment
hereunder shall terminate effective immediately upon the earlier to
occur of the following events:
(a)
death of the Executive;
(b)
receipt by either party of a Notice
of Termination for Disability from the other party, but in any
event not until the Executive is determined to be disabled in
accordance with Section 1(h);
(c)
the day the Executive receives a
Notice of Termination for Cause from the Company;
(d)
the 30th day following receipt by
the Executive of a Notice of Termination without Cause from the
Company;
(e)
the 30th day following receipt by
the Company of a Notice of Termination of employment from the
Executive (other than a Notice of Termination for non-renewal of
the Agreement);
(f)
the 90th day following receipt by
the Company of a Notice of Termination for non-renewal of the
Agreement from the Executive pursuant to Section 2; and
(g)
the last day of the Employment Term,
in the event of receipt by the Executive of a notice of non-renewal
of the Agreement from the Company pursuant to Section 2.
10.
RIGHTS AND REMEDIES UPON TERMINATION
OF EMPLOYMENT.
(a)
TERMINATION DUE TO DEATH. In the
event that the Executive’s employment is terminated due to
the Executive’s death, the Executive’s estate or
beneficiaries, as the case may be, shall be entitled to the
following benefits:
(i)
The Executive’s then current
Base Salary pro-rated through the Termination Date, which shall be
payable in a lump sum within thirty (30) days of the Termination
Date;
(ii)
The Pro-Rated Annual Bonus, if and
to the extent payable; and
(iii)
Each Equity Grant held by the
Executive, whether or not issued under this Employment Agreement,
that has not vested prior to that date shall immediately vest (and
all relevant vesting restrictions shall lapse) and to the extent
subject to an exercise period, shall
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remain exercisable until one year following the
Termination Date (but in no event beyond the end of each such
Equity Grant’s otherwise applicable exercise
period).
(b)
TERMINATION DUE TO DISABILITY. In
the event that the Executive’s employment is terminated by
either party due to the Executive’s Disability, the Executive
shall be entitled to the following benefits:
(i)
Disability benefits in accordance
with the long-term disability (“LTD”) program then in
effect for comparable executives of the Company;
(ii)
The Executive’s then current
Base Salary pro-rated through the end of the LTD elimination
period, which shall be payable in a lump sum within thirty (30)
days of the Termination Date;
(iii)
The Pro-Rated Annual Bonus, if and
to the extent payable; and
(iv)
Each Equity Grant held by the
Executive, whether or not issued under this Employment Agreement,
that has not vested prior to that date shall immediately vest (and
all relevant vesting restrictions shall lapse) and to the extent
subject to an exercise period, shall remain exercisable until one
year following the Termination Date (but in no event beyond the end
of each such Equity Grant’s otherwise applicable
exe
