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EXHIBIT 10.40
MANAGEMENT EMPLOYMENT AGREEMENT
The following Agreement is hereby entered into this 7th day of
February, 2006, between, Joseph Esposito (hereinafter known as
Employee) and
eResearchTechnology, Inc. (together with its affiliated
corporations hereinafter
known as the "Company") and having its principal offices at 30 S.
17th Street,
Philadelphia, PA 19103.
1. DUTIES AND RESPONSIBILITIES
Employee agrees to hold the position of President and Chief
Executive Officer and shall be directly responsible and report to
the Board of
Directors. Employee agrees that the Board of Directors may, at any
time and from
time to time, without notice, assign him to perform other executive
level duties
and may assign him a title other than President and Chief Executive
Officer and
Employee agrees to accept such assignments or title changes during
the balance
of the period of employment; provided, however, that Employee's
compensation
(both annual salary and guaranteed bonus) shall not be reduced as
the result of
any such assignment or title change.
2. BEST EFFORTS
Employee agrees to devote his best efforts to his employment
with the Company, on a full-time (no less than 40 hours/week)
basis. He further
agrees not to use the facilities, personnel or property of the
Company for
personal or private business benefit.
3. ETHICAL CONDUCT
Employee will conduct himself in a professional and ethical
manner at all times and will comply with all company policies as
well as all
State and Federal regulations and laws as they may apply to the
services,
products, and business of the Company.
4. TERM OF THE AGREEMENT
Employee's employment will end on December 31, 2006, unless
terminated earlier pursuant to Section 11 of this Agreement.
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5. COMPENSATION
a. Annual salary for 2006
shall be $ 385,000 payable in equal installments
as per the Company's payroll policy.
b. 2006 guaranteed bonus
shall be $195,000 ("Bonus") payable on the
earlier of the Termination Date (as hereinafter defined), subject
to pro ration
in accordance with Section 11(d), or December 31, 2006, subject to
appropriate
withholding.
c. Benefits shall be the
standard employee benefits of the Company as they
shall exist from time provided that they are not less than those
Employee
currently enjoys including, without limitation, health, dental,
life and
accident, disability, 401k company match ($.50 per dollar
contributed up to a
maximum of $7,500 per annum), 5 week vacation, payment for unused
vacation upon
termination, and car allowance of $1,000 per month.
6. NON-DISCLOSURE
Employee acknowledges that employment with the Company requires
him/her
to have access to confidential information and material belonging
to the
Company, including customer lists, contracts, proposals, operating
procedures,
trade secrets and business methods and systems, which have been
developed at
great expense by the Company and which Employee recognizes to be
unique assets
of the Company's business. Upon termination of employment for any
reason,
Employee agrees to return to the Company any such confidential
information and
material in his possession with no copies thereof retained.
Employee further
agrees, whether during employment with the Company or any time
after the
termination thereof (regardless of the reason for such
termination), he will not
disclose nor use in any manner, any confidential or proprietary
material
relating to the business, operations, or prospects of the Company
except as
authorized in writing by the Company or required during the
performance of his
duties.
7. BUSINESS INTERFERENCE; NONCOMPETITION
a. During employment with
the Company and for a period of one year (the
"Restrictive Period") thereafter (regardless of the reason for
termination)
Employee agrees he will not, directly or indirectly, in any way for
his own
account, as employee, stockholder, partner, or otherwise, or for
the account of
any other person, corporation, or entity: (i) request or cause any
of the
Company's suppliers, customers or vendors to cancel or terminate
any existing or
continuing business relationship with the Company; (ii) solicit,
entice,
persuade, induce or request any employee, officer or agent of the
Company to
refrain from rendering services to the Company or to terminate his
or her
relationship, contractual or otherwise, with the Company; or (iii)
induce or
attempt to influence any customer or vendor to cease or refrain
from doing
business or to decline to do business with the Company or any of
its affiliated
distributors or vendors.
b. The Employee agrees
that, during the Restrictive Period, the Employee
will not, directly or indirectly, accept employment with, provide
services to or
consult with, or establish or acquire any interest in, any
business, firm,
person, partnership, corporation or other entity which engages in
any business
or activity that is the same as or competitive with the business
conducted by
the Company in any state of the United States of America and in any
foreign
country in which any customer to whom the Company is providing
services or
technology is located.
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8. FORFEITURE FOR BREACH; INJUNCTIVE RELIEF.
a. Any breach of the
covenants made in Sections 6 and 7 hereof shall
result in the forfeiture of the Employee's right to any and all
payments which
may be required to be made under this Agreement following such
breach and shall
relieve the Company of any obligation to make such payments.
b. The Employee
acknowledges that his compliance with the covenants in
Sections 6 and 7 hereof is necessary to protect the good will and
other
proprietary interests of the Company and that, in the event of any
violation by
the Employee of the provisions of Section 6 or 7 hereof, the
Company will
sustain serious, irreparable and substantial harm to its business,
the extent of
which will be difficult to determine and impossible to remedy by an
action at
law for money damages. Accordingly, the Employee agrees that, in
the event of
such violation or threatened violation by the Employee, the Company
shall be
entitled to an injunction before trial from any court of competent
jurisdiction
as a matter of course and upon the posting of not more than a
nominal bond in
addition to all such other legal and equitable remedies as may be
available to
the Company.
c.
The rights and
remedies of the Company as provided in this Section 8
shall be cumulative and concurrent and may be pursued separately,
successively
or together against Employee, at the sole discretion of the
Company, and may be
exercised as often as occasion therefor shall arise. The failure to
exercise any
right or remedy shall in no event be construed as a waiver or
release thereof.
d. The Employee agrees to
reimburse the Company for any expenses incurred
by it in enforcing the provisions of Sections 6 and 7 hereof if the
Company
prevails in that enforcement.
9. INVENTIONS
Employee agrees to promptly disclose to the Company each
discovery,
improvement, or invention conceived, made, or reduced to practice
(whether
during working hours or otherwise) during the term of employment.
Employee
agrees to grant to the Company the entire interest in all of such
discoveries,
improvements, and inventions and to sign all patent/copyright
applications or
other documents needed to implement the provisions of this
paragraph without
additional consideration. Except the works created through Aspatore
publishing
by the Employee, Employee further agrees that all works of
authorship subject to
statutory copyright protection developed jointly or solely, while
employed shall
be considered a work made for hire and any copyright thereon shall
belong to the
Company. Any invention, discovery, or improvement conceived, made,
or disclosed,
during the one year period following the termination of employment
with the
Company shall be deemed to have been made, conceived, or discovered
during
employment with the Company.
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Employee acknowledges that the only discoveries, improvements,
and other inventions made prior to the date hereof which have not
been filed in
the United States Patent Office are attached as Exhibit A.
10. NO
CURRENT CONFLICT
Employee hereby assures the Company that he is not currently
restricted by any existing employment or non-compete agreement that
would
conflict with the terms of this Agreement.
11. TERM;
TERMINATION AND TERMINATION BENEFITS
a.
The
Company may terminate Employee's employment at any time with or
without cause and the Employee may terminate his employment
hereunder at any
time upon a "change in control" (as hereinafter defined) or the
material breach
of this Agreement by the Company (("Material Breach") the Employee
must give the
Company written notice of the Company's breach and 15 days to
cure), by, in all
cases, providing at least 90 days notice to the other pursuant to
Section 14e of
this Agreement ("Termination Notice", and the date of Employee's
actual
termination of employment with the Company (i.e., at the end of the
90 day
period) being the "Termination Date"). Employee acknowledges that
Sections 6, 7,
8 and 9 of this Agreement will survive the termination of
Employee's employment.
Company acknowledges Section 13 of this Agreement will survive the
termination
of Employee's employment.
b. This Agreement shall
terminate upon the death of the Employee. In
addition, if, as a result of a mental or physical condition which,
in the
reasonable opinion of a medical doctor selected by the Company's
board of
directors, can be expected to be permanent or to be of an
indefinite duration
and which renders the Employee unable to carry out the job
responsibilities held
by, or the tasks assigned to, the Employee immediately prior to the
time the
disabling condition was incurred, or which entitles the Employee to
receive
disability payments under any long-term disability insurance policy
which covers
the Employee for which the premiums are reimbursed by the Company
(a
"Disability"), the Employee shall have been absent from his duties
hereunder on
a full-time basis for 120 consecutive days, or 180 days during any
twelve month
period, and within thirty (30) days after written notice (which may
occur before
or after the end of such 120 or 180 day period), by the Company to
Employee of
the Company's intent to terminate the Employee's employment by
reason of such
Disability, the Employee shall not have returned to the performance
of his
duties hereunder, the Employee's employment hereunder shall,
without further
notice, terminate at the end of said thirty-day notice.
c.
The term
"Change of Control", as utilized in this section shall
mean:
(a) A
change of control of a
