1 August 2000
Mr. Charles C. Harwood, Jr.
[Address intentionally left blank]
Re: AMENDED AND RESTATED EMPLOYMENT LETTER AGREEMENT (THE "AMENDED
AND RESTATED AGREEMENT")
Dear Charlie:
We would like to offer you the new position as Corporate Senior Vice President,
Venture Development, of Covance Inc. ("Covance" or the "Company"). As this new
position will require a modification of duties and responsibilities as more
fully set forth below, we would like to amend and restate your Employment Letter
Agreement, dated November 20, 1996, to incorporate the terms of Amendment No. 1
to the Employment Letter Agreement, dated November 20, 1998 (the Employment
Letter Agreement together with Amendment No. 1, the "Former Agreement") and
incorporate the terms of the letter, dated May 25, 2000 (the "Letter Agreement")
setting forth the terms of your new position. This Amended and Restated
Agreement sets forth our mutually agreed upon terms of employment. Therefore, in
consideration of the premises and covenants herein contained, we hereby agree as
follows:
TERM
This Amended and Restated Agreement will be effective as of June 1, 2000 and
will terminate on June 1, 2001 (the "Term"), unless renewed by mutual agreement
of the parties.
POSITION
As Corporate Senior Vice President, Venture Development, of Covance, your duties
over the next twelve months will entail working toward achieving the goals
specified on Schedule A attached hereto (the "Goals").
You may also be required to perform such other duties as may be incidental
thereto. You will report to the CEO or his designee.
BASE SALARY
Your base salary during the Term will be $239,148 (payable on the normal
semimonthly payroll cycle for Corporate employees).
ANNUAL BONUS
You are entitled to participate in the Covance Way Annual Incentive Plan (the
"Bonus Plan") for the 2000 plan year. The Bonus Plan provides that upon
satisfaction of certain financial goals for Covance established by the Covance
Board of Directors, you shall receive an annual target incentive of $130,488
(the "2000 Target Bonus Incentive"), which is equal to 55% of your annualized
base salary of $237,250 (1/1/00 through 2/29/00 at $227,760 per year and 3/1/00
through 12/31/00 at $239,148 per year).
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Your bonus payout for 2000 will be calculated as the product of three factors,
(i) the 2000 Target Bonus Incentive, (ii) a corporate pool factor of 75% and
(iii) an individual performance factor of between zero and 200%. Your annual
bonus calculation will utilize a 100% individual performance factor for the
period beginning January 1, 2000 through May 31, 2000. For the period beginning
June 1, 2000 through December 31, 2000, your individual performance factor will
be based on your personal performance measured against attainment of the Goals,
as determined by the CEO. Thus your 2000 bonus payout under the Bonus Plan will
be the sum of (a) the 2000 Target Bonus Incentive times 75% times 100% times
5/12 or $40,777.50 for the first 5 months of 2000 and (b) the 2000 Target Bonus
Incentive times 75% times 7/12 times your individual performance factor for the
last 7 months of 2000. Your 2000 bonus will be paid in cash by March 15, 2001 so
long as you have not voluntarily left Covance by that date.
You will not be eligible to participate in the 2001 Bonus Plan.
SPECIAL GOAL BONUSES
You shall be entitled to earn the following Special Goal Bonuses during the
Term:
1. In the event you use your best efforts to complete the Goals as
specified herein (regardless of actual achievement of the Goals),
you will be entitled to receive an additional bonus payment equal
to $450,000.
2. You will be entitled to receive additional bonus payments equal to
$300,000 in the aggregate upon satisfaction of certain goals set
forth on Schedule B attached hereto.
Each Special Goal Bonus you earn, if any, will be payable to you in a cash lump
sum payment within 30 days following the end of the Term. Each Special Goal
Bonus paid to you will be deemed "Plan Compensation" for purposes of the
Supplemental Executive Retirement Plan ("SERP"), as such term is defined in the
SERP.
PENSION, INVESTMENT AND BENEFIT PLANS
During the Term, you will continue to be entitled to participate in the Covance
plans in which you currently participate (e.g., medical, dental, disability,
life insurance, SERP, 401(k) savings plan, ESOP, employee stock purchase plan)
in accordance with the terms and conditions of those plans.
AUTO AND FINANCIAL COUNSELING ALLOWANCE
You will continue to receive a gross monthly auto allowance of $1,070 per month.
In addition, you will also be entitled to participate in other perquisites
and/or benefits programs as are offered to all other senior executives of
Covance as a class. These include a tax/financial counseling allowance of $6,000
per year under the terms of the Covance plan. Any expenses actually incurred
under this plan will be grossed up for tax purposes at an incremental income tax
rate of 45%.
FUTURE EQUITY AWARDS
You may be awarded from time to time additional compensation (such as stock
options or restricted stock) pursuant to Covance's Employee Equity Participation
Program or any additional or replacement incentive compensation or long-term
compensation program established by Covance for its senior officers. Any awards
under such programs, except as provided below, shall be at such levels or in
such amounts as Covance's Board of Directors deems, in its sole discretion,
appropriate for your position and the performance of your duties.
SEVERANCE FOR TERMINATION OF EMPLOYMENT DURING THE TERM
Except as provided below under the paragraph headed "CHANGE-OF-CONTROL", Covance
guarantees that should you be involuntarily terminated for reasons other than
for Cause, you will receive an amount equal to the sum of (a) two years base
salary (payable on the normal semimonthly payroll cycle) determined at the time
of termination, (b) two years of the annual incentive bonus (payable on the
normal bonus cycles) in an amount equal for each such year to the product of
your base salary in effect at termination and 55% (the sum of (a) and (b) being,
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collectively, the "Termination Payments"), (c) the Special Goal Bonuses totaling
$750,000 (payable within 30 days of termination) and (d) the 2000 Target Bonus
Incentive of $130,488 (payable within 30 days of termination), if the 2000 bonus
has not already been paid. Any payments under (c) and (d) will be deemed "Plan
Compensation" for purposes of the Supplemental Executive Retirement Plan
("SERP"), as such term is defined in the SERP. In addition, for purposes of
benefit accrual and vesting determination purposes under the SERP, you will be
credited with two additional "Years of Service" (as such term is defined under
the SERP). You will also have a period of three years from the date of
termination to exercise any outstanding Covance stock options that are vested as
of the date of termination.
"Cause" shall mean (i) your convictions of a felony or a misdemeanor if such
misdemeanor involves moral turpitude; (ii) your committing any act of gross
negligence or intentional misconduct in the performance or non-performance of
your duties as an employee of Covance or its affiliates, including, any actions
which constitute sexual harassment under applicable laws, rules or regulations;
(iii) your failure to perform your duties assigned for a period of thirty (30)
or more days unless such failure is caused by an Extended Disability; or (iv)
misappropriation of assets, personal dishonesty or intentional misrepresentation
of facts which may cause Covance or its affiliates financial or reputational
harm.
Should such involuntary termination occur because of an Extended Disability, and
not for any other reason that constitutes Cause, for 120 consecutive days where
you have not returned to your duties on a full-time basis after the expiration
of such 120 day period within 30 days after written notice of termination is
given to you, Covance shall pay to you (a) the Termination Payments at the times
specified above, (b) a prorata portion of the $450,000 Special Goal Bonus based
upon the percentage of the Term elapsed through the date of termination (payable
within 30 days of termination), (c) a prorata portion of the 2000 Target Bonus
Incentive of $130,488, if the 2000 bonus has not already been paid, based upon
the percentage of calendar year 2000 elapsed through the date of termination
(payable within 30 days of termination), and (d) any other Special Goal Bonus,
other than (b) above, that has been achieved as of the date of termination
(payable within 30 days of termination). Any payments under (b), (c) and (d)
will be deemed "Plan Compensation" for purposes of the SERP, as such term is
defined in the SERP.
"Extended Disability" shall (i) mean you are unable, as a result of a medically
determinable physical or mental impairment, to perform the duties and services
of your position, or (ii) have the meaning specified in any disability insurance
policy maintained by Covance, whichever is more favorable to you.
Except as may be otherwise provided in applicable Covance compensation and
benefit plans, Covance shall not be liable for any salary or benefit payments to
you beyond the date of your voluntary termination of employment with Covance. In
the event of a termination of employment for Cause or Extended Disability, you
shall not be entitled to any compensation or other benefits not already earned
and owing to you on account of your services on the date of such termination of
employment except as provided above with respect to a termination for Extended
Disability.
Medical, dental, and life insurance will be continued, to the extent they are
not otherwise prohibited under the respective plans, while you are receiving the
Termination Payments.
CHANGE-OF-CONTROL
In the event of a Change-of-Control (as defined below), your employment with
Covance will be deemed to have been involuntarily terminated as of the day after
the date of the Change-of-Control and you will be entitled to a lump sum payment
equal to the sum of (1) the product of (a) 3 and (b) your base annual salary in
effect at the time of the Change-of-Control and (2) the product of (a) 3 and (b)
number that is 55% of your base annual salary in effect at the time of the
Change-of-Control (the sum of (1) and (2) being, collectively, the
"Change-of-Control Payment"). In addition, you will be entitled to a lump sum
payment equal to the sum of (A) the Special Goal Bonuses totaling $750,000 and
(B) the 2000 Target Bonus Incentive of $130,458, if the 2000 Bonus has not
already been paid, and such payment of (A) plus (B) will be deemed "Plan
Compensation" for purposes of the SERP, as such term is defined in the SERP. All
of the abovementioned payments will be made within 30 days of the date of a
Change-of-Control. In addition to, and as a result of, the foregoing (i) all of
your stock options, restricted stock, deferred compensation and similar benefits
which have not become vested on the date of a Change-of-Control shall become
vested upon such event and you will have a period of three years from the date
of termination to exercise any outstanding Covance stock options that are vested
as of the date of termination, (ii) you shall be entitled to receive any
payments calculated pursuant to the paragraph headed "CERTAIN ADDITIONAL
PAYMENTS BY COVANCE", and (iii) for purposes of benefit accrual and vesting
determination purposes under the SERP, you will be deemed to have been
involuntarily terminated during the three-year period following the
Change-of-Control.
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For purposes of this Agreement, a "Change-of-Control" is defined to occur when:
(i) any person (including as such term is used in Section 13(d) and
14(d)(2) of the Securities Exchange Act of 1934) becomes the beneficial owner,
directly or indirectly, of Covance's securities representing 20% or more of the
combined voting power of Covance's then outstanding securities; or
(ii) as a result of a proxy contest or contests or other forms of
contested shareholder votes (in each case either individually or in the
aggregate), a majority of the individuals elected to serve on Covance's Board of
Directors are different than the individuals who served on Covance's Board of
Directors at any time within the two years prior to such proxy contest or
contests or other forms of contested shareholder votes (in each case either
individually or in the aggregate); or
(iii) Covance shareholders approve a merger, or consolidation (where
in each case Covance is not the survivor thereof), or sale or disposition of all
or substantially all of Covance's assets or a plan or partial or complete
liquidation; or
(iv) an offeror (other than Covance) purchases shares of Covance
common stock pursuant to a tender or exchange offer for such shares.
In the event you are involved in any dispute about your rights under this
Agreement arising on or after a Change-of-Control, Covance shall pay all legal
costs and fees incurred by you in connection with such dispute promptly upon
receipt of any invoice relating thereto.
The benefits set forth under the paragraph headed "AUTO AND FINANCIAL COUNSELING
ALLOWANCE" and medical, dental, and life insurance will be continued, to the
extent they are not otherwise prohibited under the respective plans, until you
find other employment but not longer than three years from the date of the
Change-of-Control.
SEVERANCE FOR TERMINATION OF EMPLOYMENT FOLLOWING THE EXPIRATION OF THE TERM
Unless otherwise mutually agreed to by the parties hereto this Agreement shall
terminate on June 1, 2001. At that time, Covance may offer you continued
employment with the Company, the terms of which shall be agreed upon by you and
Covance at that time. In the event either (i) Covance does not continue to
employ you with the Company or (ii) Covance does continue to employ you with the
Company but you choose not to, you shall be entitled to receive severance
payments equal to the Termination Payments you would receive if you were
involuntarily terminated for reasons other than for Cause by the Company as set
forth above under the paragraph headed "SEVERANCE FOR TERMINATION OF EMPLOYMENT
DURING THE TERM." Such Termination Payments shall be in addition to any Special
Goal Bonuses specified in this Agreement which have been earned but not paid. In
addition, for purposes of benefit accrual and vesting determination purposes
under the SERP, you will be credited with two additional "Years of Service" (as
such term is defined in the SERP). You will also have a period of three years
from June 1, 2001 to exercise any outstanding Covance stock options that are
vested as of May 31, 2001. Any outstanding unvested options will be forfeited on
June 1, 2001.
Medical, dental, and life insurance will be continued, to the extent they are
not otherwise prohibited under the respective plans, while you are receiving the
Termination Payments.
CERTAIN ADDITIONAL PAYMENTS BY COVANCE
(a) Anything in this Agreement to the contrary notwithstanding, in the
event it shall be determined that any payment or distribution by, to or for the
benefit of you, whether made under this Agreement or otherwise (a "Payment"),
would be subject to the excise tax imposed by Section 4999 of the Internal
Revenue Code of 1986, as amended (the "Excise Tax"), then you shall be entitled
to receive an additional payment (a "Gross-Up Payment") in an amount such that
after payment by you of all taxes (including any Excise Tax) imposed upon the
Gross-Up Payment, you retain an amount of the Gross-Up Payment equal to the
Excise Tax imposed upon the Payments.
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(b) All determinations required to be made under these provisions,
including whether a Gross-Up Payment is required and the amount of such Gross-Up
Payment, shall be made by the accounting firm utilized by Covance for the
preparation of its annual external financial statements (the "Accounting Firm")
which shall provide detailed supporting calculations both to Covance and you
within 30 days of the Change-of-Control, if applicable, or such earlier time as
is requested by Covance. The Gross-Up Payment, if any, as determined pursuant to
this Paragraph (b), shall be paid to you within 10 days of the receipt of the
Accounting Firm's determination. Any determination by the Accounting Firm shall
be binding upon Covance and you. If subsequent final determinations of the
Excise Tax made by the Internal Revenue Service give rise to additional Excise
Tax, then additional Gross-Up Payments shall be made by Covance to you within 10
days after the notice is received by Covance of such final determination.
(c) You shall notify Covance in writing of any claim by the Internal
Revenue Service that, if successful, would require the payment by Covance of a
Gross-Up Payment. Such notification shall be given as soon as practicable but no
later than 10 business days after you know of such claim. You shall not pay such
claim prior to the expiration of the thirty-day period following the date on
which you give such notice to Covance (or such shorter period ending on the date
that any payment of taxes with respect to such claim is due). If Covance
notifies you in writing prior to the expiration of such period that it desires
to contest such claim, you shall:
(i) give Covance any information reasonably requested by Covance
relating too such claims,
(ii) take such action in connection with contesting such claims as
Covance shall reasonably request in writing from time to time,
including, without limitation, accepting legal representation with
respect to such claim by an attorney selected by Covance,
(iii) cooperate with Covance in good faith in order effectively to
contest such claim, and
(iv) permit Covance to participate in any proceedings relating to
such claim;
PROVIDED, however, that Covance shall bear all costs and expenses incurred in
connection with such contest and shall indemnify and hold you harmless, on an
after-tax basis, for Excise Tax or income tax imposed as a result of such
contest or representation and payment of costs and expenses. Covance shall
control all proceedings taken in connection with such contents. Covance may, at
its sole option, either direct you to pay the tax claimed and sue for a refund
or contest the claim in any permissible manner, and you agree to prosecute such
contest to a determination before any administrative tribunal, in a court of
initial jurisdiction and in one or more appellate courts, as Covance shall
determine; PROVIDED, HOWEVER, that if Covance directs you to pay such claim and
sue for a refund, Covance shall advance the amount of such payment to you on an
interest-free basis and shall indemnify and hold you harmless, on an after-tax
basis, from any Excise Tax or income tax imposed with respect to such advance.
(d) If, after the receipt by you of an amount advanced by Covance
pursuant to Paragraph (c), you become entitled to receive any refund with
respect to such claim, you shall promptly pay to Covance the amount of such
refund (together with any interest paid or credited thereon after taxes
applicable thereto). If, after the receipt by you of an amount advanced by
Covance pursuant to Paragraph (c), a final determination is made that you shall
not be entitled to any refund with respect to such claim, then such advance
shall be forgiven and shall not be required to be repaid and the amount of such
advance shall offset the amount of Gross-Up Payment required to be paid.
LOCATION
Your principal office location during the Term will be at your residence in
[city and state intentionally omitted]. You will work at the Princeton, NJ
office, other Covance locations and travel as is reasonable to perform your
duties.
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CONFIDENTIALITY
Covance possesses and will continue to possess trade secrets or other
information which has been created, discovered, developed by or otherwise become
known to Covance, or in which property rights have been assigned or otherwise
conveyed to Covance, which information has commercial value with respect to the
business and operations of Covance or the business and operations of its
subsidiaries or its affiliates, including, but not limited to, information
regarding sales, costs, customers, employees, products, services, apparatus,
equipment, processes, formulae, marketing, or the organization, business or
finances of Covance or its subsidiaries or its affiliates, or any information
you have reason to know Covance would like to treat as confidential for any
purpose, such as maintaining a competitive advantage or avoiding undesirable
publicity, whether or not developed by you ("Confidential Information"). Unless
previously authorized in writing or instructed in writing by Covance, you will
not, from and after the date of employment with Covance, directly or indirectly,
use for your own benefit or purposes, or disclose to, or use for the benefit or
purposes of, anyone other than Covance or its subsidiaries or affiliates, any
Confidential Information, unless and until, and then only to the extent that,
such Confidential Information has (a) been or becomes published, or is or
becomes generally known in the trade through no fault of you, or (b) such
information is made known and available to you by a third party, who, by such
disclosure to you does not breach any duty or obligation to Covance or its
subsidiaries or affiliates.
In the event you become legally compelled to disclose any of the Confidential
Information, you will provide Covance with prompt notice so that Covance may
seek a protective order or other appropriate remedy and/or waive compliance with
the provisions of this Agreement. If, in the absence of a protective order or
the receipt of a waiver hereunder, you are nonetheless legally required to
disclose Confidential Information to any tribunal or else stand liable for
contempt or suffer other censure or penalty, you may disclose such Confidential
Information to such tribunal without liability hereunder.
Upon termination of your employment with Covance, you will deliver to Covance
all written embodiments of the Confidential Information, including all notes,
drawings, records, reports, pertaining to work done by you during your
employment with Covance and all other matters of secret or confidential nature
relating to Covance's business.
NON-COMPETITION
You acknowledge that the services to be rendered by you to Covance are of a
special and unusual character, with a unique value to Covance, the loss of which
cannot adequately be compensated by damages or an action at law. In view of the
unique value to Covance of such services for which you are employed at Covance,
because of the Confidential Information obtained by, or disclosed to you, and as
a material inducement to Covance to compensate you as well as provide you with
additional benefits and other good and valuable consideration, you covenant and
agree that:
(a) Unless authorized by Covance's Board of Directors in writing, you
shall not, during your employment with Covance and for one year after the
expiration of your employment with Covance (the "Post Employment Term", your
employment with Covance and the Post Employment Term, being, collectively, the
"Period"), become employed by, become a director, officer, shareholder or
partner of, or to otherwise enter into, conduct, or advise any business, whether
directly or indirectly, which offers services or products in the United States
and any other geographical regions where Covance, or its subsidiaries or its
affiliates, is then offering its services or products in competition with
services or products sold by Covance, or its subsidiaries or its affiliates at
any time during the Period in the United States or such region, including,
without limitation, the conduct of contract pre-clinical toxicology laboratory
services, contract biopharmaceutical clinical laboratory services, contract
bioprocessing or manufacturing services, contract drug packaging services, Phase
I, II, III or IV clinical studies or outcomes or disease management studies
(collectively, the "Covance Services"), unless any of such services have been
substantially divested by Covance; PROVIDED that you shall not be bound by the
restrictions contained in this provision (a) unless Covance has made all
payments to you which are due and owing to you under this Agreement or any plan
or bonus or incentive plan of Covance, including any equity incentive or bonus
incentive plan of Covance, or otherwise; PROVIDED, FURTHER, that if you have
been dismissed by Covance for Cause or you have voluntarily terminated your
employment with Covance for any reason or no reason, you shall not be bound by
the foregoing provisions of this paragraph (a) during the Post Employment Term
unless Covance has made to you the payments specified above under the paragraphs
headed "SEVERANCE FOR TERMINATION OF EMPLOYMENT DURING THE TERM" or "SEVERANCE
FOR TERMINATION OF EMPLOYMENT FOLLOWING THE EXPIRATION OF THE TERM", whichever
is applicable. Nothing herein shall restrict you in your employment in any
capacity by a corporation or entity engaged substantially in the manufacture or
sale of pharmaceuticals, or any other business which does not offer Covance
Services on a contract basis as a substantial amount of its economic activity.
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Ownership of not more than 1% of the issued and outstanding shares of any class
of securities of a corporation, the securities of which are traded on a national
securities exchange or in the over-the-counter market, shall not cause you to be
deemed a shareholder under this provision.
(b) During the Period, you shall not, directly or indirectly, solicit,
divert or accept any business from any customer of Covance, its subsidiaries or
affiliates to the detriment of any of the foregoing or seek to cause any such
customers to refrain from doing business with or patronizing Covance, its
subsidiaries or its affiliates.
(c) During the Period, you shall not, directly or indirectly, solicit or
induce for employment any employee of Covance or any of its subsidiaries or
affiliates or otherwise encourage any employee of Covance or any of its
subsidiaries or affiliates to leave Covance, or any of its subsidiaries or
affiliates. For purposes of this Agreement, advertisements in trade magazines,
use of executive search firms and other conventional means of obtaining
employees shall not be construed as solicitation, inducements or encouragement
unless the party utilizing such conventional means specifically directs the
efforts at employee(s) with whom the party may not have contact pursuant to the
terms of this Agreement.
(d) For purposes of this Agreement, the term "directly or indirectly"
shall be construed in its broadest sense and shall include the activities of the
members of your members of your immediate family or any partnership, or as
otherwise specified above, and the term "customer" shall mean any person or
entity to which Covance has sold services during the one-year period prior to
the date you ceased employment with Covance or any persons or entities targeted
by Covance or contacted for the purpose of selling such services during such
one-year period which you knew about or reasonably should have known about.
OWNERSHIP OF KNOW-HOW, INVENTIONS AND OTHER INTELLECTUAL PROPERTY
All the know-how, innovations, inventions, discoveries, improvements,
procedures, programs, formulas and specifications which have been or may be
either, directly or indirectly, developed, conceived or made by you in
connection with your employment with Covance, whether or not in concert with
other employees or shown or delivered to Covance or any of its subsidiaries or
its affiliates, and whether or not they are eligible for patent, copyright,
trademark, trade secret or other legal protection, shall be the exclusive
property of Covance and you shall, at Covance's request and expense, promptly
execute any and all documents or instruments which may be necessary to evidence
such ownership.
Obligations of this Agreement cover any and all inventions, discoveries or
improvements, directly or indirectly, conceived or made by you in connection
with your employment with Covance prior to the date of this Agreement.
You will communicate to Covance promptly and fully all improvements and
inventions you make or conceive (either solely or jointly with others) during
the period of your employment with Covance and conceived by you during the Post
Employment Term if based on or related to your employment at Covance.
PATENTS
You will, during and after the Period, at Covance's request and expense but
without additional compensation, assist Covance and its nominees in every proper
way to obtain and to vest in Covance or its nominees, title to patents on such
improvements and inventions in all countries, by executing all necessary or
desirable documents, including applications for patents and assignments thereof.
RECORDS AND DOCUMENTS
Except in the performance of your duties as an employee of Covance, you will not
at any time or in any manner make or cause to be made any copies, pictures,
duplicates, facsimiles, or other reproductions, recordings, abstracts, or
summaries of any reports, studies, memoranda, correspondence, manuals, customer
lists, software, records, formulae, plans or other written, printed, or
otherwise recorded material of any kind whatever belonging to or in the
possession of Covance or its subsidiaries or affiliates, which may be produced
or created by you or others, or which may come into your possession in the
course of your employment, or which relate in any manner to the then current or
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prospective business of Covance, its subsidiaries or its affiliates. You shall
have no right, title or interest in any such materials, and you agree that you
have not removed and will not remove such materials without the prior written
consent of Covance or its subsidiaries or affiliates, as applicable, and that
you will surrender all such material to Covance immediately upon your
termination or departure from Covance, or at any time prior thereto upon the
request of Covance.
INJUNCTIVE RELIEF
You agree that the remedies available to Covance at law for any breach of any of
your obligations under this Agreement may be inadequate, and you accordingly
agree and consent that temporary or permanent injunctive relief, and/or an order
of specific performance, may be granted in any proceeding which may be brought
to enforce any provision hereof, without the necessity of proof of actual
damage, in addition to any other remedies available to Covance at law.
OUTPLACEMENT
If there has been a Change-of-Control or if there has been no Change-of-Control
but you have been terminated without Cause, or if you choose not to continue
employment with Covance after the expiration of the Term, Covance shall provide
for you, at Covance's cost, executive outplacement support, from a firm of your
choice, for one-year following such termination.
SEPARATION AGREEMENT
If there has been a Change-of-Control or if there has been no Change-of-Control
but you have been terminated without Cause or you are entitled to severance
payments pursuant to the paragraph headed "SEVERANCE FOR TERMINATION OF
EMPLOYMENT FOLLOWING THE EXPIRATION OF THE TERM", the obligation of Covance to
make to you the Termination Payments or the Change-of-Control Payment, as
applicable, specified under this Agreement shall be subject to your execution
and delivery to Covance of a Separation Agreement in the form attached hereto as
Schedule C. Any sections of Schedule C that are bracketed are for illustrative
purposes only at this time and shall be finalized prior to execution of the
Separation Agreement based upon the applicable sections of this Amended and
Restated Agreement that relate to the exact circumstances of your termination.
APPROVAL OF PAYMENTS
The payment terms of this Amended and Restated Agreement are subject to and
conditional upon the approval of the Compensation and Organization Committee of
Covance Inc.
GENERAL
The provisions of employment relating to health benefits, vacation and
reimbursement for business expenses, professional dues, etc. remain unchanged
and will be administered in accordance with company policies, as they may be
amended, modified or supplemented from time to time. This Agreement shall be
governed by and construed in accordance with the laws of the State of New
Jersey.
The failure of either party at any time to require performance by the other
party of any provision hereof shall not affect in any way the full right to
require such performance at any time thereafter, nor shall a waiver by either
party of a breach of any provision hereof be taken or held to be a waiver of
future performance under the provision itself.
You hereby expressly agree that all of the covenants in this Agreement are
reasonable and necessary in order to protect Covance and its business. If any
provision or any part of any provision of this Agreement shall be invalid or
unenforceable under applicable law, such part shall be ineffective only to the
extent of such invalidity or unenforceability and shall not affect in any way
the validity or enforceability of the remaining provisions of this Agreement, or
the remaining parts of such provision.
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This Agreement shall be binding on and inure to the benefit of the parties
hereto and their heirs, executors, legal representatives, successors and
assigns. Except in the event of a transfer to a successor corporation or other
entity or affiliate of Covance, neither party shall have the right to assign its
rights or delegate its obligations, or all or any portion of its rights or
interests under this Agreement without the prior written consent of the other
party hereto.
Any notice, request, demand, or other communication required or permitted by
this Agreement shall be deemed to be properly given if delivered by hand or when
mailed certified, registered or first class mail or overnight courier with
postage or shipping charge prepaid, addressed to Covance at 210 Carnegie Center,
Princeton, New Jersey 08540, Attention: CEO and to you at your address specified
above, and all such notices shall be deemed effective at the time of delivery or
at the time delivery is refused by the addressee upon participation. The
addresses for the purpose of this Paragraph may be changed only by giving
written notice of such change in the manner provided herein for giving notices.
The captions of the Paragraphs herein are inserted as a matter of convenience
only and in no way define, limit or describe the scope of this Agreement or any
provisions hereof.
This Agreement sets forth the entire agreement and understanding between the
parties hereto as to the subject matter hereof, and as such supersedes in its
entirety any existing agreement, whether oral or written, between you and
Covance including, but not limited to, the Former Agreement and the Letter
Agreement, except as expressly otherwise provided to the contrary under this
Agreement.
This Agreement may be amended only by a written instrument signed by both
parties hereto making specific reference to this Agreement and expressing the
plan or intention to modify it.
Please indicate your agreement with the terms and conditions of this Agreement
by signing one copy of this Agreement and returning it to my attention.
Very truly yours,
/s/ CHRISTOPHER A. KUEBLER
--------------------------------
Christopher A. Kuebler
President and CEO
Accepted as of the date first above specified:
By: /s/ CHARLES C. HARWOOD
------------------------------
Charles C. Harwood, Jr.
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