Exhibit
10.30


 


	
  

  	
   

  	
   

  



 


March 19, 2003


 


Ms. Karen K. Garza

1018 Calle Venezia

San Clemente. CA 92672


 


Dear Karen:


 


ChromaVision Medical
Systems, Inc, (the “Company”) is pleased to enter into this Letter Agreement
with you (the “Executive”) which will address the terms of Executive’s
employment with the Company. The Company considers it essential to the best
interests of its stockholders to attract and foster the continuous employment
of key management personnel of the Company and the arrangements described in this
letter are intended to address that goal.


 


1              Duties.  Commencing on April 7,
2003 (the “Commencement Date”), or a date mutually agreed upon, Executive will
serve as Vice President, Business Development and
Strategic Initiatives and
will report directly to the President, Chief Executive Officer.


 


2.                                       Term.  Executive’s
employment relationship with the Company is employment “at will”. As a result,
Executive’s employment may be terminated by the President, Chief Executive
Officer, the Board of Directors, or by Executive at any time (subject to the
notice provision below), in each case without any liability or obligation,
except as set forth in this letter. If Executive terminates her employment, she
shall give the Company written notice of such termination not less than sixty
(60) days prior to the effective date of such termination. In light of the
severance benefits provided for in Section 6, the Company will have no
obligation to give Executive prior notice of any such termination by the
Company (whether or not such termination is without cause).


 


3.                                       Compensation.


 


(a)                                  Base
Salary.  During the term of Executive’s employment, Executive
will receive a base salary of $175,000.00 per annum, payable in biweekly
increments, subject to annual salary and performance review and potential
salary increase at the sole discretion of the Company.


 


(b)                                 Bonus.  Executive
will be eligible for a performance-based bonus as a participant in the Company’s
Management Incentive Plan (“MIP”) with an annual target payment of 40% of base salary.
Potential exists under the MIP to receive as much as twice this figure based on
achievement of Company and personal objectives. Establishment and revision of
the MIP performance requirements and determination of any bonuses payable under
the MIP will be made at the sole discretion of the Compensation Committee. Any
MIP payment determined by the Compensation Committee to payable for 2003 will
be prorated based on the number of days of service in 2003.


 


4.                                       Option
Grant.  A recommendation to the Compensation Committee of the
Board of Directors will be made for a stock Option Grant in the amount of
100,000 qualified (incentive) shares of Common Stock of the Company, which
option shares will vest 25% on the first anniversary of the Commencement Date
and the remaining 75% of which will vest in equal monthly installments during
the three-year period commencing on the first anniversary of the date hereof.
The option will not be granted under the Company’s 1996 Equity Compensation
Plan (the “Option Plan”) but will


 


	
  ChromaVision
  Medical Systems, Inc.

  	
  33171
  Paseo Cerveza

  	
  San
  Juan Capistrano, CA 92675-4824

  	
  Telephone
  949.443.3355

  	
  Fax  949.443.3366

  



 





















 


have the same terms as
the standard form agreement currently in use under the Option Plan (Including
such terms as are incorporated therein from the Options Plan itself). The
option will have an exercise price equal to the last sale price of Company
Common Stock on the later of the Commencement Date or the date the options are
approved by the Board of Directors of the Company and will expire on the tenth
anniversary of the date hereof (subject to earlier termination in accordance
with the terms of the Option Plan and standard form of agreement thereunder).
Additional equity grants may be awarded commencing in 2004 by action of the
Board of Directors or a duly authorized committee of the Board.


 


5.                                       Fringe
Benefits.


 


(a)                                  Executive
will be paid a car allowance at the rate of $600 per month.


 


(b)                                 Executive
is eligible for group life and accidental death and dismemberment insurance in
an amount equal to twice the Executive’s annual base salary not to exceed
$600,000 (assuming that Executive meets normal insurability requirements.) If insurability
requirements cannot be met, the maximum amount of group life insurance benefit
is $225,000. Executive will be offered the opportunity to purchase voluntary
life insurance for herself and her spouse and children, if applicable; and
otherwise be eligible to participate in all other benefits programs offered
generally by the Company to its other Executives, including medical, dental,
and vision insurance, short and long term disability insurance, 401k Plan,
flexible spending account (Section 125) plan, and employee assistance
program.


 


(c)                                  Executive will
also be entitled to seventeen (17) days of vacation which will accrue from Commencement
Date at the rate of 5.23 hours for each biweekly pay period. Executive may not accrue
more than forty (40) hours above her eligible vacation allowance per year. All
vacation accrued will carry over year to year; however, the point at which the
total number of vacation hours accrued exceeds the maximum allowable, no
additional accruals will be earned until the amount is reduced below the
maximum. After Executive has completed five (5) full years of employment, the vacation
accrual rate will be increased to twenty-two (22) days per year at the accrual
rate of 6.77 hours for each biweekly pay period.


 


6.                                       Severance
Payments.  Subject to the provisions of (d) below and the other terms
and conditions of this letter, in the event the Company terminates Executive’s
employment without cause (the foregoing being a “Severance Termination”), the
Company will provide Executive the following benefits, which shall be the only
severance benefits or other payments with respect to Executive’s employment
with the Company to which Executive shall be entitled. Without limiting the generality
of the foregoing, these benefits are in lieu of all salary (except for salary
for periods ending on the date of termination), accrued vacation and other
rights Executive may have against the Company or its affiliates.


 


(a)                                  After a Severance Termination,
Executive will receive payment of an amount equal to six (6) month’s of her
base salary in effect at the time of the Severance Termination, payable as set
forth in subsection (e) below.


 


(b)                                 Upon a Severance Termination,
Executive will be able to exercise any options which have become exercisable on
or before the termination date until the earlier of (a) six (6) months from the
date of termination or (b) the expiration date of the option.


 


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(c)                                  Upon a Severance
Termination, Executive will receive continued coverage under the Company’s
medical and health plans in accordance with COBRA rules and regulations
following the termination date (including any period as may be required by
law), provided that coverage will end if Executive obtains comparable coverage
from a subsequent employer or otherwise ceases to be eligible for COBRA
benefits. If Executive ceases to be eligible for COBRA because the Company does
not pay the premiums for its existing or group insurance policy or the Company
ceases to have a group healthcare plan, the Company will pay Executive, for any
portion of the 6-month period referred to above during which Executive’s COBRA
eligibility ceases for such reasons, the amount of the premium it would have
had to pay for Executive’s coverage under the then existing, or if none, the
most recently existing, healthcare insurance policy. Executive should consult
with the Company’s Manager of Human Resources concerning the process for
assuming ownership of and continued premium payments for any life insurance
policy. Executive will be reimbursed in accordance with Company policies promptly
for all of Executive’s reasonable and necessary business expenses incurred on
behalf of the Company prior to Executive’s termination date.


 


(d)                                 All compensation
and benefits described above in (a) through (c) of this Section 6 wilt be
contingent upon (i) Executive’s execution of a release of all claims against
the Company substantially in the form of Exhibit A and expiration of the
seven-day revocation period referred to in the release; (ii) Executive’s not
engaging in any Competition (as defined in Section 7 of this Agreement)
with the Company during the period of her employment by the Company or the
period referred to in paragraph (a) above; and, (iii) Executive’s not engaging
in any Solicitation (as defined in Section 7 of this Agreement) during the
period of her employment by the Company or the period referred to in paragraph
(a) above.


 


(e)                                  The Company will
pay Executive the amount described in (a) above in six (6) equal monthly
installments with the first payment being payable on the date when the seven-day
revocation period referred to below with respect to the release expires. The
Company will prepare the final release (which will be substantially in the form
attached as Exhibit A to this letter) and deliver it to Executive within five
business days of Executive’s termination of employment. Executive will have
twenty-one (21) days in which to consider the release; although, Executive may execute
it sooner. Please note that the release has a revocation period of seven days.


 


(f)                                    Subject to the
provisions of paragraph (d) above, the Company will pay interest on payments
that are more than ten days past due at the prime rate at the Company’s
principal bank (or, if none, Citibank N.A.) plus two percentage points
compounded monthly. In addition, the Company will pay all reasonable costs and
expenses (including reasonable attorney’s fees and all costs of arbitration or
court proceedings) incurred by Executive to enforce this agreement or any obligation
hereunder but only if Executive is the prevailing party in any such proceeding.
If the Company is the prevailing party, Executive will pay all of the Company’s
reasonable costs and expenses (including reasonable attorneys’ fees and all
costs of arbitration or court proceedings) incurred in connection with any such
proceeding.


 


(g)                                 In this letter,
the term “cause” means (a) Executive’s failure to
adhere to any written policy of the Company if Executive has been given a
reasonable opportunity to comply with such policy and cure Executive’s failure
to comply (which reasonable opportunity to cure must be granted for a period of
ten days); (b) Executive’s appropriation (or attempted appropriation) of a
business opportunity of the Company, including attempting to secure or securing
any personal profit in connection with any transaction entered into on behalf
of the Company; (c) Executive’s


 


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misappropriation (or
attempted misappropriation) of any of the Company’s funds or property
(including without limitation trade secrets and other intellectual property);
or, (d) Executive’s conviction of, or Executive’s entering of a guilty plea or
plea of no contest with respect to, a felony or the equivalent thereof.


 


(h)                                 In this letter,
the term “Change of Control” means (a) the issuance, sale, transfer or
acquisition by the Company of shares of capital stock of the Company (including
a transfer as a result of death, disability, operation of law, or otherwise) in
a single transaction or a group of related transactions, as a result of which
any entity, person, or group (other than Safeguard Scientifics, Inc. and/or its
affiliates) acquires the beneficial ownership of newly issued, outstanding or
treasury shares of the capital stock of the Company having 50% or more of the
combined voting power of the Company’s then outstanding securities entitled to
vote for at least a majority of the authorized number of directors of the
Company or (b) any merger, consolidation, sale of all or substantially all the
assets or other comparable transaction as a result of which all or
substantially all of the assets and business of the Company are acquired
directly or indirectly by another entity (except Safeguard Scientifics, Inc.
and/or any of its affiliates). An “affiliate” of an entity is an entity controlling,
controlled by, or under common control with the entity specified, directly or
indirectly through one or more intermediaries. “Group” shall have the same
meaning as in section 13(d) of the Securities Exchange Act of 1934. and “beneficial
ownership” shall have the same meaning as set forth in Rule 13d-3 of the
Securities and Exchange Commission adopted under the Securities Exchange Act of
1934.


 


(i)                                     Executive will
not be required to mitigate the amount of any payment provided for in this
letter by seeking other employment or otherwise.


 


(j)                                     Executive
acknowledges that the arrangements described in this letter will be the only
obligations of the Company or its affiliates in connection with any
determination by the Company to terminate Executive’s employment with the
Company. This letter does not terminate, alter, or participate, except as
explicitly set forth herein. Executive’s participation in such plans or
programs will be governed by the terms of such plans and programs.


 


7.                                       Definitions of
Competition and Solicitation.


 


(a)                                  For purposes of Section 6(d)
of this Agreement, Executive shall be deemed to have engaged in “Competition”
with the Company if, without prior written approval of the Board of Directors
of the Company, Executive directly or indirectly through any other person, firm
or corporation, whether individually or in conjunction with any other person,
or as an employee, agent, consultant, representative, partner or holder of any
interest in any other person, firm, corporation or other association during any
portion of the term of this Agreement or any renewals or extensions hereof, or
the period of salary continuation referred to in Section 6(a), competes
with, or encourages or assists others to compete with, or solicit orders or
otherwise participates in business transactions or provides services in
competition with, the business engaged in by the Company at any time during the
term of Executive’s employment (unless such business shall have been abandoned
by the Company.) Executive acknowledges that the Company’s products are
marketed throughout the United States, that therefore the Company is engaged in
business in every county and state of the United States and that the foregoing
definition of “competition” includes competition in every county and state of
the United States as well as in foreign countries.


 


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(b)                                 For purposes of Section 6(d)
of this Agreement “Solicitation” shall mean (A) soliciting, enticing, or
inducing any Customer (as defined below) to become a client, customer, OEM,
distributor, or reseller of any other person, firm or corporation with respect
to, or provide, products or services which are competitive with products or
services then sold or under development by the Company or to cease doing
business with the Company or authorizing or knowingly approving the taking of
such actions by any other person or (B) soliciting, enticing, or inducing
directly or indirectly, or hiring any person who presently is or at any time
during the term hereof shall be an employee of the Company to become employed
by any other person, firm or corporation or to leave his or her employment with
the Company or authorizing or approving any such action by any other person or
entity. Providing a reference for an employee of the Company will not, however,
constitute Solicitation if the employee has decided to leave the employ of the Company,
is seeking other employment, and requests the reference.


 


(c)                                  For purposes of
this Section 7, “Customer” means any person or entity which at the time of
determination, if made prior to termination of employment, or, after
termination of employment, at the time of such termination, shall be, or shall
have been within two years prior to such time, a client, customer, OEM, distributor,
or reseller of the Company or a bona fide prospect to become any of the
foregoing.


 


(d)                                 Competition shall
not include investing in the securities of any corporation having securities
listed on a national securities exchange, the Nasdaq National Market, or the
Nasdaq SmallCap Market, provided that such investment does not exceed 5% of any
class of securities of any corporation engaged in business in competition with
the Company, and provided that such ownership represents a passive investment
and that neither Executive nor any group of persons including her, in any way,
either directly or indirectly, manages or exercises control of any such corporation,
guarantees any of its financial obligations, otherwise takes any part in its
business, other than exercising her rights as a shareholder, or seeks to do any
of the foregoing.


 


(e)                                  Executive
acknowledges (i) that her experience and capabilities are such that the conditions
in Section 6(d) to her receiving the severance benefits referred to in Section 6
will not prevent her from obtaining employment or otherwise earning a living at
the same general economic benefit as reasonably required by her without losing
the severance benefits and (ii) that she has, prior to the execution of this
Agreement, reviewed this Agreement with her legal counsel. Executive acknowledges
that the provisions contained in this Section 7 and in Section 6(d)
are reasonable and necessary to protect the legitimate business interests of
the Company and that the Company would not have entered into this Agreement in
the absence of such provisions.


 


8.                                      Prior Restrictive
Covenants Affecting Executive.  Executive represents that she is not
a party to any agreements or arrangements which may restrict or prohibit the
performance by Executive of any of her duties or responsibilities at the
Company, including without limitation any agreements or arrangements which in
any way may restrict competition with any other person, firm or entity, or the
solicitation of any customers or prospective customers or any prospective
employees.


 


9.                                       Other Payments in
the Event of Termination of Employment.  In the event of termination of
Executive’s employment for any reason. Executive will be entitled to receive
upon such termination payment of all accrued, unpaid salary to the date of
termination and, when bonuses for the year of termination are paid generally to
other employees of the Company, a “pro rata portion” of her “bonus for the year
of termination” (as those terms are defined below). “Pro rata portion” means
the


 


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number of days in the
calendar year of termination up to and including the date of termination
divided by the total number of days in that full calendar year. The “bonus for
the year of termination” means the amount the Executive would have been likely
to earn if she had been employed for the full year, as determined in good faith
by the Board of Directors of the Company or a committee thereof at the time
that bonuses for the year of termination are paid generally to other employees
of the Company.


 


10.                               Withholding;
Nature of Obligations.  The Company will withhold applicable
taxes and other legally required deductions from all payments to be made
hereunder. The Company’s obligations to make payments under this letter are
unfunded and unsecured and will be paid out of the general assets of the
Company.


 


11.                               Miscellaneous.  The
agreement will inure to the benefit of Executive’s personal representatives,
executors, and heirs. In the event Executive dies while any amount payable
under this agreement remains unpaid, all such amounts will be paid to the
parties legally entitled thereto in accordance with the terms and conditions of
this letter. No term or condition set forth in this letter may be modified,
waived, or discharged unless such waiver, modification, or discharge is agreed
to in writing and signed by Executive and an officer of the Company authorized
to sign such writing by the Board of Directors of the Company or an authorized
committee thereof. This agreement will be construed and enforced in accordance
with the laws of the State of California without regard to the conflicts of
laws of any state. Any controversy or claim arising out of or relating to this
agreement, or the breach thereof, will be settled by arbitration in Los Angeles
or Orange County, California in accordance with the National Rules for the
Resolution of Employment Disputes of the American Arbitration Association,
using one arbitrator, and judgment upon the award rendered by the arbitrator
may be entered in any court of competent jurisdiction.


 


If this letter sets forth our agreement on the
subject matter hereof, kindly sign and return to us the enclosed copy of this
letter which will then constitute our legally binding agreement on this
subject.


 


	
   

  	
  Sincerely,

  
	
   

  	
   

  
	
   

  	
  CHROMAVISION MEDICAL
  SYSTEMS, INC.

  
	
   

  	
   

  
	
   

  	
  /s/ Carl W.
  Apfelbach

  
	
   

  	
  Carl W.
  Apfelbach

  
	
   

  	
  President, Chief
  Executive Officer

  
	
   

  	
   

  
	
  I agree to the terms
  and conditions of this letter

  	
   

  
	
   

  	
   

  
	
  /s/ Karen K.
  Garza

  	
   

  
	
  Karen K. Garza

  	
   

  
	
   

  	
   

  
	
  Dated:

  	
  3/20/03

  	
   

  
			



 


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EXHIBIT A


 


GENERAL RELEASE AND AGREEMENT


 


NOTICE:


 


Various state and federal laws,
including the Civil Rights Act of 1964 and 1991 and the Age Discrimination in
Employment Act, prohibit employment discrimination based on age, sex, race,
color, national origin, religion, disability and veteran status. These laws are
enforced through the Equal Employment Opportunity Commission (EEOC), the
Department of Labor and state civil rights agencies.


 


If you sign this General Release
and Agreement and accept the agreed upon special severance allowance and other
termination benefits described in the letter addressed to you which accompanies
this release, you are giving up your right to file a lawsuit pursuant to the
aforementioned federal, state and local laws in local, state or federal courts
against ChromaVision Medical Systems, Inc. and its affiliates, as defined in
the General Release and Agreement (the “Releasees,”) with respect to any claims
relating to your employment or termination therefrom which arise up to the date
this Agreement is executed.


 


By signing this General Release
and Agreement you waive your right to recover any damages or other relief in
any claim or suit brought by or through the Equal Employment Opportunity
Commission or any other state or local agency on your behalf under any federal
or state discrimination law, except where prohibited by law. You agree to
release and discharge each Releasee not only from any and all claims which you
could make on your own behalf but also specifically waive any right to become,
and promise not to become, a member of any class in any proceeding or case in
which a claim or claims against a Releasee may arise, in whole or in part, from
any event which occurred as of the date of this Agreement.  You agree to pay
for any legal fees or costs incurred by any Releasee as a
result of any breach of the promises in this paragraph. The parties agree that
if you, by no action of your own, become a mandatory member of any class from
which you cannot, by operation of law or order of court, opt out, you shall not
be required to pay for any legal fees or costs incurred by a Releasee as a
result.


 


We
encourage you to discuss the following release language with an attorney prior
to executing this Agreement. In any event, you should thoroughly review and
understand the effect of the release before acting on it.  Therefore, please take this release home and
consider it for up to twenty-one (21) days before you decide to sign it.