Document:

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 

 

3

 

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. 

 

4

 

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 after the giving of such notice). In the case of a discharge of the Executive
for Cause, the Notice of Termination shall include a copy of a resolution duly
adopted by the Board at a meeting called and held for such purpose authorizing
such action. No purported termination of the Executive’s employment for Cause
shall be effective without a Notice of Termination.

(c)     Termination for Other Reasons.  The Corporation may discharge the Executive
without Cause by giving written notice to the Executive in accordance with
Paragraph 14 at least thirty (30) days prior to the Date of Termination. The
Executive may resign from his employment by giving written notice to the
Corporation in accordance with Paragraph 14 at least thirty (30) days prior to
the Date of Termination. 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 without Cause or resigns.

(d)     Definitions.  For purposes of this Agreement, the following
capitalized terms shall have the meanings set forth below:

	
  (i)

  	
   

  	
  “Accrued
  Obligations” shall mean, as of the Date of Termination, the sum of (A) the
  Executive’s base salary under Paragraph 3 through the Date of Termination to
  the extent not theretofore paid, (B) the amount of any bonus, incentive
  compensation, deferred compensation and other cash compensation earned by the
  Executive under the terms and conditions of the applicable bonus plan,
  incentive compensation plan and/or deferred compensation plan as of the Date
  of Termination to the extent not theretofore paid and (C) any vacation pay,
  expense reimbursements and other cash entitlements accrued by the Executive
  as of the Date of Termination to the extent not theretofore paid.

  
	
   

  	
   

  	
   

  
	
  (ii)

  	
   

  	
  “Cause” means
  that any of the following has occurred with respect to Executive: (A)
  Executive has been convicted of a felony (other than a motor vehicle moving
  violation); (B) Executive has been convicted of stealing funds or property
  from the Corporation or otherwise engaged in fraudulent conduct against the
  Corporation; (C) Executive has engaged in knowing and willful misconduct
  which is materially injurious to the Corporation; (D) Executive has failed or
  refused to comply with the directions of the Board that are reasonably
  consistent with Executive’s current executive employee title and the terms of
  this Agreement, the failure with which to comply is materially injurious to
  the Corporation; or (E) Executive has repeatedly failed or refused to comply
  with the directions of the Board that are reasonably consistent with
  Executive’s current executive employee title and the terms of this Agreement.
  Notwithstanding clause (E) of the preceding sentence, no act or omission by
  the Executive shall constitute Cause hereunder unless the Corporation has
  given detailed

  

 

 

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  written notice
  thereof to the Executive, and the Executive has failed to remedy such act or
  omission within a reasonable time after receiving such notice.

  

 

	
  (iii)

  	
   

  	
  “Date of
  Termination” shall mean (A) in the event of a discharge of the Executive by
  the Board for Cause, the date the Executive receives a Notice of Termination,
  or any later date specified in such Notice of Termination, as the case may
  be, (B) in the event of a discharge of the Executive without Cause or a
  resignation by the Executive, the date specified in the written notice to the
  Executive (in the case of discharge) or the Corporation (in the case of
  resignation), which date shall be no less than thirty (30) days from the date
  of such written notice, (C) in the event of the Executive’s death, the date
  of the Executive’s death, and (D) in the event of termination of the
  Executive’s employment by reason of disability pursuant to Paragraph 8(a),
  the date the Executive receives written notice of such termination (or, if
  earlier, six (6) months following the date the Executive’s disability began).

  
	
   

  	
   

  	
   

  
	
  (iv)

  	
   

  	
  “Good Reason”
  shall mean any of the following:

  

 

	
  (A)

  	
   

  	
  the Corporation
  materially reduces Executive’s base salary; or

  
	
   

  	
   

  	
   

  
	
  (B)

  	
   

  	
  the assignment
  to the Executive of any duties inconsistent in any material respect with the
  Executive’s positions with the Corporation as set forth in this Agreement
  (including status, offices, titles and reporting requirements), authority,
  duties or responsibilities as contemplated by Paragraph 2; or

  
	
  (C)

  	
   

  	
  any material
  failure by the Corporation to comply with any of the provisions of this
  Agreement, which is not remedied within 15 days after notice thereof from the
  Executive.

  
	
   

  	
   

  	
   

  
	
  (D)

  	
   

  	
  the Corporation
  requires Executive to change the location of his principal office or offices
  in a manner inconsistent with Paragraph 2 hereof; or

  
	
   

  	
   

  	
   

  
	
  (E)

  	
   

  	
  the Corporation
  or the Board shall notify the Executive that it does not want to renew the
  Term pursuant to Paragraph 1(b).

  

 

9.     Obligations of the Corporation Upon Termination.

The
following provisions describe the obligations of the Corporation to the
Executive under this Agreement upon termination of his employment.

(a)     Death, Disability, Discharge for Cause, or
Resignation Without Good Reason.  In the
event this Agreement terminates pursuant to Paragraph 8(a) by reason of the
death or disability of the Executive, or pursuant to Paragraph 8(b) by reason
of the discharge of the Executive by the Corporation for Cause, or pursuant to
Paragraph 8(c) by reason of 

 

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the resignation of the Executive other than for Good
Reason, the Corporation shall pay to the Executive, or his heirs or estate, in
the event of the Executive’s death, all Accrued Obligations in a lump sum in
cash within thirty (30) days after the Date of Termination; provided further
that in the event this Agreement terminates pursuant to Paragraph 8(a) by
reason of the disability of the Executive, the Corporation shall continue to
provide to the Executive, for a period of nine (9) months from the commencement
of such disability, all health benefits at least equal to those which would
have been provided to Executive in accordance with the plans, programs and
arrangements referred to in Paragraph 6(d) and (e) of this Agreement, in
addition to any other benefits or payments to which Executive is entitled
hereunder or otherwise.

(b)     Discharge Without Cause or Resignation with
Good Reason.  In the event that this
Agreement terminates pursuant to Paragraph 8(c) by reason of the discharge of
the Executive by the Corporation other than for Cause, death or disability or
by reason of the resignation of the Executive for Good Reason (any such
termination, a “Severance”):

	
  (i)

  	
   

  	
  The Corporation shall pay all Accrued Obligations to
  the Executive in a lump sum in cash within thirty (30) days after the Date of
  Termination;

  
	
   

  	
   

  	
   

  
	
  (ii)

  	
   

  	
  For a period equal to nine (9) months, the
  Corporation shall continue to provide benefits to the Executive and/or the
  Executive’s dependents at least equal to those which would have been provided
  to them in accordance with the plans, programs and arrangements referred to
  in Paragraph 6(d) and (e) of this Agreement; and

  
	
   

  	
   

  	
   

  
	
  (iii)

  	
   

  	
  The Corporation shall, at its sole expense, provide
  the Executive with outplacement services not to exceed $15,000.00 the scope
  and provider of which shall be mutually agreed upon by the Executive and the
  Corporation.

  
	
   

  	
   

  	
   

  

10.                       DEFRA Limitation.

 

(a)     Notwithstanding anything in this Agreement
to the contrary, in the event that the provisions of the Deficit Reduction Act
of 1984 (“DEFRA”) relating to “excess parachute payments” shall be applicable
to any payment or benefit received or to be received by Executive in connection
with a termination of the Executive’s employment with the Corporation, then the
total amount of payments or benefits payable to Executive which are deemed to
constitute parachute payments shall be reduced to the largest amount such that
provisions of DEFRA relating to “excess parachute payment” shall no longer be
applicable. Should such a reduction be required, the Executive shall determine,
in the exercise of his sole discretion, which payment or benefit to reduce,
extend or eliminate. Pending such determination, the Corporation shall continue
to make all other required payments to Executive at the time and in the manner
provided herein and shall pay the largest portion of any parachute payments
such that the provisions of DEFRA relating to “excess parachute payments” shall
no longer be applicable.

(b)     Recharacterization of Payments.  Due to the complexity in the application of
Section 280(G) of the Internal Revenue Code of 1986, as amended (the “Code”) it
is 

 

7

 

possible that payments made or benefits received
hereunder should not have been made under Paragraph 10(a) (an “Overpayment”).
In the event that it is determined in writing by the Corporation’s outside
auditors in their reasonable good faith judgment or by any court of competent
jurisdiction that an Overpayment has been made resulting in an “Excess
Parachute Payment” as defined in Section 280G(b)(1) of the Code, then any such
Overpayment shall be treated for all purposes as an unsecured, long-term loan
from the Corporation to the Executive, his personal representative, his
successors or assigns, as the case may be, that is payable, together with
accrued interest from the date of the making of the Overpayment at the rate of
8% per annum on the later to occur of the third anniversary of the payment of
such Overpayment, or 6 months following the date upon which it is determined an
Overpayment was made. Should it be determined that such an Overpayment has been
made, the Executive shall determine, in the exercise of his sole discretion,
which payments or benefits shall be deemed to constitute the Overpayment.

11.                       No Set-Off or Mitigation.

The
Corporation’s obligation to make the payments provided for in this Agreement
and otherwise to perform its obligations hereunder shall not be affected by any
set-off, counterclaim, recoupment, defense or other claim, right or action
which the Corporation may have against the Executive or others.  In no event shall the Executive be obligated
to seek other employment or take any other action by way of mitigation of the
amounts payable to the Executive under any of the provisions of this Agreement
and such amounts shall not be reduced whether or not the Executive obtains
other employment.

12.                       Payment of Certain Expenses.

The
losing party in any suit or proceeding to enforce this Agreement shall
reimburse the prevailing party for all reasonable costs and expenses incurred
in connection with such suit or proceeding.

13.                       Binding Effect.

This
Agreement shall be binding upon and inure to the benefit of the heirs and
representatives of the Executive and the successors and assigns of the
Corporation.  The Corporation shall
require any successor (whether direct or indirect, by purchase, merger,
reorganization, consolidation, acquisition of property or stock, liquidation,
or otherwise) to all or a substantial portion of its assets, by agreement in
form and substance reasonably satisfactory to the Executive, expressly to
assume and agree to perform this Agreement in the same manner and to the same
extent that the Corporation would be required to perform this Agreement if no
such succession had taken place. Regardless of whether such an agreement is
executed, this Agreement shall be binding upon any successor of the Corporation
in accordance with the operation of law, and such successor shall be deemed the
“Corporation” for purposes of this Agreement.

14.                       Notices.

All
notices, requests, demands and other communications hereunder shall be in
writing and shall be deemed to have been duly given if delivered by hand or
mailed 

 

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within the continental United States by first class
certified mail, return receipt requested, postage prepaid, addressed as
follows:

(a)     If to the Board or the Corporation, to:

	
  Alliance Imaging, Inc.

  
	
  1900 S. State College Blvd., Ste. 600

  
	
  Anaheim, CA 92806

  
	
  Attention: General Counsel

  
	
  Facsimile: (714) 688-3377

  

 

 

 

(b)     If to the Executive, to:

	
  Mr. Howard K. Aihara

  
	
  2366 Tryall

  
	
  Tustin, CA 92782

  

 

 

Such addresses may be changed by written notice sent to the other party
at the last recorded address of that party.

 

15.                       Indemnification.

The
Corporation agrees to indemnify the Executive to the fullest extent permitted
by law for his services to, or on behalf of the Corporation, as an Executive
hereunder, as a director (as applicable) and in any and every other capacity in
which he may serve the Corporation or its interests. In furtherance of such
agreement to indemnify, but not by way of limitation, the terms of the
Corporation’s certificate of incorporation and by-laws providing for such
indemnification and payment of expenses, as in effect on the date hereof, are
hereby incorporated by reference as if fully stated herein.  For the purpose of this Agreement, any
amendment to said certificate of incorporation or by-laws shall not be
effective to reduce, qualify or otherwise limit the scope, benefit or
enforceability of this provision; provided, however, if any such amendment
extends or improves the scope, benefit or enforceability of the indemnification
and payment of expenses contained in such certificate of incorporation or
by-laws for any officer, director, employee or agent, such extended or improved
provisions shall be deemed to be incorporated by reference herein for the
benefit of the Executive without any further action by the Corporation or the
Executive.

The
indemnification provided in this Section 15 shall include, without limitation,
all legal fees and expenses that may be incurred by Executive (whether during
the term of his employment hereunder or following the termination of this
Agreement) to the extent that such legal fees and expenses relate to any claim
or other cause of action in respect of the Corporation or Executive’s services
to, or on behalf of, the Corporation as 

 

9

 

Executive hereunder, as a director (as applicable),
and in any and every other capacity in which he may serve the Corporation or
its interests.

16.                       Tax Withholding.

The Corporation shall provide for the withholding of
any taxes required to be withheld by federal, state, or local law with respect
to any payment in cash, shares of stock and/or other property made by or on
behalf of the Corporation to or for the benefit of the Executive under this
Agreement or otherwise.  The Corporation
may, at its option: (a) withhold such taxes from any cash payments owing from
the Corporation to the Executive, (b) require the Executive to pay to the Corporation
in cash such amount as may be required to satisfy such withholding obligations
and/or (c) make other satisfactory arrangements with the Executive to satisfy
such withholding obligations.

17.                       Arbitration.

Except as to any controversy or claim which the
Executive elects, by written notice to the Corporation, to have adjudicated by
a court of competent jurisdiction, any controversy or claim arising out of or
relating to this Agreement or the breach hereof shall be settled by arbitration
in Los Angeles, California in accordance with the laws of the State of
California.  The arbitration shall be
conducted in accordance with the rules of the American Arbitration
Association.  The costs and expenses of
the arbitrator(s) shall be borne by the Corporation. The award of the
arbitrator(s) shall be binding upon the parties. Judgment upon the award
rendered by the arbitrator(s) may be entered in any court having jurisdiction.

18.                       No Assignment.

Except
as otherwise expressly provided herein, this Agreement is not assignable by any
party and no payment to be made hereunder shall be subject to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance or other charge.

19.                       Execution in Counterparts.

This
Agreement may be executed by the parties hereto in two (2) or more
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall constitute one and the same instrument, and all signatures
need not appear on any one counterpart.

20.                       Jurisdiction and Governing Law.

Except
as provided in Paragraph 17, jurisdiction over disputes with regard to this
Agreement shall be exclusively in the courts of the State of California, and
this Agreement shall be construed and interpreted in accordance with and
governed by the laws of the State of California, other than the conflict of
laws provisions of such laws.

 

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21.                       Severability.

If
any provision of this Agreement shall be adjudged by any court of competent
jurisdiction to be invalid or unenforceable for any reason, such judgment shall
not affect, impair or invalidate the remainder of this Agreement.  Furthermore, if the scope of any restriction
or requirement contained in this Agreement is too broad to permit enforcement
of such restriction or requirement to its full extent, then such restriction or
requirement shall be enforced to the maximum extent permitted by law, and the
Executive consents and agrees that any court of competent jurisdiction may so
modify such scope in any proceeding brought to enforce such restriction or
requirement.

22.                       Prior Understandings.

This
Agreement and that certain Letter Agreement by and between the Corporation and
Executive dated even date herewith embodies the entire understanding of the
parties hereto and, upon its effectiveness, will supersede all other oral or
written agreements or understandings between them regarding the subject matter
hereof.  No change, alteration or
modification hereof may be made except in a writing, signed by each of the
parties hereto.  The headings in this
Agreement are for convenience and reference only and shall not be construed as
part of this Agreement or to limit or otherwise affect the meaning hereof.

 

IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the day and year first above written.

 

	
  Attest:

  	
   

  	
   

  	
  ALLIANCE IMAGING, INC.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  /s/ Russell D. Phillips, Jr.

  	
   

  	
  By: 

  	
  /s/ Paul S. Viviano

  	
   

  
	
  Name:

  	
  Russell D. Phillips, Jr.

  	
   

  	
  Name:

  	
  Paul S. Viviano

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chairman of the Board

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Chief Executive Officer

  	
   

  
							

 

 

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
  EXECUTIVE

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  By: 

  	
  /s/ Howard K. Aihara

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  Name:

  	
  Howard K. Aihara

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Executive Vice President

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Chief Financial Officer

  

 

 

 

11Exhibit 10.35

 

December 1, 2005

Mr. Howard K. Aihara

2366 Tryall

Tustin, CA  92782

AGREEMENT

Dear Mr. Aihara:

1.     Reference is made to (i) the Alliance Imaging, Inc. 1999 Equity
Plan (the “Option Plan”) and (ii) the Stock Option Agreement (the “Option Agreement”)
between Alliance Imaging, Inc. (the “Company”) and you, dated as of December 1,
2005.  In consideration of the Company
granting you options under the Option Plan, executing and delivering the Option
Agreement and making the payments described in Paragraph 5 below, you agree
that no Competition Event (as defined below) shall occur prior to nine (9) months
after the Date of Termination (as defined in the employment agreement between
the Company and you as of the date hereof (the “Employment Agreement”)).  Defined terms used but not defined herein
shall have the meaning ascribed thereto in the Employment Agreement.

2.     For purposes of this letter agreement, a Competition Event shall
occur if you directly or indirectly (i) engage in any imaging business or any
other business that becomes material to the Company’s business during your
employment by the Company (the “Company Business”) within the United States
that is the same or substantially similar to or competitive with any service
provided by the Company; (ii) compete or participate as agent, employee,
consultant, advisor, representative or otherwise in any enterprise engaged in a
business which has any operations engaged in the Company Business within the
United States that is the same or substantially similar to or competitive with
any service provided by the Company; or (iii) compete or participate as a
stockholder, partner or joint venturer, or have any direct or indirect
financial interest, in any enterprise which has any material operations engaged
in the Company Business within the United States that is the same or
substantially similar to or competitive with any service provided by the
Company; provided, however, that nothing contained herein shall
prohibit you from owning no more than five percent (5%) of the equity of any
publicly traded entity with respect to which you do not serve as an officer,
director, employee, consultant or in any other capacity other than as an
investor.

3.     As a means reasonably designed to protect certain confidential
information of the Company which would otherwise inherently be utilized in the 

 

 

 

following proscribed activities, and in partial
consideration of the Company’s covenant to make the payment described in
Paragraph 5, you agree that you will not, prior to the nine (9) month
anniversary of the Date of Termination, solicit or make any other contact with,
directly or indirectly, any customer of the Company as of the Date of
Termination with respect to the provision by you of any service to any such
customer that is the same or substantially similar to any service provided to
such customer by the Company.

4.     In partial consideration of the Company’s covenant to make the
payment described in Paragraph 5, you agree that you will not, prior to the nine
(9) month anniversary of the Date of Termination, solicit or make any other
contact with, directly or indirectly, any employee of the Company on the Date
of Termination (or any person who was employed by the Company at any time
during the three-month period prior to the Date of Termination) with respect to
any employment, services or other business relationship.

5.     In partial consideration of your covenants contained herein, the
Company shall, following the Date of Termination, pay you an amount equal to nine
(9) months of your annual base salary as of the effective date of the general
release referred in Paragraph 6 below.  The
payment under this Paragraph 5 shall be made in a lump sum.  Notwithstanding the foregoing, the Company
shall not be obligated to make any payments under this Paragraph 5 to you if
your employment with the Company is terminated by reason of your death or
disability or for Cause or by reason of your resignation other than for Good
Reason.

6.     In partial consideration of the Company’s covenant to make the
payment described in Paragraph 5, the Company may require you to execute a full
release of claims against the Company and its officers, directors, agents and
affiliates concerning such matters and in such form as the Company shall
prescribe.

7.     Notwithstanding paragraph 1 through 4 hereof, if the Company
shall fail to make any payment to you that the Company is obligated to make
pursuant to Paragraph 5 and such failure shall continue for more than five days
after receipt of notice from you, all future payments to you, if any, under
Paragraph 5 shall become immediately due and payable and you shall be relieved
of all obligations under this Agreement.

8.     For purposes of paragraph 2 through 4
hereof, the term Company shall include Alliance Imaging, Inc., its subsidiaries
and/or its affiliates.

9.     You acknowledge that irreparable damage would occur in the event
of a breach of the provisions of this Agreement by you.  It is accordingly agreed that, in addition to
any other remedy to which it is entitled at law or in equity, the Company shall
be entitled to an injunction or injunctions to prevent breaches of 

 

this letter agreement and
to enforce specifically the terms and provisions of this letter agreement.

10.   If, at the time of enforcement, any sentence,
paragraph, clause, or combination of the same of this Agreement is in violation
of the law of any state where applicable, such sentence, paragraph, clause, or
combination of the same shall be void in the jurisdictions where it is
unlawful, and the remainder of this Agreement shall remain binding on the
parties.  In the event that any part of
any covenant of this Agreement is determined by a court of law to be overly
broad thereby making the covenant unenforceable, the parties agree that such
court shall substitute a judicially enforceable limitation in its place, and
that as so modified, the covenants shall be binding upon the parties as if
originally set forth in this Agreement.

If
you are in agreement with the foregoing, please sign a copy of this letter where
indicated below.

Very truly yours,

 

	
   

  	
  ALLIANCE IMAGING, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Paul S. Viviano

  
	
   

  	
  Name:

  	
   

  	
  Paul S. Viviano

  
	
   

  	
  Title:

  	
   

  	
  Chairman of the Board

  
	
   

  	
   

  	
   

  	
  Chief Executive Officer

  

 

Acknowledged and agreed to

as of the date first above

written:

 

	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Howard K. Aihara

  	
   

  
	
   

  	
  Name: Howard K. Aihara

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