CDNA 8-K
CareDx, Inc. (CDNA)
8-K
2024-10-04
For: 2024-09-30
View Original
Added on
April 04, 2026
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): September 30, 2024
(Exact Name of Registrant as Specified in its Charter)
(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||||||||||||
(Address of Principal Executive Offices) (Zip Code)
(415 ) 287-2300
Registrant’s telephone number, including area code
N/A
(Former Name, or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |||||
Securities registered pursuant to Section 12(b) of the Exchange Act:
| (Title of each class) | (Trading Symbol) | (Name of exchange on which registered) | ||||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On September 12, 2024, CareDx, Inc. (the “Company”) announced that the Company reached an agreement with Alexander Johnson, the Company’s President of Patient and Testing Services, pursuant to which Mr. Johnson’s employment would conclude effective as of September 13, 2024 and that such separation would be treated as a termination by the Company without “cause” for purposes of the various agreements in place between the Company and Mr. Johnson.
In connection with Mr. Johnson’s separation, on September 30, 2024, the Company entered into a separation agreement and release of claims with Mr. Johnson (the “Separation Agreement”). Pursuant to the Separation Agreement, subject to Mr. Johnson’s effective release of claims against the Company, Mr. Johnson will receive (i) the severance payments and benefits provided under the Change of Control and Severance Agreement, dated July 19, 2021, between the Company and Mr. Johnson, which consist of continued payment of his base salary for six months from the separation date and, subject to Mr. Johnson’s election of continuation coverage under COBRA, reimbursement of the COBRA premiums for six months from the separation date (or, if earlier, the date on which Mr. Johnson and/or his eligible dependents become covered under similar plans), (ii) a lump sum cash payment equal to $517,920, representing 200% of his target bonus as in effect for the 2024 fiscal year, to be paid at the same time 2024 annual bonuses are generally paid to other senior executives of the Company and (iii) a lump sum cash payment equal to $300,000, representing the unpaid portion of the retention bonus payable pursuant to that certain letter agreement between Mr. Johnson and the Company, dated December 1, 2023, to be paid on the first regularly scheduled payroll date in December 2024. The Separation Agreement includes a mutual non-disparagement provision and subjects Mr. Johnson to non-solicitation of the Company’s employees for 12 months following the effective date of the Separation Agreement.
In connection with Mr. Johnson’s separation, on September 30, 2024, the Company also entered into a consulting agreement with Mr. Johnson (the “Consulting Agreement”), which will have effect retroactive to September 14, 2024 and pursuant to which Mr. Johnson will provide services to the Company as a non-employee consultant to ensure a smooth transition of his duties and responsibilities during his employment with the Company and provide guidance as requested by the Company in connection with such transition. Pursuant to the Consulting Agreement, Mr. Johnson will make himself available for services up to 40 hours of consulting services to the Company in any given calendar month (and for an anticipated average of no more than 20 hours per month) for a period of six months (the “Term”), which may be extended or renewed for additional agreed upon periods upon written agreement of the Company and Mr. Johnson. As consideration for the services to be provided by Mr. Johnson to the Company pursuant to the Consulting Agreement, the Company will pay Mr. Johnson an aggregate fee of $107,901 (the “Fee”), payable in a lump sum at the end of the Term, and Mr. Johnson’s outstanding equity awards will continue to vest pursuant to the terms of the applicable award agreements during the Term. The Consulting Agreement will terminate prior to the expiration of the Term upon Mr. Johnson’s death or disability, upon Mr. Johnson’s valid revocation of the Separation Agreement or upon Mr. Johnson’s written request, and may be terminated by the Company prior to the expiration of the Term for “good cause” (as defined in the Consulting Agreement). Under the Consulting Agreement, a termination upon Mr. Johnson’s death or disability will result in payment of the consideration provided under the Consulting Agreement as if his services continued for the full Term, notwithstanding its earlier termination. In the event of an automatic termination other than on account of Mr. Johnson’s death or disability or a termination by the Company for “good cause,” the Company will only be obligated to pay such portion of the Fee that is pro-rated based on the number of days that lapsed during the Term prior to the date of such termination, and any then-unvested portion of Mr. Johnson’s stock units will automatically expire. The Consulting Agreement subjects Mr. Johnson to non-solicitation of the Company’s employees during the Term and six months thereafter.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit No. | Description | |||||||
| 10.1 | ||||||||
| 10.2 | ||||||||
| 104 | Cover Page Interactive Data File, formatted in Inline Extensible Business Reporting Language (iXBRL). | |||||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: October 4, 2024 | CAREDX, INC. | |||||||||||||||||||
| By: | /s/ John W. Hanna | |||||||||||||||||||
| John W. Hanna | ||||||||||||||||||||
| President and Chief Executive Officer | ||||||||||||||||||||
SEPARATION AGREEMENT AND RELEASE OF CLAIMS
This Separation Agreement and Release of Claims (this “Agreement”) is made by and between CareDx, Inc. (the “Company”), and Alexander Johnson (“Executive”). The Company and Executive are sometimes collectively referred to herein as the “Parties” and individually referred to as a “Party.”
RECITALS
WHEREAS, Executive signed an At-Will Employment, Confidential Information, Invention Assignment and Arbitration Agreement with the Company on March 29, 2018 (the “Confidentiality Agreement”);
WHEREAS, Executive signed a Change of Control and Severance Agreement with the company on July 19, 2021 (the “Severance Agreement”), which, among other things, provides for certain severance benefits to be paid to Executive by the Company upon the termination of Executive’s employment without Cause, unrelated to a Change of Control (as defined in the Severance Agreement) or following a Change of Control of the Company;
WHEREAS, Executive was employed by the Company until September 13, 2024 (“Separation Date”), when Executive’s employment was terminated without Cause unrelated to a Change of Control;
WHEREAS, in accordance with Section 4 of the Severance Agreement between the Company and Executive, Executive has agreed to enter into and not revoke a standard release of claims in favor of the Company as a condition to receiving the Consideration (as defined below);
WHEREAS, in connection with Executive’s termination of employment, Executive has agreed to offer consulting services to the Company, pursuant to a separate Consulting Agreement, which will take effect on September 14, 2024 (the “Consulting Agreement”); and
WHEREAS, the Parties wish to resolve any and all disputes, claims, complaints, grievances, charges, actions, petitions and demands that Executive may have against the Company and any of the Releasees (as defined below), including, but not limited to, any and all claims arising out of or in any way related to Executive’s employment relationship with the Company and the termination of that relationship.
NOW THEREFORE, for good and valuable consideration, including the mutual promises and covenants made herein, the Company and Executive hereby agree as follows:
COVENANTS
1.Separation. Executive’s employment with the Company concluded on the Separation Date.
2.Payment of Salary and Receipt of All Benefits. Executive acknowledges and represents that, other than the Consideration (as defined below) and as provided in the Consulting Agreement, the Company has paid or provided all salary, wages, bonuses, accrued vacation/paid time off, premiums, leaves, housing allowances, relocation costs, interest, severance, outplacement costs, fees, reimbursable expenses, commissions, draws, stock, stock options or other equity awards (including restricted stock unit awards), vesting, and
any and all other benefits and compensation due to Executive and that no other reimbursements or compensation are owed to Executive.
3.Separation Benefits. In consideration of Executive’s release and waiver of claims set forth in Sections 4 and 5 hereof, and subject to Executive’s execution, delivery and non-revocation of this Agreement and continued compliance with this Agreement, the Company will provide Executive with the following separation benefits (collectively, the “Consideration”):
(a)The separation benefits as set forth in Section 3(a) of the Severance Agreement;
(b)A lump-sum cash payment in an amount equal to $517,920, representing an amount equal to two hundred percent (200%) of Executive’s target bonus as in effect for the 2024 fiscal year, such amount to be paid at the same time 2024 annual bonuses are generally paid to other senior executives of the Company, but in no event later than March 15, 2025; and
(c)An amount equal to $300,000, representing the unpaid portion of the retention bonus payable pursuant to that certain letter agreement between Executive and the Company, dated December 1, 2023, such amount to be subject to applicable withholding and paid on the first regularly scheduled payroll date in December 2024.
4.Release of Claims. Executive agrees that the Consulting Agreement and Consideration to be paid in accordance with Section 3 hereof and the terms and conditions of the Severance Agreement represents settlement in full of all outstanding obligations owed to Executive by the Company and its current and former officers, directors, employees, agents, investors, attorneys, stockholders, administrators, affiliates, benefit plans, plan administrators, insurers, trustees, divisions, and subsidiaries, and predecessor and successor corporations and assigns (collectively, the “Releasees”). Executive, on Executive’s own behalf and on behalf of Executive’s respective heirs, family members, executors, agents, and assigns, hereby and forever releases the Releasees from, and agrees not to sue concerning, or in any manner to institute, prosecute, or pursue, any claim, complaint, charge, duty, obligation, demand, or cause of action relating to any matters of any kind, whether presently known or unknown, suspected or unsuspected, that Executive may possess against any of the Releasees arising from any omissions, acts, facts, or damages that have occurred up until and including the Effective Date (as defined below) of this Agreement, including, without limitation the following:
(a)any and all claims relating to or arising from Executive’s employment relationship with the Company and the termination of that relationship;
(b)any and all claims relating to, or arising from, Executive’s right to purchase, or actual purchase of shares of stock of the Company, including, without limitation, any claims for fraud, misrepresentation, breach of fiduciary duty, breach of duty under applicable state corporate law, and securities fraud under any state or federal law;
(c)any and all claims for wrongful discharge of employment; termination in violation of public policy; discrimination; harassment; retaliation; breach of contract, both express and implied; breach of covenant of good faith and fair dealing, both express and implied; promissory estoppel; negligent or intentional infliction of emotional distress; fraud; negligent or intentional misrepresentation; negligent or intentional interference with contract or prospective economic advantage; unfair business practices; defamation; libel; slander; negligence; personal injury; assault; battery; invasion of privacy; false imprisonment; conversion; and disability benefits;
(d)any and all claims for violation of any federal, state, or municipal statute, including, but not limited to, Title VII of the Civil Rights Act of 1964; the Civil Rights Act of 1991; the Rehabilitation Act of 1973; the Americans with Disabilities Act of 1990; the Equal Pay Act; the Fair Labor Standards Act; the Fair Credit Reporting Act; the Age Discrimination in Employment Act of 1967; the Older Workers Benefit Protection Act; the Employee Retirement Income Security Act of 1974; the Worker Adjustment and Retraining Notification Act; the Family and Medical Leave Act; the Sarbanes-Oxley Act of 2002; the California Family Rights Act; the California Labor Code; the California Workers’ Compensation Act; and the California Fair Employment and Housing Act;
(e)any and all claims for violation of the federal, or any state, constitution;
(f)any and all claims arising out of any other laws and regulations relating to employment or employment discrimination;
(g)any claim for any loss, cost, damage, or expense arising out of any dispute over the non-withholding or other tax treatment of any of the proceeds received by Executive as a result of this Agreement; and
(h)any and all claims for attorneys’ fees and costs.
Executive agrees that the release set forth in this Section 4 (the “Release”) will be and remain in effect in all respects as a complete general release as to the matters released. The Release does not extend to any severance obligations due Executive under the Severance Agreement. The Release does not release claims that cannot be released as a matter of law, including, but not limited to, Executive’s right to file a charge with or participate in a charge by the Equal Employment Opportunity Commission, or any other local, state, or federal administrative body or government agency that is authorized to enforce or administer laws related to employment, against the Company (with the understanding that any such filing or participation does not give Executive the right to recover any monetary damages against the Company; Executive’s release of claims herein bars Executive from recovering such monetary relief from the Company). Executive represents that Executive has made no assignment or transfer of any right, claim, complaint, charge, duty, obligation, demand, cause of action, or other matter waived or released by this Section 4. Nothing in this Agreement waives Executive’s rights to indemnification or any payments under any fiduciary insurance policy, if any,
provided by any act or agreement of the Company, state or federal law or policy of insurance.
5.Acknowledgment of Waiver of Claims under ADEA. Executive acknowledges that Executive is waiving and releasing any rights Executive may have under the Age Discrimination in Employment Act of 1967 (“ADEA”) and that this waiver and release is knowing and voluntary. Executive agrees that this waiver and release does not apply to any rights or claims that may arise under the ADEA after the Effective Date of this Agreement. Executive acknowledges that the consideration given for this waiver and release Agreement is in addition to anything of value to which Executive was already entitled. Executive further acknowledges that Executive has been advised by this writing that
(a) Executive should consult with an attorney prior to executing this Agreement;
(b) Executive has at least 21 days within which to consider this Agreement;
(c) Executive has 7 days following the execution of this Agreement by the parties to revoke the Agreement;
(d) this Agreement will not be effective until the revocation period has expired; and
(e) nothing in this Agreement prevents or precludes Executive from challenging or seeking a determination in good faith of the validity of this waiver under the ADEA, nor does it impose any condition precedent, penalties or costs for doing so, unless specifically authorized by federal law. In the event Executive signs this Agreement and delivers it to the Company in less than the 21-day period identified above, Executive hereby acknowledges that Executive has freely and voluntarily chosen to waive the time period allotted for considering this Agreement. Executive acknowledges and understands that revocation must be accomplished by a written notification to the General Counsel of the Company that is received prior to the Effective Date.
6.California Civil Code Section 1542. Executive acknowledges that Executive has been advised to consult with legal counsel and is familiar with the provisions of California Civil Code Section 1542, a statute that otherwise prohibits the release of unknown claims, which provides as follows:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.
Executive, being aware of California Civil Code Section 1542, agrees to expressly waive any rights Executive may have thereunder, as well as under any other statute or common law principles of similar effect.
7.No Pending or Future Lawsuits. Executive represents that Executive has no lawsuits, claims, or actions pending in Executive’s name, or on behalf of any other person or entity, against the Company or any of the other Releasees. The Company represents that
the Company has no lawsuits, claims, or actions pending in the Company’s name against the Executive. Executive also represents that Executive does not intend to bring any claims on Executive’s own behalf or on behalf of any other person or entity against the Company or any of the other Releasees.
8.Sufficiency of Consideration. Executive hereby acknowledges and agrees that Executive has received good and sufficient consideration for every promise, duty, release, obligation, agreement and right contained in this Release.
9.Confidential Information. Executive reaffirms and agrees to observe and abide by the terms of the Confidentiality Agreement, specifically including the provisions therein regarding nondisclosure of the Company’s trade secrets and confidential and proprietary information, which agreement will continue in force; provided, however, that: (a) as to any provisions regarding competition contained in the Confidentiality Agreement that conflict with the provisions regarding competition contained in the Severance Agreement, the provisions of the Severance Agreement will control; (b) as to any provisions regarding solicitation of employees contained in the Confidentiality Agreement that conflict with the provisions regarding solicitation of employees contained in this Agreement, the provisions of this Agreement will control.
10.Return of Company Property; Passwords and Password-protected Documents. Executive confirms that Executive will return to the Company in good working order all keys, files, records (and copies thereof), equipment (including, but not limited to, computer hardware, software and printers, wireless handheld devices, cellular phones and pagers), access or credit cards, Company identification, and any other Company-owned property in Executive’s possession or control. Executive further confirms that Executive will cancel all accounts for Executive’s benefit, if any, in the Company’s name, including, but not limited to, credit cards, telephone charge cards, cellular phone and/or pager accounts and computer accounts. Executive also confirms that Executive has delivered all passwords in use by Executive at the time of Executive’s termination, a list of any documents that Executive created or of which Executive is otherwise aware that are password- protected, along with the password(s) necessary to access such password-protected documents. All of the foregoing obligations will be completed promptly after the conclusion of Executive’s provision of consulting services, unless earlier requested in writing by the Company, in which case, such will be completed promptly after Executive’s receipt of the written request.
11.No Cooperation. Executive agrees that Executive will not knowingly encourage, counsel, or assist any attorneys or their clients in the presentation or prosecution of any disputes, differences, grievances, claims, charges, or complaints by any third party against any of the Releasees, unless under a subpoena or other court order to do so or as related directly to the ADEA waiver in this Agreement. Executive agrees both to promptly notify the Company upon receipt of any such subpoena or court order, and to furnish, within seven days of its receipt, a copy of such subpoena or other court order, if permitted by governing law. If approached by anyone for counsel or assistance in the presentation or prosecution of any disputes, differences, grievances, claims, charges, or complaints
against any of the Releasees, Executive will state no more than that Executive cannot provide any such counsel or assistance.
12.Nondisparagement. Executive agrees that Executive will not directly or indirectly disparage or defame the Company, its business interests or reputation, or that of any of the other Releasees. The Company agrees not to issue any public statements or press releases making, and to instruct the current members of the Board of Directors of the Company and the current executive officers of the Company to not make, any disparaging or defamatory comments regarding Executive.
13.No Admission of Liability. Executive understands and acknowledges that this Agreement constitutes a compromise and settlement of any and all actual or potential disputed claims by Executive. No action taken by the Company hereto, either previously or in connection with this Agreement, will be deemed or construed to be (a) an admission of the truth or falsity of any actual or potential claims or (b) an acknowledgment or admission by the Company of any fault or liability whatsoever to Executive or to any third party.
14.Solicitation of Employees. Executive agrees that for a period of 12 months immediately following the Effective Date of this Agreement, Executive will not directly or indirectly solicit, or recruit any of the Company’s employees to leave their employment at the Company either for Executive or for any other person or entity, any of the Company’s employees to leave their employment.
15.Costs. The Parties will each bear their own costs, attorneys’ fees and other fees incurred in connection with the preparation of this Agreement.
16.Arbitration. THE PARTIES AGREE THAT ANY AND ALL DISPUTES ARISING OUT OF THE TERMS OF THIS AGREEMENT, THEIR INTERPRETATION, AND ANY OF THE MATTERS HEREIN RELEASED, WILL BE SUBJECT TO ARBITRATION IN SANTA CLARA COUNTY, BEFORE JUDICIAL ARBITRATION & MEDIATION SERVICES (“JAMS”), PURSUANT TO ITS EMPLOYMENT ARBITRATION RULES & PROCEDURES (“JAMS RULES”). THE ARBITRATOR MAY GRANT INJUNCTIONS AND OTHER RELIEF IN SUCH DISPUTES. THE ARBITRATOR WILL ADMINISTER AND CONDUCT ANY ARBITRATION IN ACCORDANCE WITH CALIFORNIA LAW, INCLUDING THE CALIFORNIA CODE OF CIVIL PROCEDURE, AND THE ARBITRATOR WILL APPLY SUBSTANTIVE AND PROCEDURAL CALIFORNIA LAW TO ANY DISPUTE OR CLAIM, WITHOUT REFERENCE TO ANY CONFLICT-OF-LAW PROVISIONS OF ANY JURISDICTION. TO THE EXTENT THAT THE JAMS RULES CONFLICT WITH CALIFORNIA LAW, CALIFORNIA LAW WILL TAKE PRECEDENCE. THE DECISION OF THE ARBITRATOR WILL BE FINAL, CONCLUSIVE, AND BINDING ON THE PARTIES TO THE ARBITRATION. THE PARTIES AGREE THAT THE PREVAILING PARTY IN ANY ARBITRATION WILL BE ENTITLED TO INJUNCTIVE RELIEF IN ANY COURT OF COMPETENT JURISDICTION TO ENFORCE THE ARBITRATION AWARD. THE COMPANY WILL PAY THE COSTS AND EXPENSES OF SUCH ARBITRATION, AND EACH PARTY WILL SEPARATELY PAY FOR ITS RESPECTIVE COUNSEL FEES AND EXPENSES; THE ARBITRATOR WILL NOT AWARD ATTORNEYS’ FEES AND COSTS TO
THE PREVAILING PARTY, EXCEPT AS REQUIRED BY LAW. THE PARTIES HEREBY AGREE TO WAIVE THEIR RIGHT TO HAVE ANY DISPUTE BETWEEN THEM RESOLVED IN A COURT OF LAW BY A JUDGE OR JURY. NOTWITHSTANDING THE FOREGOING, THIS SECTION WILL NOT PREVENT EITHER PARTY FROM SEEKING INJUNCTIVE RELIEF (OR ANY OTHER PROVISIONAL REMEDY) FROM ANY COURT HAVING JURISDICTION OVER THE PARTIES AND THE SUBJECT MATTER OF THEIR DISPUTE RELATING TO THIS AGREEMENT AND THE AGREEMENTS INCORPORATED HEREIN BY REFERENCE. SHOULD ANY PART OF THE ARBITRATION AGREEMENT CONTAINED IN THIS PARAGRAPH CONFLICT WITH ANY OTHER ARBITRATION AGREEMENT BETWEEN THE PARTIES, THE PARTIES AGREE THAT THIS ARBITRATION AGREEMENT WILL GOVERN.
17.Authority. The Company represents and warrants that the undersigned has the authority to act on behalf of the Company and to bind the Company and all who may claim through it to the terms and conditions of this Agreement. Executive represents and warrants that Executive has the capacity to act on Executive’s own behalf and on behalf of all who might claim through Executive to bind them to the terms and conditions of this Agreement. Each Party warrants and represents that there are no liens or claims of lien or assignments in law or equity or otherwise of or against any of the claims or causes of action released herein.
18.No Representations. Executive represents that Executive has had the opportunity to consult with an attorney, and has carefully read and understands the scope and effect of the provisions of this Agreement. Executive has relied upon any representations or statements made by the Company that are not specifically set forth in this Agreement.
19.Severability. In the event that any provision or any portion of any provision hereof or any surviving agreement made a part hereof becomes or is declared by a court of competent jurisdiction or arbitrator to be illegal, unenforceable, or void, this Agreement will continue in full force and effect without said provision or portion of provision.
20.Entire Agreement. This Agreement represents the entire agreement and understanding between the Company and Executive concerning the subject matter of this Agreement and Executive’s employment with and separation from the Company and the events leading thereto and associated therewith, and supersedes and replaces any and all prior agreements and understandings concerning the subject matter of this Agreement and Executive’s relationship with the Company, with the exception of the Severance Agreement, the Confidentiality Agreement, the Consulting Agreement, and Executive’s written equity compensation agreements with the Company.
21.No Oral Modification. This Agreement may only be amended in writing signed by Executive and the Chairman of the Board of Directors of the Company.
22.Governing Law. This Agreement will be governed by the laws of the State of California, without regard for choice-of-law provisions. Executive consents to personal and exclusive jurisdiction and venue in the State of California.
23.Effective Date. Executive understands that he may review this Agreement for at least 21 days. Executive has seven (7) days after he signs this Agreement to revoke it. This Agreement will become effective on the eighth (8th) day after Executive signed this Agreement, so long as it has not been revoked by Executive before that date (the “Effective Date”).
24.Counterparts. This Agreement may be executed in counterparts and by facsimile, and each counterpart and facsimile will have the same force and effect as an original and will constitute an effective, binding agreement on the part of each of the undersigned.
25.Voluntary Execution of Agreement. Executive understands and agrees that Executive executed this Agreement voluntarily, without any duress or undue influence on the part or behalf of the Company or any third party, with the full intent of releasing all of Executive’s claims against the Company and any of the other Releasees. Executive expressly acknowledges that:
(a)Executive has read this Agreement;
(b)Executive has been represented in the preparation, negotiation, and execution of this Agreement by legal counsel of Executive’s own choice or has elected not to retain legal counsel;
(c)Executive understands the terms and consequences of this Agreement and of the releases it contains; and
(d)Executive is fully aware of the legal and binding effect of this Agreement.
* * * * *
IN WITNESS WHEREOF, the Parties have executed this Agreement on the respective dates set forth below.
COMPANY CAREDX, INC.
By: /s/ John W. Hanna
Name: John W. Hanna
Title: President and Chief Executive Officer
Dated: September 30, 2024
EXECUTIVE Alexander Johnson, an individual
By: /s/ Alexander Johnson
(Signature)
Dated: September 30, 2024
CONSULTING AGREEMENT
This Consulting Agreement (“Agreement”) is entered into on September 30, 2024 and is effective on September 14, 2024 (“Effective Date”) and is between CareDx, Inc., with a business address at 8000 Marina Blvd, Brisbane, CA 94005 (“CareDx” or the “Company”) and Alexander Johnson (“Consultant”). CareDx and Consultant may be referred to individually as a (“Party”) and collectively as the (“Parties”).
1.Services
a.Consultant will perform the consulting services described in Exhibit A (“Services”). CareDx will compensate Consultant as set forth in Exhibit A. Both Parties acknowledge that this compensation represents the fair market value of Consultant’s Services.
b.Upon written backup provided to CareDx, CareDx will reimburse Consultant for all reasonable travel, lodging and incidental expenses incurred in the performance of the Services (“Reimbursable Expenses”).
c.CareDx must comply with legal requirements to provide compliance and regulatory training to certain of its consultants. Consultant agrees to complete any appropriate mandated training as may be assigned by CareDx.
2.Confidentiality
a.Consultant understands that his consulting work for CareDx creates a relationship of confidence and trust with respect to any information of a confidential or secret nature that (i) relates to the business of CareDx or to the business of any parent, subsidiary, affiliate, customer or vendor of CareDx or any other party with whom CareDx agrees to hold information of such party in confidence; (ii) is not generally known to the public or to other persons in the industry; and (iii) CareDx has taken reasonable measures under the circumstances to protect from unauthorized use or disclosure (“Confidential Information”). Confidential Information means (a) trade secrets; (b) proprietary information that does not rise to the level of a statutorily protectable trade secret that is made the property of CareDx through positive operation of law in the form of this mutual agreement of the parties; or (c) information that is otherwise legally protectable. Such Confidential Information includes, but is not limited to, Work Product (as defined below), information protected by the attorney/client privilege and attorney work product doctrine, and non-public knowledge, data, information and know-how, such as information relating to CareDx’s products, services, and methods of operation, the identities and competencies of CareDx’s employees, customers and suppliers, chemical formulae, computer software, financial information, operating and cost data, research databases, selling and pricing information, business and marketing plans, and information concerning potential acquisitions, dispositions or joint ventures, as well as all non-public intellectual property rights including unpublished or pending patent applications and all related patent rights, techniques, formulae, processes, discoveries, improvements, ideas, conceptions,
Page 1 of 10
compilations of data and developments, whether or not patentable and whether or not copyrightable. The foregoing are only examples of Confidential Information.
b.Consultant will, at all times, both during the term of this Agreement and for seven (7) years thereafter, hold all Confidential Information in the strictest confidence. Consultant will not attempt unauthorized access to Confidential Information, or use, disclose, copy, reverse-engineer or distribute any Confidential Information without the prior written consent of CareDx, except as may be necessary to perform Services. Despite Consultant’s confidentiality obligations, Consultant understands that he is permitted to disclose Confidential Information that is required to be disclosed pursuant to regulatory, administrative, judicial order or other legal mandate, provided that, to the extent legally permitted, Consultant has given CareDx prompt notice of the disclosure requirement, and that Consultant reasonably cooperates with any efforts by CareDx to obtain and comply with any protective order imposed on such disclosure.
c.Confidential Information does not include information that Consultant can show: (i) was generally available to, or known by, the relevant public at the time of disclosure, or became generally available to, or known by the relevant public, after disclosure to Consultant; (ii) was lawfully received by Consultant from a third party without breach of any confidentiality obligation; (iii) was known to Consultant prior to receipt from CareDx; or (iv) was independently developed by Consultant or independent third parties without breach by Consultant or any third party of any obligation of confidentiality or non-use.
d.During the term of this Agreement, Consultant will not improperly use, disclose or induce CareDx to use any confidential information of any former or current employer (other than CareDx) or other person or entity with which Consultant has an agreement or duty to keep information in confidence.
e.Upon termination or expiration of this Agreement, or upon CareDx’s earlier written request, Consultant will deliver to CareDx, and will not keep in his possession, recreate or deliver to anyone else, any and all CareDx property, including, but not limited to, Confidential Information, as well as all devices and equipment belonging to CareDx (including computers, handheld electronic devices, telephone equipment and other electronic devices), CareDx credit cards, records, data, notes, notebooks, reports, files, proposals, lists, correspondence, specifications, drawings, blueprints, sketches, materials, photographs, charts, any other documents and property, and reproductions of any and all of the aforementioned items that were developed by Consultant as part of Consultant’s Services for CareDx, obtained by Consultant in connection with Consultant’s Services for CareDx, or otherwise belonging to CareDx. If, at the time of termination, Consultant has Confidential Information stored in Consultant’s personal computer or any mobile, cloud or other storage medium, Consultant will so advise CareDx and not delete, cache or transfer it. Consultant will then work with CareDx to ensure that the location of all such information is fully disclosed
Page 2 of 10
to CareDx, retrieved and returned to CareDx in a forensically sound manner, and is permanently deleted.
3.Intellectual Property
a.Consultant hereby assigns and will assign all inventions, improvements, ideas, designs, original works of authorship, formulas, processes, compositions of matter, computer software programs and databases, that Consultant makes, creates, conceives, or first reduces to practice during the term of this Agreement that (i) are developed using equipment, supplies, facilities or trade secrets of CareDx, or (ii) are developed within the course and scope of Consultant’s performance of Services hereunder (“Work Product”).
b.Consultant recognizes and understands that this Agreement does not require assignment of any inventions that are developed either (i) during the course of and within the scope of Consultant’s non-CareDx consulting work or employment with a subsequent employer, or (ii) entirely on Consultant’s own time, and with respect to both the foregoing clauses (i) and (ii), without using any of CareDx’s equipment, supplies, facilities, trade secrets or Confidential Information. Consultant hereby represents to CareDx that he does not own, individually or jointly with any other person or persons, any original works of authorship, inventions, developments or trade secrets that belong to Consultant that are not assigned to CareDx (“Prior Inventions”).
c.To the extent any future act is required, Consultant will reasonably assist CareDx, or its designee, at CareDx’s expense, to secure CareDx’s rights in the Work Product including copyrights, patents, mask work rights or other intellectual property rights relating thereto in any and all countries. Consultant will execute or cause to be executed any such instrument or papers during the term of this Agreement and after the term of this Agreement. If, at any time, a court or other tribunal rules that the assignment under this section is ineffective or unenforceable for any reason, Consultant agrees to perform all actions reasonably necessary to assign the Work Product to CareDx.
d.If Consultant incorporates any invention, improvement, development, concept, discovery, Prior Invention or other confidential information owned by Consultant or in which Consultant has an interest, into any Work Product, Consultant hereby grants and will grant, without any further action required by either Party, a nonexclusive, royalty-free, perpetual, irrevocable, with the right to grant and authorize sublicenses, worldwide license to use, make, have made, modify, use and sell such item as part of or in connection with such Work Product.
e.If CareDx is unable because of Consultant’s unavailability, mental or physical incapacity, or any other reason, to secure Consultant’s signature to pursue any application for any United States or foreign patents or mask work or copyright registrations covering the Work Product, then Consultant hereby irrevocably designates and appoints CareDx and its duly authorized officers and agents as Consultant’s agent and attorney-in-fact, to act for and on Consultant’s behalf to
Page 3 of 10
execute and file any such applications and to do all other lawfully permitted acts to further the prosecution and issuance of patents, copyright and mask work registrations thereon with the same legal force and effect as if executed by Consultant.
4.No Conflicting Obligations
Consultant warrants that entering into this Agreement does not violate any outstanding agreement, obligation or employment arrangement of Consultant. Consultant further warrants that during the term of this Agreement, he will not enter into any such conflicting agreement, without the written agreement of CareDx. Further, Consultant will not perform any services for CareDx that would conflict with any agreement or obligation of Consultant, or which would cause or result in any other person or entity having any ownership interest in any CareDx intellectual property, including Work Product (as defined below).
5.Term and Termination
The term of this Agreement will begin on the Effective Date and will continue in full force and effect for a period of six (6) months from the Effective Date (the “Term”). This Agreement may be extended or renewed for additional agreed upon periods upon the written agreement of the Parties.
This Agreement will terminate automatically exclusively (i) upon Consultant’s death or disability (if such disability substantially impairs his ability to provide consulting to the Company), (ii) upon Consultant’s valid revocation of that certain Separation Agreement and Release of Claims by and between CareDx and Consultant, dated as of September 30, 2024 (the “Separation Agreement”), or (iii) Consultant’s written request to terminate this Agreement (in each case, such a termination, an “Automatic Termination”). In the event of an Automatic Termination under (ii) and (iii), notwithstanding anything in this Agreement to the contrary, the Company will only be obligated to pay for consulting actually rendered on or before the date of such automatic termination. An Automatic Termination under (i) for Consultant’s death or disability shall result in payment of the consideration provided for under this Agreement as if Consultant’s Services continued for the full Term, notwithstanding its earlier termination.
Further, CareDx may terminate this Agreement for “Good Cause.” For the purposes of this Agreement, “Good Cause” shall be defined as any act or omission by Consultant that, in CareDx’s sole and reasonable discretion, is materially detrimental to the Company’s business interests, reputation, or financial well-being, including but not limited to, acts of misconduct, material violation of CareDx policies, willful failure to fulfill the material terms of this Agreement, material breach of confidentiality, Consultant’s material breach of his Separation Agreement, any criminal or fraudulent activities. CareDx’s determination of “Good Cause” must be reasonable and in good faith and shall be final and binding, and Consultant shall have no right to contest or dispute such determination. Upon termination for “Good Cause,” Consultant shall not be entitled to any further compensation or benefits under this Agreement.
Page 4 of 10
6.Independent Contractor
Consultant is an independent contractor and nothing in this Agreement or the performance of the Parties under this Agreement will constitute (or be deemed to constitute in law or in equity) a partnership, agency, distributorship, fiduciary, employment, principal/agent relationship or joint venture relationship between the Parties. The Parties are not affiliated and neither has any right or authority to bind the other in any way. As such, except for the continued vesting of Company equity and the compensation specified herein, Consultant will not be entitled to any benefits accorded to CareDx’s employees, including workers’ compensation, disability insurance, vacation or sick pay. Consultant will have sole control of and will determine the manner, method, details and means of performing the obligations under this Agreement, provided, however, that CareDx retains the right to control the overall objectives regarding the Services.
7.DTSA Notification
Despite Consultant’s confidentiality obligations set forth in this Agreement, Consultant understands that, pursuant to the Defend Trade Secrets Act of 2016, Consultant will not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that: (a) is made (i) in confidence to a federal, state or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or (b) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. If Consultant files a lawsuit for retaliation by CareDx for reporting a suspected violation of law, Consultant may disclose the trade secret to Consultant’s attorney and may use the trade secret information in the court proceeding, if Consultant (a) files any document containing the trade secret under seal, and (b) does not disclose the trade secret, except pursuant to court order.
8.Restrictive Covenants
Consultant will not, during the Term and, to the fullest extent permissible under applicable law, for six (6) months thereafter, directly or indirectly solicit employees or consultants of CareDx to terminate their relationship with CareDx, except within the scope of Consultant’s work for the Company as directed by CareDx. Despite the previous sentence, Consultant may hire CareDx employees or consultants that respond to a general solicitation for employment or other engagement. Consultant will not during the Term directly or indirectly solicit or induce vendors or customers of CareDx to terminate their relationship with CareDx, except within the scope of Consultant’s work for the Company as directed by CareDx.
Consultant acknowledges that he is in possession of and will have continuing access to the Company’s Confidential Information (as defined in Section 2 above) while Consultant provides services under this Agreement, and accordingly Consultant shall have a fiduciary duty and an undivided duty of loyalty to the Company such that Consultant shall not, absent permission in writing from Company’s Chief Executive Officer, while providing services to the Company, (i) invest in, accept employment with,
Page 5 of 10
or render managerial, advisory or consulting services to any third party directly or indirectly competitive with the Company’s current business or currently contemplated potential future businesses known to Consultant; or (ii) perform services for himself or any third party, if doing so threatens to or actually requires him to reveal or utilize the Company’s Confidential Information.
9.Indemnification
Consultant will indemnify, defend (with counsel reasonably acceptable to CareDx) and hold harmless CareDx and its directors, officers, employees, affiliates, shareholders, agents, representatives and successors in interest from and against any and all third party claims, demands, suits, actions, causes of actions, legal or administrative proceedings, losses, damages, liabilities, costs and expenses, including but not limited to, reasonable attorneys’ fees, arising directly from: (a) Consultant’s willful failure to comply with material applicable laws, or regulations concerning the performance of Services hereunder, including without limitation any actual violation of any third party’s confidential information or other intellectual property rights in connection with the performance of the Services; (b) any intentional misconduct of Consultant concerning the performance of Services hereunder; or (c) the breach of any representation, warranty or covenant made by Consultant herein. For the avoidance of doubt, in no circumstances shall the total amount of indemnification provided exceed the Fee paid under Section 4 of Exhibit A to this Agreement.
10.Limitation of Liability
Except for a willful breach of this Agreement by either Party or a breach by Consultant of Sections 2, 3, or 8, in no event will either Party be liable to the other for any special, incidental, punitive or consequential damages of any kind in connection with this Agreement, even if such party has been informed in advance of the possibility of such damages. Moreover, in no event shall either Party’s aggregate liability under this Agreement, including under Section 9 above, exceed the amount of the Fee paid to Consultant under this Agreement.
11.Compliance with Laws
Consultant warrants to CareDx that during the term of this Agreement, Consultant: (a) is not currently excluded, debarred, or otherwise ineligible to participate in any federal health care program as defined in 42 U.S.C. Section 1320a-7b(f) or any state healthcare program (collective, the “Healthcare Programs”); (b) has not been convicted of a criminal offense related to the provision of health care items or services and not yet been excluded, debarred or otherwise declared ineligible to participate in the Healthcare Programs; and (c) is not under investigation or otherwise aware of any circumstances which may result in Consultant being excluded from participation in Healthcare Programs. Consultant will immediately notify CareDx of any change in the status of the representations and warranties set forth in this section.
12.Miscellaneous
Page 6 of 10
a.Severability. If any provision of this Agreement is determined to be illegal or unenforceable, that provision will be limited or eliminated to the minimum extent necessary so that this Agreement will otherwise remain enforceable and in full force and effect.
b.Survival. Sections 2 (Confidentiality), 3 (Intellectual Property), 8 (Restrictive Covenants), 9 (Indemnification), 10 (Limitation of Liability), and 12 (Miscellaneous) will survive such termination or expiration of this Agreement.
c.Governing Law. This Agreement will be governed by and construed under the laws of the State of California without regard to the conflict of law provisions thereof. Each Party consents to venue exclusively in San Mateo County, California, for any dispute or controversy arising out of or relating to any interpretation, construction, performance, or breach of this Agreement.
d.Equitable Remedies. In the event of a breach or a threatened breach of this Agreement by a Party, the other Party may seek judicial relief in any forum with jurisdiction over the Parties. In such case, each Party agrees that the other Party may suffer irreparable harm and will therefore be entitled to request injunctive relief to enforce this Agreement, without any requirement to obtain bonds or other security. Each Party also acknowledges that, in the event of breach of this Agreement by such Party, the other Party may pursue any and all available legal remedies, including monetary damages.
e.No Assignment. Consultant may not assign this Agreement to any third party.
f.Waiver. Waiver by either Party of a breach of any provision of this Agreement will not operate as a waiver of any other or subsequent breach.
g.Entire Agreement. This Agreement is the entire agreement of the Parties and supersedes any prior agreements, understandings, or arrangement between them with respect to the subject matter hereof, except to the extent such prior agreements are referenced herein.
h.Modifications. This Agreement may be modified only by a subsequent written agreement signed by both Parties.
i.Execution. This Agreement may be executed via facsimile, electronic signature via recognized provider (e.g., DocuSign or Adobe), or “.pdf” file, and in two counterparts, each of which will be deemed an original, but both of which together will constitute one and the same instrument and will have the same legal force and effect as the exchange of original signatures.
CareDx, Inc. Alexander Johnson
By: /s/ John W. Hanna By: /s/ Alexander Johnson
Name: John W. Hanna Date: September 30, 2024
Title: President and Chief Executive Officer
Date: September 30, 2024
Page 7 of 10
EXHIBIT A
1. Contact
Consultant’s Contact information is as follows:
Name: Alexander Johnson
Address: 379 East Strawberry Drive, Mill Valley CA 94941
United States
Phone: 917-757-1889
Email: [email protected]
2. Services
During the Term, Consultant will act as a non-employee consultant and agrees to (i) render Consultant’s assistance and participation, giving at all times the full benefit of his knowledge, expertise, technical skill, and ingenuity, in all matters involved in or relating to any matter in which Consultant was involved during his employment with the Company and its affiliates or of which he has knowledge and (ii) assist to transition the duties and responsibilities of his role during his employment with the Company, and to answer questions and provide guidance as requested by the Company in connection with such transition. During the Term, Consultant will report to the Company’s Chief Executive Officer, but shall also be available to consult with other members of the Company’s leadership team as reasonably requested from time to time. This Agreement is governed by the laws of the state of California. The Services may be performed, at Consultant’s discretion, remotely via Zoom or similar teleconferencing technology.
3. Time Commitment
Consultant shall be available to provide services for a maximum of forty (40) hours in any given calendar month, and for an anticipated average of no more than twenty (20) hours per month beginning on the Effective Date.
4. Compensation and Expense Reimbursement
For Consultant’s Services during the Term, CareDx shall remunerate Consultant with an aggregate fee of $107,901 (the “Fee”), which will be paid in a lump sum at the end of the Term.
Furthermore, during the Term, the outstanding equity awards held by Consultant set forth in Schedule A below will continue to vest pursuant to the terms of the applicable award agreements, which Consultant would have otherwise received had he remained employed during the Term. The vesting rate shall remain unaffected and shall not be reduced, deferred, or canceled, regardless of the number of hours required to work during the term of this Agreement. For the avoidance of doubt, Consultant understands and agrees that the continued vesting of any
Page 8 of 10
stock options that previously qualified as “incentive stock options” (ISOs) will no longer qualify as ISOs as a result of the continued vesting provided for above and, as a result, such stock options will hereinafter be treated as nonqualified stock options.
In the event of an Automatic Termination, the Company will only be obligated to pay such portion of the Fee that is pro-rated based on the number of days that lapsed during the Term prior to the date of such Automatic Termination, and Consultant’s unvested stock units will automatically expire.
In the event of a termination for Good Cause, the Company will only be obligated to pay such portion of the Fee that is pro-rated based on the number of days that lapsed during the Term prior to the date of such termination, and Consultant’s unvested stock units will automatically expire.
CareDx will reimburse Consultant all pre-authorized Reimbursable Expenses upon presentation of an invoice, including original receipts.
Page 9 of 10
SCHEDULE A
A.Johnson Equity Awards
As of 9-13-2024
Option Grants
Grant Date | Exercise Price | Unvested Options | ||||||
02/01/2023 | $15.66 | 1,838 | ||||||
02/03/2021 | $87.37 | 333 | ||||||
02/02/2022 | $41.32 | 2,962 | ||||||
08/09/2022 | $23.48 | 2,066 | ||||||
02/01/2023 | $15.66 | 24,806 | ||||||
02/03/2021 | $87.37 | 500 | ||||||
07/19/2021 | $78.02 | 3,055 | ||||||
02/02/2022 | $41.32 | 7,628 | ||||||
08/09/2022 | $23.48 | 49,569 | ||||||
Restricted Stock Unit and Performance Restricted Stock Unit Awards
RSU or PRSU | Grant Date | Unvested Shares | ||||||
RSU | 02/03/2021 | 1,000 | ||||||
RSU | 02/03/2021 | 1,000 | ||||||
RSU | 07/19/2021 | 3,333 | ||||||
RSU | 02/02/2022 | 9,950 | ||||||
RSU | 08/09/2022 | 18,256 | ||||||
RSU | 02/01/2023 | 63,825 | ||||||
RSU | 02/01/2024 | 145,434 | ||||||
PRSU | 02/02/2022 | 4,975 | ||||||
PRSU | 02/01/2023 | 37,800 | ||||||
Page 10 of 10