EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (this "Agreement"), dated as of this 15th
day of February, 1996, by and between Catalina Coatings, Inc., an Arizona
corporation (the "Company"), and Xxxxx X. Xxxx, an individual, residing at 0000
X. Xxxxx Xxxxxxxx, Xxxxxx, Xxxxxxx 00000 ("Employee").
W I T N E S S E T H:
WHEREAS, the Company wishes to employ Employee, and Employee
wishes to accept such employment, all upon the terms and conditions herein
contained;
NOW, THEREFORE, the parties hereby agree as follows:
1. Term. Subject to the terms and conditions of this
Agreement, the Company hereby employs Employee, and Employee hereby accepts such
employment, commencing as of the date hereof and ending on the fourth
anniversary of the date hereof unless this Agreement is earlier terminated in
accordance with the provisions of Section 7 (the "Term").
2. Duties of Employee.
(a) General Duties. During the Term, Employee shall be
employed by the Company as its President and technical director and shall have
day-to-day responsibility for administration and product and technology
development. Employee shall report directly to the Board of Directors of the
Company (the "Board") or to a duly designated representative of the Board.
Employee acknowledges that Employee's duties may be reasonably changed by the
Board, and Employee will serve the Company in such other capacities and with
such other duties and responsibilities as may be reasonably determined by the
Board. Notwithstanding the foregoing, Employee shall in no event be required to
relocate his place of residence from Tucson, Arizona. The duties and services to
be performed by Employee hereunder are collectively referred to herein as the
"Services."
(b) Other Duties and Obligations. In addition to performing
the Services described in Section 2(a), during the term of this Agreement,
Employee shall:
(i) perform the Services hereunder, subject to, and
in accordance with, the reasonable directions of the Board;
(ii) comply with and be bound by the operating
policies, procedures, standards, regulations and practices of
the Company that are in effect from time to time during
Employee's employment with the Company;
(iii) be generally available and readily accessible
to Company personnel by telephone, e-mail and facsimile at all
reasonable times.
(iv) not engage in any unethical, dishonest,
fraudulent behavior; or intentionally or deliberately cause or
attempt to cause an injury to the Company; or steal, convert,
misappropriate or wrongfully and willfully use or disclose any
proprietary information or trade secrets of the Company; or
breach any provision of the Confidentiality Agreement as
defined in Section 6 hereof.
3. Representations of Employee. Employee hereby represents and
warrants to the Company that he is free to enter into and fully perform this
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Agreement and the agreements referred to herein without breach of any agreement
or contract to which Employee is a party or by which Employee is bound.
4. Exclusive Service. Employee shall devote his full working
time, energy, skill and efforts exclusively to the performance of the Services
for the Company and shall apply all his skill and experience to the performance
of the Services and the advancement the Company's interests. Employee shall not
do anything inconsistent with the performance of the Services hereunder.
Notwithstanding the foregoing, Employee may engage in outside investments so
long as they only occupy a nominal amount of Employee's time.
5. Compensation.
(a) Salary. In consideration for the Services rendered by
Employee hereunder, the Company shall pay Employee a salary of $150,000.00 per
year (the "Salary") and any increases to the Salary shall be made at the option
of the Company, in its sole and absolute discretion.
(b) Expenses. During the Term, Employee shall be entitled
to receive prompt reimbursement for all reasonable expenses incurred by him in
performing services hereunder in accordance with the existing policies of
Presstek, Inc., the parent of the Company("Presstek"), provided that Employee
properly accounts therefor in accordance with the Company's policy relating
thereto.
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(c) Benefit Plans. Employee shall be entitled to
participate in or receive benefits under any employee benefit plan or
arrangement currently available, or made available by the Company in the future,
to its employees, subject to and on a basis consistent with the terms,
conditions and overall administration of such plan or arrangement and consistent
with the benefit plans of Presstek for employees at a level comparable with that
of Employee.
(d) Vacations, Holidays and Sick Leave. Employee shall be
entitled to the number of paid holidays, personal days off, vacation days and
sick leave days in each calendar year as are determined by the Company from time
to time for its employees (prorated in any calendar year during which Employee
is employed under this Agreement for less than the entire such year, in
accordance with the number of calendar days in such calendar year during which
he is so employed), provided that Employee's continuous service date shall be
deemed to be January 1, 1991. Vacation may be taken in Employee's discretion, so
long as it is not inconsistent with the reasonable business needs of the
Company. Employee shall be entitled to accrue from year to year all vacation
days not taken by him. The vacation policy of the Company, including the
foregoing expression of Employee's entitlement, shall in all instances be made
consistent with the policy of Presstek for employees of the same or similar
level as Employee.
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(e) Key Man Life Insurance. If in the sole discretion of
the Board of Directors of the Company the Board shall deem it appropriate to
acquire so-called key man life insurance on the life of Employee, Employee shall
cooperate with the Company to secure, for the Company, a key man life insurance
policy on the life of Employee in an amount determined by the Board, to be paid
to the Company upon Employee's death.
(f) Base Salary Not Affected by Other Benefits. None of the
benefits to which Employee is entitled under any of the provisions of Sections
5(b) - 5(g) hereof shall in any manner reduce or be deemed to be in lieu of the
Salary payable to Employee pursuant to Section 5(a) hereof.
6. Confidentiality and Non-Competition Agreement. All
obligations of the Company hereunder, including, but not limited to, its
obligations to employ and compensate Employee shall be subject to the execution
and delivery of the Confidentiality and Non-Competition Agreement of even date
herewith executed and delivered by the Company and Employee (the
"Confidentiality Agreement").
7. Termination. Anything in this Agreement contained to the
contrary notwithstanding, Employee's employment hereunder shall terminate
forthwith upon the earlier to occur of the following:
(a) Death. Upon the death of Employee.
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(b) Disability. At the option of the Company, in the event
that the Board determines that Employee suffers from Disability (as hereinafter
defined) so as to be unable to substantially perform his duties hereunder for an
aggregate of one hundred and eighty (180) calendar days during any period of
twelve (12) consecutive months. As used in this Agreement, the term "Disability"
shall mean the material inability of Employee to render the Services due to
physical and/or mental infirmity in the opinion of a majority of the entire
membership of the Board set forth in a resolution giving the particulars
thereof, which opinion is concurred to by a physician or psychiatrist selected
by the Board of Directors of the Company.
(c) Cause. The Company may terminate Employee's employment
hereunder for Cause. For purposes of this Agreement, the Company shall have
"Cause" to terminate Employee's employment hereunder upon (i) the continued
failure by Employee to substantially perform his duties hereunder in a manner
which amounts to gross negligence (other than any such failure resulting from
Employee's incapacity due to physical or mental illness) after demand for
substantial performance is delivered by the Company specifically identifying the
manner in which the Company believes Employee has not substantially performed
his duties, or (ii) the engaging by Employee in misconduct that is materially
injurious to the Company, monetarily or otherwise, or (iii) the violation by
Employee of the Confidentiality Agreement.
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(d) Notice of Termination. Any termination of Employee's
employment by the Company (other than termination pursuant to Section 5(a)
hereof) shall be communicated by written Notice of Termination to Employee. For
purposes of this Agreement, a "Notice of Termination" shall mean a notice which
shall indicate the specific termination provision in this Agreement relied upon
and shall set forth in reasonable detail the facts and circumstances claimed to
provide a basis for termination of Employee's employment under the provision so
indicated.
(e) Date of Termination. "Date of Termination" shall mean
(i) if Employee's employment is terminated by his death, the date of his death,
(ii) if Employee's employment is terminated pursuant to Section 5(b) hereof,
thirty (30) calendar days after Notice of Termination is given, (iii) if
Employee's employment is terminated pursuant to Section 5(c) hereof, the date
specified in the Notice of Termination, and (iv) if Employee's employment is
terminated for any other reason, the date on which a Notice of Termination is
given.
8. Payments and Benefits Upon Early Termination.
Upon the termination of this Agreement prior to the
expiration of the Term, the Company shall pay Employee:
(i) his Salary through the Date of
Termination at the rate in effect at the time of Notice
of Termination is given or, in the case of the death of
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Employee, the Date of Termination, payable at the time
such payments are due; and
(ii) all other amounts to which Employee is
entitled, including, without limitation, expense
reimbursement amounts accrued to the Date of
Termination and amounts under any benefit plan of the
Company, at the time such payments are due.
9. No Continuing Waiver. Any waiver of any breach of
this Agreement shall not be construed to be a continuing waiver or consent to
any subsequent breach on the part of the Company or Employee.
10. Notices. All notices, requests and other communications
pursuant to this Agreement shall be in writing and shall be deemed to have been
duly given, if delivered in person or by courier, telex or by facsimile
transmission or sent by registered, express or certified mail, postage prepaid,
addressed as follows.
If to Employee: Xxxxx X. Xxxx
0000 X. Xxxxx Xxxxxxxx
Xxxxxx, Xxxxxxx 00000
If to the Company: Catalina Coatings, Inc.
0000 X. Xxxxxx Xxxxx
Xxxxxx, Xxxxxxx 00000
Any party may, by written notice to the other, change the address to which
notices to such party are to be delivered or mailed.
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11. Assignment. Neither party hereto may assign his or its
rights or delegate his or its duties under this Agreement without the prior
written consent of the other party.
12. Severability. To the extent any provision of this
Agreement shall be invalid or unenforceable, it shall be considered deleted from
this Agreement and the remainder of such provision and of this Agreement shall
be unaffected and shall continue in full force and effect.
13. Applicable Law and General. The terms and provisions of
this Agreement shall be construed and enforced in accordance with the laws of
the State of Arizona shall constitute the entire agreement by the Company and
Employee with respect to the subject matter hereof, and shall supersede any and
all prior agreements or understandings between the parties, whether written or
oral. This Agreement may be amended or modified only by written instrument
executed by the parties.
14. Interpretation. Any issues regarding construction or
interpretation of this Agreement shall be resolved without consideration of the
identity of the drafting party.
15. Headings. The headings contained in this Agreement are
solely for convenience of reference and shall not limit or affect the meaning
construction or interpretation of any of the terms or provisions of this
Agreement.
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16. Attorney's Fees. In the event of litigation over the terms
of this Agreement, the prevailing party shall be entitled to an award of
reasonable attorney's fees and costs.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first above written.
CATALINA COATINGS, INC., an Arizona
corporation
By:/s/ Xxxxx X. Xxxx
-----------------------------------
Name: Xxxxx X. Xxxx
Title: President
/s/ Xxxxx X. Xxxx
-----------------------------------
Xxxxx X. Xxxx
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