EMPLOYMENT AGREEMENT
This Employment Agreement (hereinafter referred to as "Agreement") dated as
of March 1, 2006 (the "Effective Date"), by and between Vicor Technologies, Inc.
(hereinafter referred to as the "Company") and Xxxxx X. Xxxxxxx whose mailing
address is 000 Xxxxxx Xxxxx, Xxxxxx, XX 00000 (hereinafter referred to as
"Executive").
WHEREAS, the Company desires to secure the services of the Executive upon
the terms and conditions hereinafter set forth: and
WHEREAS, the Executive desires to render services to the Company upon the
terms and conditions hereinafter set forth.
NOW, THEREFORE, the parties mutually agree as follows:
1. EMPLOYMENT. The Company hereby employs Executive and the Executive hereby
accepts such employment as Vice President-Research subject to the terms and
conditions set forth in this Agreement.
2. DUTIES. The Executive shall serve as the Vice President-Research of the
Company as set forth in Section 1 above. During the term of this Agreement,
Executive shall devote no less than 100% (40 hours per week) of his business
time to the performance of his duties hereunder unless otherwise authorized by a
majority of the Company's Board of Directors. The Executive shall report
directly to the Chief Executive Officer.
3. TERM OF EMPLOYMENT.
(a) The term of the Executive's employment shall be for a period of
thirty-four (34) months commencing on the date hereof (through December 31,
2008), subject to earlier termination by the Company pursuant to Section 6
hereof (the "Term")
4. COMPENSATION OF EXECUTIVE.
a. BASE SALARY. The Company shall pay to Executive a base salary (the "Base
Salary") of $174,000 Dollars per annum, less such deductions as shall be
required to be withheld by applicable law and regulations. All salaries payable
to Executive shall be paid at such regular weekly, biweekly or semi-monthly time
or times as the Company makes payment of its regular payroll in the regular
course of business. Employee's Base will be adjusted upward on each anniversary
of the Effective Date (or more frequently, at the Company's discretion) by a
percentage equal to not less than the higher of the increase in the consumer
price index for the preceding year or the increase in the core rate of inflation
for the preceding year, each as reported by the United Sates government, to
reflect cost of living increases.
b. OTHER BENEFITS. Employee will be entitled to participate in such
incentive plans, bonus plans and other benefits as are offered from time to time
by the Company to its executive level employees, including medical coverage or
reimbursement therefore for the Employee and his family and an extended
disability insurance plan, each at the Company's cost, including any
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right to receive any stock options. Employee will also be entitled to
participate in any other benefits that the Company may maintain from time to
time for all employees, provided that Employee meets the respective eligibility
requirements.
c. EXPENSE REIMBURSEMENT. The Company agrees to reimburse Employee for all
reasonable expenses incurred by him in the discharge of his duties hereunder.
The Employee agrees to maintain records of such expenses in such form as the
Company may request and make such records available to the Company as and when
requested.
d. TAXES. All sums payable to the Employee hereunder shall be subject to
all federal, state and municipal laws or governmental regulations now or
hereafter in existence requiring the withholding, deduction, or payment
therefrom of sums for income or other taxes payable by or for or assessable
against the Employee.
e. VACATION. The Employee may take a maximum of four (4) weeks vacation
during each twelve (12) month period during the Term at times to be reasonably
determined by mutual agreement between the Company and Employee. Employee shall
be entitled to carryover up to one (1) week per year of unused vacation to
future periods.
5. INABILITY TO PERFORM JOB DUTIES. If Employee becomes unable to substantially
perform his employment duties pursuant to this Agreement due to mental or
physical incapacity (a "Disability"), the Company shall continue his
compensation under this Agreement at one-half of his regular rate during the
first three months of such Disability. Thereafter no compensation shall be
payable until such time as Employee becomes able to resume his job duties for
the Company, except to the extent any amounts are payable pursuant to any
Company-maintained disability insurance. In the event that Employee is Disabled
for a cumulative period of greater than six (6) months within any span of twelve
(12) months, this Agreement and Employee's employment may be terminated by the
Company. For purposes of this Agreement, Disability shall be determined by a
medical doctor who is mutually agreeable to the Company and the Employee; in the
event that Company and Employee cannot agree on a medical doctor, then each of
Company and Employee shall select a medical doctor, and the selected medical
doctors shall select a third medical doctor who shall individually determine
whether Disability exists pursuant to this Section. Following a termination of
this Agreement by Company pursuant to this Section 5, Company shall pay to
Employee all accrued compensation and benefits and all normal post-termination
benefits available under any of Company's retirement plan, insurance programs or
other benefit plans.
6. TERMINATION BY COMPANY FOR CAUSE. The Company may terminate this Agreement,
and Employee's employment "for cause" at any time. As used herein, "for cause"
shall mean any one of the following:
a. The death of the Employee; or
b. The Employee has a guardian of his person or estate appointed by a court
of competent jurisdiction; or
c. The Employee is Disabled for a cumulative period of greater than six (6)
months in any twelve (12) month period; or
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d. The conviction of the Employee of a felony or of any crime involving
moral turpitude (but excluding any offenses involving operation of a motor
vehicle); or
e. The misuse, misappropriation or embezzlement of Company funds or
property by Employee, as determined by a court of competent jurisdiction; or
f. Any willful gross neglect or willful gross misconduct of Employee
resulting in material economic harm to the Company; provided that the Company
shall give Employee thirty (30) days' written notice thereof during which thirty
(30) day period Employee may cure same; or
g. The habitual and sustained use of alcohol or drugs by Employee which
interferes with the performance of Employee's duties for the Company.
In the event the Company terminates Employee's employment for cause,
Employee's right to continued payment of salary and other compensation shall
automatically terminate and be forfeited, and the Company shall pay to Employee
all compensation and benefits accrued through the date of termination. In
addition, Employee shall be entitled to any post-termination benefits to which
Employee would otherwise be entitled under any retirement plans, insurance
programs or other benefit plans.
7. TERMINATION BY EMPLOYEE WITHOUT CAUSE. Employee may terminate this Agreement
and his employment with the Company without cause upon thirty (30) days prior
written notice to the Company. Employee may be required to perform his job
duties and will be paid his regular compensation up to the date of the
termination. At the option of the Company, the Company may require Employee to
immediately terminate employment upon receiving said thirty (30) days' notice
from Employee of the termination of this Agreement. In such event, the Company
will pay to Employee an amount equal to thirty (30) calendar days of his Base.
8. TERMINATION BY THE COMPANY WITHOUT CAUSE OR BY THE EMPLOYEE FOR GOOD REASON.
a. The Employee may resign (and thereby terminate his employment under this
Agreement) at any time for Good Reason (as defined below), upon not less than
thirty (30) days' prior written notice to the Company specifying in reasonable
detail the reason therefor, provided, however, that if the reason for
resignation for Good Reason is susceptible of a cure, the Company shall have a
period of thirty (30) days after such written notice to effect a cure. For
purposes of this Agreement, "Good Reason" shall mean (a) any material failure by
the Company to comply with any material obligation imposed by this Agreement
(including the failure of a successor to the Company to assume this Agreement or
any purported termination hereof which is not in compliance with any applicable
notice provisions hereof); (b) a reduction of Employee's Base or a material
reduction in the Employee's title, position, duties or responsibilities; or (c)
the Company's creation of working conditions that a reasonable person in the
Employee's position would consider unreasonable or intolerable, as determined by
the Compensation Committee. The Company may terminate the employment of Employee
without cause and the Employee may terminate the Agreement with Good Reason, in
each case, at any time upon 30 days' prior written notice, provided that in
either such event the Company shall be obligated to pay Employee, in a lump sum
within fifteen (15) days of the date of termination of employment, an
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amount equal to 100% of the sum of (a) Employee's then current Base, and (b) any
bonuses paid to Employee during the 12 month period preceding the date of such
termination. In addition, the Company shall maintain the Employee's health
insurance, life insurance and disability insurance at its expense on the same
terms and conditions as existed during the Employee's employment for the
unexpired Term of this Agreement; provided, that such benefits will not be
continued in the event that Employee obtains similar benefits in connection with
any future employment. Moreover, in such event, Employee shall be entitled to
receive all other customary post-termination benefits under the Company's
retirement plans, insurance programs, and other benefit plans, and Employee
shall be entitled to acceleration of any vesting under any long-term incentive
plans, including the vesting of any unvested stock options or stock warrants.
9. AGREEMENT NOT TO USE OR DISCLOSE CONFIDENTIAL OR PROPRIETARY INFORMATION.
During the term of this Agreement and a period of two (2) years thereafter,
Employee promises and agrees that he will not disclose or utilize any
confidential or proprietary information acquired during the course of service
with the Company and/or its related business entities, Employee shall not
divulge, communicate, use to the detriment of the Company or for the benefit of
any other person or persons, or misuse in any way, any confidential or
proprietary information pertaining to the business of the Company. Any
confidential or proprietary information or data now or hereafter acquired by
Employee with respect to the business of the Company (which shall include, but
not be limited to, information concerning the Company's financial condition,
prospects, technology, customers, suppliers, methods of doing business and
promotion of the Company's products and services) shall be deemed a valuable,
special and unique asset of the Company that is received by Employee in
confidence and as a fiduciary. For purposes of this Agreement "confidential or
proprietary information" means information disclosed to Employee as a
consequence of or through his/her employment by the Company (including
information conceived, originated, discovered or developed by Employee) prior to
or after the date hereof and not generally known or in the public domain, about
the Company or its business. This Section 12 is effective regardless of the
reason for the termination of the Agreement and regardless of whether the
Agreement is terminated by the Employee, the Company or by its own terms. This
restrictive covenant may be assigned to and enforced by any of the Company's
assignees or successors.
10. COVENANT NOT TO COMPETE.
(a) Executive recognizes that the services to be performed by him
hereunder are special, unique and extraordinary. The parties confirm that it is
reasonably necessary for the protection of Company that Executive agree, and
accordingly, Executive does hereby agree, that he shall not, directly or
indirectly, at any time during the term of the Agreement and the "Restricted
Period" (as defined in Section 10(e) below):
(i) except as provided in Subsection (d) below, be engaged in the
research, development/creation, marketing, sale or distribution of
pharmaceutical and/or medical products that compete directly or indirectly with
the Company's products or proposed products, or provide technical assistance,
advice or counseling regarding such competing products in any state in the
United States, either on his own behalf or as an officer, director, stockholder,
partner, consultant, associate, employee, owner, agent, creditor, independent
contractor, or co-venturer of any third party; or
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(ii) employ or engage, or cause or authorize, directly or
indirectly, to be employed or engaged, for or on behalf of himself or any third
party, any employee or agent of Company or any affiliate thereof in a manner
which directly or indirectly competes with the Company.
(b) Executive hereby agrees that he will not, directly or indirectly,
for or on behalf of himself or any third party, at any time during the term of
the Agreement and during the Restricted Period solicit any customers of the
Company or any affiliate thereof in a manner which directly or indirectly
competes with the Company.
(c) If any of the restrictions contained in this Section 10 shall be
deemed to be unenforceable by reason of the extent, duration or geographical
scope thereof, or otherwise, then the court making such determination shall have
the right to reduce such extent, duration, geographical scope, or other
provisions hereof, and in its reduced form this Section shall then be
enforceable in the manner contemplated hereby.
(d) This Section 10 shall not be construed to prevent Executive from
owning, directly or indirectly, in the aggregate, an amount less than or equal
to one percent (I%) of the issued and outstanding voting securities of any class
of any company that directly or indirectly competes with the Company whose
voting capital stock is traded on a national securities exchange or on the
over-the-counter market other than securities of the Company. Furthermore, this
Section 9 shall not be construed to prevent Executive from owning, directly or
indirectly, any number of issued and outstanding voting securities of any
company that does not directly or indirectly compete with the Company.
(e) The term "Restricted Period," as used in this Section 10, shall
mean the period of Executive's actual employment hereunder plus a period of
twelve (12) months thereafter.
(f) The provisions of this Section 10 shall survive the end of the
Term as provided in Section 10(e) hereof.
11. EXECUTIVE CONCEPTIONS AND DEVELOPMENTS. The Company shall own all
Intellectual Property Rights (as defined below) in and to, and, for the duration
of such Intellectual Property Rights have the exclusive rights to the commercial
exploitation with respect to, all Conceptions and Developments (as defined
below) made individually or jointly by Executive during the period while
employed at Employer (the "Covered Period"). Any Intellectual Property Rights as
to which Executive was an inventor, author or assignee, whether patentable or
not, shall be presumed to have been originally made during the Covered Period
and subject to Employer's ownership. For purposes hereof, the term "Conceptions
and Developments" means all creative, expressive, branding or technological
conceptions, discoveries and developments related to the business of the Company
and the development of the Company's products of any nature, including, without
limitation, conceptions for products and process, inventions, designs, writings,
graphics, animations and other works of authorship, specifications, drawings,
methods, formulas and branding proposals, and any implementations, improvements,
derivative works or modifications thereof and without regard to whether are
patentable or copyrightable, and the
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term "Intellectual Property Rights" means all U.S. and foreign patents,
copyrights, trademarks, service marks, tradenames, corporate names, trade
secrets, rights of publicity and similar rights (including without limitation
and all common law rights), domain names and all rights of priority under
international conventions to make application with respect thereto. All
Conceptions and Developments arising during the Covered Period are referred to
as the "Covered Conceptions and Developments". In addition to any previous
assignments, Executive assigns to the Company all Intellectual Rights included
the Covered Conceptions and Developments without regard to their being
patentable or copyrightable. All works of authorship included in the Covered
Conceptions and Developments that are eligible for protection under the
Copyright Act shall be deemed "works made for hire" to the extent they may
qualify as such under17 U.S.C. Section 101, and otherwise the copyright therein
shall be assigned by Executive to the Company at the time such works were made.
All Covered Conceptions and Developments, whether or not patentable, shall be
promptly disclosed to the Company in writing and shall be held in confidence by
the Executive and treated as "Confidential Information", until such time as the
Company, in its sole determination, shall elect to make the subject matter
thereof publicly known. Executive agrees that, at the expense of the Company, he
will, without additional compensation, take any such further action, including
the rendering of all lawful testimony and assistance; and the execution and
delivery to such instruments as the Company may require from time to time, to
perfect, effectuate, register, record or enforce the Company's rights or
interests in any of the Covered Conceptions and Developments. Executive hereby
irrevocably appoints the Company to be Executive attorney-in-fact to act in
Executive's name, place and stead to do and execute any such act or instrument
for the purpose of this Section. The Company shall be under no liability to
account to Executive for any revenue or profit derived or resulting from the
use, exploitation or licensing of any of the covered Conceptions or Developments
subject in this Section.
12. AGREEMENT NOT TO USE OR DISCLOSE TRADE SECRETS. During the term of this
Agreement and a period of five (5) years thereafter, Employee promises and
agrees that he will not disclose or utilize any trade secrets acquired during
the course of service with the Company and/or its related business entities. As
used herein, "trade secret" refers to the whole or any portion or phase of any
formula, pattern, device, combination of devices, or compilation of information
which is for use, or is used, in the operation of the Company's business and
which provides the Company an advantage, or an opportunity to obtain an
advantage, over those who do not know or use it. "Trade secret" also includes
any scientific, technical, or commercial information, including any design, list
of suppliers, list of customers, as well as pricing information or methodology,
contractual arrangements with vendors or suppliers, business development plans
or activities, or Company financial information. This Section 11 is effective
regardless of the reason for the termination of the Agreement and regardless of
whether the Agreement is terminated by the Employee, the Company or by its own
terms. This restrictive covenant may be assigned to and enforced by any of the
Company's assignees or successors.
13. AGREEMENT NOT TO HIRE COMPANY EMPLOYEES. If Employee leaves the employ of
the Company or terminates this Agreement, Employee promises and agrees that,
during the two (2) years following his departure from the Company, Employee will
not, without the express written permission of the Company, directly or
indirectly employ as a consultant or employee any person who is employed as a
consultant or employee of the Company at the time of Employee's termination, or
any person who was an employee or consultant of the Company during the six
6
months preceding Employee's termination; provided, however this Section 13 shall
not apply in the event that Employee is terminated without cause by the Company
or the Employee terminates this Agreement with Good Reason. This restrictive
covenant may be assigned to and enforced by any of the Company's assignees or
successors.
14. INJUNCTIVE RELIEF. In recognition of the unique services to be performed by
Employee and the possibility that any violation by Employee of Section 10,
Section 11, Section 12 or Section 13 of this Agreement may cause irreparable or
indeterminate damage or injury to Company, Employee expressly stipulates and
agrees that the Company shall be entitled, upon ten (10) days written notice to
Employee, to obtain an injunction from any court of competent jurisdiction
restraining any violation or threatened violation of this Agreement. Such right
to an injunction shall be in addition to, and not in limitation of, any other
rights or remedies the Company may have for damages.
15. JUDICIAL MODIFICATION OF AGREEMENT. The Company and Employee specifically
agree that a court of competent jurisdiction (or an arbitrator, as appropriate)
may modify or amend Section 10, Section 11, Section 12 or Section 13 of this
Agreement if absolutely necessary to conform with relevant law or binding
judicial decisions in effect at the time the Company seeks to enforce any or all
of said provisions.
16. RESOLUTION OF DISPUTES BY ARBITRATION. Any claim or controversy that arises
out of or relates to Employee's employment, this Agreement, or the breach of
this Agreement, will be resolved by arbitration in Palm Beach County in
accordance with the rules of the American Arbitration Association. Judgment upon
the award rendered by the arbitrator may be entered in any court possessing
jurisdiction over arbitration awards. This Section shall not limit or restrict
the Company's right to obtain injunctive relief for violations of Section 10,
Section 11, Section 12 or Section 13 of this Agreement directly from a court
under Section 14 of this Agreement.
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17. MISCELLANEOUS.
a. COSTS AND EXPENSES. Each party hereto agrees to pay its own costs and
expenses incurred in negotiating this Agreement and consummating the
transactions described herein. In the event either party is required to seek
legal counsel to enforce the terms and provisions of this Agreement, the
prevailing party in any action (including arbitration) shall be entitled to
recover attorneys fees and costs (including on appeal).
b. CHOICE OF LAW. This Agreement will be interpreted, construed and
enforced in accordance with the laws of the State of Florida and the proper
jurisdiction and venue shall be the Circuit Court in Palm Beach County, Florida.
c. CONSTRUCTION. The parties hereto and their respective legal counsel
participated in the preparation of this Agreement; therefore, this Agreement
shall be construed neither against nor in favor of any of the parties hereto,
but rather in accordance with the fair meaning thereof.
d. EFFECT OF WAIVER. The failure of any party at any time or times to
require performance of any provision of this Agreement will in no manner affect
the right to enforce the same. The waiver by any party of any breach of any
provision of this Agreement will not be construed to be a waiver by any such
party of any succeeding breach of that provision or a waiver by such party of
any breach of any other provision.
e. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which will be deemed an original and all of which together
will constitute one and the same instrument.
f. ENTIRE AGREEMENT. This Agreement sets forth the entire agreement between
the parties, and supersedes any prior agreements or understanding between the
Company and Employee. This Agreement may be amended only in writing, signed by
both parties.
g. SEVERABILITY. If any provision of this Agreement is held invalid for any
reason, such invalidity shall not affect the enforceability of the remainder of
this Agreement.
h. NOTICES. Any notices required or permitted or given pursuant to this
Agreement to the Company or Employee shall be in writing and shall be deemed
given upon delivery in person or three (3) days after deposit of same in the
U.S. certified mail or registered mail, return receipt requested, first class
postage and registration fees prepaid, to the addresses listed below. The
parties hereto shall notify each other whenever their addresses shall change
during the Term.
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IN WITNESS WHEREOF, the parties have executed this Employment Agreement on
the date set forth below.
COMPANY EMPLOYEE
By: /s/ Xxxxx X. Xxxxx /s/ Xxxxx X. Xxxxxxx
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Name: Xxxxx X. Xxxxx Xxxxx X. Xxxxxxx
-------------------------------- --------------------------------------
Title: Chief Executive Officer
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Date: February 8, 2006 Date: February 8, 2006
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0000 XX Xxxxxxxxx Xxxxxxxxx 399 Autumn Drive
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Xxxx Xxxxx, XX 00000 Xxxxxx, XX 00000
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(Address for Notices) (Address for Notices)
/s/ Xxxx Xxxxxx
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Witness Witness
