EMPLOYMENT AGREEMENT
This Employment Agreement, dated October 15, 1988, is by and
between WESTERN STAR, INC., an Oregon corporation (the "Company"), and XXXX
XXXXXXXXX ("Executive").
RECITALS
A. Executive is the founder of the Company and has been
President and a director since its formation.
B. The directors of the Company consider the continued
services of its principal executives to be in the best interests of the Company
and its shareholders. The directors of the Company desire to assure the
continued services of such principal executives on an objective and impartial
basis without distraction or conflict of interest and without concern as to
their individual income security or changes in the conditions of their
employment.
C. The directors of the Company have selected Executive as one
of the principal executives whose continued services are deemed essential to the
future performance of the Company. The execution and delivery of this Agreement
provides the Company with continuity in Executive's services and Executive's
continued loyalty.
In consideration of the premises and conditions of this
Agreement, the Company and Executive agree as follows:
1. Employment. The Company and Executive hereby confirm the
continued employment of Executive by the Company under the terms of this
Agreement.
2. Duties. Executive shall serve as President and chief
executive officer of the Company and perform such duties as are prescribed
presently by the Company's Bylaws. Executive shall serve as a director of the
Company if so elected by the shareholders.
3. Compensation. Employee shall be compensated at the rate of
not less than Seven Thousand Dollars ($7,000) per month, payable in accordance
with the Company's standard payroll policies. Executive shall also receive the
standard fringe benefits, insurance programs and vacation and sick leave
provided by the Company to its executive employees. Executive's compensation and
benefits shall be reviewed by the Board of Directors not less than annually.
4. Term. The term of this Agreement shall commence as of the
date hereof and shall continue until terminated by either party on not less than
60 days' written notice. The expiration of the term of this Agreement following
notice of termination by the Company shall not affect Executive's rights to
payments which become due under the circumstances described in Sections 5 and 6.
5. Definitions.
5.1 Change In Control. For purposes of this Agreement, the
term "Change in Control" shall mean any event or events which result in any one
or more of the following:
(a) Any "person" (as such term is used in Section
3(a)(9) and 13(d)(3) of the Securities Exchange Act of 1934 and the rules under
such Act) hereafter becoming the beneficial owner, directly or indirectly, of
securities of the Company representing more than 25 percent of the combined
voting power of the then outstanding voting stock of the Company;
(b) A change in the composition of a majority of the
Board of Directors of the Company within 18 months after any person hereafter
becomes the beneficial owner, directly or indirectly, of securities of the
Company representing 20 percent or more of the combined voting power of the then
outstanding voting stock of the Company;
(c) Any transaction in which all or substantially
all of the assets of the Company are sold, exchanged or otherwise disposed of;
or
(d) Any merger, consolidation or reorganization, the
result of which the shareholders of the Company own less than 50 percent of the
voting stock of the combined entity.
5.2 Cause. For purposes of this Agreement, "Termination for
Cause" will exist if Executive's employment is terminated by the Company for any
one or more of the following reasons:
(a) Gross negligence or incompetence in the
performance of the duties assigned to Executive;
(b) Fraud of Executive against Company; or
(c) Conviction of or entrance of a plea of not
guilty or nolo contendere to a felony or other crime which has or may have a
material adverse effect on Executive's ability to carry out the duties assigned
to him or upon the reputation of the Company.
5.3 Event of Termination. For purposes of this Agreement, an
"Event of Termination:" shall be deemed to occur:
(a) In the event that Executive's employment is
terminated by the Company for any reason, including in anticipation of or
following a Change in Control, other than a Termination for Cause; or
(b) In the event Executive's employment is
terminated by Executive following the occurrence, without Executive's written
consent, of one or more of the following events in anticipation of or following
a Change in Control:
(i) Executive is assigned reduced duties or
responsibilities that are inconsistent with his position, duties and
responsibilities immediately prior to such assignment, or his reporting
responsibilities or titles in effect at such time are reduced;
(ii) Executive's annual base salary is
reduced; or
(iii) Executive is transferred to a
location which is an unreasonable distance from his current principal work
location or is required to engage in a substantially greater amount of travel on
Company business.
6. Salary Continuation. Upon occurrence of any Event of
Termination, the Company will continue to pay Executive's annual base salary on
a regular monthly basis for a period ending on the first to occur of the
following:
(a) Two years following the date of the Event of
Termination; or
(b) The obtaining by Executive of permanent
full-time employment by any other employer; provided, however, that Executive's
annual base salary shall continue to be paid until two years following the date
of the Event of Termination to the extent that the salary paid to Executive in
the new employment is less than the annual base salary received by Executive
prior to the Event of Termination. Executive will promptly advise the Company of
the fact of such new employment. The salary to be paid shall be Executive's base
salary in effect on the date of the Event of Termination, but before any
reduction that resulted in an Event of Termination under Section 5.3(b)(ii). The
base salary shall not include any cash bonus, profit sharing, pension, incentive
bonus or any fringe benefits.
7. Benefits Upon Death. In the event of the death or
disability of Executive prior to the payment to Executive of all amounts which
have become payable to Executive during his lifetime, the Company will pay all
such amounts to his personal representative or the executor or administrator of
his estate in the event of death or to Executive or the guardian or conservator
of Executive in the event of disability.
8. Attorney Fees. The Company recognizes the disparate
economic positions of the Company and Executive in legal actions arising from
disputes as to the enforceability or interpretation of agreements such as this.
Accordingly, to the fullest extent that a court having jurisdiction will enforce
a unilateral agreement for the payment of a party's legal expenses, it is agreed
that in any suit or action brought by Executive under this Agreement in which
Executive shall prevail, the Company will pay the reasonable attorney fees and
court costs incurred by Executive in the prosecution of such suit or action.
9. Limitation on Benefits. The benefits provided to Executive
by Section 6 shall be payable to the Executive only once, even though there may
be two or more events constituting an Event of Termination.
10. General Provisions.
(a) No right, benefit or interest hereunder shall be
subject to assignment, anticipation, alienation, sale, encumbrance, charge,
pledge, hypothecation or set-off in respect of any claim, debt or obligation, or
to execution, attachment, levy or similar process.
(b) This Agreement may not be amended, modified or
canceled except by written agreement of the parties.
(c) No provisions of this Agreement may be waived
except by writing signed by the party to be bound thereby.
(d) In the event that any provision or portion of
this Agreement shall be determined to be invalid or unenforceable for any
reason, the remaining provisions of this Agreement shall remain in full force
and effect to the fullest extent permitted by law.
(e) This Agreement shall be binding upon and inure
to the benefit of Executive and his personal representative and Company in any
successor organization or organizations which shall succeed to substantially all
of the business and property of Company, whether by means of merger,
consolidation, acquisition of substantially all of the assets or voting stock of
Company or otherwise, including by operation of law.
(f) This Agreement has been made in and shall be
governed and construed in accordance with the laws of the state of Oregon.
(g) This Agreement sets forth the entire agreement
and understanding of the parties hereto with respect to the matters covered
hereby.
WESTERN STAR, INC.
By /s/ Xxxxx X. Xxxxxxxxx
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Xxxxx X. Xxxxxxxxx
Vice President
/s/ Xxxx Xxxxxxxxx
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Xxxx Xxxxxxxxx
AMENDMENT TO EMPLOYMENT AGREEMENT
This document amends the Employment Agreement entered into
between XXXX XXXXXXXXX ("Xxxxxxxxx") and INFORMEDICS, INC. (formerly known as
Western Star, Inc.) (the "Corporation") dated October 15, 1988 (the "Employment
Agreement").
Effective and conditioned upon the filing of Articles of
Merger providing for the merger of the Corporation into an affiliate of
Mediware, Inc. (the "Merger"), the Employment Agreement is amended as follows:
1. Continuation and Termination of Employment.
Xxxxxxxxx shall continue as the President and CEO of the
Corporation until the effective date of the Merger, and as a full-time employee
of the Corporation, but not as an officer or director, for the three-month
period following the closing of the Merger transaction at his existing base
salary of $150,000 per year, payable at the Corporation's normal pay periods. At
the conclusion of such three-month period, Xxxxxxxxx'x employment with the
Corporation shall terminate and he shall be paid his accrued vacation as may
exist at that date, if any. Any unvested stock options held by Xxxxxxxxx shall
become immediately vested upon execution of this Amendment.
2. Consulting Services.
For the two-year period commencing with the termination of
employment date (the "Consulting Period"), Xxxxxxxxx will provide consulting
services to the Corporation on such matters as the Corporation may request. Such
services shall be at times convenient to Xxxxxxxxx and shall be arranged in
advance so as not to interfere with Xxxxxxxxx'x other business or personal
activities. During the two-year period of consulting services, Corporation shall
continue to provide at its cost coverage for Xxxxxxxxx under medical insurance
plans of the Corporation as may exist from time to time.
3. Noncompete Covenant.
During the period from the effective date of the Merger to the
end of the Consulting Period, Xxxxxxxxx covenants that he will not, as a
principal, shareholder, director, officer, employee or consultant, directly or
indirectly, engage in any business in any way connected with the sale of blood
banking software that is in any way competitive with the business of the
Corporation or any affiliate in any geographic markets then being served by the
Corporation or any affiliate.
4. Payments by Corporation.
As consideration for Xxxxxxxxx'x noncompete covenant, the
Corporation shall pay Xxxxxxxxx monthly payments in the amount of $8,333.33
commencing on the first day of the month immediately following the termination
of employment and continuing on the first day of each month thereafter through
and including the 24th month.
5. Deletion of Inapplicable Provisions.
Paragraphs 2 through 6 and paragraph 9 of the Employment
Agreement are deleted in their entirety. The remaining paragraphs of the
Employment Agreement remain applicable to the relationship of the parties.
6. Effective Date.
This Agreement shall become effective upon and shall have no
effect unless and until the Articles of Merger referenced above are filed with
the Secretary of State for the State of Oregon.
EXECUTED this 5th day of December, 1997.
INFORMEDICS, INC.
By /s/Xxxxxx X. Xxxxxxxx
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By Authorization of the
Board of Directors
/s/ Xxxx Xxxxxxxxx
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Xxxx Xxxxxxxxx
