EXECUTIVE EMPLOYMENT AGREEMENT
PARTIES:
XXXXXX X. XXXXXXX, Vice President, Engineering ("Executive")
000 Xxxxxxxxxx Xxxxxx
Xxxxxxxxxx XX 00000
AUGUST TECHNOLOGY CORPORATION ("Company")
0000 Xxxx 00xx Xxxxxx
Xxxxxxxxxxx, XX 00000
Dated this 27th day of October, 2000.
RECITALS
A. The parties desire to provide for employment of Executive by Company as its
Vice President, Engineering.
B. Company desires reasonable protection of Company's confidential business
and technical information which has been developed over the years by
Company at substantial expense.
Company and Executive, each intending to be legally bound, covenant and agree as
follows:
1. EMPLOYMENT. Upon the terms and conditions set forth in this Agreement,
Company hereby employs Executive, and Executive accepts such employment as
its Vice President, Engineering, expressly provided herein, termination of
this Agreement by either party shall also terminate Executive's employment
by Company.
2. DUTIES. Executive shall devote his full-time and best efforts to Company
and fulfilling the duties of his position which shall include such duties
as may from time to time be assigned him by the CEO, COO or Board of
Directors of the Company; provided that such duties are reasonably
consistent with Executive's education, experience and background.
3. EMPLOYMENT DATE. Executive's employment shall commence as of the date
hereof (11/15/00), and continue until terminated as provided herein. In any
event, the Agreement shall automatically terminate without notice when the
Executive reaches 70 years of age. If employment is continued after the age
of 70 by mutual agreement, it shall be terminable at will by either party.
4. COMPENSATION.
(a) BASE SALARY. For all services rendered under this Agreement during the
term of Executive's employment, Company shall pay Executive a Base
Salary ("Base Salary" shall mean regular cash compensation paid on a
periodic basis exclusive of benefits, bonuses or incentive payments)
at the annual rate of $127,500, payable twice monthly subject to
review and possible adjustment by the Board of Directors at least
annually. If the Executive's salary is adjusted during the term of
this Agreement, the adjusted amount shall be the Base Salary until
further adjusted by the Board of Directors.
(B) BONUS AND INCENTIVE. Bonus or incentive compensation shall be in
accordance with the August Technology Annual Incentive Plan
(Appendix-B). Company reserves the right to alter, amend or eliminate
any bonus or incentive plans in accordance with their terms.
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(C) HIRING BONUS. A hiring bonus of $20,000 will be paid along with your
first paycheck. Should Executive voluntarily terminate employment with
August Technology within twenty-four months of his start date,
executive agrees to reimburse August Technology $833.33 multiplied by
the number of months remaining in the twenty-four month period.
(D) RELOCATION. Executive will receive relocation assistance of up to
$60,000, to be coordinated through Plus Relocation.
(e) FRINGE BENEFITS. In addition to the compensation payable to Executive
as provided in paragraphs 4(a) and (b) above:
i) VACATION. Executive shall be entitled to accrue three (3) weeks
paid vacation for each year of employment, which shall be
calculated in arrears on a monthly basis commencing as of the end
of the month following the Employment Date. Vacation shall
accumulate, so that if the full vacation that is earned and
accrued in a particular year of employment is not taken in that
particular year of employment, any unused portion will be carried
into and may be taken in the following year of employment only.
ii) OTHER BENEFITS. The Executive shall be entitled to participate in
most other benefit programs offered by the Company to its
full-time executive employees, including, but not limited to,
health/dental; retirement benefits through the Company's 401k
plans; personal days off benefits; and other benefits that may be
offered from time to time by the Company. Executives
participating in the Annual Incentive Plan are not eligible to
participate in the Cash Profit Sharing Plan.
(f) STOCK OPTIONS. Company hereby agrees to grant the Executive Stock
Options under the Company's 1997 Stock Option Plan to purchase up to
30,000 shares of its common stock. Such options shall be granted at
the closing price on the date of the Board of Directors approval,
normally within two weeks after the end of the month in which you were
hired. Options shall expire seven (7) years from the date of hereof,
shall vest 20% per year commencing on your start date (subject to
paragraph 10 hereof), and shall have other provisions generally
included in stock option agreements of the Company. Such stock options
shall be governed by the terms of the Company's applicable stock
option plan(s) and a stock option agreement with Executive. It is the
intention of the Board of Directors, from time to time, to make
additional options available to executives based on performance.
5. BUSINESS EXPENSES. Company shall, in accordance with, and to the extent of,
its policies in effect from time to time, bear all ordinary and necessary
business expenses incurred by the Executive in performing his duties as an
employee of Company, provided that Executive accounts promptly for such
expenses to Company in the manner prescribed from time to time by Company.
6. TERMINATION. Subject to the respective continuing obligations of the
parties, pursuant to paragraphs 7, 8, 9, 10, 11 and 12, this Agreement may
be terminated as follows:
(a) BY THE COMPANY. The Company may terminate this Agreement under the
following circumstances:
(i)WITH CAUSE, ETC. Company may terminate this Agreement immediately
for cause, which for purposes of this agreement shall include without
limitation, fraud, misrepresentation, theft or embezzlement of Company
assets, material intentional violations of law or Company policies,
actions involving moral turpitude or a material breach of the
provisions of this Agreement, including specifically the repeated
failure to perform his duties as required by paragraph 2 after notice
of such failure from Company and the expiration of thirty (30) days
without corrective action having been undertaken by Executive.
(II)WITHOUT CAUSE. Company may terminate this Agreement without cause
on thirty (30) days' advance written notice subject to the severance
payment provisions set forth in paragraph 7.
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(b) BY EXECUTIVE. Executive may terminate this Agreement without cause on
thirty (30) days' notice. August Technology shall then set the date of
termination which shall be no less than two (2) weeks from date of
notice, unless company pays executive for the balance of the two week
notice period.
(c) DEATH. If Executive should die during the term of this Agreement, this
Agreement shall thereupon terminate; provided, however, that the
Company shall pay to the Employee's beneficiary or estate, the
compensation as provided in paragraph 7 below.
(d) PERMANENT DISABILITY. In the event the Executive should become
permanently disabled during the term of this Agreement, then this
Agreement shall terminate. For the purposes hereof, a permanent
disability shall mean that disability resulting from injury, disease
or other cause, whether mental or physical, which incapacitates the
Executive from performing his normal duties as an employee, appears to
be permanent in nature and contemplates the continuous, necessary and
substantially complete loss of all management and professional
activities for a continuous period of six (6) months.
(e) PARTIAL DISABILITY. If the Executive should become partially disabled,
he shall be entitled to his salary as provided herein for a period of
six (6) months. At the end of said period of time, if such Executive
remains partially disabled, the Executive's salary shall be adjusted
to reflect the amount of time the Executive is able to devote to the
Company's business.
(f) TEMPORARY DISABILITY. In the event the Executive should become
disabled, but such disability is not permanent, as defined above, such
Executive shall be entitled to his salary for a period of six (6)
months. If such temporary disability continues longer than said period
of time, then the Executive shall be deemed to have become permanently
disabled for the purposes of this Agreement at the end of said six (6)
month period.
7. REMEDIES FOR EARLY TERMINATION.
(a) In the event of termination pursuant to paragraph 6, Base Salary and
any other compensation shall be paid as follows:
(i) In the event of termination pursuant to paragraph 6(a)(i), Base
Salary shall continue to be paid on a semi-monthly basis prorated
through the date of termination specified in any notice of
termination and Executive shall be entitled to continue to
participate in those benefit programs provided by Subparagraph
4(c)(ii) for the minimum time period required by law following
termination at his own cost.
(ii) In the event of termination pursuant to paragraph 6(a)(ii), Base
Salary shall continue to be paid on a semi-monthly basis for
three (3) months following the date of termination specified in
any notice of termination, and Executive shall be entitled to
continue to participate in those benefit programs provided by
Subparagraph 4(c)(ii) for the longer of three (3) months or the
minimum time period required by law following termination,
provided that the Company shall bear the cost of such benefits
for no longer than three (3) months.
(iii)In the event of termination pursuant to paragraph 6(b),
compensation shall continue to be paid as follows: if the notice
of termination is given by Executive at any time, Base Salary
shall continue to be paid on a semi-monthly basis prorated
through the date of termination specified in such notice and
Executive shall be entitled to continue to participate in those
benefit programs provided by Subparagraphs 4(c)(ii) for the
minimum time period required by law following termination at his
own cost.
(iv) In the event of termination of this Agreement by reason of
Executive's death, payment of Base Salary shall terminate as of
the end of the month following the Executive's death.
(v) In the event of disability, payment of Base Salary shall
terminate as of the end of the month in which the last day of the
three (3) month period of Executive's inability to perform his
duties occurs.
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(b) In the event of termination by reason of Executive's death or
disability (clauses (a)(iv) and (a)(v) above):
(i) Executive shall receive a pro rata portion (prorated through the
last day Base Salary is payable pursuant to clauses (a)(iii) and
(a)(iv), respectively) of any bonus or incentive payment (for the
year in which death or disability occurred), to which he/she
would have been entitled had he/she remained continuously
employed for the full fiscal year in which death or disability
occurred and continued to perform his duties in the same manner
as they were performed immediately prior to the death or
disability; and
(ii) The exercise of any options then held by Executive shall be
governed by the terms of the applicable Company stock option
plan.
8. CONFIDENTIAL INFORMATION.
(a) For purposes of this paragraph 8, the term "Confidential Information"
means information which is not generally known and which is
proprietary to Company or which has been made available to the Company
in a manner reasonably understood to require confidential treatment,
including (i) trade secret information about Company and its products;
and (ii) information relating to the business of Company as conducted
at any time within the previous two (2) years or anticipated to be
conducted by Company, and to any of its past, current or anticipated
products, including, without limitation, information about Company's
research, development, manufacturing, purchasing, accounting,
engineering, marketing, selling, leasing or servicing. All information
that Executive has a reasonable basis to consider Confidential
Information or which is treated by Company as being Confidential
Information shall be presumed to be Confidential Information, whether
originated by Executive or by others, and without regard to the manner
in which Executive obtains access to such information.
(b) Executive will be governed by the terms of the Employee Assignment and
Disclosure Agreement attached hereto as Appendix C .
9. INVENTIONS.
(a) For purposes of this paragraph 9, the term "Inventions" means
discoveries, improvements and ideas (whether or not in writing or
reduced to practice) and works of authorship, whether or not
patentable or copyrightable, (1) which relate directly to the business
of Company, or to Company's actual or demonstrably anticipated
research or development, (2) which result from any work performed by
Executive for Company, (3) for which equipment, supplies, facilities
or trade secret information of Company is utilized, or (4) which were
developed during the time Executive was obligated to perform the
duties described in paragraph 2.
(b) Executive will be governed by the terms of the Employee Assignment and
Disclosure Agreement attached hereto as Appendix B.
10. NO ADEQUATE REMEDY. The parties agree that it is impossible to measure in
money the damages which the Company will accrue to either party by reason
of a failure of an executive to perform any of the obligations under this
Agreement. Therefore, if the Company shall institute any action or
proceeding to enforce the provisions hereof, the Executive shall not urge
in any such action or proceeding the claim or defense that the Company has
an adequate remedy at law.
11. MISCELLANEOUS.
(a) SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and inure
to the benefit of the successors and assigns of Company, whether by
way of merger, consolidation, operation of law, assignment, purchase
or other acquisition of substantially all the assets or business of
Company and shall only be assignable under the foregoing circumstances
and shall be deemed to be materially breached by Company if any such
successor or assign does not absolutely and unconditionally assume all
of Company's obligations hereunder. Any such successor or assign shall
be included in the term "Company" as used in this Agreement.
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(b) NOTICES. All notices, requests and demands given to or made pursuant
hereto shall, except as otherwise specified herein, be in writing and
be delivered or mailed to any such party at its address which:
In the case of the Executive shall be:
XXXXXX X. XXXXXXX
000 Xxxxxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
In the case of Company shall be:
AUGUST TECHNOLOGY CORPORATION
ATTN: COO
0000 Xxxx 00xx Xxxxxx
Xxxxxxxxxxx XX 00000
Either party may, by notice hereunder, designate a changed address.
Any notice, if mailed properly addressed, postage prepaid, registered
or certified mail, shall be deemed dispatched on the registered date
or that stamped on the certified mail receipt, and shall be deemed
received within the second business day thereafter or when it is
actually received, whichever is sooner.
(c) CAPTIONS. The various headings or captions in this Agreement are for
convenience only and shall not affect the meaning or interpretation of
this Agreement.
(d) GOVERNING LAW. The validity, construction and performance of this
Agreement shall be governed by the laws of the State of Minnesota and
any and every legal proceeding arising out of or in connection with
this Agreement shall be brought in the appropriate courts of the State
of Minnesota, each of the parties hereby consenting to the exclusive
jurisdiction of said courts for this purpose.
(e) CONSTRUCTION. Wherever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be
prohibited by or invalid under applicable law, such provision shall be
ineffective only to the extent of such prohibition or invalidity
without invalidating the remainder of such provision or the remaining
provisions of this Agreement.
(f) WAIVERS. No failure on the part of either party to exercise, and no
delay in exercising, any right or remedy hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any right
or remedy hereunder preclude any other or further exercise thereof or
the exercise of any other right or remedy granted hereby or by any
related document or by law.
(g) MODIFICATION. This Agreement may not be and shall not be modified or
amended except by written instrument signed by the parties hereto.
(h) ENTIRE AGREEMENT. This Agreement constitutes the entire Agreement and
understanding between the parties hereto in reference to all the
matters herein agreed upon; provided, however, that this Agreement
shall not deprive Executives of any other rights Executives may have
now or in the future, pursuant to law or the provisions of Company
benefit plans.
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IN WITNESS WHEREOF, The parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first above written.
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Xxxxxx X. Xxxxxxx
AUGUST TECHNOLOGY CORPORATION
By
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Its:
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