EMPLOYMENT AGREEMENT
Exhibit
10.2
AGREEMENT
by and between Bio-Lok International Inc. (the “Company”), and Xxxxx X.
Xxxxxxxxx (the “Executive”), dated as of the 1st day of November,
1997.
WHEREAS,
The Board of Directors of the Company (the “Board”) has determined that it is in
the best interest of the Company and its shareholders, to avail itself of
the
Executive’s services as President and Chief Executive Officer (CEO) of the
Company and to assure that the Company will have the continued dedication
of the
Executive;
WHEREAS,
this Agreement shall cancel, replace and supersede, the Employment Agreement
signed by the Executive on February 19, 1997.
NOW,
THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
1. Definitions. As
used
in this Agreement, the following terms shall have the following
meaning:
(a) Proprietary
Information shall mean any trade or business secrets of the Company and any
scientific, technical or business materials that are treated by the Company
as
confidential or proprietary and are not now in, or hereafter enter, the public
domain, including, but not limited to information to which the Executive
has
access or to which he may have access relating to the Company’s present or
planned business methods of doing business and certain other business
information with which the Company has entrusted Executive in the use,
application or purpose therefore. “Proprietary Information” shall not include
any (i) general knowledge of the industry in the possession of the Executive
prior to his becoming an employee of the Company (ii) any information in
the
public domain at the time of receipt by Executive, or (iii) any information
which, after receipt thereof by Executive, becomes part of the public domain
through no improper act or omission of Executive, but shall include the trade
secrets of and confidential information about the Company possessed by the
Executive prior to his becoming an employee of the Company.
(b) Intellectual
Property means any written, drawing, logo, computer program, manual, trade
name,
trademark, service xxxx or other material of the Company registered or otherwise
protected or protectable under state, federal or foreign patent, trademark,
copyright, or similar laws.
2. Employment
Period. The
Company hereby employs the Executive and agrees to continue the Executive
in its
employ, and the Executive hereby agrees to remain in the employ of the Company
upon the terms and conditions hereinafter set forth, for the period commencing
on the date hereof and ending on the fifth (5th) anniversary from such date
(the
“Employment Period”), and such Employment Period shall automatically renew
annually on each October 31st for a full five (5) years - i.e. at all times
on
each October 31st a full five (5) Employment Period will be
outstanding.
3. Terms
of
Employment. During the Employment Period(s), and excluding any periods of
vacation, personal and sick leave to which the Executive is entitled, the
Executive agrees to devote reasonable attention and time during normal business
hours to the business and affairs of the Company and, to the extent necessary,
to discharge the responsibilities assigned to the Executive, to use the
Executive’s reasonable best efforts to perform faithfully and efficiently such
responsibilities. During the Employment Period, it shall not be a violation
of
this Agreement for the Executive to (i) serve on civic or charitable boards
or
committees, (ii) manage associated companies, as directed by the Board of
Directors, for compensation additional to this agreement, (iii) deliver
lectures, fulfill speaking engagements or teach at educational institutions
or
(iv) manage personal investments, as long as such activities do not interfere
with the performance of the Executive’s responsibilities as an employee of the
Company in accordance with this Agreement.
4. Position,
Responsibilities and Location. During the Employment Period, the Executive
shall
hold and perform a position of responsibility, importance and scope with
the
Company at least equal to those of the position held by him immediately prior
to
any Change in Control. The Executive shall not be required, without his written
consent, to change his office location from the location thereof immediately
prior to a Change in Control or to be absent therefrom on business more than
sixty (60) working days in any year or more than ten (10) consecutive days
at
any one time.
5. Compensation.
(a) Base
Salary. During the Employment Period, the Executive shall receive a base
salary
(“Base Salary”) of $150,000 per annum payable in accordance with the customary
payroll practices of the Company. The Executive’s performance and Base Salary
shall be reviewed by the Board of Directors each October 31, and each such
review shall represent a salary adjustment date which can cause the Base
Salary
to be increased by an amount to be determined and approved by the Board of
Directors. Any such increase in the Base Salary shall not serve to limit
or
reduce any other obligation to the Executive under this Agreement. That portion
of the Executive’s salary which is not taken during a given employment year
shall be paid in common stock shares of the Company as detailed under (i)
under
this section.
(b) Annual
Bonus. In addition to the Base Salary, the Executive shall be awarded, for
each
fiscal year during the Employment Period(s), an annual bonus (an “Annual Bonus”)
of not less than 10% of Base Salary in cash in such amounts as determined
and
approved by the Board of Directors. That portion of the Executive’s Annual Bonus
which is not taken during a given employment year shall be paid in common
stock
shares of the Company as detailed under (i) under this section.
(c) Incentive,
Savings and Retirement Plans. In addition to Base Salary and Annual Bonus
payable as hereinabove provided, the Executive shall be entitled to participate
during the Employment Period(s) in all incentive, savings and retirement
plans
and programs applicable to other key executives and employees of the Company.
(d) Welfare
Benefits Plans. During the Employment Period(s), the Executive and/or the
Executive’s family, as the case may be, shall be eligible for participation in
and shall receive all benefits under the welfare benefit plans provided by
the
Company (including, without limitation, medical, hospitalization, prescription,
dental, disability, salary continuance, executive life, group life, accidental
death and travel, accident insurance plans and programs).
(e) Expenses.
During the Employment Period(s), the Executive shall be entitled to incur
and
receive prompt reimbursement for all reasonable travel, (other than commuting)
entertainment and other business expenses incurred by the Executive in
accordance with the policies and procedures of the Company.
(f) Fringe
Benefits. During the Employment Period(s), the Executive shall be entitled
to
all fringe benefits provided to the Executives and any employees of the Company,
including country club membership, two (2) Airline memberships, free annual
full
physical and continued use of an American made Company-owned or leased
automobile to be selected by the Executive. The Company will pay all garage,
insurance, gasoline, registration, maintenance and repair costs incident
to the
Executive’s use of such Company owned or leased automobile.
(g) Office
and Support Staff. During the Employment Period(s), the Executive shall be
entitled to an office of a size and with furnishings and other appointments,
and
to secretarial and other assistance, at least equal to those provided to
other
key Executives of the Company.
(h) Vacation.
During the Employment Period(s), the Executive shall be entitled to such
paid
vacation as determined by the officers of the Company and concurred by the
Board
of Directors.
(i) Compensation
paid in lieu of cash. Any compensation and benefit due the Executive and
not
paid by the Company on a timely and current basis can be taken in common
stock
shares of the Company at a value equal to the net worth divided by the number
of
shares issued and outstanding, at the Executive’s discretion.
(j) Severance
Payment. Executive
shall receive severance payments upon termination if termination is other
than
due to Cause (Section 5. (c)). Commencing with the termination, death or
disability classification of the Executive the Company shall pay to the
Executive and/or his dependent(s) severance payments equal to his then current
compensation over any then outstanding employment period as defined herein.
(k) Payment
to Executive upon Termination of Term. If
the
Term shall terminate pursuant to Section 6. (a). (b) or (d), Company shall
compensate Executive with a Severance Bonus in the form of common stock shares
of the Company’s voting shares equal 2% of the Company’s then outstanding common
stock shares each year of the Executive’s Termination Date so long Severance
Payments are paid to the Executive.
6. Termination.
(a)
Death.
This Agreement shall terminate automatically upon the Executive’s death and
dependent(s) will receive payments due as detailed under Section 7.
(b)
Disability.
If the Company determines in good faith that the Disability of the Executive
has
occurred (pursuant to the definition of “Disability” as set forth below), it may
give to the Executive written notice of its intention to terminate the
Executive’s employment. In such event, the Executive’s employment with the
Company shall terminate effective on the 30th day after receipt of such notice
by the Executive (the “Disability Effective Date”), provided that, within the 30
days after such receipt, the Executive shall not have returned to full-time
performance of the Executive’s duties.
(1) For
purposes of this Agreement, “Disability” means disability which, at least 26
weeks after its commencement, is determined by the Company to be of such
a
nature as to prevent the Executive from performing his duties; or
(2) Disability
as defined by the Social Security System Guidelines.
(c) Cause.
The Company may terminate the Executive’s employment for “Cause”. For purposes
of this Agreement, “Cause” means (a) an act or acts of personal dishonesty taken
by the Executive, (b) the conviction of the Executive of a crime involving
moral
turpitude, (c) the failure, refusal or inability to adequately perform his
duties as reasonably assigned to him hereunder from time-to-time, or (d)
the
failure to follow a reasonable instruction form the Board of Directors of
the
Company.
(d) Good
Reason. The Executive’s employment may be terminated by the Executive for Good
Reason. For purposes of this Agreement, “Good Reason” means:
(i)
the
assignment to the Executive of duties inconsistent in any material respect
with
the Executive’s position, authority, duties or responsibilities or any other
action by the Company which results in a material diminution in such position,
authority, duties or responsibilities, excluding for this purpose an isolated,
insubstantial and inadvertent action not taken in bad faith and which is
remedied by the Company promptly after receipt of notice thereof given by
the
Executive;
(ii)
any
failure by the Company to comply with any of the provisions of Section 4.
of
this Agreement, other than an isolated, insubstantial and inadvertent failure
not occurring in bad faith and which is remedied by the Company promptly
after
receipt of notice thereof given by the Executive;
(iii)
the
Company requiring the Executive to be based at any office or location other
than
within 50 miles of the Company’s current office location in Deerfield Beach,
Florida, except for travel reasonably required in the performance of the
Executive’s responsibilities;
(iv)
any
purported termination by the Company of the Executive’s employment otherwise
than as expressly permitted by this Agreement.
(e) Notice
of
Termination. Any termination by the Company for Cause or by the Executive
for
Good Reason shall be communicated by Notice of Termination to the other party
hereto given in accordance with Section 14 (b) of this Agreement. For purposes
of this Agreement, a “Notice of Termination” means a written notice which (i)
indicates the specific termination provision in this Agreement relied upon,
(ii)
sets forth in reasonable detail the facts and circumstances claimed to provide
a
basis for termination of the Executive’s employment under the provisions so
indicated and (iii) if the Date of Termination (as defined below) is other
than
the date of receipt of such notice, specifies the termination date (which
date
shall be not more than fifteen (15) days after the giving of such Notice).
The
failure by the Executive to set forth in the Notice of Termination any fact
or
circumstances which contribute to a showing of Good Reason shall not waive
any
right of the Executive hereunder or preclude the Executive from asserting
such
fact or circumstance in enforcing his rights hereunder.
(f) Date
of
Termination. “Date of Termination” means the date of receipt of the Notice of
Termination or any later date specified therein, as the case may be; provided,
however, that (i) if the Executive’s employment is terminated by the Company
other than for Cause or Disability, the Date of Termination shall be the
date on
which the Company notifies the Executive of such termination and (ii) if
the
Executive’s employment is terminated by reason of Death or Disability, the Date
of Termination shall be the date of death of the Executive or the Disability
Effective Date, as the case may be.
7. Obligation
of the Company upon Termination.
(a) Death.
If
the Executive’s employment is terminated by reason of the Executive’s death,
this Agreement shall continue as required under the section titled “Severance
Payment”; and, any unpaid Annual Bonus required to be paid to the Executive for
the last full fiscal year or fraction thereof together with any accrued interest
thereon, any accrued vacation pay not yet paid by the Company, and any other
amounts or benefits owing to or accrued or vested for the account of the
Executive under the then applicable employee benefits plans or policies of
the
Company. All accrued obligations shall be paid by the Company to the Executive
dependent(s) in a lump sum in cash within 90 days of the Date of Termination.
Anything in this Agreement to the contrary notwithstanding, the Executive’s
family shall be entitled to receive benefits at least equal to the benefits
provided by the Company, to surviving families of executives of the Company,
under such plans, programs and policies relating to family death benefits,
if
any, in accordance with the most favorable policies of the Company.
(b) Disability.
If the Executive’s employment is terminated by reason of the Executive’s
Disability, this Agreement shall terminate and continue as detailed under
this
section par. (a).
(c) Cause:
Other than for Good Reason. If the Executive’s employment shall be terminated
for Cause, this Agreement shall terminate without further obligations to
the
Executive, other than the obligation to pay to the Executive the current
Base
Salary through the Date of Termination and after the Date of Termination
salary
and amounts as detailed under Section 5. (j) and (k) hereto. If the Executive
terminates employment other than for Good Reason, death or disability, this
Agreement shall terminate without further obligations to the Executive, other
than those obligations accrued or earned by the Executive through the Date
of
Termination, including for this purpose, All Accrued Obligations.
(d) Salary
and Benefit continuance shall be for the balance of any contractual period
of
(five (5) years) following Termination of Employee (see severance payment
section 5. (j)) for any reason other than described in section 6.
(c).
8. Non-Exclusivity
of Rights. Nothing in this Agreement shall prevent or limit the Executive’s
continuing or future participation in any benefit, bonus, incentive or other
plan or program provided by the Company and its affiliated companies for
which
the Executive may qualify, nor shall anything herein limit or otherwise affect
such rights as the Executive may have under any stock option or other agreements
with the Company, or any of its affiliated companies. Amounts which are vested
benefits or which the Executive is otherwise entitled to receive under any
plan
or program of the Company or any of its affiliated companies at or subsequent
to
he Date of Termination shall be payable in accordance with such plan or
program.
9. Confidentiality
and Restrictive Covenant.
(a) During
the Employment Period and for a period of twenty-four (24) months immediately
following the termination of the Executive’s employment or after any salary
continuance, the Executive agrees to maintain in strict confidence the
Proprietary Information and Intellectual Property and that he will not engage
in
or have any financial interest in any business enterprise in competition
with
the Company. For purposes of this Section 9, the Executive shall be deemed
to be
engaged in or have a financial interest in a business enterprise if he is
an
employee, officer, director, trustee, agent, consultant or partner of any
person
which is engaged in such business, or if he owns, directly or indirectly,
stock
or securities convertible into or exchangeable for stock or otherwise has
any
equity or beneficial interest in such person; provided, that the ownership
of 5%
or less of the outstanding shares of a class of security, which is regularly
traded on a national securities exchange or quoted in an automated inter-dealer
quotation system, shall not be deemed to be engaging or having a financial
interest in the business of such person or entity.
(b) During
the Term and for a period of one (1) year immediately following the termination
of the Executive’s employment or salary continuance, the Executive agrees that
he will not directly or indirectly hire or solicit any employee of the Company
or who was an employee, consultant or independent contractor of the Company
at
any time within the six-month period immediately prior thereto or encourage
an
employee, consultant, independent contractor or agent of the Company to
terminate such employment or agency relationship.
(c) The
Executive acknowledges and agrees that the restrictive covenants set forth
in
this Section 9. (the “Restrictive Covenants”) are reasonable and valid in
geographical and temporal scope and in all other respects. If any court
determines that any of the Restrictive Covenants, or any part thereof, is
invalid or unenforceable, the remainder of the Restrictive Covenants shall
not
thereby be affected and shall be given full force and effect, without regard
to
the invalid or unenforceable parts.
(d) If
any
court determines that any of the Restrictive Covenants, or any part thereof,
is
invalid or unenforceable for any reason, such court shall have the power
to
modify such Restrictive Covenant, or any part thereof, and, in its modified
form, such Restrictive Covenant shall then be valid and
enforceable.
10. Equitable
Relief. In the event of a breach or threatened breach by the Executive of
any of
the covenants contained in Section 8. hereof, the Company shall be entitled
to
temporary retraining order, a preliminary injunction and/or a permanent
injunction restraining the Executive from breaching or continuing to breach
any
of said covenants. Nothing herein contained shall be construed as prohibiting
the Company from pursuing any other remedies that may be available to it
for
such breach or threatened breach, including the recovering of
damages.
11. Full
Settlement. The Company’s obligation to make the payments provided for in this
Agreement and otherwise to perform its obligations hereunder shall not be
affected by any setoff, counterclaim, recoupment, defense or other claim,
right
or action which the Company may have against the Executive or others. In
no
event shall the Executive be obligated to seek other employment or take any
other action by way of mitigation of the amounts payable to the Executive
under
any of the provisions of this Agreement.
12. Confidential
Information. The Executive shall hold in a fiduciary capacity for the benefit
of
the Company all Proprietary Information, relating to the Company or any of
its
affiliated companies, and their respective businesses, which shall have been
obtained by the Executive during the Executive’s employment by the Company or
any of its affiliated companies and which shall not be or become public
knowledge (other than by acts by the Executive or his representatives in
violation of this Agreement). After termination of the Executive’s employment
with the Company, the Executive shall not, without the prior written consent
of
the Company, communicate or divulge any such Proprietary information, knowledge
or date to anyone other than the Company and those designated by it. In no
event
shall an asserted violation of those designated by it. In no event shall
an
asserted violation of the provisions of this Section 12. constitute a basis
for
deferring or withholding any amounts otherwise payable to the Executive under
this Agreement.
13. Successors.
(a) This
Agreement is personal to the Executive and without the prior written consent
of
the Company shall not be assignable by the Executive. This Agreement shall
inure
to the benefit of and be enforceable by the Executive’s representative(s) and
dependent(s) as detailed herein.
(b) This
Agreement shall inure to the benefit of and be binding upon the Company,
its
respective successors and assigns.
(c) The
Company will require any successor (whether direct or indirect, by purchase,
merger, consolidation or otherwise) to all or substantially all of the business
and/or assets of the Company, respectively to expressly assume and agree
to
perform this Agreement in the same manner and to the same extent that such
party
would be required to perform it if no such succession had taken place. As
used
in this Agreement, “Company” shall mean, respectively, the Company as
hereinbefore defined and any successor to such party’s business and/or assets as
aforesaid which assumes and agrees to perform this Agreement by operation
of
law, or otherwise.
14. Miscellaneous.
(a) This
Agreement shall be governed by and construed in accordance wit the laws of
the
State of Florida, without reference to principles of conflict of laws. The
captions of this Agreement are not part of the provisions hereof and shall
have
no force or effect. This Agreement may not be amended or modified otherwise
than
by a written agreement executed by the parties hereto or their respective
successors and legal representatives.
(b) All
notices and other communications hereunder shall be in writing and shall
be
given by hand delivery to the other party or by registered or certified mail,
return receipt requested, postage prepaid, addressed as follows:
if
to the
Executive: Xxxxx
X.
Xxxxxxxxx
00000
Xxxx Xxxxx Xxxx
Xxxx
Xxxxx, XX 00000
if
to the
Company: Bio-Lok
International Inc.
000
X.
Xxxxxxxx Xxxxx
Xxxxxxxxx
Xxxxx, XX 00000
or
to
such other address as either party shall have furnished to the other in writing
in accordance herewith. Notice and communications shall be effective when
actually received by the addressed.
(c) The
invalidity in total or in part of any provision of this Agreement shall not
affect the validity or enforceability of any other provision of this
Agreement.
(d) The
Company may withhold from any amounts payable under this Agreement such Federal,
State or local taxes as shall be required to be withheld pursuant to any
applicable law or regulation.
(e) The
Executive’s failure to insist upon strict compliance with any provision hereof
shall not be deemed to be a waiver of such provision or any other provision
thereof.
(f) This
Agreement contains the entire understanding of the Company and the Executive
with respect to the subject matter hereof.
IN
WITNESS WHEREOF, the Executive has hereunto set his hand and, pursuant to
the
authorization from each respective Board member of the Company have caused
this
Agreement to be duly executed in its corporate name by one of its officers
or
directors duly authorized to enter into and execute this Agreement, all as
of
the day and year first above written.
| Bio-Lok International Inc. | ||
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| By: | /s/ Xxxx X. Xxxxx | |
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| By: | /s/ Xxxx X. Xxxxx | |
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| Executive: | ||
| /s/ Xxxxx X. Xxxxxxxxx | ||
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Xxxxx
X. Xxxxxxxxx
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