Exhibit 10(pp)
EMPLOYMENT AGREEMENT
AGREEMENT (the "Agreement") dated this December 31, 2003 made by and
between Presstek, Inc., a Delaware corporation, its parents, subsidiaries,
divisions, or affiliated entities, successors and assigns (the "Employer"), and
Xxxxx X. Xxxxx (the "Employee").
WHEREAS, both the Employer and the Employee now wish for the Employee
to continue to be employed as Chief Financial Officer and Vice President of
Finance of the Employer; and
WHEREAS, the Employee wishes to continue his employment with the
Employer and the Employer wishes to continue its employment of the Employee
under this Agreement on the date this Agreement is executed by the parties as
set forth above;
NOW, THEREFORE, in consideration of the promises hereafter contained,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto AGREE as follows:
1. Consideration. In consideration for the Employee's execution
of this Agreement, the Employer agrees that the Employee's employment shall
continue as set forth in this Agreement, the Employee shall be permitted access
to the Employer's confidential information and trade secrets and the Employee
shall be eligible to receive post-Term Severance Payments (Section 9) or the
Change in Control payment (Section 12) as set forth in this Agreement (subject
to his compliance with Sections 10 and 11 of this Agreement). The Employee
understands, acknowledges and agrees that the Employee would not receive the
consideration specified in this Section 1, except for the Employee's execution
of this Agreement and the fulfillment of the promises contained herein.
2. Employment. Commencing from the date of this Agreement as set forth
above (the "Start Date"), the Employee shall continue his employment as Chief
Financial Officer and Vice President of Finance of the Employer under the terms
of this Agreement. The Employee shall render executive, financial, policy and
other management services to the Employer of the type customarily performed by
persons situated in similar executive and management capacities. The Employee
shall perform such other related duties as the Board of Directors of the
Employer may from time to time reasonably direct.
3. Employment Term. "Term," as used in this Agreement, shall refer to the
Term of this Agreement as defined in this Section. The Term of the employment
under this Agreement shall commence on the Start Date and shall initially end
three years thereafter, on the day preceding the third anniversary of the Start
Date, unless terminated sooner in accordance with the provisions hereof. The
Term of employment under this Agreement shall, on each anniversary of the Start
Date thereafter (commencing with the third anniversary of the Start Date), be
automatically extended for an additional year unless the
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Employer or the Employee gives written notice to the other, at least 90 days
prior to such anniversary date, that he or it does not concur in such extension.
If neither party gives notice of non-concurrence in such extension, the Term
will be automatically extended for an additional year, unless terminated sooner
in accordance with the provisions hereof.
4. Compensation. The Employer agrees to pay the Employee during the Term
of this Agreement an annual base salary equal to TWO HUNDRED AND TWENTY-FIVE
THOUSAND U.S. DOLLARS And ZERO CENTS ($225,000) with the salary to be reviewed
no less than annually during the Term of this Agreement by the Board of
Directors or Compensation Committee of the Employer. In the annual salary
review, the Board of Directors may compensate the Employee for increases in the
market value of the Employee's duties and responsibilities hereunder and may
provide for performance or merit increases. The base salary of the Employee
shall not be decreased at any time during the Term of this Agreement from the
amount then in effect, unless the Employee otherwise agrees in writing. The
salary shall be payable to the Employee not less frequently than monthly. All
payments and benefits in this Agreement shall be subject to all applicable
federal, state and local withholding, payroll and other taxes.
Participation in discretionary bonuses, retirement and other employee
benefit plans and fringe benefits shall not reduce the salary payable to the
Employee under this Section 4.
5. Discretionary Bonuses. During the Term of this Agreement, the Employee
may be entitled to receive an annual cash bonus of up to 40% of the Employee's
then annual base salary, based on the Employee's contribution to the
accomplishment of key annual corporate objectives mutually determined by the
Employee and the Employer. The determination of whether to pay a discretionary
bonus, and the amount of the bonus, if any, shall be made by the Employer in its
sole and absolute discretion. During the Term of this Agreement, the Employee
also may be entitled to participate in any incentive compensation and bonus
programs authorized and declared by the Board of Directors or Compensation
Committee of the Employer for the benefit of the Employee. The determination of
whether the Employee is eligible to participate in any such incentive
compensation and bonus programs, and the amount of incentive compensation and
bonus paid, if any, shall be made solely by the Employer. No other compensation
provided for in this Agreement shall be deemed a substitute for the Employee's
right to participate in such incentive compensation or bonus programs when and
as declared.
6. Stock Option Grant; Participation in Stock Option, Retirement and
Employee Benefit Plans; Fringe Benefits. Subject to the terms and conditions of
the option agreement annexed hereto as Exhibit A and the Employer's 1998 Stock
Incentive Plan, the Employee shall be granted, on the date hereof (the "Grant
Date"), options to purchase 60,000 shares of common stock of the Employer at a
price per share equal to the fair market value of the shares on the Grant Date,
such options to vest as follows: 25% on the first anniversary of the Grant Date,
an additional 25% on the second anniversary of the Grant Date, an additional 25%
on the third anniversary of the Grant Date and the remaining 25% on the fourth
anniversary of the Grant Date (subject to the earlier vesting of the options, in
their entirety, upon the execution by the Employer of a definitive
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agreement relating to a Trigger Event). For this purpose, "Trigger Event" shall
mean (a) the sale by the Employer of all or substantially all of its assets, or
(b) the acquisition of a majority of the shares of common stock of the Employer
by a third party pursuant to which holders of the Employer's common stock prior
to such transaction receive equity securities or cash from the third party in
exchange for their common stock of the Employer, and to be in the form of, and
have such other terms and conditions as are set forth in the option agreement
annexed hereto as Exhibit A.
In addition to the foregoing stock options, and subject to the
eligibility requirements that may be applicable, the Employee may be entitled to
participate during the Term in any plan or arrangement of the Employer relating
to stock options, stock purchases, pension, thrift, or profit sharing benefits,
or other benefits under qualified or non-qualified deferred compensation plans,
group life insurance, medical coverage, education or any other employee benefits
that the Employer may adopt or make available for the benefit of the Employee.
The Employee may also be entitled during the Term of this Agreement to
any fringe benefits which may be or become available by the Employer for the
benefit of the Employee during the Term of this Agreement, and to the payment or
reimbursement of reasonable expenses for attending annual and periodic meetings
of trade associations, and any other benefits which are commensurate with the
duties and responsibilities to be performed by the Employee under this
Agreement.
The Employer fully reserves its rights to change, modify or discontinue
any of its stock purchase, retirement, employee benefit or other fringe benefit
plans at any time during the Term of this Agreement in its sole and absolute
discretion, and in accordance with applicable law.
7. Standards. The Employee shall perform his duties and responsibilities
under this Agreement in accordance with such reasonable standards as are
established from time to time by the Chief Executive Officer and President
and/or Board of Directors of the Employer, in its sole and absolute discretion.
8. Voluntary Absences; Vacations. The Employee shall be entitled to an
annual paid vacation during the Term of this Agreement of four (4) weeks per
year or such longer period as the Board of Directors may approve or such longer
periods to which the Employee may be entitled as an employee of the Employer.
The timing of paid vacations shall be scheduled in a reasonable manner by the
Employee.
9. Termination of Employment.
(a) (i) The Board of Directors may terminate the Employee's employment
at any time, but any termination by the Employer other than termination for
Cause (as defined in Section 9(a)(iii) below) shall not prejudice the Employee's
right to receive compensation and other benefits under this Agreement, except as
otherwise stated in this Agreement. In the event of a termination for Cause, the
Employee shall have no right to receive
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compensation or other benefits, including payment of legal fees and expenses
incurred, for any period after termination for Cause except as otherwise
required by law. Regardless of the reason for the termination of the Employee's
employment, other than termination for Cause, the Employer shall continue to be
subject to any independent obligation to the Employee under any employee benefit
plan in which the Employee is then a participant.
(ii) In the event that the Employee's employment ceases by reason of
the Employer's termination of the Employee's employment during the Term other
than for Cause, or if either party provides the other party with written notice
of the party's non-concurrence in the automatic extension of the Term, as set
forth in Section 3 of this Agreement, the Employer shall be obligated
concurrently with the termination of such employment, in lieu and replacement of
the Employee's entitlement to any compensation and other benefits under this
Agreement pursuant to Section 9(a)(i), to make severance payments to the
Employee in an aggregate amount that is equal to the Employee's then current
annual base salary for a period of one (1) year (collectively, the "Severance
Payments"). The Severance Payments shall be paid after termination of employment
in equal monthly installments according to the Employer's normal payroll
practices then in effect. However, if the Employer's termination of the
Employee's employment without Cause occurs in connection with, or within one and
one-half (1-1/2) years after, a "Change in Control" as defined in Section 12(b)
hereof, the amount payable to the Employee shall be exclusively determined under
Section 12(a) as limited by Section 12(c) hereof, and the Employer shall not be
required to make the payments set forth in this Section. The Severance Payments
under this Section 9(a)(ii) shall not be reduced by any compensation which the
Employee may receive for other employment with another employer after
termination of his employment with the Employer. In addition, the Employee shall
be entitled to have all existing retirement or employee benefits of the type
referred to in Section 6 hereof continue for the remainder of the Term when the
Agreement is terminated, except as otherwise required by law or provided in the
related retirement or other employee benefit plans or agreements.
Notwithstanding the foregoing, the Employer shall have no obligation to make any
contributions to any retirement plan applicable to the Employee after the date
the Employee ceases to be employed by the Employer. In the event of a retirement
plan, the Employee shall be entitled to contributions made by the Employer to
the retirement plan on the Employee's behalf prior to the date of the Employee's
termination, which have vested and for which the Employee is otherwise eligible
in accordance with the written terms of the official plan documents governing
any applicable retirement plan. The Employer shall have no obligation to make
the Severance Payments set forth in this Section unless the Employee fully
complies with his obligations under this Agreement, including, but not limited
to, his obligations under Sections 10 and 11 of this Agreement.
(iii) References in this Agreement to "termination for Cause" shall
mean termination on account of acts or omissions of the Employee which
constitute Cause as defined below. Any determination with respect to a
termination for Cause shall require the approval of the Board of Directors of
the Employer. "Cause" shall mean any of the following:
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(A) conviction of a felony,
(B) theft from the Employer,
(C) breach of fiduciary duty involving personal profit,
(D) sustained and continuous conduct by the Employee
which adversely affects the reputation of the
Employer,
(E) continued failure of the Employee to substantially
and satisfactorily perform his duties or obligations
under this Agreement following twenty (20) days'
notice by the Employer to the Employee and a failure
by the Employee to correct the deficiency cited in
such notice (other than any such failure resulting
from the Employee's incapacity due to physical or
mental illness).
(b) The Employee shall have no right to terminate his employment
under this Agreement prior to the end of the Term of this Agreement, unless such
termination is either for Good Reason (as described in Section 12(a) hereof) in
connection with, or within one (1) and one-half years after, a Change in Control
or approved by the Board of Directors of the Employer. In the event that the
Employee violates this provision, or in the event that the Employee is
terminated for Cause, the Employee shall be entitled to no further payments
pursuant to this Agreement.
(c) The Employee's employment under this Agreement may also cease
prior to the end of the Term of this Agreement in the event of the Employee's
death or upon the Employee becoming "Totally Disabled." For purposes of this
Agreement, the Employee shall be "Totally Disabled" as of the date he becomes
entitled to receive disability benefits under the Employer's long term
disability plan. In the event that the Employee's employment is terminated by
his death or upon becoming "Totally Disabled," the Employee shall be entitled to
receive (i) any accrued but unpaid salary for services rendered to the date of
termination as determined pursuant to Section 4, (ii) any vacation accrued under
the Employer's policy to the date of termination, and (iii) any accrued but
unpaid expenses pursuant to Section 14 of this Agreement. The benefits to which
the Employee may be entitled upon termination pursuant to the plans and
arrangements referred to in Section 6 of this Agreement shall be determined and
paid in accordance with the terms of such plans and arrangements.
(d) The Employer shall have no obligation to make the payments set
forth herein if the Employee is in material breach of the Employee's obligations
under this Agreement. The Employee shall be obligated to execute a general
release of claims in favor of the Employer, its current and former parents,
subsidiaries, subdivisions, divisions, shareholders, Board of Directors, or
affiliated entities or persons, and the current and former directors, officers,
employees and agents of the Employer, in a form acceptable to the Employer (the
"Release"), as a condition to receiving the Severance Payments described above.
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10. Confidential Information and Non-Competition.
(a) "Confidential Information" shall mean trade secrets or
confidential information relating to the Employer, its customers, affiliates and
their respective businesses, including, but not limited to, the identity of the
Employer's customers; the entity of distributors and suppliers of the Employer;
the identity of representatives responsible for entering into contracts with the
Employer; specific customer, distributor and supplier needs and requirements;
the details of contracts and proposals between the Employer and its customers,
distributors and suppliers; selling and marketing strategies, prices, costs and
profit margins; the names, addresses and other contact information of purchasing
agents, vendors or other entities; purchasing techniques, methods, procedures
and processes; manufacturing and production techniques, methods, procedures and
processes; other techniques, methodologies and processes used by the Employer in
the conduct of its business; techniques, methods, procedures, know-how,
show-how, prototypes and technical specifications; computer data, software,
software codes, computer models, research projects, data processing and other
programs; production and manufacturing equipment and operating practices;
information with respect to products and product formulae, designs, plans for
future business, new business, products or other developments; new or innovative
ideas, customer proposals, marketing plans and ideas, and future developments or
strategies; information pertaining to research and development, acquisitions or
divestitures, marketing and sales, cost cutting, revenue generation, or other
matters concerning the Employer's planning and strategy; and other nonpublic
financial and other information of the Employer disclosed to or known by the
Employee as a consequence of or through the Employee's employment (or other
service relationship) with the Employer (including information conceived,
originated, discovered or developed by the Employee), which information is not
generally known in the relevant trade or industry or public knowledge. The
Employee acknowledges and agrees that the Confidential Information is not
generally known or available to the public, but has been developed, compiled or
acquired by the Employer at its great effort and expense. Confidential
Information can be in any form: oral, written or machine readable, including
electronic files.
(b) The Employee acknowledges and agrees that the Employer is
engaged in a highly competitive business and that its competitive position
depends upon its ability to maintain the confidentiality of the Confidential
Information and Trade Secrets which were developed, compiled and acquired by the
Employer at its great effort and expense. The Employee further acknowledges and
agrees that any disclosure, divulging, revelation or use of any of the
Confidential Information, other than in connection with the Employer's business
or as specifically authorized by the Employer, will be highly detrimental to the
Employer, and that serious loss of business and goodwill and pecuniary damage
may result therefrom. During the Employee's employment with the Employer and
thereafter, the Employee shall hold for the benefit of the Employer, and not for
the Employee's own benefit or disclosure to third parties, all Confidential
Information relating to the Employer and its business, including all
Confidential Information of customers of the Employer (i) obtained by the
Employee during the Employee's employment with the Employer and (ii) not
otherwise public knowledge or generally known in the trade or industry. The
Employee shall not, without the prior written consent
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of the Employer, unless compelled pursuant to the order of a court or other
governmental or legal body having jurisdiction over such matter, communicate or
divulge any such Confidential Information to anyone other than the Employer and
those designated by it. In the event the Employee is compelled by order of a
court or other governmental or legal body to communicate or divulge any such
Confidential Information to anyone other than the Employer and those designated
by it, the Employee shall promptly notify the Employer of any such order and the
Employee shall cooperate fully with the Employer in protecting such information
to the extent possible under applicable law and will only disclose that portion
of the Confidential Information necessary to satisfy any such order.
(c) Upon termination of the Employee's employment with the
Company, or at any time the Company requests, all equipment, property,
documents, files, records, notes, memoranda, designs, reports, price lists, cost
sheets, prototypes, blue prints, technical specifications, estimates, databases,
home office equipment, automobiles, computer equipment, computer files, computer
programs, plans, documents and all other property and Confidential Information
of the Employer (including all copies in all forms in the Employee's possession
or control), whether prepared by the Employee solely or jointly with others,
shall be left with or promptly returned to the Employer and shall at all times
be the property of the Employer.
(d) The Employee acknowledges and agrees that the Employer is
engaged in a highly competitive business, and by virtue of the Employee's
position and responsibilities with the Employer, and the Employee's access to
Confidential Information, the Employee's engaging in any business which is
directly or indirectly competitive with the Employer will cause it great and
irreparable harm. During the period of employment as an officer and/or employee
of the Employer, the Employee will devote his available business time and best
efforts to promoting and advancing the business of the Employer. During the Term
of the Agreement and for a period of one (1) year after termination of such
employment (for any reason whatsoever), the Employee agrees that he or she will
not, in any jurisdiction around the world in which the Employer conducts
business, whether alone or as a partner, officer, director, consultant, agent,
employee or stockholder of any company or other commercial enterprise, engage in
any business or other commercial activity which is or may be competitive with
the products and services being designed, conceived, marketed, distributed or
developed by the Employer at the time of termination of such employment, unless
written approval is obtained from the Company's Board of Directors. For purposes
of this Section, competitive products and services shall be defined to mean
non-photographic imaging, computer-to-plate, direct-to-press, thermal laser or
chemistry-free printing plate technology products and services or any other
products and services substantially similar to the products and services
designed, conceived, marketed, distributed or developed by the Employer at the
time of termination of the Employee's employment. The Employee acknowledges,
understands and agrees that accepting such competitive employment would cause
him to inevitably use, misappropriate and disclose the Employer's Confidential
Information which the Employee came to learn during his employment with the
Employer.
(e) The Employee acknowledges and agrees that during the course
and solely as a result of the Employee's employment with the Employer, the
Employee has and will
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become aware of some, most or all of the customers of the Employer, their names
and addresses, their representatives responsible for engaging the services of
the Employer and their specific needs and requirements. The Employee further
acknowledges and agrees that the loss of such customers will cause the Employer
serious loss of business and will be detrimental to the Employer's goodwill and
will cause great and irreparable harm. During the Term of the Agreement and for
a period of one (1) year after termination of employment (for any reason
whatsoever), the Employee will not directly or indirectly either for himself or
for any other person or commercial enterprise (1) divert or take away or attempt
to divert or take away, any of the Employer's customers or business in existence
at the time of termination of such employment that the Employee had contact
with, for whom the Employee performed services during his employment with the
Employer and/or that were made known to the Employee by the Employer during his
employment with the Employer; and/or (2) solicit or attempt to solicit, ask for,
accept, or seek to do business with, for the purpose or effect of engaging in
competition with the Employer, any of the Employer's customers or business in
existence at the time of termination of such employment with whom the Employee
had contact, for whom the Employee performed services during his employment with
the Employer and/or that were made known to the Employee by the Employer during
his employment.
(f) The Employee acknowledges and agrees that during the course
and solely as a result of the Employee's employment with the Employer, the
Employee has and will become aware of some, most or all of the employees of the
Employer, and has and will acquire knowledge of their qualifications, skills,
abilities, salaries, commissions, benefits and other matters with respect to
such employees not generally known to the public. The Employee further
acknowledges and agrees that any solicitation, luring away or hiring of such
employees of the Employer will cause serious loss of business and will be
detrimental to the Employer's goodwill and will cause great and irreparable
harm. During the Term of the Agreement and for a period of one (1) year after
termination of employment (for any reason whatsoever), the Employee will not
directly or indirectly either for himself or for any other person or commercial
enterprise (1) solicit or induce any employee to terminate his or her employment
relationship with the Employer, and/or (2) recruit, attempt to recruit, hire, or
attempt to hire any employee of the Employer other than on behalf of the
Employer.
(g) The Employee hereby acknowledges and agrees that the type and
periods of restrictions imposed in Sections 10(a) through 10(f) of this
Agreement are fair and reasonable and are reasonably required for the protection
of the Employer's Confidential Information and the goodwill associated with the
business of the Employer. Further, the Employee acknowledges and agrees that the
restrictions imposed in Sections 10(a) through 10(f) will not prevent him from
obtaining suitable employment after his employment with the Employer ceases or
from earning a livelihood. The Employee hereby acknowledges, agrees and
understands that he would not be entitled to the Severance Payments (as
described in Section 9(a)(ii)) or the Change in Control payment (as described in
Section 12(a)), except for his agreement to fulfill his obligations under this
Agreement, including, but not limited to, his obligations under Sections 10(a)
through 10(f) and Section 11 of this Agreement.
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11. Assignment of Inventions. The Employee expressly understands and agrees
that any and all right or interest he may obtain in any designs, trade secrets,
technical specifications and technical data, know-how and show-how, customer and
vendor lists, marketing plans, pricing policies, inventions, concepts, ideas,
works of authorship, documentation, formulae, data, designs, techniques,
discoveries, improvements or intellectual property rights of any kind or any
interest therein (whether or not patentable or registrable under copyright,
trademark or similar statutes (including, but not limited to, the Semiconductor
Chip Protection Act) or subject to analogous protection) that he, whether alone
or jointly with others, authors, conceives, devises, develops, reduces to
practice, or otherwise obtains during the Employee's employment with the
Employer, and that (i) relate to or arise out of his employment with the
Employer; (ii) relate to the Employer's present or planned business or any of
the products or services being designed, conceived, developed, marketed,
manufactured or distributed by the Employer or that may be used in relation
therewith; (iii) result from the use of premises or personal property (whether
tangible or intangible) owned, leased or contracted for or by the Employer; (iv)
result from activities engaged in during the Employer's time; and/or (v) result
from use of Confidential Information of the Employer whether such use occurred
prior to or during the Employee's employment with the Employer (the
"INVENTIONS"), are and shall immediately become the sole and absolute property
of the Employer and its assigns, as works made for hire or otherwise.
The Employee hereby assigns to the Employer the sole and
exclusive right to such Inventions. The Employee agrees that he will promptly
disclose to the Employer any and all such Inventions, and that, upon request of
the Employer, the Employee will execute and deliver any and all documents or
instruments and take any other action which the Employer shall deem necessary to
assign to and vest completely in the Employer, to perfect trademark, copyright
and patent protection with respect to, or to otherwise protect the Employer's
trade secrets and proprietary interest in such Inventions. The Employer agrees
to pay any and all copyright, trademark and patent fees and expenses or other
costs incurred by the Employee for any assistance rendered to the Employer
pursuant to this Section.
In the event the Employer is unable, after reasonable effort,
to secure the Employee's signature on any letters, patent, copyright or other
analogous protection relating to an Invention, the Employee hereby irrevocably
designates and appoints the Employer and any of its officers as his agent and
attorney-in-fact, to act for and on his behalf and stead to execute and file any
such application or applications and to do all other lawfully permitted acts to
further the prosecution and issuance of letters patent, copyright or other
analogous protection thereon with the same legal force and effect as if executed
by the Employee. The obligations in this Section shall continue beyond the
termination of the Employee's employment.
12. Change in Control.
(a) (i) If during the Term of this Agreement there is a
Change in Control of the Employer, and the Employee's employment with the
Employer is terminated involuntarily (other than for Cause), or voluntarily for
Good Reason (as defined below),
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in connection with or within one and one-half (1-1/2) years after such Change
in Control, then the Employee shall be entitled to receive a lump sum cash
payment as provided in Section 12(a)(ii) below. The Employer shall have no
obligation to make the payment set forth in this Section unless the Employee
fully complies with his obligations under this Agreement, including, but not
limited to, his obligations under Sections 10 and 11 of this Agreement. The
Employer shall have no obligation to make the payment set forth in this Section
in the event of the Employee's death or upon Employee becoming "Totally
Disabled" (as described in Section 9(a)(c)) on the date of a Change in Control
or within one and one-half (1 -1/2) years after such Change in Control. In such
event, the payments and benefits, if any, to which the Employee may be entitled
shall be determined in accordance with Section 9(c) of this Agreement.
(ii) Subject to Section 12(c) hereof, the lump sum cash payment (the
"Payment") shall be in an amount equal to three (3) times the Employee's average
annual base salary paid to the Employee by the Employer over the five (5) most
recent years ending prior to such Change in Control of the Employer (or such
portion of such period during which the Employee was a full-time employee of the
Employer), less one dollar. In addition, in the event of a Change in Control,
all existing options that have been granted to the Employee shall be subject to
immediate vesting.
(iii) As used herein, the term "Good Reason" means, unless previously
consented to in writing by the Employee, the occurrence of any one of the
following:
(A) the assignment to the Employee of duties and
responsibilities that are not at least substantially equivalent to the
Employee's duties and responsibilities with the Employer immediately prior to
such Change in Control;
(B) the failure to continue the Employee in a position
and title that is at least substantially equivalent to the position held by the
Employee with the Employer immediately prior to such Change in Control, except
in connection with the termination of the Employee's employment for Cause or as
a result of death or upon the Employee becoming Totally Disabled (as described
in Section 9(2)(c));
(C) a reduction in or failure to pay currently total
annual cash compensation in an amount equal to or greater than the sum of (i)
the Employee's salary at the highest annual rate in effect during the 12-month
period immediately prior to such Change in Control, and (ii) the bonus paid to
similarly situated employees pursuant to the acquiring Employer's executive
bonus plan for the fiscal year ending immediately prior to such Change in
Control;
(D) the Employee's benefits under any employee benefit or
welfare plan of the acquiring Employer are less, or are reduced to less (subject
to Employer's right to provide equivalent benefits in cash or otherwise in
kind), other than reductions mandated by a change in law, than the benefits of
similarly situated employees under any employee benefit or welfare plan of the
acquiring Employer in effect immediately prior to such Change in Control;
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(E) the Employee is reassigned to a place of business
which is more than thirty-five (35) miles from a major city in the United States
as defined by the twenty-six (26) Standard Metropolitan Statistical Areas; or
(F) any material breach by the Employer of this
Agreement.
(iv) Payment under this Section 12(a) shall be in lieu of
any amount owed to the Employee as severance payments for termination without
Cause under Sections 9(a) hereof. However, payment under this Section 12(a)
shall not be reduced by any compensation which the Employee may receive from
other employment with another employer after termination of his employment with
the Employer. The Employer shall have no obligation to make any contributions to
any retirement plan that may be applicable to the Employee after a Change in
Control of the Employer. The Employee shall be entitled to contributions made by
the Employer to any retirement plan that may be applicable to the Employee on
the Employee's behalf prior to a Change in Control of the Employer, which have
vested and for which the Employee is otherwise eligible in accordance with the
written terms of the official plan documents governing any applicable retirement
plan.
(b) A "Change in Control of the Employer," for purposes of this
Agreement, shall be deemed to have taken place if as the result of, or in
connection with, any cash tender or exchange offer, merger, or other business
combination, sale of assets or contested election, or any combination of the
foregoing transactions, the persons who were directors of the Employer before
such transaction shall cease to constitute a majority of the Board of Directors
of the Employer or any successor institution.
(c) Notwithstanding any other provisions of this Agreement or of
any other agreement, contract, or understanding heretofore or hereafter entered
into by the Employee with the Employer, except an agreement, contract, or
understanding hereafter entered into that expressly modifies or excludes
application of this Section 12(c) ("Other Agreements"), and notwithstanding any
formal or informal plan or other arrangement heretofore or hereafter adopted by
the Employer for the direct or indirect provision of compensation to the
Employee (including groups or classes of participants or beneficiaries of which
the Employee is a member), whether or not such compensation is deferred, is in
cash, or is in the form of a benefit to or for the Employee (a "Benefit Plan"),
the Employee shall not have any right to receive any payment or other benefit
under this Agreement, any Other Agreement, or any Benefit Plan if such payment
or benefit, taking into account all other payments or benefits to or for the
Employee under this Agreement, all Other Agreements, and all Benefit Plans,
would cause any payment to the Employee under this Agreement to be considered a
"parachute payment" within the meaning of Section 280G(b)(2) of the Internal
Revenue Code as then in effect (a "Parachute Payment"), as determined by a
nationally recognized accounting firm selected by the Board. In the event that
the receipt of any such payment or benefit under this Agreement, any Other
Agreement, or any Benefit Plan would cause the Employee to be considered to have
received a Parachute Payment under this Agreement, then the Employee shall have
the right, in the Employee's sole discretion, to designate those payments or
benefits under this Agreement, any Other Agreements, and/or any Benefit
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Plans, which should be reduced or eliminated so as to avoid having the payment
to the Employee under this Agreement be deemed to be a Parachute Payment.
(d) The Employer shall have no obligation to make the payments set
forth herein if the Employee is in material breach of the Employee's obligations
under this Agreement. The Employee shall be obligated to execute a general
release of claims in favor of the Employer, its current and former parents,
subsidiaries, subdivisions, divisions, shareholders, Board of Directors, or
affiliated entities or persons, and the current and former directors, officers,
employees and agents of the Employer, in a form acceptable to the Employer (the
"Release"), as a condition to receiving the payments set forth in this Section.
13. Remedies. The Employee acknowledges and agrees that compliance with the
covenants set forth in this Agreement is necessary to protect the business and
goodwill of the Employer and that any breach of Sections 10 through 11 of this
Agreement will result in irreparable and continuing harm to the Employer, for
which money damages may not provide adequate relief. Accordingly, in the event
of any breach or anticipatory breach of Sections 10 and 11 by the Employee, the
Employer and the Employee agree that the Employer shall be entitled to the
following particular forms of relief as a result of such breach, in addition to
any remedies otherwise available to it at law or equity: (a) injunctions,
whether temporary, preliminary or permanent, enjoining or restraining such
breach or anticipatory breach, and the Employee hereby consents to the issuance
thereof forthwith and without bond by any court of competent jurisdiction; and
(b) recovery of all reasonable sums and costs, including attorneys' fees,
incurred by the Employer to enforce the provisions of Sections 10 and 11.
14. Expenses; Automobile Allowance.
(a) The Employee is authorized to incur, during the Term of this
Agreement, reasonable expenses for promoting the business of the Employer,
including without limitation expenses for entertainment, travel and similar
items. The Employer will promptly reimburse the Employee for all such expenses,
upon the presentation by the Employee, from time to time, of an itemized account
of such expenses.
(b) During the Term of this Agreement, the Employer shall buy or lease a
full size luxury vehicle of Employer's choosing for the Employee's exclusive use
and/or, at the Employee's option, provide the Employee with a monthly automobile
allowance in an amount sufficient to pay the Employee's costs for the purchase
or lease of such a vehicle, and the Employer shall reimburse the Employee (upon
submission by him of reasonably itemized accounts thereof) for all maintenance,
repairs, insurance, gasoline, tolls, parking and other reasonable upkeep and
related expenses on such vehicle.
15. Legal Expenses. The Employer shall indemnify and hold harmless the
Employee from and against any and all costs and liabilities, including without
limitation reasonable attorneys' fees, arising out of or in connection with
becoming, being or having been an officer or director of the Employer, except in
relation to matters as to which the
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Employee shall be finally adjudged not to have acted in good faith in the
reasonable belief that his action or failure to act was in the best interest of
the Employer.
16. Successors and Assigns; Assumption by Successors. All rights hereunder
shall inure to the benefit of the parties hereto, their personal or legal
representatives, heirs, successors or assigns. This Agreement may not be
assigned or pledged by the Employee. The Employer will require any successor
(whether direct or indirect, by purchase, assignment, merger, consolidation or
otherwise) to all or substantially all of the business and/or assets of the
Employer in any consensual transaction expressly to assume this Agreement and to
agree to perform hereunder in the same manner and to the same extent that the
Employer would be required to perform if no such succession had taken place.
References herein to the Employer will be understood to refer to the successor
or successors of the Employer, respectively.
17. Other Contracts. The Employee shall not, during the Term of this
Agreement, have any other paid employment (other than with a subsidiary or
affiliate of the Employer), except with the prior approval of the Board of
Directors of the Employer.
18. Entire Agreement. This Agreement constitutes the entire agreement
between the parties with respect to the subject matter contained herein, and
supersedes all prior employment agreements and understandings, whether written
or oral, except for the Employer's Code of Business Conduct and Ethics,
Corporate Communications Disclosure Procedures, Xxxxxxx Xxxxxxx Policy Statement
and 1998 Stock Incentive Plan which are incorporated herein by reference.
19. Amendments or Additions. There are currently no oral representations,
agreements or understandings which affect the enforceability of this Agreement,
and no alteration or variation of the terms of this Agreement can be valid
unless made in writing and signed by both parties, wherein specific reference is
made to this Agreement.
20. Section Headings. The section headings used in this Agreement are
included solely for convenience and shall not affect, or be used in connection
with, the interpretation of this Agreement.
21. Severability. Each promise and provision contained in this Agreement
shall be enforceable independently of every other promise and provision in this
Agreement. If any provision contained in this Agreement is determined to be
partially or totally invalid or unenforceable in any respect, such determination
shall not affect any other provision of this Agreement, but this Agreement shall
be considered divisible as to such provision which shall become null and void,
leaving the remainder of this Agreement in full force and effect.
22. Governing Law. This Agreement shall be governed by the laws of the
United States where applicable and otherwise by the laws of the State of New
Hampshire, without giving effect to the conflicts of laws principles thereof.
23. Arbitration of Disputes and Jury Waivers.
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(a) The parties hereto agree to arbitrate any dispute,
claim, or controversy ("claim") against each other arising out of the cessation
of the Employee's employment, any claim of unlawful discrimination or harassment
that might or did arise during or as a result of the Employee's employment which
could have been brought before an appropriate government administrative agency
or in an appropriate court, including but not limited to claims of age
discrimination under the Age Discrimination in Employment Act of 1967, as
amended, as well as any claim or controversy arising under this Agreement. The
Arbitration shall be arbitrated by one arbitrator in accordance with the
National Rules for the Resolution of Employment Disputes of the American
Arbitration Association. The decision or award of the arbitration shall be final
and binding upon the parties. Any arbitral award may be entered as a judgment or
order in any court of competent jurisdiction. Any claims under Sections 10 and
11 of this Agreement shall not be subject to arbitration, but shall be subject
to the remedies set forth in Section 13 hereof.
(b) If for any reason this arbitration provision is
declared unenforceable, the Employee agrees to waive any right he may have to a
jury trial with respect to any dispute or claim against the Employer relating to
this Agreement, his employment, termination or any terms and conditions of
employment, including, but not limited to claims of age discrimination under the
Age Discrimination in Employment Act of 1967, as amended.
(c) The Employee has been advised of his right to consult
with counsel regarding this Agreement. The Employee's acceptance of this
Agreement can be revoked any time within seven (7) days of signing this
Agreement, but such revocation must be signed and in writing. The Employee has
been afforded at least twenty-one (21) days to consider this Agreement.
IN WITNESS WHEREOF, the parties have knowingly and voluntarily
executed this Agreement this 31st day of December, 2003.
PRESSTEK, INC. (the "Employer")
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------
Name: XXXXXXX X. XXXXXXXX
Title: Chairman of the Board of
Directors, Presstek, Inc.
/s/ Xxxxx X. Xxxxx
----------------------------------
XXXXX X. XXXXX
(the "Employee")
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