Exhibit 10(c)
EMPLOYMENT AGREEMENT
Employment Agreement dated as of January 1, 2003 between SCIENTIFIC
INDUSTRIES, INC., a Delaware corporation 00 Xxxxxxx Xxxxx, Xxxxxxx, Xxx
Xxxx 00000 (the "Company") and XXXXXX X. XXXXXXX, an individual residing
at 00 Xxxxx Xxxxxx, Xxxxx Xxxxx, Xxx Xxxx, 00000 ("Employee").
WITNESSETH:
WHEREAS, Employee has been employed as a senior executive officer
of the Company since May 2001 and the Company and Employee desire the
Employee continue to be employed as a senior executive officer of the
Company on the terms and conditions hereinafter contained;
NOW, THEREFORE, it is hereby agreed as follows:
1. Employment. The Company hereby employs and Employee agrees to
be employed as a senior executive officer of the Company for the
Term as defined in Section 2 to perform the duties described in
Section 3 hereof.
2. Term. The employment of Employee by the Company shall continue
from the date hereof through December 31, 2004, unless terminated
earlier pursuant to the provisions of Section 7 hereof. The period
from the date hereof until the date of termination of employment
pursuant to this Agreement is herein referred to as the "Term".
3. Duties. Employee shall devote his full time to the affairs
and business of the Company for which he will serve in such
senior executive positions or offices as the Board of Directors
(the "Board") shall designate. For the purposes of this Agreement,
senior executive offices means any one or more of the following:
Chief Operating Officer, Executive Vice President and Treasurer,
it being agreed that Employee may hold more than one executive
office, provided that his duties will not require him to devote
more time to the performance of his duties on behalf of the Company
than is reasonable. As a senior executive officer Employee shall
report directly to the President or Chief Executive Officer of
the Company. Employee shall use his best efforts to promote the
interests and welfare of the Company. The duties shall be
principally performed at the principal executive offices of the
Company.
4. Salary. As his compensation hereunder, Employee shall be
paid by the Company a base salary determined by the Board
of Directors but not less than $95,000 per annum. The base
salary shall be payable in equal weekly installments. The
Company may also pay to Employee with respect to each of the
12 month periods ended December 31, 2003 and December 31, 2004
a bonus determined by the Board in its sole discretion. The
Board in determining the base salary for the 12 month period
ending December 31, 2004 and the amount of a bonus, if any,
shall consider the achievement and surpassing of goals or
projections set forth or referred to in the 12 month operation
plan for the relevant period approved by the Board, including but
not limited to, cash flow and earnings; the Employee's performance
of his executive responsibilities, and such other criteria as the
Board deems relevant.
5. Expenses.
a. Subject to the authorization of the Board, Employee will be
authorized to incur reasonable and necessary expenses in connection
with the discharge of Employee's duties and in promoting the business
of the Company. The Company will, according to its practices,
reimburse Employee for all such expenses upon presentation of a
properly itemized account of such expenditures, setting forth the
business reasons for such expenditures on a timely basis.
b. Employee agrees to cooperate with the Company in the Company's
efforts to obtain and maintain a term insurance policy on the life of
Employee with the Company as sole beneficiary in such principal amount as
may be determined by the Board, currently anticipated to be $250,000.
6. Other Benefits; Vacation.
a. Employee shall be entitled to receive from the Company such
medical, hospital and disability benefits, life insurance, holiday
and sick pay consistent with those made available to the officers of
the Company and to participate in the Company's Plan under Section
401(k) of the Internal Revenue Code in accordance with its
terms.
b. Employee shall be entitled to an annual vacation of two weeks
during each 12 months of employment hereunder.
7. Termination.
a. In the event of Employee's death during the Term, this Agreement
shall terminate automatically as of the date of death, except with
respect to any accrued but unsatisfied obligations to the date of death.
In the event of Employee's disability (as hereinafter defined) for
sixty (60) consecutive calendar days or ninety (90) calendar days in
the aggregate during any twelve (12) months of the Term, the Company
shall have the right, by written notice to Employee, to terminate this
Agreement as of the date of such notice, except with respect to any
accrued but unsatisfied obligation to the date of such termination.
"Disability" for the purposes of this Agreement shall mean Employee's
physical or mental disability so as to render Employee incapable of
carrying out Employee's essential duties under this Agreement. In the
event of a termination by the Company pursuant to this Section 7(a),
the Company shall not be under any further obligation to Employee
hereunder except to pay Employee: (i) base salary and benefits
accrued and payable up to the date of such termination, and (ii)
reimbursement for expenses accrued and payable under Section 5
hereof through the date of termination.
b. This Agreement may be terminated by either Employee or the
Company (other than as provided in Section 7(a)) upon thirty (30)
days' written notice if, during the Term, the other of them shall
be in breach of or in default under any provision of this Agreement.
In the event of termination of this Agreement by reason of breach or
default by the Company, Employee shall have no obligation to mitigate
damages, and he shall be entitled to receive the base salary due him
at the rate in effect on the date written notice is delivered
hereunder for the then balance of the Term, not reduced by any
compensation he may receive elsewhere during such period.
8. Non-Competition; Non-Interference; Non-Solicitation.
a. For the purpose of this Section 8 and of Sections 9, 10 and
11 "Company" includes each of its subsidiaries.
b. From the date hereof through end of the Term, Employee
will not, without the express written approval of the
Board, directly or indirectly, own, manage, operate, control,
invest or acquire an interest in, or otherwise engage
or participate in, or be associated with in any way, any
business which competes directly or indirectly with the
business or proposed business of the Company (a "Competitive
Business"); provided, however, that Employee may, directly or
indirectly, own, invest or acquire an interest in the aggregate
of up to one percent (1%) of the
capital stock of a corporation whose capital stock is traded publicly.
Additionally, from the date hereof through the date which is
18 months after the date of termination of employment (the
"Restricted Period"), Employee will not, without the express
written approval of the Board, directly or indirectly, become
associated with a Competitive Business, or otherwise engage in
or assist in any enterprise, which develops, markets, sells,
manufactures or designs products currently being sold, developed or
contemplated (including those acquired or about to be acquired) by
the Company, or which hereinafter may be sold, developed or
contemplated, by the Company as of the date of termination,
including, but not limited to, mixers, including vortex mixers,
rotating, shaking or oscillating apparatus; thermoelectric apparatus;
or any industrial or laboratory processes, apparatus or equipment
(the "Products").
c. During the Restricted Period, Employee will not without the
express prior written approval of the Board of Directors (i)
directly or indirectly, in one or a series of transactions,
recruit, solicit or otherwise induce or influence any proprietor,
partner, stockholder, lender, director, officer, employee, sales agent,
joint venturer, investor, lessor, supplier, customer, consultant,
agent, representative or any other person which has a business
relationship with the Company to discontinue, reduce or modify
during the Restrictive Period such employment, agency or business
relationship with the Company, or (ii) employ or seek to employ or
cause any Competitive Business to employ or seek to employ any
person or agent who is then (or was at any time within one (1) year
prior to the date Employee or the Competitive Business employs or
seeks to employ such person) engaged or retained by the Company
or a business acquired or sold by the Company.
9. Confidential Information.
a. Employee agrees that during and after the Term Employee will
not, directly or indirectly, disclose to any person, or use or
otherwise exploit for the benefit of Employee or for the benefit
of anyone other than the Company, any Confidential Information
(as defined in Section 9(c)). Employee shall have no obligation
hereunder to keep confidential any Confidential Information if
and to the extent disclosure of any therefor is specifically required
by law; provided, however, that in the event disclosure is required
by applicable law, Employee shall provide the Company with prompt
notice of such requirement, prior to making any disclosure, so that
the Company may seek an appropriate protective order.
b. At the request of the Company, Employee agrees to deliver to
the Company, at any time during the Term, or thereafter, all
Confidential Information which Employee may possess or control.
Employee agrees that all Confidential Information of the Company
(whether now or hereafter existing) conceived, discovered or made by
Employee during the Term exclusively belongs to the Company (and not
to Employee). Employee will promptly disclose such Confidential
Information to the Company and perform all actions reasonably requested
by the Company to establish and confirm such exclusive ownership.
c. "Confidential Information" means any confidential information
including, without limitation, any patent, patent application, copyright,
trademark, trade name, service xxxx, service name, "know-how", trade
secrets, customer lists, vendor lists, customer pricing or terms,
details of client or consultant contracts, pricing policies, cost
information, operational methods, marketing plans or strategies,
product development techniques or plans, business acquisition plans
or any portion or phase of any business, scientific or technical
information, ideas, discoveries, designs, computer programs
(including source or object codes), processes, procedures,
formulae, improvements, information relating to the products currently
being sold, developed or contemplated, by the Company, or which
hereinafter may be sold, developed or contemplated, by the Company
through the date of termination of the Term, including, but not
limited to, mixers, including vortex mixers, rotating, shaking or
oscillating apparatus; thermoelectric apparatus; or any industrial
or laboratory processes, apparatus or equipment relating thereto
(the "Products") or other proprietary or intellectual property of
the Company, whether or not in written or tangible form, and
whether or not registered, and including all memoranda, notes,
summaries, plans, reports, records, documents and other evidence
thereof. The term "Confidential Information" does not include,
and there shall be no obligation hereunder with respect to,
information that becomes generally available to the
public other than as a result of a disclosure by Consultants
not permissible hereunder.
10. Patents. Employee agrees that all inventions, copyrightable
material, secret processes, formulae, trademarks, trade
secrets and the like, discovered or developed by him while in the
employ of the Company, whether in the course of his employment,
on company time or property, or otherwise, shall be the exclusive
property of the Company and Employee agrees to execute such
instruments of transfer, assignment, conveyance or confirmation
and such other documents as may be requested by the Company to
transfer, confirm and perfect in the Company all legally
protectible rights in any such inventions, copyrightable materials,
secret processes, formulae, trademarks, trade secrets and the like
at no expense to Employee.
11. Remedies.
a. Nothing herein contained is intended to waive or diminish any
rights the Company may have at law or in equity at any time to
protect and defend its legitimate property interests including its
business relationship with third parties, the foregoing provisions
being intended to be in addition to and not in derogation or
limitation of any other rights the Company may have at law or
in equity.
Since a breach of the provisions of Section 8, Section 9 or Section 10
could not adequately be compensated by money damages, the Company
shall be entitled, in addition to any other right and remedy
available to it, to an appropriate order from a court of competent
jurisdiction restraining such breach or a threatened breach, and
in any such case no bond or other security shall be required to be
posted in connection therewith. Employee agrees that the provisions
of Section 8, Section 9 and Section 10 are necessary and reasonable to
protect the Company in the conduct of its business. If any
restriction contained in Section 8, Section 9 or Section 10 shall be
deemed to be invalid, illegal, or unenforceable by reason of the
extent, duration, or geographical scope thereof, or otherwise, then
the court making such determination shall have the right to reduce
such extent, duration, geographical scope, or other provisions
hereof, and in its reduced form such restriction shall then be
enforceable in the manner contemplated hereby.
12. Insurance. The Company agrees to include Employee in the
coverage of any directors' and officers' liability insurance
policy it provides on behalf of its directors or other senior
executive officers.
13. Notices. Any notices pertaining to this Agreement if to the
Company shall be addressed to the Company at its address
set forth in the opening paragraph of this Agreement, with a copy
of any notice to the Company to be sent to Xxx Xxxxxxxxxxx, Esq.,
Reitler Xxxxx LLC, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 and
if to Employee shall be addressed to him at his address stated in
the opening of paragraph of this Agreement. All notices shall be
in writing and shall be deemed duly given if personally delivered
or sent by registered or certified mail, overnight or express mail
or by telefax. If sent by registered or certified mail, notice
shall be deemed to have been received and effective three days
after mailing; if by overnight or express mail or by telefax,
notice shall be deemed received the next business day after
being sent. Any party may change its address for notice hereunder
by giving notice of such change in the manner provided herein.
14. Entire Agreement. This Agreement contains the entire
agreement of the parties respecting the subject matter contained
herein. No modification of any provision hereof shall be effective
except by a written agreement signed by the parties hereto.
15. Miscellaneous.
a. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York applicable to
contracts entirely made and performed therein.
b. This Agreement shall be binding upon and inure to the benefit
of the parties, their respective successors, heirs and assigns
(where permitted).
c. The waiver by one party hereto of any breach by the other
(the "Breaching Party") of any provision of this Agreement shall not
operate or be construed as a waiver of any other (prior or subsequent)
breach by the Breaching Party, and waiver of a breach of a provision
in one instance shall not be deemed a waiver of a breach
of such provision in any other circumstance.
IN WITNESS WHEREOF, the parties hereto have signed this
Agreement as of the year and date first above written.
Dated as of January 1, 2003
SCIENTIFIC INDUSTRIES, INC.
By: /s/Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx, President
/s/Xxxxxx X. Xxxxxxx
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XXXXXX X. XXXXXXX
