EMPLOYMENT AGREEMENT
Exhibit
10.1
AGREEMENT
(the “Agreement”) dated this February 27, 2007 (the “Effective Date”) made
by and between Presstek, Inc., a Delaware corporation, its parents,
subsidiaries, divisions, or affiliated entities, successors and assigns (the
“Employer”), and Xxxxxxx Xxxx, (the “Employee”).
WHEREAS,
both the Employer and the Employee wish for the Employee to
be
employed as Senior
Vice President and Chief
Financial Officer
of the
Employer; and
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.
During
the term of this Agreement, the Employee agrees to serve as Senior Vice
President, Chief Financial Officer, and as a Corporate Officer, or in such
other
positions as may be assigned. The Employee agrees to devote all of his business
time and efforts to the performance of his duties hereunder. The Employee shall
at all times report to, and his activities shall at all times be subject to,
the
direction and control of the Chief Executive Officer, the Board of Directors,
and such other person appointed by the Company. The Employee shall exercise
such
powers and comply with and perform, faithfully and to the best of his ability,
such directions and duties in relation to the business and affairs of the
Company as may from time to time be vested in or requested of him, and shall
not
engage in any other business activity, whether or not for profit, that may
conflict with the Employee’s duties under this Agreement and the Nondisclosure
Agreement. If Employee shall be elected to other offices of the Company or
any
of its affiliates, he shall serve in such positions without further compensation
than provided for in this Agreement. The Employee shall perform his services
under this Agreement at such locations as may be required by the
Company.
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 February 28, 2007, (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 Employer
or
the Employee gives written notice to the other, at least 180 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 SEVENTY FIVE THOUSAND U.S. DOLLARS And
ZERO
CENTS ($275,000) 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
in
accordance with the Employer’s payroll system, as determined by the Employer,
but 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, except as set out herein.
5. Discretionary
Bonuses.
Employee
will be entitled to a guaranteed cash bonus for 2007 of $165,000, pro-rated
so
that Employee is paid one-twelfth (1/12) of said amount for each full month
of
service completed during calendar year 2007, said bonus to be paid by March
1,
2008. During the subsequent term hereof, the Employee also may be eligible
to
receive a bonus of up to percent (60%) of the Base Salary for each calendar
year
of full-time employment. Such bonus, if any, shall be based on the Company’s and
the Employee’s achievement (as determined by the Company) of certain goals and
objectives. Such achievement is to be determined by the Company’s Board of
Directors (the “Board”)
in its
sole discretion. If the Board determines the Employee is eligible to receive
a
bonus under this Section, said bonus shall be paid no later than March 1 of
the following calendar year. No bonus under this paragraph shall be payable
to
the Employee with respect to any calendar year during which his employment
is
terminated, regardless of the manner of such termination.
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 2003 Stock Incentive Plan, the Employee shall be granted the
right to purchase 250,000 shares of the Company's common stock, of which,
the
right to purchase 41,666 shares shall vest upon signing of this agreement.
The
remaining 208,334 shares shall vest equally over a period of five (5) years
at
the rate of 20% per year on each anniversary date of the commencement of
employment. The per share exercise price for your options grant will be
determined by the closing price on the date of grant.
These
options are subject to the terms and conditions of the Company’s Stock Option
Plan and a Stock Option Agreement between the Company and the
Employee.
Said
options are subject to the earlier vesting, in their entirety, upon a Change
in
Control, as that term is defined herein, or, should Employer elect not to
renew
this agreement upon expiration of the initial term..
In
addition to the foregoing stock options, are 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
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 in accordance with the Employer’s policy of executives 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.
The
Employee’s employment with the Employer may terminate either by either:
| (a) |
termination
by the Board of Directors of the Employer either (i) for Cause (as
defined
in Section 9(a)(iii) below) or (ii) without Cause;
|
| (b) |
termination
by the Employee either for (i) Good Reason (as defined in Section
9(b)
below or (ii) Not Good Reason (as defined in Section 9(b); or
|
| (c) |
death
or disability of the Employee.
|
(a)
Termination
by the Board.
(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 payment, 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. Where the Employer terminates
the
employment of the Employee 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. Where
the
Employee’s employment is terminated for Cause, the Employer shall have no
obligation to continue to be subject to any independent obligations to the
Employee under any employee benefit plan for which the Employee is then a
participant, except as otherwise required by law.
(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. In the event termination under this subsection occurs before Employee
has completed twelve months of service, Employers obligation to make severance
payments shall be limited to one month of base salary for each completed full
month of service, but in no case less than six months of base salary.
However,
if the Employer's termination of the Employee's employment without Cause occurs
in connection with, or within one and one-half (1 ½) 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
except as may be required by such applicable plan. Notwithstanding anything
stated herein to the contrary, and for purposes of clarity, should the Employer
terminate the Employment of the Employee for Cause, the Employee shall not
be
entitled to receive Severance Payments. 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:
(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) Termination
by the Employee.
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) (i) in connection
with, or within one (1) and one-half years after, a Change in Control; or
(ii)
approved by the Board of Directors of the Employer. For purposes of this
Agreement, the term “Not Good Reason” shall mean such termination by the
Employee of his employment for reasons other than for Good Reason. In the
event
that the Employee terminates his employment for Not Good Reason, the Employee
shall have no right to receive compensation or other benefits, including
payment
of legal fees and expenses incurred, for any period after such termination
except as otherwise required by law. Where the Employee terminates his
employment for Good Reason, 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. Where the Employee terminates his employment
for Not Good Reason, the Employer shall have no obligation to continue to
be
subject to any independent obligations to the Employee under any employee
benefit plan for which the Employee is then a participant, except as otherwise
required by law.
Notwithstanding
anything stated herein to the contrary, and for purposes of clarity, should
the
Employee terminate his Employment for Not Good Reason, the Employee shall not
be
entitled to receive Severance Payments as described in Section 9(a)(ii).
However, nothing herein shall in any way affect the Employee’s entitlement to
indemnification under Paragraph 15 of the Agreement entitled “Legal Expenses”
unless Employee is terminated by the Employer prior to the Term of this
Agreement for “Cause” (as defined in Section 9(a)(iii) of the Agreement) and the
reason for Employee’s termination for “Cause” is related to the claim with
respect to which indemnification is sought.
(c) Death
and
Disability.
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, “Totally
Disabled” shall mean such situation where the Employee, because of injury (the
“Injury”) or sickness (the “Sickness”), the Employee is unable to perform the
material duties of his regular occupation for a specified period; and, solely
due to injury or sickness, he is unable to earn more than the percentage
of
their Indexed Covered Earnings (as that term is defined in the Employer’s
Long-Term Disability Summary Plan Description) from working in his regular
occupation. Thereafter, “Totally Disabled” shall mean such situation where the
Employee is disabled in that his injury or sickness makes his unable to perform
the material duties of any occupation for which he may reasonably become
qualified based on education, training or experience; and solely due to such
Injury or Sickness, he is unable to earn more than the percentage of their
Indexed Covered Earnings (as that term is defined in the Employer’s Long-Term
Disability Summary Plan Description). 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 or the Employee’s heirs or estate (as
applicable), 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.
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 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 two (2) years after termination of such employment
(for any reason whatsoever), the Employee agrees that he 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 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 two (2) years 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 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.
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), in connection with or within one and one-half (1 ½) 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 ½) 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 two (2) 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). 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;
(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 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 provide Employee with an
automobile allowance of $1000 per month, and the Employer shall reimburse the
Employee (upon submission by him of reasonably itemized accounts thereof) for
all gasoline, tolls, and parking.
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 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
2003
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.
(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.
[Signature
page to follow.]
IN
WITNESS WHEREOF, the parties have knowingly and voluntarily executed this
Agreement this 27thday
of February, 2007.
PRESSTEK,
INC. (the “Employer”)
By:
_/s/Xxxxxx X. Marino____
Xxxxxx
X. Xxxxxx
Chief
Executive Officer,
By
Direction of the
Compensation
Committee of the Board of Directors
__/s/
Xxxxxxx Cook_______
Xxxxxxx
Xxxx
(the
“Employee”)
