EXHIBIT 10.23
EMPLOYMENT AGREEMENT
THIS AGREEMENT (along with all Exhibits attached hereto hereinafter
referred to as the "Agreement") made effective as of January 3, 2003 by and
between BIO-key International, Inc., a Minnesota corporation with its principal
place of business at 0000 Xxxxxxxxx Xxxxxx Xxxxx, Xxxxx 000, Xxxxx, XX 00000
(the "Company"), and Xxxxxxx X. XxXxxxxxxx residing at 000 Xxxxxxx Xxxxx, Xxxx
Xxxxx, XX 00000 (the "Executive").
WITNESSETH:
WHEREAS, the Company desires to secure the employment of the Executive
as Chief Executive Officer in accordance with the provisions of this Agreement;
and
WHEREAS, the Executive desires and is willing to be employed by the
Company in accordance herewith.
NOW THEREFORE, in consideration of the premises and mutual covenants
contained herein, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and intending to be legally bound
hereby, the parties hereto agree as follows:
1. EMPLOYMENT TERM. This Agreement shall remain in force and effect for
a term commencing on the Effective Date hereof and expiring on the second (2nd)
anniversary hereof (the "Term"), or until the employment relationship is
terminated pursuant to Section 4 hereof.
2. DUTIES; EXCLUSIVE SERVICES AND BEST EFFORTS.
(a) DUTIES. Executive shall hold the position of Chief
Executive Officer and to serve in such position in accordance with the Company's
Articles of Incorporation and subject By-Laws and in accordance with the
ultimate control of the Board of Directors of the Company. As Chief Executive
Officer, the Executive will have the responsibility for general management of
the day to day business and affairs of the Company, as well as any duties
assigned to the Executive by the Board of Directors of the Company.
(b) EXCLUSIVE SERVICES AND BEST EFFORTS. The Executive agrees
to devote his best efforts, energies and skill to the faithful, competent and
diligent discharge of the duties and responsibilities attributable to his
position, and to this end, will devote his fulltime attention to the business
and affairs of the Company. The Executive also agrees that he shall not take
personal advantage of any business opportunities that arise during his
employment that may benefit the Company. All material facts regarding such
opportunities must be promptly reported to the Board of Directors of the Company
for its consideration. In addition, the Company acknowledges and agrees that the
Executive shall be permitted to engage in and pursue such contemporaneous
activities and interests as the Executive may desire, for personal profit or
otherwise, provided such activities do not interfere with the Executive's
performance of his duties and obligations hereunder.
3. COMPENSATION. On and after the commencement of Executive's
employment, the Executive shall receive, for all services rendered to the
Company hereunder, the following:
(a) BASE SALARY. The Executive shall be paid a base annual
salary equal to One Hundred Fifty Thousand Dollars ($150,000). The Executive's
annual base salary shall be payable in equal installments in accordance with the
Company's general salary payment policies but no less frequently than monthly.
Executive's Base Salary may be increased annually, or at such other intervals,
as the Board of Directors or Compensation Committee thereof shall determine from
time to time.
(b) PERFORMANCE BONUS. In addition to Base Salary, a
"Performance Bonus" in the amount of up to $150,000 shall be awarded to
Executive based on the Company achieving the "Financial Performance Targets"
identified below during the year ending December 31, 2003. The Performance Bonus
shall be paid in quarterly installments (each a "Quarterly Installment")
forty-five (45) days after the end of the fiscal quarter to which the
Performance Bonus relates in the amounts set forth below:
------------------------------------------------------------ ---------------------------------------------------------
FINANCIAL PERFORMANCE TARGET AMOUNT OF QUARTERLY INSTALLMENT
------------------------------------------------------------ ---------------------------------------------------------
Gross Revenue of $300,000 during quarter ending March 31, $37,500
2003
------------------------------------------------------------ ---------------------------------------------------------
Gross Revenue of $400,000 during quarter ending June 30, $37,500
2003
------------------------------------------------------------ ---------------------------------------------------------
Gross Revenue of $650,000 during quarter ending September $37,500
30, 2003
------------------------------------------------------------ ---------------------------------------------------------
Gross Revenue of $900,000 during quarter ending December $37,500
31, 2003
------------------------------------------------------------ ---------------------------------------------------------
In the event that the Company does not achieve the Financial Performance Target
for the first calendar quarter, Executive shall be entitled to receive 100% of
the Quarterly Installment payable with respect to the first calendar quarter in
the event that the Company's gross revenue for the six months ended June 30,
2003 equals or exceeds $700,000 or 50% of the Quarterly Installment payable with
respect to the first calendar quarter in the event that either the Company's
gross revenue for the nine months ended September 30, 2003 equals or exceeds
$1,350,000 or the Company's gross revenue for the twelve months ended December
31, 2003 equals or exceeds $2,250,000. In the event that the Company does not
achieve the Financial Performance Target for the second calendar quarter,
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Executive shall be entitled to receive 50% of the Quarterly Installment payable
with respect to the second calendar quarter in the event that either the
Company's gross revenue for the nine months ended September 30, 2003 equals or
exceeds $1,350,000 or the Company's gross revenue for the twelve months ended
December 31, 2003 equals or exceeds $2,250,000. In the event that the Company
does not achieve the Financial Performance Target for the third calendar
quarter, Executive shall be entitled to receive 50% of the Quarterly Installment
payable with respect to the third calendar quarter in the event that the
Company's gross revenue for the twelve months ended December 31, 2003 equals or
exceeds $2,250,000.
(c) STOCK OPTIONS. Executive shall be granted subject to the terms of a
stock option agreement to be entered into by the Company and Executive in
substantially the form attached hereto as Exhibit A, a stock option to purchase
580,000 shares of the Company's Common Stock. The options shall vest in equal
quarterly installments over a twenty four (24) month period.
(d) DISCRETIONARY BONUS. In addition to the Base Salary and Performance
Bonus, a "Discretionary Bonus" may be awarded to Executive on the basis of merit
performance on an annual basis in the sole discretion of the Board of Directors
or Compensation Committee thereof in the form of options to purchase up to an
additional 500,000 shares of Common Stock of the Company at an exercise price
equal to the closing market price of the Company's Common Stock on the date of
grant; PROVIDED, HOWEVER, that the failure of the Company to provide any
Discretionary Bonus shall not give rise to any claim against the Company. The
amount, if any, and timing of any Discretionary Bonus, shall be determined by
the Company in its sole discretion.
(e) BENEFITS. Executive shall not be eligible to participate in any of the
Company's employee welfare or health benefit plans (including, but not limited
to, life insurance, health, medical and dental plans). In lieu of participating
in any such plans, the Company shall pay Executive $1,000 per month in
accordance with the Company's general salary payment policies but no less
frequently than monthly.
(f) VACATION. The Executive shall be eligible for four (4) weeks of paid
vacation each year of his employment hereunder. The Executive shall be permitted
to carry over and accrue unused vacation time for a period of up to two years.
(g) EXPENSES. Subject to and in accordance with the Company's policies and
procedures, and, upon presentation of itemized accounts, the Executive shall be
reimbursed by the Company for reasonable and necessary business-related
expenses, which expenses are incurred by the Executive on behalf of the Company.
(h) DEDUCTIONS FROM SALARY AND BENEFITS. The Company will withhold from any
salary or benefits payable to the Executive all federal, state, local, and other
taxes and other amounts as required by law, rule or regulation.
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4. TERMINATION. This Agreement may be terminated by either the
Executive or the Company at any time, subject only to the provisions of this
Section 4.
(a) VOLUNTARY TERMINATION. If Executive terminates his own
employment, the Company shall be released from any and all further obligations
under this Agreement, except that the Company shall be obligated to pay
Executive his salary and benefits owing to Executive through the effective date
of termination. Executive shall also be entitled to any reimbursement owed in
accordance with Section 3(h). Executive's obligations under Sections 5, 7, 8 and
9 hereof and shall survive the termination of Executive's employment, and
Executive shall remain bound thereby.
(b) DEATH. This Agreement shall terminate on the date of the
Executive's death, in which event salary, benefits, and reimbursable expenses
owing to the Executive through the date of the Executive's death shall be paid
to his estate.
(c) DISABILITY. If, during the term of this Agreement, in the
opinion of the Company, the Executive, because of physical or mental illness or
incapacity or disability, shall become unable to perform, with or without
reasonable accommodation, substantially all of the duties and services required
of him under this Agreement for a period one hundred eighty (180) days during
any twelve-month period, the Company may, upon at least ten (10) days prior
written notice given at any time after the expiration of such one hundred eighty
(180) day period, notify the Executive of its intention to terminate this
Agreement as of the date set forth in the notice. In case of such termination,
the Executive shall be entitled to receive salary, benefits, and reimbursable
expenses owing to the Executive through the date of termination. The Company
shall have no further obligation or liability to the Executive. The Executive's
obligations under Sections 5, 7 8 and 9 hereof shall survive the termination of
Executive's employment, and Executive shall remain bound thereby.
(d) TERMINATION BY EMPLOYER FOR CAUSE. This Agreement may be
terminated by the Company for "Cause" at any time. Upon such termination for
"Cause", the Company shall be released from any and all further obligations
under this Agreement, except that the Company shall be obligated to pay the
Executive his salary and benefits owing to the Executive through the effective
date of such termination. The Executive shall also be entitled to any
reimbursement owed in accordance with Section 3(h). The Executive's obligations
under Sections 5, 7, 8 and 9 hereof shall survive the termination of Executive's
employment, and Executive shall remain bound thereby.
Cause. "Cause" for Termination shall include, but is not
limited to, the following conduct of the Executive:
(i) Breach of any material provision of this
Employment Agreement by the Executive
if not cured within two (2) weeks after receiving written notice thereof;
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(ii) Misconduct as an Executive of the Company, including
but not limited to, misappropriating funds or property of the
Company; any attempt to obtain any personal profit from any
transaction in which the Executive has an interest that is
adverse to the Company or any breach of the duty of loyalty and
fidelity to the Company; or any other material act or omission of
the Executive which substantially impairs the Company's ability
to conduct its ordinary business in its usual manner;
(iii) Material neglect or refusal to perform the duties
assigned to the Executive pursuant to this Employment Agreement
if not cured within two (2) weeks after receiving notice thereof;
(iv) Conviction of a felony or plea of guilty or nolo
contendere to a felony;
(v) Acts of dishonesty or moral turpitude by the Executive
that are detrimental to the Company or any other act or omission
which subjects the Company or any of its affiliates to public
disrespect, scandal, or ridicule, or that causes the Company to
be in violation of governmental regulations that subjects the
Company either to sanctions by governmental authority or to civil
liability to its Executives or third parties;
(vi) Disclosure or use of confidential information of the
Company, other than as specifically authorized and required in
the performance of the Executive's duties.
(e) TERMINATION BY EMPLOYER WITHOUT CAUSE. Upon termination of
this Agreement without Cause, the Company shall be released from any and all
further obligations under this Agreement, except that the Executive shall be
paid his Base Salary through the date of termination and continue to be paid in
the same manner as before termination, an amount equal to his monthly Base
Salary for a period of time equal to the greater of (i) six (6) months; and (ii)
that number of months remaining until the end of the Term, if, and only if, the
Executive signs a valid general release of all claims against the Company, its
affiliates, subsidiaries, officers, directors and agents, in a form provided by
the Company. The Company shall have no further obligation or liability to the
Executive. The Executive's obligations under Sections 5, 7, 8 and 9 hereof and
shall survive the termination of the Executive's employment, regardless of the
circumstances of any such termination, and the Executive shall remain bound
thereby.
(f) TERMINATION BY MUTUAL AGREEMENT. This Agreement may be
terminated at any time by mutual agreement of the Executive and the Company.
5. NON-COMPETITION AND BUSINESS OPPORTUNITIES.
(a) NON-COMPETITION. The Executive understands that the
Company is in the business of developing and licensing finger print
identification technologies, and distributing products incorporating such
technologies, to original equipment manufacturers and end users. The Executive
agrees that during the period of his employment hereunder and for a period of
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one (1) year thereafter, the Executive will not directly or indirectly: (i)
market, sell or perform services such as are offered or conducted by the
Company, its affiliates and subsidiaries during the period of his employment, to
any customer or client of the Company or "Prospective Customer" or client of the
Company; or (ii) engage, directly or indirectly, whether as principal or as
agent, officer, director, Executive, consultant, shareholder, or otherwise,
alone or in association with any other person, corporation or other entity, in
any "Competing Business". For the purpose of this Section 5(a) "Prospective
Customer" shall mean any person with whom the Company has engaged in any
substantial discussion or negotiation regarding the use of the Company's
products or services. For purposes of this Section 5(a), the term "shareholder"
shall exclude any interest owned by Employer in a public company to the extent
the Employer owns less than ten percent (10%) of any such company's outstanding
common stock. For the further purposes of this Agreement, the term "Competing
Business" shall mean any person, corporation or other entity developing and/or
licensing finger print identification technologies or distributing products
incorporating such technologies, within the United States, to original equipment
manufacturers and end users at the time of such termination or non-renewal. Due
to the nature of the markets served and the technology and products to be
developed and marketed by the Company which are intended to be available on a
national basis, the restrictions set forth in this Section 5(a) can not be
limited to a specific geographic area within the United States.
(b) BUSINESS OPPORTUNITIES. The Executive agrees that during
the period of his employment hereunder, the Executive will not take personal
advantage of any business opportunities that are similar or substantially
similar to the business of the Company. In addition, all material facts
regarding any such business opportunities must be promptly and fully disclosed
by the Executive to the Board of Directors as soon as the Executive becomes
aware of any opportunity, and in no event later than forty-eight (48) hours
after learning of such opportunity. Business opportunities covered by this
Section 5(b) shall include, but are not limited to, opportunities relating to
the development and licensing of finger print identification technologies or the
distribution of products incorporating such technologies to original equipment
manufacturers and end users.
(c) NON-SOLICITATION. The Executive agrees that during the
period of employment hereunder and for a period of one (1) year thereafter, the
Executive will not request or otherwise attempt to induce or influence, directly
or indirectly, any present customer, distributor or supplier, or Prospective
Customer, distributor or supplier, of the Company, or other persons sharing a
business relationship with the Company to cancel, to limit or postpone their
business with the Company, or otherwise take action which might be to the
material disadvantage of the Company. The Executive agrees that during the
period of employment hereunder and for a period of one (1) year thereafter,
Executive will not hire or solicit for employment, directly or indirectly, or
induce or actively attempt to influence, hire or solicit, any Executive, agent,
officer, director, contractor, consultant or other business associate of the
Company to terminate his or her employment or discontinue such person's
consultant, contractor or other business association with the Company.
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(d) SCOPE. The parties hereto agree that, due to the nature of
the Company's business, the duration and scope of the non-competition and
non-solicitation provisions set forth above are reasonable. In the event that
any court determines that the duration or the geographic scope, or both, are
unreasonable and that such provisions are to that extent unenforceable, the
parties hereto agree that such provisions shall remain in full force and effect
for the greatest time period and in the greatest area that would not render it
unenforceable. The parties intend that the non-competition and non-solicitation
provisions herein shall be deemed to be a series of separate covenants, one for
each and every county of each and every state of the United States of America
and each and every political subdivision of each and every country outside the
United States of America where this provision is intended to be effective. The
Executive agrees that damages are an inadequate remedy for any breach of such
provisions and that the Company, shall, whether or not it is pursuing any
potential remedies at law, be entitled to seek in any court of competent
jurisdiction, equitable relief in the form of preliminary and permanent
injunctions without bond or other security upon any actual or threatened breach
of either of these competition provisions. If the Executive shall violate this
Section 5, the duration of this Section 5 automatically shall be extended as
against the Executive for a period equal to the period during which the
Executive shall have been in violation of this Section 5. The covenants
contained in this Section 5 are deemed to be material and the Company is
entering into this Agreement relying on such covenants.
6. REPRESENTATIONS AND WARRANTIES OF THE EXECUTIVE. The Executive,
hereby represents and warrants to the Company as follows: (i) The Executive has
the legal capacity and unrestricted right to execute and deliver this Agreement
and to perform all of his obligations hereunder; (ii) the execution and delivery
of this Agreement by the Executive and the performance of his obligations
hereunder will not violate or be in conflict with any fiduciary or other duty,
instrument, agreement, document, arrangement, or other understanding to which
Executive is a party or by which he is or may be bound or subject; and (iii)
except as set forth in Exhibit B attached hereto, the Executive is not a party
to any instrument, agreement, document, arrangement, including, but not limited
to, invention assignment agreement, confidential information agreement,
non-competition agreement, non-solicitation agreement, or other understanding
with any person (other than the Company) requiring or restricting the use or
disclosure of any confidential information or the provision of any employment,
consulting or other services.
7. DISCLOSURE OF INNOVATIONS; ASSIGNMENT OF OWNERSHIP OF INNOVATIONS;
PROTECTION OF CONFIDENTIAL INFORMATION. Executive hereby represents and warrants
to the Company that Executive understands that the Company is in the business of
developing and licensing finger print identification technologies, and
distributing products incorporating such technologies, to original equipment
manufacturers and end users and that Executive may have access to or acquire
information with respect to Confidential Information (as defined below),
including software, processes and methods, development tools, scientific,
technical and/or business innovations.
(a) DISCLOSURE OF INNOVATIONS. Executive agrees to disclose in writing to
the Company all inventions, improvements and other innovations of any kind that
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Executive may make, conceive, develop or reduce to practice, alone or jointly
with others, during the term of Executive's employment with the Company, whether
or not such inventions, improvements or other innovations are related to and
grow out of Executive's work for the Company and whether or not they are
eligible for patent, copyright, trademark, trade secret or other legal
protection ("Innovations"). Examples of Innovations shall include, but are not
limited to, discoveries, research, inventions, formulas, techniques, processes,
know-how, marketing plans, new product plans, production processes, advertising,
packaging and marketing techniques and improvements to computer hardware or
software.
(b) ASSIGNMENT OF OWNERSHIP OF INNOVATIONS. Executive agrees that all
Innovations will be the sole and exclusive property of the Company and Executive
hereby assigns all of Executive's rights, title or interest in the Innovations
and in all related patents, copyrights, trademarks, trade secrets, rights of
priority and other proprietary rights to the Company. At the Company's request
and expense, during and after the period of Executive's employment with the
Company, Executive will assist and cooperate with the Company in all respects
and will execute documents, and, subject to Executive's reasonable availability,
give testimony and take further acts requested by the Company to obtain,
maintain, perfect and enforce for the Company patent, copyright, trademark,
trade secret and other legal protection for the Innovations. Executive hereby
appoints an authorized officer of the Company as Executive's attorney-in-fact to
execute documents on his behalf for this purpose. Executive has attached hereto
as Exhibit C a list of Innovations as of the date hereof which belong to
Executive and which are not assigned to the Company hereunder (the "Prior
Innovations"), or, if no such list is attached, Executive represents that there
are no Prior Innovations.
(c) PROTECTION OF CONFIDENTIAL INFORMATION OF THE COMPANY. Executive
understands that Executive's work as an Executive of the Company creates a
relationship of trust and confidence between Executive and the Company. During
and after the period of Executive's employment with the Company, Executive will
not use or disclose or allow anyone else to use or disclose any "Confidential
Information" (as defined below) relating to the Company, its products, services,
suppliers or customers except as may be necessary in the performance of
Executive's work for the Company or as may be specifically authorized in advance
by appropriate officers of the Company. "Confidential Information" shall
include, but not be limited to, information consisting of research and
development, patents, trademarks and copyrights and applications thereto,
technical information, computer programs, software, methodologies, innovations,
software tools, know-how, knowledge, designs, drawings, specifications,
concepts, data, reports, processes, techniques, documentation, pricing,
marketing plans, customer and prospect lists, trade secrets, financial
information, salaries, business affairs, suppliers, profits, markets, sales
strategies, forecasts, Executive information and any other information not
available to the general public, whether written or oral, which Executive knows
or has reason to know the Company would like to treat as confidential for any
purpose, such as maintaining a competitive advantage or avoiding undesirable
publicity. Executive will keep Confidential Information secret and will not
allow any unauthorized use of the same, whether or not any document containing
it is marked as confidential. These restrictions, however, will not apply to
Confidential Information that has become known to the public generally through
no fault or breach of Executive's or that the Company regularly gives to third
parties without restriction on use or disclosure.
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8. WORK MADE FOR HIRE.
(a) WORK MADE FOR HIRE. Executive further recognizes and
understands that Executive's duties at the Company may include the preparation
of materials, including without limitation written or graphic materials, and
that any such materials conceived or written by Executive shall be done as "work
made for hire" as defined and used in the Copyright Act of 1976, 17 U.S.C.
xx.xx. 1 ET SEQ. In the event of publication of such materials, Executive
understands that since the work is a "work made for hire", the Company will
solely retain and own all rights in said materials, including right of
copyright. In the event that any of such works shall be deemed by a court of
competent jurisdiction not to be a "work made for hire," this Agreement shall
operate as an irrevocable assignment by Executive to the Company of all right,
title and interest in and to such works, including, without limitation, all
worldwide copyright interests therein, in perpetuity. The fact that such
copyrightable works are created by Executive outside of the Company's facilities
or other than during Executive's working hours with the Company shall not
diminish the Company's right with respect to such works which otherwise fall
within this paragraph. Executive agrees to execute and deliver to the Company
such further instruments or documents as may be requested by the Company in
order to effectuate the purposes of this paragraph.
(b) DISCLOSURE OF WORKS AND INVENTIONS/ASSIGNMENT OF PATENTS.
In consideration of the promises set forth herein, Executive agrees to disclose
promptly to the Company, or to such person whom the Company may expressly
designate for this specific purpose (its "Designee"), any and all works,
inventions, discoveries and improvements authored, conceived or made by
Executive during the period of employment and related to the business or
activities of the Company, and Executive hereby assigns and agrees to assign all
of Executive's interest in the foregoing to the Company or to its Designee.
Executive agrees that, whenever he is requested to do so by the Company,
Executive shall execute any and all applications, assignments or other
instruments which the Company shall deem necessary to apply for and obtain
Letters Patent or Copyrights of the United States or any foreign country or to
otherwise protect the Company's interest therein. Such obligations shall
continue beyond the termination or nonrenewal of Executive's employment or
service with respect to any works, inventions, discoveries and/or improvements
that are authored, conceived of, or made by Executive during the period of
Executive's employment or service, and shall be binding upon Executive's
successors, assigns, executors, heirs, administrators or other legal
representatives.
9. COMPANY PROPERTY. All records, files, lists, including computer
generated lists, drawings, documents, software, documents, equipment, models,
binaries, object modules, libraries, source code and similar items relating to
the Company's business that the Executive shall prepare or receive from the
Company and all Confidential Information shall remain the Company's sole and
exclusive property ("Company Business Property"). Upon termination of this
Agreement, the Executive shall promptly return to the Company all property of
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the Company in his possession, including Company Business Property. The
Executive further represents that he will not copy or cause to be copied, print
out, or cause to be printed out any Company Business Property other than as
specifically authorized and required in the performance of the Executive's
duties. The Executive additionally represents that, upon termination of his
employment with the Company, he will not retain in his possession any such
Company Business Property; PROVIDED, HOWEVER, that the Executive shall be
entitled to inspect, copy and retain copies of documents in any personnel file
relating to his employment which is maintained by the Company.
10. COOPERATION. The Executive and Company agree that during the term
of Executive's employment they shall, at the request of the other Party, render
all assistance and perform all lawful acts that each Party considers necessary
or advisable in connection with any litigation involving either Party or any
director, officer, Executive, shareholder, agent, representative, consultant,
client, or vendor of the Company. Executive shall be entitled to all protections
afforded officers, agents and directors under the Company's Articles of
Incorporation and Bylaws. The Company shall maintain a Directors and Officers
Liability Insurance Policy.
11. EMPLOYMENT DISPUTE SETTLEMENT PROCEDURE/WAIVER OF RIGHTS. The
Executive and the Company each agree that, in the event either party (or its
representatives, successors or assigns) brings an action in a court of competent
jurisdiction relating to the Executive's recruitment, employment with, or
termination of employment from the Company, each party in such action agrees to
waive his, her or its right to a trial by jury, and further agrees that no
demand, request or motion will be made for trial by jury.
The parties hereto further agree that, in the event that either seeks relief in
a court of competent jurisdiction for a dispute covered by this Agreement, any
other Agreement between the Executive and the Company or which relates to the
Executive's recruitment, employment with, or termination of employment from the
Company, the defendant or third-party defendant in such action may, at any time
within sixty (60) days of the service of the complaint, third-party complaint or
cross-claim upon such party, at his, her or its option, require all or part of
the dispute to be arbitrated by one arbitrator in accordance with the rules of
the American Arbitration Association. The parties agree that the option to
arbitrate any dispute is governed by the Federal Arbitration Act. The parties
understand and agree that, if the other party exercises his, her or its option,
any dispute arbitrated will be heard solely by the arbitrator, and not by a
court. Judgment upon the award rendered, however, may be entered in any court of
competent jurisdiction. The cost of such arbitration shall be borne equally by
the parties.
This dispute resolution agreement will cover all matters directly or indirectly
related to the Executive's recruitment, employment or termination of employment
by the Company; including, but not limited to, claims involving laws against
discrimination whether brought under federal and/or state law and/or local law,
and/or claims involving co-Executives but excluding Worker's Compensation
Claims. Nothing contained in this Section 11 shall limit the right of the
Company to enforce by court injunction or other equitable relief the Executive's
obligations under Sections 5, 7, 8 and 9 hereof.
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The right to a trial, and to a trial by jury, is of value.
THE EXECUTIVE MAY WISH TO CONSULT AN ATTORNEY PRIOR TO SIGNING THIS
AGREEMENT. IF SO, THE EXECUTIVE SHOULD TAKE A COPY OF THIS AGREEMENT
WITH HIM. HOWEVER, THE EXECUTIVE WILL NOT BE OFFERED EMPLOYMENT UNTIL
THIS AGREEMENT IS SIGNED AND RETURNED TO EMPLOYER.
12. CHOICE OF LAW AND JURISDICTION. This Agreement shall be construed,
interpreted and the rights of the parties determined in accordance with the laws
of the State of Minnesota. Each of the parties hereto hereby irrevocably
consents and submits to the exclusive jurisdiction of the state courts of the
State of Minnesota, and of the United States District Court for the District of
Minnesota in connection with any suit, action, or other proceeding concerning
this Agreement or enforcement of Sections 5, 7, 8 and 9 hereof. The Executive
waives and agrees not to assert any defense that the court lacks jurisdiction,
venue is improper, inconvenient forum or otherwise. The Executive waives the
right to a jury trial and agrees to accept service of process by certified mail
at the Executive's last known address.
13. SUCCESSORS AND ASSIGNS. Neither this Agreement, nor any of the
Executive's rights, powers, duties or obligations hereunder, may be assigned by
the Executive. This Agreement shall be binding upon and inure to the benefit of
the Executive and his heirs and legal representatives and the Company and its
successors. Successors of the Company shall include, without limitation, any
company or companies, individuals, groups, associations, partnerships, firm,
venture or other entity or party acquiring, directly or indirectly, all or
substantially all of the assets of the Company, whether by merger,
consolidation, purchase, lease or otherwise. Any such successor referred to in
this paragraph shall thereafter be deemed "the Company" for the purpose hereof.
All covenants and restrictions upon the Executive hereunder, including, but not
limited to Sections 5, 7, 8 and 9 hereof, are specifically assignable by the
Company.
14. WAIVER. Any waiver or consent from the Company with respect to any
term or provision of this Agreement or any other aspect of the Executive's
conduct or employment shall be effective only in the specific instance and for
the specific purpose for which given and shall not be deemed, regardless of
frequency given, to be a further or continuing waiver or consent. The failure or
delay of the Company at any time or times to require performance of, or to
exercise any of its powers, rights or remedies with respect to any term or
provision of this Agreement or any other aspect of the Executive's conduct or
employment in no manner (except as otherwise expressly provided herein) shall
affect the Company's right at a later time to enforce any such term or
provision.
15. NOTICES. All notices, requests, demands, and other communications
hereunder must be in writing and shall be deemed to have been duly given if
delivered by hand or mailed within the continental United States by first class,
registered mail, return receipt requested, postage and registry fees prepaid, to
the applicable party and addressed as follows:
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(a) If to the Company:
BIO-key International, Inc.
0000 Xxxxxxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxx, XX 00000
Attn: Board of Directors
With a copy to:
Xxxxxxxx Ingersoll Professional Corporation
Eleven Penn Center
0000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxx, Esquire
(b) If to the Executive:
Xxxxxxx X. XxXxxxxxxx
000 Xxxxxxx Xxxxx
Xxxx Xxxxx, XX 00000
16. Construction of Agreement.
(a) SEVERABILITY. In the event that any one or more of the
provisions of this Agreement shall be held to be invalid, illegal or
unenforceable, the validity, legality or enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
(b) HEADINGS. The descriptive headings of the several
paragraphs of this Agreement are inserted for convenience of reference only and
shall not constitute a part of this Agreement.
17. ENTIRE AGREEMENT AND AMENDMENTS. This Agreement, including all Exhibits
which shall form parts hereof, contains the entire agreement of the parties
concerning the Executive's employment and all promises, representations,
understandings, arrangements and prior agreements on such subject are merged
herein and superseded hereby. The provisions of this Agreement may not be
amended, modified, repealed, waived, extended or discharged except by an
agreement in writing signed by the party against whom enforcement of any
amendment, modification, repeal, waiver, extension or discharge is sought. No
person acting other than pursuant to a resolution of the Board of Directors
shall have authority on behalf of the Company to agree to amend, modify, repeal,
waive, extend or discharge any provision of this Agreement or anything in
reference thereto or to exercise any of the Company's rights to terminate or to
fail to extend this Agreement.
12
18. SURVIVAL. The Executive's obligations under Paragraphs 5, 7, 8 and 9
shall survive and continue pursuant to the terms and conditions of this
Agreement following specific termination.
19. UNDERSTANDING. The Executive represents and agrees that he fully
understands his rights to discuss all aspects of this Agreement with his private
attorney, that to the extent he desires, he availed himself of this right, that
he has carefully read and fully understands all of the provisions of this
Agreement, that he is competent to execute this Agreement, that his decision to
execute this Agreement has not been obtained by any duress and that he freely
and voluntarily enters into this Agreement, and that he has read this document
in its entirety and fully understands the meaning, intent, and consequences of
this Agreement.
20. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, and all of which
together shall constitute one and the same instrument.
21. INJUNCTIVE RELIEF. The Executive hereby agrees and acknowledges that in
the event of a breach or threatened breach of this Agreement by the Executive,
the Company may suffer irreparable harm and monetary damages alone would not
adequately compensate the Company. Accordingly, the Company will therefore be
entitled to injunctive relief to enforce this Agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
13
IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed and attested by its duly authorized officers, and the Executive has set
his hand, all as of the day and year first above written.
BIO-KEY INTERNATIONAL, INC.
By: /S/ XXXXXX X. XXXXXXXXX
--------------------------------------
Name: XXXXXX X. XXXXXXXXX
--------------------------------------
Title: CHAIRMAN OF THE BOARD OF DIRECTORS
--------------------------------------
EXECUTIVE
/S/ XXXXXXX X. XXXXXXXXXX
------------------------------------
Xxxxxxx X. XxXxxxxxxx
14
EXHIBIT B
LIST OF PRIOR CONFIDENTIALITY AND/OR NONCOMPETITION AGREEMENTS
COMPANY; DATE OF EMPLOYMENT;
COMPANY ADDRESS EFFECTIVE DATES OF AGREEMENT BRIEF DESCRIPTION
--------------------------- ------------------------------- -------------------------
PRISM ESOLUTIONS FEBRUARY 2001- AUGUST 2002 CONFIDENTIALITY AND NON
000 XXXXXXXX XXXX XXXX SOLICITATION AGREEMENT
BLUE XXXX, PA ONE YEAR POST EMPLOYMENT
ISO 9000/14000 WEB
TECHNOLOGIES
Date: ________________
-----------------------------------------------------
Executive's Signature
EXHIBIT C
PRIOR INNOVATIONS:
NONE.
