EXHIBIT 10.10
EMPLOYMENT AGREEMENT
AGREEMENT, made and entered into this first day of February, 1996, by and
between Rochester Medical Corporation, a Minnesota corporation (the
"Corporation"), and Xxxxx X. Xxxxxxxxxxx ("Employee").
WHEREAS, the Corporation and the Employee desire to record the terms of
Employee's employment by the Corporation;
NOW, THEREFORE, in consideration of the premises and mutual covenants contained
herein and for other good and valuable consideration, the parties agree as
follows:
1. TERM OF EMPLOYMENT. Subject to the terms and conditions of this Agreement,
the Corporation hereby employs Employee and Employee hereby accepts employment
for the period commencing February 19, 1996, and continuing thereafter until the
employment is terminated according to the provisions of this Agreement.
2. DUTIES. During the term of this Agreement, Employee shall perform the
duties of Chief Financial Officer and such additional duties as may be
prescribed from time to time by the Board of Directors or the Chief Executive
Officer of the Corporation.
3. BASE SALARY, COMMISSION, BONUS AND OTHER COMPENSATION.
3.1 BASE SALARY. The Corporation shall pay Employee an initial Base
Salary ("Base Salary") of One Hundred Thousand Dollars ($100,000) per annum
commencing February 19, 1996. The Base Salary shall be paid according to the
Corporation's regular payroll procedure, in equal increments not less
frequently than monthly. The Base Salary shall be subject to annual review
and merit increase adjustment in accordance with the Corporation's customary
practices, as may be then in effect, for salary planning and administration.
3.2 INCENTIVE BONUS. In addition to the Base Salary, Employee shall be
entitled to an incentive bonus (the "Bonus") targeted at 25% of Base Salary.
The amount and timing of payment of the Bonus shall be mutually agreed by
the Corporation and Employee and is intended to take effect during the
Corporation's fiscal year beginning October 1, 1996.
3.3 RELOCATION ALLOWANCE. In addition to any other compensation to which
Employee may be entitled by this agreement, the Corporation shall pay
Employee a Relocation Allowance (the "Relocation Allowance"). The Relocation
Allowance shall cover all costs and expenses associated with relocation
including (i) Employee's accountable out-of-pocket expenses in connection
with Employee's relocation to the Rochester, Minnesota area, (ii) points and
fees associated with financing the purchase of Employee's new home in the
Rochester, Minneosta area, (iii) the difference, not to exceed $15,000, by
which the sale price of Employee's current home is less than $260,000, (iv)
the additional sum of $8,500 for non-accountable expenses which Employee may
incur as a result of relocation to the Rochester, Minnesota area, and (v)
all associated tax liabilities incurred by Employee in connection with the
Relocation Allowance.
3.4 INCENTIVE STOCK OPTION. In addition to any other compensation to
which Employee may be entitled by this agreement, Employee shall be entitled
to receive an Incentive Stock Option for Eighty Thousand (80,000) shares of
the Corporation under the Corporation's 1991 Stock Option Plan according to
the Incentive Stock Option Agreement appended hereto as Exhibit 1.
4. BENEFITS.
4.1 VACATION. During each year of his employment, Employee shall be
entitled to three weeks annual vacation and to reasonable holidays and sick
leave. Vacations shall be taken by Employee during the year earned at such
time or times and for such periods as Corporation and Employee shall agree.
4.2 BENEFIT PROGRAMS, INSURANCE. Employee shall be entitled to
participate in customary employee benefit programs as may be from time to
time determined by the Board of Directors including, but not limited to,
life insurance, hospitalization, surgical and major medical coverage, and
long-term disability as are or may be made available from time to time to
other salaried employees of the Corporation. The Corporation currently
provides salaried employees with health insurance coverage under a policy
issued by Great West Insurance Company.
5. TERMINATION.
5.1 EVENTS OF TERMINATION. This Agreement may be terminated upon the
occurrence of any one of the following events:
(a) VOLUNTARY. Employee may terminate this Agreement at any time
during the term of this Agreement by giving 30 days prior written notice
of termination to the Board.
(b) INVOLUNTARY WITHOUT CAUSE. The Corporation may terminate this
Agreement without cause by 30 days written notice to Employee.
(c) INVOLUNTARY WITH CAUSE. The Corporation may terminate this
Agreement immediately for cause for (i) Employee's material breach of any
agreement with the Corporation, (ii) Employee's deliberate, willful or
gross misconduct in the performance or Employee's duties on behalf of the
Corporation, or (iii) Employee's being charged with a crime punishable by
imprisonment
(d) DEATH. This Agreement shall automatically terminate upon the
death of the Employee.
(e) DISABILITY. This Agreement shall automatically terminate upon the
permanent disability of Employee. For the purposes of this Agreement,
Employee shall be deemed permanently disabled if any ailment, illness or
other incapacity prevents him from performing his duties as specified in
this Agreement for a period of three consecutive months or for an
aggregate of three months in any twelve month period from the date of
this Agreement.
5.2 CONSEQUENCES OF TERMINATION.
(a) In the event of the termination of this Agreement in accordance
with Subparagraph 5.1(a) or 5.1(c) above, Employee shall be entitled to
Base Salary and Bonus earned by him prior to the date of termination as
provided herein computed on a pro rata basis to and including such date
of termination. In addition, Employee shall also be reimbursed for his
reasonable business expenses incurred prior to the date of termination.
(b) If the Corporation terminates this Agreement without cause
pursuant to Subparagraph 5.1(b) above, Employee shall be entitled to
receive Base Salary and Bonus earned by him prior to the date of
termination as provided herein computed on a pro rata basis to and
including such date of termination and, in addition, as liquidated
damages for, and in lieu of, any and all damages which he may incur as a
result of such termination severance payments consisting of (i) regular
installment payments of Base Salary for a period of six (6) months
following termination. and, (ii) in addition, if Employee is unable,
using good faith efforts, to obtain suitable employment during that
initial six (6) month period following termination, Employee shall
thereafter continue to receive regular installments of Base salary until
he obtains suitable employment or for a period six (6) additional months,
which ever first occurs; it being understood that the maximum period to
which Employee is entitled to any salary continuation shall not exceed
twelve months following termination.
(c) In the event this Agreement is terminated due to the death
(pursuant to Subparagraph 5.1(d)) or disability (pursuant to Subparagraph
5.1(e)) of Employee, Employee (or his estate) shall be entitled to the
base salary earned by him prior to the date of termination as provided
herein computed on a pro rata basis to and including such date of
termination plus any cash bonus payable with respect to the fiscal year
of death or disability according to normal payment procedures of the
Corporation.
6. NON-COMPETITION; INVENTIONS.
6.1 DEFINITIONS. For purposes of this Section 6, the following words and
phrases have the meanings ascribed to them, respectively:
(a) "Confidential Information" means all formulas, processes,
customer lists, computer user identifiers and passwords, and all
purchasing, engineering, accounting, marketing and other information that
is proprietary to the Corporation and not generally known or readily
ascertainable by proper means, relating to research, development,
manufacture or sale of the Corporation's products, as well as formulas,
processes and other information received by the Corporation from third
parties under an obligation of secrecy. All information disclosed to
Employee or to which Employee has access during the period of his
employment, which he has reasonable basis to believe to be Confidential
Information, or which is treated by the Corporation as being Confidential
Information, shall be presumed to be Confidential Information.
(b) "Inventions" means all formulas, processes, discoveries,
improvements, ideas and works of authorship, whether patentable or
copyrightable or not, which Employee learns, has access to, has a part in
developing, first conceives or first reduces to practice, alone or with
others (1) that are developed on the Corporation's time, or (2) that
relate directly to the Corporation's business or actual or
anticipated research, or (3) for which any of the Corporation's property,
including Confidential Information, is used, or (4) that result from any
of Employee's work for the Corporation.
6.2. DISCLOSURE AND ASSIGNMENT. Except as provided elsewhere in this
Agreement, Employee shall treat as for the Corporation's sole benefit and
fully and promptly disclose to the Corporation, without additional
compensation, all ideas, discoveries, inventions and improvements, whether
patentable or not, which, while the Employee is employed by the Corporation,
are made conceived or reduced to practice by Employee, alone or with others,
during or after usual working hours, either on or off the job, and Employee
hereby assigns to the Corporation all such ideas, discoveries, inventions
and improvements to be the Corporation's exclusive property.
6.3 FURTHER DOCUMENTS. Employee will acknowledge and deliver promptly
without charge all documents to the Corporation, and will do such other acts
as may be necessary in the Corporation's opinion to obtain and maintain
patents (including divisional, reissued or extended Letters Patent) or
copyrights and to vest the entire right and title in the Corporation to such
patents, copyrights and Inventions in all countries.
6.4 CONFIDENTIALITY. Employee will not use or disclose any Confidential
Information, either during or after employment by the Corporation, except as
required by his duties to the Corporation, and Employee acknowledges and
understands that the obligation to maintain the confidentiality of the
Corporation's Confidential Information is unconditional and shall not be
excused by any conduct on the part of the Corporation except its prior
voluntary disclosure of the information. Upon termination of employment,
Employee agrees that (a) all Confidential Information, including all copies,
excerpts and summaries in his possession or control (whether prepared by the
Corporation, the Employee or others), and also all other the Corporation
property, including keys, credit cards, software, reports and the like,
shall be left with the Corporation and (b) Employee will stop use of all
Confidential Information. Employee shall not at any time during the term of
this Agreement or thereafter, or in any manner, either directly or
indirectly, divulge, disclose or communicate to any person, firm or
corporation in any manner whatsoever any information concerning any matters
affecting or relating to the business of the Corporation, including without
limiting the generality of the foregoing, any of its customers, the prices
it obtains or has obtained from the sale of, or at which it sells or has
sold, its products, or any other information concerning the business of the
Corporation, its manner of operation, its plans, processes, or other data
without regard to whether all of the foregoing matters will be deemed
confidential, material, or important, the parties hereto stipulating that as
between them, the same are important, material, and confidential and gravely
affect the effective and successful conduct of the business of the
Corporation, and the Corporation's good will, and that any breach of the
terms of this Section 6 shall be a material breach of this Agreement.
6.5 LIMITATION; FIRST REFUSAL. The obligations of Section 6.2 and 6.3
shall not apply to any ideas, discoveries, inventions and improvements for
which no equipment, supplies, facility or trade secret information of the
Corporation was used, and which was developed entirely on Employee's own
time, and (1) which does not relate (a) directly to the business of the
Corporation or (b) to the Corporation's actual or demonstrably anticipated
research or development, or (2) which does not result from any work
performed by Employee for the Corporation. Employee will, nonetheless,
promptly disclose all such ideas, discoveries, inventions and improvements
to the Corporation and offer to the Corporation the right of first refusal
to enter into a license or purchase agreement covering the subject idea,
discovery, invention or improvement on terms mutually agreed to by Employee
and the Corporation. In the event the Corporation and Employee cannot agree
on terms and Employee receives an offer to enter into a license or purchase
agreement with some other party on terms more favorable to that other party
than the terms offered to the Corporation, then the Corporation shall have
the right and Employee shall have the obligation to offer to the Corporation
the idea, discovery, invention or improvement on such favorable terms. When
such an offer is made to the Corporation pursuant to the preceding sentence,
it must be accepted by the Corporation within thirty (30) days; or if not
accepted, the right of first refusal hereunder as to that offer shall
terminate.
NOTICE: SECTION 6 HEREOF REQUIRES EMPLOYEE TO ASSIGN RIGHTS TO
INVENTIONS TO THE CORPORATION OR ITS SUCCESSORS. MINNESOTA STATUTES
S.181.78 LIMITS THE SCOPE OF AGREEMENTS REQUIRING THE INVENTIONS BE
ASSIGNED TO EMPLOYERS. THE STATUTE STATES THAT SUCH ASSIGNMENT AGREEMENTS
DO NOT APPLY:
"TO AN INVENTION FOR WHICH NO EQUIPMENT, SUPPLIES, FACILITY OR TRADE
SECRET INFORMATION OF THE EMPLOYER WAS USED AND WHICH WAS DEVELOPED
ENTIRELY ON THE EMPLOYEE'S OWN TIME, AND (1) WHICH DOES NOT RELATE (a)
DIRECTLY TO THE BUSINESS OF THE EMPLOYER OR (b) TO THE EMPLOYER'S ACTUAL
OR DEMONSTRABLY ANTICIPATED RESEARCH OR DEVELOPMENT, OR (2) WHICH DOES NOT
RESULT FROM ANY WORK PERFORMED BY THE EMPLOYEE FOR THE EMPLOYER."
PLEASE NOTE THAT SECTION 6 OF THIS AGREEMENT USES THESE STATUTORY TERMS
TO DEFINE THE INVENTIONS WHICH ARE NOT AUTOMATICALLY ASSIGNED TO THE
CORPORATION BUT INSTEAD ARE SUBJECT TO A RIGHT OF FIRST REFUSAL IN FAVOR OF
THE CORPORATION.
6.6. ASSISTANCE TO THE CORPORATION. Employee shall give the Corporation,
at the Corporation's expense, all assistance the Corporation reasonably
requires to perfect, protect, and exercise the rights to all ideas,
discoveries, inventions or improvements acquired by the Corporation pursuant
to the assignment provisions or the right of first refusal provisions of
this Section 6.
6.7 REMEDIES. The Employee's obligations set forth in Section 6 of this
Agreement shall continue to be binding upon Employee, notwithstanding the
termination of his employment with the Corporation for any reason
whatsoever. Such obligations shall be deemed and construed as separate
agreements independent of any other provisions of this Agreement. The
existence of any claim or cause of action by Employee against the
Corporation, whether predicated on this Agreement or otherwise, shall not
constitute a defense to the enforcement by the Corporation or any or all of
such obligations. It is expressly agreed that the remedy at law for the
breach of any such obligation is inadequate and that temporary and permanent
injunctive relief shall be available to prevent the breach or any threatened
breach thereof, without the necessity of proof of actual damages.
7. NOTICES. Any notices to be given hereunder by either party to the other may
be effected either by personal delivery in writing or by mail, registered or
certified, postage prepaid, with return receipt requested. Personal delivery to
the Corporation shall mean personal delivery to the Chief Executive Officer of
the Corporation. Mailed notices shall be addressed to the respective addresses
shown below. Either party may change its address for notice by giving written
notice according to the terms of this Section 7.
(a) If to Employee:
Xxxxx X. Xxxxxxxxxxx
0000 Xxxxxxxxxxx Xxxxx
Xxxxxxx Xxxxxxx, Xxxxxxxxx 00000
(b) If to the Corporation:
Rochester Medical Corporation
0000 Xxxxxx Xxxxxx X. X.
Xxxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Chairman of the Board
8. GENERAL PROVISIONS.
8.1 LAW GOVERNING. This Agreement shall be governed by and construed
according to the laws of the State of Minnesota.
8.2 INVALID PROVISIONS. If any provision of this Agreement is held to be
illegal, invalid, or unenforceable under present or future laws effective
during the term hereof, such provision shall be fully severable and this
Agreement shall be construed and enforced as if such illegal, invalid, or
unenforceable provision had never comprised a part hereof; and the remaining
provisions hereof shall remain in full force and effect and shall not be
affected by the illegal, invalid, or unenforceable provision or by its
severance herefrom. Furthermore, in lieu of such illegal, invalid, or
unenforceable provision there shall be added automatically as a part of this
Agreement a provision as similar in terms to such illegal, invalid, or
unenforceable provision as may be possible and still be legal, valid or
enforceable.
8.3 ENTIRE AGREEMENT. This Agreement sets forth the entire understanding
of the parties and supersedes all prior agreements or understandings,
whether written or oral, with respect to the subject matter hereof. No
terms, conditions, warranties, other than those contained herein, and no
amendments or modifications hereto shall be binding unless made in writing
and signed by the parties hereto.
8.4 BINDING EFFECT. This Agreement shall extend to and be binding upon
and inure to the benefit of the parties hereto, their respective heirs,
representatives, successors and assigns. This Agreement may not be
assigned by Employee.
8.5 WAIVER. The waiver by either party hereto of a breach of any term or
provision of this Agreement shall not operate or be construed as a waiver of
a subsequent breach of the same provision by any party or of the breach of
any other term or provision of this Agreement.
8.7 TITLES. Titles of the paragraphs herein are used solely for
convenience and shall not be used for interpretation or construing any word,
clause, paragraph, or provision of this Agreement.
8.8 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the Corporation and Employee have executed this Agreement as
of the date and year first written above.
"Employee" Rochester Medical Corporation
/s/ XXXXX X. XXXXXXXXXXX By: /s/ XXXXXXX X. XXXXXX
Xxxxx X. Xxxxxxxxxxx Xxxxxxx X. Xxxxxx,
Chief Executive Officer
