EXHIBIT 10.6
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EMPLOYMENT AGREEMENT
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This Employment Agreement ("Agreement") is entered into as of the
first day of May, 1998 by and between InPath, LLC, a Delaware Limited
Liability Company ("InPath"), and Xxxxx X. Xxxxxxxx ("Employee").
RECITALS
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InPath desires to have the benefits of Employee's knowledge and
experience as a full time senior executive without distraction by
employment-related uncertainties and considers such employment a vital
element of protecting and enhancing the best interests of InPath and its
shareholders.
Employee desires to be employed full time with InPath.
InPath desires to assure itself of the continued services of
Employee, and Employee desires to render services to InPath.
In consideration of the mutual covenants and other good and valuable
consideration, the parties agree as follows:
1. TERM. InPath shall employ Employee for a five (5) year period
commencing May 1, 1998 (the "Effective Date") and ending April 30, 2003,
unless terminated as provided in Sections 5 or 6. This Agreement shall
automatically renew for additional one (1) year terms unless either party
delivers to the other written notice of non-renewal at least 60 days prior
to the end of the term. In addition, if a Change of Control as defined in
section 7(d) occurs when less than one (1) year remains prior to the
expiration of this Agreement, this Agreement shall be automatically
extended until the first anniversary of the date on which the Change of
Control occurred. The period during which Employee is employed by InPath
is the "Employment Period."
2. DUTIES. Employee shall serve as the Chief Executive Officer and
Chairman and shall exercise the authority and assume the responsibilities
typically given to the chief executive officer of a corporation similar in
size and nature to InPath, and shall assume any other duties and
responsibilities as the Board of Directors may prescribe that are
consistent with the duties of the chief executive officer of a company
similar in size and nature to InPath. Throughout the Employment Period,
Employee shall devote substantially all of his time, attention and efforts
during normal business hours to the performance of his duties. Employee
shall not render any services as a director, trustee, officer, employee or
consultant to any other organization without the prior approval of the
Board of Directors.
3. COMPENSATION. During the Employment Period, InPath shall
compensate Employee as follows:
(a) A base annual salary determined by the Board of Directors
consistent with its practices for executive officers of InPath, but not
less than $200,000 per year, payable in accordance with InPath's customary
payroll practices;
(b) Bonuses as determined by the Board of Directors, but with a
minimum annual bonus of not less than 25% of the Employee's base annual
salary applicable in that year;
(c) If Employee's base annual salary is increased at any time, it
shall not thereafter be decreased;
(d) A monthly automobile allowance of $750.
4. EMPLOYEE BENEFITS.
(a) Employee shall be entitled, on a basis commensurate with
Employee's position with InPath, to full participation in, and service
credit for benefits as provided under, all life, accident, medical payment,
health and disability insurance, retirement pension, salary continuation,
expense reimbursement and other employee benefit and perquisite policies,
plans, programs and arrangements that generally are made available to
executive officers of InPath, except for such arrangements that the Board
of Directors, in its discretion, shall adopt for select employees to
compensate them for special or extenuating circumstances.
(b) Employee shall be entitled to five (5) weeks of annual vacation
leave at full pay.
(c) Employee shall be entitled to participate in all bonus,
incentive, profit-sharing, stock option, stock purchase, stock
appreciation, discretionary pay and similar policies, plans programs and
arrangements that generally are made available to executive officers of
InPath.
(d) Nothing in this Agreement shall limit in any way Employee's
participation in any other benefit plans or arrangements as are from time
to time approved by InPath.
5. TERMINATION BY INPATH. InPath may terminate this Agreement
without entitling Employee to the severance benefits provided by Sections 7
and 8 only under the following circumstances:
(a) DEATH, TOTAL DISABILITY OR RETIREMENT. This Agreement
shall be terminated upon Employee's death or retirement. This Agreement
shall be terminated if, as a result of Employee's incapacity resulting from
physical or mental illness or disease that is likely to be permanent,
Employee is unable to perform his duties for a period of more than 120
consecutive days during any twelve (12) month period and Employee is
qualified and eligible to receive disability benefits under the long-term
disability plan then in effect for executive officers of InPath; and
(b) CAUSE. InPath may terminate this Agreement for cause,
which means:
(i) the repeated, willful and continued failure by
Employee to follow the reasonable instructions of the Board of Directors of
InPath after Employee has been given written notice of the failure and a
period of at least thirty (30) days to cure the failure;
(ii) the willful commission by Employee of acts that are
dishonest and materially injurious to InPath;
(iii) the conviction of Employee of a felony; or
(iv) drug addiction.
InPath's termination of this Agreement for any reason other than
those specified in this Section 5 shall be a termination without cause. No
breach or default by Employee shall be deemed to have occurred unless
written notice is given to Employee within sixty (60) days after InPath
first learns of the breach or default and it is not cured within thirty
(30) days after notice is given to Employee.
6. TERMINATION BY EMPLOYEE. Employee may terminate this Agreement,
and shall be entitled to severance compensation and benefits as provided in
Sections 7 and 8 if:
(a) at any time more than 120 days after the occurrence of a
Change of Control, for any reason or no reason at all; or
(b) for Good Reason, provided that Employee terminates this
Agreement no later than ninety (90) days following the occurrence of an
event constituting Good Reason. "Good Reason" means the occurrence of any
of the following:
(i) The assignment of duties to Employee that are
materially inconsistent with Employee's position, duties and status as
contemplated by this Agreement (without the express written consent of
Employee);
(ii) Any action by InPath that results in a material
adverse change in the nature or scope of the position, duties, authorities,
responsibilities or functions of Employee as contemplated by this
Agreement, except for strategic reallocations of the personnel reporting to
Employee;
(iii) Employee's base annual salary, as may be increased
from time to time, is reduced, Employee's right to participate in any
policy, plan, program or arrangement of the type referred to in Section
4(c) is changed or terminated, or Employee's right to benefits of the type
referred to in Section 4(a) is changed, terminated or denied;
(iv) InPath relocates its principal executive offices,
or requires Employee to change his principal location of work to any
location that is more than fifty 50 miles from his principal location of
work on the Effective Date, or requires Employee to travel away from his
office in the course of discharging Employee's responsibilities or duties
significantly more (in terms of either consecutive days or aggregate days
in any calendar year) than was required of Employee prior to the Effective
Date, in either case without Employee's prior written consent; provided,
however, that InPath has the right to make temporary assignments for a
reasonable period of time at other locations where InPath has a special
need for Employee's services;
(v) Employee is not re-elected or is removed as a
member of the Board of Directors; or
(vi) Without limiting the generality or effect of the
foregoing, InPath fails to comply with any of its obligations in any
material respect.
7. SEVERANCE PAYMENT AFTER CHANGE OF-CONTROL.
(a) If, following the occurrence of a Change of Control,
InPath terminates this Agreement without cause or Employee resigns for Good
Reason, Employee shall receive a lump sum severance payment equal to three
(3) times Employee's Base Amount, as defined in subsection (b) below.
(b) "Base Amount" means the sum of:
(i) Employee's annual base salary in effect immediately
prior to the termination of this Agreement; plus
(ii) the highest incentive compensation paid to Employee
in any of the two consecutive annual incentive compensation periods ending
immediately prior to the termination of this Agreement; plus
(iii) the monthly automobile allowance Employee is
entitled to receive pursuant to Section 3(d), multiplied by 12.
(c) If a Change of Control occurs, despite the terms of any
applicable plan or arrangement to the contrary,
(i) Employee's unit options and unit appreciation
rights shall immediately vest and be immediately exercisable,
(ii) any risk of forfeiture included in restricted unit
grants made to Employee shall immediately lapse, and
(iii) Employee's rights in all other employee benefit and
compensation plans shall immediately vest, provided that Employee's rights
under any plan or arrangement of InPath described in Section 28OG(b)(6) of
the Internal Revenue Code of 1986, as amended, or any successor provision
thereto (the "Code"), shall not be altered as a result of this subsection
(c).
(d) A "Change of Control" shall be deemed to have taken place
if:
(i) if, prior to the date InPath becomes a publicly
held corporation, any outside person(s) or entity(ies) directly or
indirectly acquire fifteen percent (15%) or more of the units or the
combined voting power of InPath;
(ii) if InPath becomes a publicly held corporation, and
if any person, as that term is used in Section 13(d) and Section 14(d)(2)
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
except the unitholders of record immediately prior to the initial public
offering (IPO), becomes, is discovered to be, or files a report on Schedule
13D or 14D-1 disclosing that he is the beneficial owner, as defined in Rule
l3d-3 under the Exchange Act, directly or indirectly, of securities
representing 20% or more of the combined voting power of InPath's then
outstanding securities entitled to vote generally in the election of
directors (unless such person is known by Employee to already be a
beneficial owner on the date of this Agreement;
(iii) InPath is merged, consolidated or reorganized into
or with another corporation or other legal person, or securities of InPath
are exchanged for securities of another corporation or other legal person,
and, immediately after such merger, consolidation, reorganization or
exchange, less than a majority of the combined voting power of the then
outstanding securities of the corporation or person immediately after the
transaction are held, directly or indirectly, in the aggregate by the
unitholders of InPath immediately prior to such transaction;
(iv) InPath, in any transaction or series of related
transactions, sells all or substantially all of its assets, and less than a
majority of the combined voting power of the then outstanding securities of
the purchaser immediately after the sale or sales are held, directly or
indirectly, in the aggregate by the unitholders of InPath immediately prior
to the sale;
(v) InPath sells or disposes of (in any transaction or
series of related transactions) business operations that generated
two-thirds of its consolidated revenues immediately prior thereto,
determined on the basis of InPath's four most recently completed fiscal
quarters;
(vi) InPath files a report or proxy statement with the
Securities and Exchange Commission pursuant to the Exchange Act disclosing,
in response to Form 8-K or Schedule 14A, that a change in control of InPath
may have occurred or may occur pursuant to any then-existing contract or
transactions;
(vii) any other transaction or series of related
transactions occurs that has substantially the effect of a transaction
specified in any of the preceding clauses in this subsection (d); or
(viii) Employee is terminated by InPath, or removed from
Employee's office or position without cause within ninety (90) days before
a Change of Control occurs.
(e) Notwithstanding any contrary provision in this Agreement,
if any amount or benefit to be paid or provided would be an "Excess
Parachute Payment", within the meaning of Section 280G of the Code but for
the application of this Subsection 7(e), then the payments and benefits
shall be reduced to the minimum extent necessary, but in no event to less
than zero, so that no portion of any payment or benefit, as reduced,
constitutes an Excess Parachute Payment. The determination of whether any
reduction in the payments or benefits is required pursuant to this Section
7(e) shall be made at the expense of InPath. If any payments or benefits
intended to be provided must be reduced pursuant to this subsection (e),
Employee may designate the payments or benefits to be reduced. InPath
shall provide Employee with all reasonably requested information for
Employee to make the designation. If Employee fails to make such
designation within ten (10) business days of the termination of this
Agreement, InPath may effect reduction in any manner it deems appropriate.
(f) Notwithstanding the provisions of Section 7(d)(i), (ii)
and (v), unless otherwise determined in a specific case by majority vote of
the Board of Directors, a Change of Control shall not be deemed to have
occurred solely because an entity in which InPath directly or indirectly
beneficially owns 50% or more of the voting securities, or any InPath
sponsored employee stock ownership plan or other employee benefit plan
files or becomes obligated to file a report or a proxy statement in
response to Schedule 13D, Schedule 14D-1, Form 8-K or Schedule 14A under
the Exchange Act, disclosing beneficial ownership by it of units of InPath,
or because InPath reports that a change in control may have occurred or may
occur in the future by reason of such beneficial ownership.
(g) If this Agreement is not terminated as provided in
Section 7(a), then the rights and obligations of the parties for the
balance of the Employment Period shall be governed by this Agreement
exclusive of the provisions contained in this Section 7, except this
Section 7 shall continue and become applicable if a subsequent Change of
Control occurs during the Employment Period.
8. OTHER SEVERANCE BENEFITS.
(a) If Employee is terminated without cause or Employee
resigns for Good Reason, and no Change of Control has occurred, Employee
shall receive a severance payment equal to two (2) times Employee's Base
Amount as defined in Section 7(b).
(b) If Employee is terminated without cause or Employee
resigns for Good Reason or as provided in Section 6(a), InPath shall
continue to provide, at no cost to Employee, basic employee group benefits
referred to in Section 4(a) that are welfare benefits, but not pension,
retirement or similar compensatory benefits, for Employee and Employee's
dependents and are substantially similar to those they were receiving or to
which they were entitled immediately prior to the termination of this
Agreement for the lesser of one year after termination or until Employee
secures new employment. Employee's unit option agreements shall provide
for a continuance of
the option exercise period for at least two (2) years from the date
of Employee's termination without cause and at least one (1) year from the
date of Employee's resignation for Good Reason, except that if Employee
dies, continuance of the option exercise period shall be at least two (2)
years and the exercise period of an option shall not be extended beyond the
date on which it would have terminated had Employee continued to be
employed by the Company. The preceding sentence shall not apply to any
"incentive stock option," as that term is defined in Section 411 of the
Code.
(c) If Employee is terminated without cause or Employee
resigns for Good Reason or as provided in Section 6(a), InPath shall
promptly, within five (5) business days after a request by Employee, pay or
reimburse Employee for the costs and expenses of any executive outplacement
firm selected by Employee; provided that InPath's liability under this
Subsection (e) shall be limited to $20,000. Employee shall provide InPath
with reasonable documentation of outplacement costs and expenses.
9. TIMING OF PAYMENT. Any severance or other payment under this
Agreement shall be paid within thirty (30) days after the event giving rise
to Employee's entitlement to the payment or at any other date as the
parties agree.
10. OTHER BENEFITS. The provisions of Sections 7 and 8 shall not
affect Employee's participation in or terminate distributions and vested
rights under any pension, profit sharing, insurance or other employee
benefit plan to which Employee is entitled pursuant to the terms of the
plans, except for the acceleration of vested benefits in certain employee
benefits pursuant to Section 7(c) and as provided in Section 8(b).
11. NO MITIGATION OBLIGATION. InPath recognizes that it will be
difficult, and may be impossible, for Employee to find reasonable
comparable employment following the termination of this Agreement. The
non-competition covenant contained in Section 13 further limits the
employment opportunities for Employee. In addition, InPath's severance pay
policy applicable in general to its salaried employees does not provide for
mitigation, offset or reduction of any severance payment. Accordingly, the
payment of severance compensation under this Agreement will be liquidated
damages, and that Employee shall not be required to seek other employment
or otherwise mitigate any payment.
12. NO RIGHT TO SET OFF. InPath shall not set off against amounts
payable to Employee any amounts earned by Employee in other employment, or
otherwise, after termination of this Agreement, or any amounts which might
have been earned by Employee in other employment had he sought such other
employment.
13. COMPETITIVE ACTIVITY. For two (2) years following the
termination of this Agreement, if Employee receives payments and benefits
under this Agreement, Employee shall not, without the prior written consent
of the Board of Directors, engage in any Competitive Activity.
"Competitive Activity" means Employee's participation in the management of
any business if it engages in substantial and direct competition with
InPath and the business' sales of any competing product or service amounted
to 25% or more of its net sales for its most recently completed fiscal
year, and if InPath's net sales of a competing product or service amounted
to 25% or more of InPath's net sales for its most recently completed fiscal
year. "Competitive Activity" shall not include
(a) the mere ownership of securities in any business and the
exercise of rights appurtenant thereto, or
(b) participation in the management of any business other
than in connection with that business' operations competitive with InPath.
14. NON-DISCLOSURE OF INFORMATION.
(a) During the Employment Period, and at all times
thereafter, except in the performance of Employee's obligations to InPath,
Employee shall not, directly or indirectly, use or authorize the use of any
confidential or other proprietary information ("Confidential Information")
of InPath including but not limited to trade secrets, product
specifications and ideas, manuals, systems, procedures, confidential
reports, customer lists, sales or distribution methods, patentable
information and data and financial information concerning InPath, which
Confidential Information has been made known, whether or not with the
knowledge and permission of InPath, and whether or not developed, devised
or otherwise created in whole or in part by the efforts of Employee, to
Employee by reason of Employee's activities on behalf of InPath. Employee
shall not reveal, divulge or make known any Confidential Information to any
individual or business organization whatsoever except in performance of
Employee's obligations to InPath, with the express permission of the Board
of Directors, or as required by operation of law.
(b) All Confidential Information is the exclusive property of
InPath. All business records, papers and documents kept or made by
Employee relating to the business of InPath shall be and remain the
property of InPath and shall remain in the possession of InPath. Upon the
termination of this Agreement or upon the request of InPath at any time,
Employee shall promptly deliver to InPath, and shall retain no copies of
any written materials, records or documents made by Employee or in
Employee's possession concerning the business and affairs of InPath that
contain Confidential Information.
(c) Without limiting the remedies available to InPath,
Employee acknowledges that a breach of any of the covenants contained in
Section 13 and this Section 14 may result in material irreparable injury to
InPath for which there is no adequate remedy at law, that it may not be
possible to measure damages for such injuries precisely and that, in the
event of a breach or threatened breach, InPath may obtain a temporary
restraining order and a preliminary or permanent injunction restraining
Employee from engaging in activities prohibited by Section 13 or this
Section 14 or any other relief as may be required to specifically enforce
any of the covenants in such Sections.
15. INVENTIONS.
(a) Employee shall promptly and fully disclose to InPath any
and all ideas, improvements, discoveries and inventions, whether or not
they are believed to be patentable ("Inventions"), which Employee conceives
or first actually reduces to practice, either alone or with others, during
the Employment Period, and which relate to the business now or hereafter
carried on or contemplated by InPath, or which result from any work
performed by Employee for InPath.
(b) All Inventions shall be the sole and exclusive property
of InPath, and during the Employment Period and at all times thereafter,
Employee shall, upon request, execute and assign any and all applications,
assignments and other instruments that InPath shall deem necessary or
appropriate to apply for or obtain a United States patent, trademark or
copyright and/or any foreign patent, trademark or copyright for any
Inventions. Employee shall assign and convey to InPath or its nominee the
sole and exclusive right, title and interest in and to any Inventions.
(c) The provisions of this Section 15 do not apply to an
invention for which no equipment, supplies, facility or Confidential
Information of InPath was used, that was developed entirely on Employee's
own time, and
(i) that does not relate directly to the business of
InPath or to InPath's actual or anticipated research or development, or
(ii) that does not result from any work performed by
Employee for InPath.
16. BINDING ARBITRATION: LEGAL FEES AND EXPENSES.
(a) Any dispute or controversy arising under or in connection
with this Agreement prior to the occurrence of a Change of Control shall be
resolved exclusively by binding arbitration in Xxxx County, Illinois, in
accordance with the rules of the American Arbitration Association.
Judgment may be entered on the arbitrator's award in any court having
jurisdiction. Each party shall bear his or its own costs and expenses of
arbitration, but if Employee is the prevailing party in such arbitration,
in whole or in part, InPath shall pay as part of the award all attorney's
and related fees, costs and expenses incurred by Employee in connection
with the arbitration.
(b) If a Change of Control occurs and Employee determines, in
good faith, that InPath has failed to comply with any of its obligations
under this Agreement, or InPath or any other person takes or threatens to
take any action to declare this Agreement void or unenforceable or
institutes any litigation, arbitration proceeding or other action or
proceeding designed to deny or recover from Employee the benefits provided
or intended to be provided to Employee, InPath shall pay for, as provided
below, counsel selected and retained by Employee, to represent Employee in
connection with the initiation or defense of any litigation, arbitration or
other legal action, whether by or against InPath or any director, officer,
unitholder or other person affiliated with InPath, in any jurisdiction.
Within ten (10) business days after receipt of Employee's request
referencing this Section 16(b), InPath shall pay or reimburse Employee for
fees and expenses incurred, or reasonably anticipated to be incurred, in
accordance with the request and this Section 16(b). InPath shall pay and
shall be solely responsible for any and all attorneys' and related fees and
expenses incurred by Employee in connection with any of the foregoing,
excluding any fees and expenses related to an unsuccessful appeal filed by
Employee of an adjudication on the merits, any motion for a new trial filed
by Employee that is denied or any other motion filed by Employee for
reconsideration or review that is denied.
17. WITHHOLDING OF TAXES. InPath may withhold from any amounts
payable under this Agreement federal, state, city or other taxes as
required by law or government regulation.
18. NOTICES. All notices, requests, demands and other
communications called for or contemplated by this Agreement shall be in
writing and shall be deemed given when delivered personally or when mailed
by United States certified or registered mail, return receipt requested,
postage prepaid, addressed to the parties, their successors in interest or
assignees at the following addresses or such other addresses as the parties
may designate:
If to InPath: InPath, LLC
000 X. Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
Attn: Secretary
If to Employee: Xxxxx X. Xxxxxxxx
0000 X. Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
19. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Illinois, without
giving effect to Illinois' principles of conflict of laws. Venue will be
solely in the state or federal courts located in Xxxx County, Illinois,
subject only to Section 16(a).
20. VALIDITY. The invalidity or unenforceability of any provision
or provisions of this Agreement shall not affect the validity or
enforceability of any other provision of this Agreement, which shall remain
in full force and effect. Any provision of this Agreement held to be
invalid or unenforceable shall be reformed only to the extent necessary to
make it valid and enforceable.
21. ENTIRE AGREEMENT. This Agreement constitutes the entire
understanding between the parties with respect to the subject matter, and
supersedes all negotiations, prior discussions, preliminary agreements and
employment arrangements between Employee and InPath. This Agreement may
not be amended, nor may any of its provisions be waived, except in a
writing executed by the parties.
22. EFFECT ON SUCCESSORS IN INTEREST. This Agreement shall inure to
the benefit of and be binding upon the heirs, administrators, executors and
successors of each of the parties, including without limitation any person
acquiring, directly or indirectly, all or substantially all of the business
and/or assets of InPath by purchase, merger, consolidation, reorganization
or otherwise, and such successor shall thereafter be deemed "InPath" for
purpose of this Agreement. This Agreement is personal in nature and
neither of the parties shall, without the consent of the other, assign,
transfer or delegate this Agreement or any rights or obligations except as
expressly provided in this Section. Without limiting the generality of the
foregoing, Employee's right to receive payments shall not be assignable,
transferable or delegable, whether by pledge, creation of a security
interest or otherwise, other than by bequest or devise or by the laws of
descent and distribution and, upon any attempt to assign or transfer
contrary to this Section, InPath shall have no liability to pay any amount
attempted to be assigned, transferred or delegated.
23. EFFECTIVENESS. This Agreement shall be effective upon the
Effective Date.
24. CAPTIONS. The captions and headings of the sections are
inserted only as a convenience and do not define, limit or otherwise
describe the scope of this Agreement or the intent of any of its
provisions.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the day and year first above written.
INPATH, LLC
By: /s/ Xxxxx X. Xxxxxxxx
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Authorized Representative of the
Board of Directors
By: /s/ Xxxxx X. Xxxxxxxx
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Xxxxx X. Xxxxxxxx
AMENDMENT NO. 1 TO EMPLOYMENT AGREEMENT
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This is Amendment No. 1, dated as of December 4, 1998, to that
certain Employment Agreement (the "Original Agreement") dated as of May 1,
1998 between InPath, LLC, a Delaware limited liability company ("InPath"),
and Xxxxx X. Xxxxxxxx ("Employee").
RECITALS:
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Inpath and the members of Inpath are contemporaneously herewith
entering into a Stock and Membership Interest Exchange Agreement with Xxxx
National Corporation and Xxxxxxxxx X. Xxxxxx (the "Exchange Agreement"),
and it is a condition to the closing of the transactions contemplated by
such agreement that the Original Agreement be amended to modify the term of
the Employee's employment, clarify certain circumstances under which the
Employee may be terminated and clarify that the transactions contemplated
thereby shall not constitute a "Change of Control" for purposes of the
Original Agreement.
In consideration of the mutual covenants and for other good and
valuable consideration, the receipt of which is hereby acknowledged, the
parties agree as follows:
COVENANTS
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1. AMENDMENTS TO ORIGINAL AGREEMENT. The Original Agreement is
hereby amended as follows:
(a) Paragraph 1 of the Original Agreement is hereby amended
by deleting the first two sentences thereof and inserting in their place:
InPath shall employ Employee for a three (3) year period,
commencing May 1, 1998 (the "Effective Date") and ending April 30, 2001,
unless terminated as provided in Sections 5 or 6. This Agreement shall
automatically renew for additional two (2) year terms unless either party
delivers to the other written notice of non-renewal at least sixty (60)
days prior to the end of the term.
(b) Section 3(b) of the Original Agreement is hereby amended
by deleting the comma after the word "Directors", by adding the words "of
Xxxx National Corporation" after "Directors, and deleting the words "but
with a minimum annual bonus of not less than 25% of the Employee's base
annual salary applicable in that year".
(c) Section 5(b) of the Original Agreement is hereby amended
by deleting the word "or" at the end of clause (iii), by deleting the
period at the end of clause (iv) and inserting a semicolon and by inserting
the following after clause (iv):
(v) InPath materially deviates from its business and financial
plan as from time to time approved by the Board of Directors of Xxxx
National Corporation, and such deviation directly results in a material and
adverse change in or to the business of InPath.
2. CHANGE IN CONTROL. Employee agrees that the transactions
contemplated by the Exchange Agreement will not constitute a "Change of
Control," as defined in Section 7(d) of the Original Agreement.
3. REAFFIRMATION OF ORIGINAL AGREEMENT. Except as otherwise
specifically set forth herein, the Original Agreement shall remain in full
force and effect.
IN WITNESS WHEREOF, the undersigned have executed this Amendment No.
1 to the Original Agreement as of the date first set forth above.
/s/ Xxxxx X. Xxxxxxxx
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Xxxxx X. Xxxxxxxx
InPath, LLC
By: /s/ Xxxxx X. Xxxxxxxx
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Its: CEO
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