EMPLOYMENT AGREEMENT
Exhibit 10(u)
AGREEMENT
(the “Agreement”) dated this February 27, 2007 (the “Effective Date”) made by
and between Presstek, Inc., a Delaware corporation, its parents, subsidiaries,
divisions, or affiliated entities, successors and assigns (the “Employer”), and
Xxxxxxx Xxxx, (the “Employee”).
WHEREAS,
both the Employer and the Employee wish for the Employee to be employed as
Senior Vice President and Chief Financial Officer of the Employer. This is a
full time position. Travel may be necessary for Employee's duties.
NOW,
THEREFORE, in consideration of the promises hereafter contained, and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto AGREE as follows:
1. Consideration. In
consideration for the Employee's execution of this Agreement, the Employer
agrees that the Employee's employment shall continue as set forth in this
Agreement, the Employee shall be permitted access to the Employer's confidential
information and trade secrets and the Employee shall be eligible to receive
post-Term Severance Payments (Section 9) or the Change in Control payment
(Section 12) as set forth in this Agreement (subject to his compliance with
Sections 10 and 11 of this Agreement). The Employee understands, acknowledges
and agrees that the Employee would not receive the consideration specified in
this Section 1, except for the Employee's execution of this Agreement and the
fulfillment of the promises contained herein.
2. Employment. During
the term of this Agreement, the Employee agrees to serve as Senior Vice
President, Chief Financial Officer, and as a Corporate Officer. The Employee
agrees to devote all of his business time and efforts to the performance of his
duties hereunder. The Employee shall at all times report to, and his activities
shall at all times be subject to, the direction and control of the Chief
Executive Officer, and the Board of Directors. The Employee shall exercise such
powers and comply with and perform, faithfully and to the best of his ability,
such directions and duties in relation to the business and affairs of the
Company as may from time to time be vested in or requested of him, and shall not
engage in any other business activity, whether or not for profit, without the
written authorization of the Board of Directors. If Employee shall be elected to
other offices of the Company or any of its affiliates, he shall serve in such
positions without further compensation than provided for in this Agreement. The
Employee shall perform his services under this Agreement at such locations as
may be required by the Company.
3. Employment
Term. “Term,” as used in this Agreement, shall refer to the
Term of this Agreement as defined in this Section. The Term of the employment
under this agreement shall commence on Feb. 28, 2007, (the “Start Date”) and
shall initially end three years thereafter, on the day preceding the third
anniversary of the Start Date, unless terminated sooner in accordance with the
provisions hereof. The Term of employment under this Agreement shall, on each
anniversary of the Start Date thereafter (commencing with the third anniversary
of the Start Date), be automatically extended for an additional year unless the
Employer or the Employee gives written notice to the other, at least 180 days prior to
such anniversary date, that he or it does not concur in such extension. If
neither party gives notice of non-concurrence in such extension, the Term will
be automatically extended for an additional year, unless terminated sooner in
accordance with the provisions hereof.
4. Compensation. The
Employer agrees to pay the Employee during the Term of this Agreement an annual
base salary equal to TWO HUNDRED AND SEVENTY FIVE THOUSAND U.S. DOLLARS And ZERO
CENTS ($275,000) with the salary to be reviewed no less than annually during the
Term of this Agreement by the Board of Directors or Compensation Committee of
the Employer. In the annual salary review, the Board of Directors may compensate
the Employee for increases in the market value of the Employee's duties and
responsibilities hereunder and may provide for performance or merit increases.
The base salary of the Employee shall not be decreased at any time during the
Term of this Agreement from the amount then in effect, unless the Employee
otherwise agrees in writing. The salary shall be payable to the Employee in
accordance with the Employer's payroll system, as determined by the Employer,
but not less frequently than monthly. All payments and benefits in this
Agreement shall be subject to all applicable federal, state and local
withholding, payroll and other taxes.
Participation
in discretionary bonuses, retirement and other employee benefit plans and fringe
benefits shall not reduce the salary payable to the Employee under this Section
4, except as set out herein.
5. Discretionary
Bonuses. Employee will be entitled to a guaranteed cash bonus
for 2007 of $165,000, pro-rated so that Employee is paid one-twelfth (1/12) of
said amount for each full month of service completed during calendar year 2007,
said bonus to be paid by March 1, 2008. During the subsequent term hereof, the
Employee is also eligible to receive a target bonus of sixty percent (60%) of
the Base Salary for each calendar year of full-time employment. Such bonus, if
any, shall be based on the Company's and the Employee's achievement (as
determined by the Company) of certain goals and objectives. Such achievement is
to be determined by the Company's Board of Directors (the “Board”) in its sole
discretion. If the Board determines the Employee is eligible to receive a bonus
under this Section, said bonus shall be paid no later than March 1 of the
following calendar year. Other than the pro-rated 2007 bonus, no bonus under
this paragraph shall be payable to the Employee with respect to any calendar
year during which his employment is terminated, regardless of the manner of such
termination.
6. Stock Option Grant:
Participation in Stock Option, Retirement and Employee Benefit Plans;
Fringe Benefits. Subject to the terms and conditions of the
option agreement annexed hereto as Exhibit A and the Employer's 2003 Stock
Incentive Plan, the Employee shall be granted the right to purchase 250,000
shares of the Company's common stock, of which, the right to purchase 41,666
shares shall vest upon signing of this Agreement. The remaining 208,334 shares
shall vest equally over a period of five (5) years at the rate of 20% per year
on each anniversary date of the commencement of employment. The per share
exercise price for your options grant will be determined by the closing price on
the 27th of February 2007.
Said
options are subject to the earlier vesting, in their entirety, upon a Change in
Control, as that term is defined herein, or, should Employer elect not to renew
this agreement upon expiration of the initial term.
In
addition to the foregoing stock options, the Employee may be entitled to
participate during the Term in any plan or arrangement of the Employer relating
to stock options, stock purchases, pension, thrift, or profit sharing benefits,
or other benefits under qualified or non-qualified deferred compensation plans,
group life insurance, medical coverage, education or any other employee benefits
that the Employer in its sole discretion may adopt or make available for the
benefit of the Employee.
The
Employer fully reserves its rights to change, modify or discontinue any of its
stock purchase, retirement, or employee benefit plans at any time during the
Term of this Agreement in its sole and absolute discretion, and in accordance
with applicable law.
7. Standards. The
Employee shall perform his duties and responsibilities under this Agreement in
accordance with such reasonable standards as are established from time to time
by the Chief Executive Officer and/or Board of Directors of the Employer, in its
sole and absolute discretion.
8. Voluntary Absences;
Vacations. The Employee shall be entitled to an annual paid vacation
during the Term of this Agreement in accordance with the Employer's policy of
executives of four (4) weeks per year. The timing of paid vacations shall be
scheduled in a reasonable manner by the Employee.
9. Termination of
Employment.
The
Employee's employment with the Employer may terminate either by;
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(a)
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termination
by the Board of Directors of the Employer either (i) for Cause (as defined
in Section 9(a)(iii) below) or (ii) without
Cause;
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(b)
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termination
by the Employee either for (i) Good Reason (as defined in Section 9(b)
below or (ii) Not Good Reason (as defined in Section 9(b);
or
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(c)
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death
or disability of the Employee.
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(a) Termination by the
Board.
(i) The
Board of Directors may terminate the Employee's employment at any time, but any
termination by the Employer other than termination for Cause (as defined in
Section 9(a)(iii) below) shall not prejudice the Employee's right to receive
compensation and other benefits under this Agreement, except as otherwise stated
in this Agreement. In the event of a termination for Cause, the Employee shall
have no right to receive payment, compensation or other benefits, including
payment of legal fees and expenses incurred, for any period after termination
for Cause except as otherwise required by law. Where the Employer terminates the
employment of the Employee other than termination for Cause, the Employer shall
continue to be subject to any independent obligation to the Employee under any
employee benefit plan in which the Employee is then a participant. Where the
Employee's employment is terminated for Cause, the Employer shall have no
obligation to continue to be subject to any independent obligations to the
Employee under any employee benefit plan for which the Employee is then a
participant, except as otherwise required by law.
(ii) In
the event that the Employee's employment ceases by reason of the Employer's
termination of the Employee's employment during the Term other than for Cause,
or if either party provides the other party with written notice of the party's
non-concurrence in the automatic extension of the Term, as set forth in Section
3 of this Agreement, the Employer shall be obligated concurrently with the
termination of such employment, in lieu and replacement of the Employee's
entitlement to any compensation and other benefits under this Agreement pursuant
to Section 9(a)(i), to make severance payments to the Employee in an aggregate
amount that is equal to the Employee's then current annual base salary for a
period of one (1) year (collectively, the “Severance Payments”). The Severance
Payments shall be paid after termination of employment in equal monthly
installments according to the Employer's normal payroll practices then in
effect. In the event termination under this subsection occurs before Employee
has completed twelve months of service, Employers obligation to make severance
payments shall be limited to one month of base salary for each completed full
month of service, but in no case less than six months of base
salary.
However,
if the Employer's termination of the Employee's employment without Cause occurs
in connection with, or within one and one-half (1 ½) years after, a “Change in
Control” as defined in Section 12(b) hereof, the amount payable to the Employee
shall be exclusively determined under Section 12(a) as limited by Section 12(c)
hereof, and the Employer shall not be required to make the payments set forth in
this Section. The Severance Payments under this Section 9(a)(ii) shall not be
reduced by any compensation which the Employee may receive for other employment
with another employer after termination of his employment with the Employer. In
addition, the Employee shall be entitled to statutory benefit continuation
rights in accordance with COBRA (or a state law equivalent), provided Employee
makes the appropriate voluntary contribution payments and subject to applicable
law and the requirements of the Company's health insurance plans then in
effect.
Notwithstanding
the foregoing, the Employer shall have no obligation to make any contributions
to any retirement plan applicable to the Employee after the date the Employee
ceases to be employed by the Employer except as may be required by such
applicable plan. Notwithstanding anything stated herein to the contrary, and for
purposes of clarity, should the Employer terminate the Employment of the
Employee for Cause, the Employee shall not be entitled to receive Severance
Payments. In the event of a retirement plan, the Employee shall be entitled to
contributions made by the Employer to the retirement plan on the Employee's
behalf prior to the date of the Employee's termination, which have vested and
for which the Employee is otherwise eligible in accordance with the written
terms of the official plan documents governing any applicable retirement plan.
The Employer shall have no obligation to make the Severance Payments set forth
in this Section unless the Employee fully complies with his obligations under
this Agreement, including, but not limited to, his obligations under Sections 10
and 11 of this Agreement.
(iii) References
in this Agreement to “termination for Cause” shall mean termination on account
of acts or omissions of the Employee which constitute Cause as defined below.
Any determination with respect to a termination for Cause shall require the
approval of the Board of Directors of the Employer. “Cause” shall mean any of
the following:
(A) conviction
of a felony,
(B) theft
from the Employer,
(C) breach
of fiduciary duty involving personal profit,
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(D)
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sustained
and continuous conduct by the Employee which adversely affects the
reputation of the Employer.
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(b) Termination
by the Employee.
The
Employee shall have no right to terminate his employment under this Agreement
prior to the end of the Term of this Agreement, unless such termination is
either for Good Reason (as described in Section 12(a) hereof) (i) in connection
with, or within one (1) and one-half years after, a Change in Control; or (ii)
approved by the Board of Directors of the Employer. For purposes of this
Agreement, the term “Not Good Reason” shall mean such termination by the
Employee of his employment for reasons other than for Good Reason. In the event
that the Employee terminates his employment for Not Good Reason, the Employee
shall have no right to receive compensation or other benefits, including payment
of legal fees and expenses incurred (with exception of paragraph 15), for any
period after such termination except as otherwise required by law. Where the
Employee terminates his employment for Good Reason, the Employer shall continue
to be subject to any independent obligation to the Employee under any employee
benefit plan in which the Employee is then a participant. Where the Employee
terminates his employment for Not Good Reason, the Employer shall have no
obligation to continue to be subject to any independent obligations to the
Employee under any employee benefit plan for which the Employee is then a
participant, except as otherwise required by law.
Notwithstanding
anything stated herein to the contrary, and for purposes of clarity, should the
Employee terminate his Employment for Not Good Reason, the Employee shall not be
entitled to receive Severance Payments as described in Section 9(a)(ii).
However, nothing herein shall in any way affect the Employee's entitlement to
indemnification under Paragraph 15 of the Agreement entitled “Legal Expenses”
unless Employee is terminated by the Employer prior to the Term of this
Agreement for “Cause” (as defined in Section 9(a)(iii) of the Agreement) and the
reason for Employee's termination for "Cause" is related to the claim with
respect to which indemnification is sought.
(c) Death
and Disability.
The
Employee's employment under this Agreement may also cease prior to the end of
the Term of this Agreement in the event of the Employee's death or upon the
Employee becoming "Totally Disabled." For purposes of this Agreement, "Totally
Disabled" shall mean such situation where the Employee, because of injury (the
"Injury") or sickness (the "Sickness"), the Employee is unable to perform the
material duties of his regular occupation for a specified period; and, solely
due to injury or sickness, he is unable to earn more than the percentage of
their Indexed Covered Earnings (as that term is defined in the Employer's
Long-Term Disability Summary Plan Description) from working in his regular
occupation. Thereafter, "Totally Disabled" shall mean such situation where the
Employee is disabled in that his injury or sickness makes his unable to perform
the material duties of any occupation for which he may reasonably become
qualified based on education, training or experience; and solely due to such
Injury or Sickness, he is unable to earn more than the percentage of their
Indexed Covered Earnings (as that term is defined in the Employer's Long-Term
Disability Summary Plan Description). For purposes of this Agreement the
Employee shall be "Totally Disabled" as of the date he becomes entitled to
receive disability benefits under the Employer's long term disability plan. In
the event that the Employee's employment is terminated by his death or upon
becoming "Totally Disabled," the Employee or the Employee's heirs or estate (as
applicable), shall be entitled to receive (i) any accrued but unpaid salary for
services rendered to the date of termination as determined pursuant to Section
4, (ii) any vacation accrued under the Employer's policy to the date of
termination, and (iii) any accrued but unpaid expenses pursuant to Section 14 of
this Agreement. The benefits to which the Employee may be entitled upon
termination pursuant to the plans and arrangements referred to in Section 6 of
this Agreement shall be determined and paid in accordance with the terms of such
plans and arrangements.
(d) The
Employer shall have no obligation to make the payments set forth herein if the
Employee is in material breach of the Employee's obligations under this
Agreement. The Employee shall be obligated to execute a general release of
claims in favor of the Employer, its current and former parents, subsidiaries,
subdivisions, divisions, shareholders, Board of Directors, or affiliated
entities or persons, and the current and former directors, officers, employees
and agents of the Employer, in a form acceptable to the Employer (the
"Release"), as a condition to receiving the Severance Payments described
above.
10. Confidential Information and
Non-Competition.
(a) "Confidential
Information" shall mean trade secrets or confidential information relating to
the Employer, its customers, affiliates and their respective businesses,
including, but not limited to, the identity of the Employer's customers; the
entity of distributors and suppliers of the Employer; the identity of
representatives responsible for entering into contracts with the Employer;
specific customer, distributor and supplier needs and requirements; the details
of contracts and proposals between the Employer and its customers, distributors
and suppliers; selling and marketing strategies, prices, costs and profit
margins; the names, addresses and other contact information of purchasing
agents, vendors or other entities; purchasing techniques, methods, procedures
and processes; manufacturing and production techniques, methods, procedures and
processes; other techniques, methodologies and processes used by the Employer in
the conduct of its business; techniques, methods, procedures, know-how,
show-how, prototypes and technical specifications; computer data, software,
software codes, computer models, research projects, data processing and other
programs; production and manufacturing equipment and operating practices;
information with respect to products and product formulae, designs, plans for
future business, new business, products or other developments; new or innovative
ideas, customer proposals, marketing plans and ideas, and future developments or
strategies; information pertaining to research and development, acquisitions or
divestitures, marketing and sales, cost cutting, revenue generation, or other
matters concerning the Employer's planning and strategy; and other nonpublic
financial and other information of the Employer disclosed to or known by the
Employee as a consequence of or through the Employee's employment (or other
service relationship) with the Employer (including information conceived,
originated, discovered or developed by the Employee), which information is not
generally known in the relevant trade or industry or public knowledge. The
Employee acknowledges and agrees that the Confidential Information is not
generally known or available to the public, but has been developed, compiled or
acquired by the Employer at its great effort and expense. Confidential
Information can be in any form: oral, written or machine readable, including
electronic files.
(b) The
Employee acknowledges and agrees that the Employer is engaged in a highly
competitive business and that its competitive position depends upon its ability
to maintain the confidentiality of the Confidential Information and Trade
Secrets which were developed, compiled and acquired by the Employer at its great
effort and expense. The Employee further acknowledges and agrees that any
disclosure, divulging, revelation or use of any of the Confidential Information,
other than in connection with the Employer's business or as specifically
authorized by the Employer, will be highly detrimental to the Employer, and that
serious loss of business and goodwill and pecuniary damage may result therefrom.
During the Employee's employment with the Employer and thereafter, the Employee
shall hold for the benefit of the Employer, and not for the Employee's own
benefit or disclosure to third parties, all Confidential Information relating to
the Employer and its business, including all Confidential Information of
customers of the Employer (i) obtained by the Employee during the Employee's
employment with the Employer and (ii) not otherwise public knowledge or
generally known in the trade or industry. The Employee shall not, without the
prior written consent of the Employer, unless compelled pursuant to the order of
a court or other governmental or legal body having jurisdiction over such
matter, communicate or divulge any such Confidential Information to anyone other
than the Employer and those designated by it. In the event the Employee is
compelled by order of a court or other governmental or legal body to communicate
or divulge any such Confidential Information to anyone other than the Employer
and those designated by it, the Employee shall promptly notify the Employer of
any such order and the Employee shall cooperate fully with the Employer in
protecting such information to the extent possible under applicable law and will
only disclose that portion of the Confidential Information necessary to satisfy
any such order.
(c) Upon
termination of the Employee's employment with the Company, or at any time the
Company requests, all equipment, property, documents, files, records, notes,
memoranda, designs, reports, price lists, cost sheets, prototypes, blue prints,
technical specifications, estimates, databases, home office equipment,
automobiles, computer equipment, computer files, computer programs, plans,
documents and all other property and Confidential Information of the Employer
(including all copies in all forms in the Employee's possession or control),
whether prepared by the Employee solely or jointly with others, shall be left
with or promptly returned to the Employer and shall at all times be the property
of the Employer.
(d) The
Employee acknowledges and agrees that the Employer is engaged in a highly
competitive business, and by virtue of the Employee's position and
responsibilities with the Employer, and the Employee's access to Confidential
Information, the Employee's engaging in any business which is directly or
indirectly competitive with the Employer will cause it great and irreparable
harm. During the period of employment as an officer and/or employee of the
Employer, the Employee will devote his available business time and best efforts
to promoting and advancing the business of the Employer. During the Term of the
Agreement and for a period of 2 years after termination of such employment (for
any reason whatsoever), the Employee agrees that he will not, in any
jurisdiction around the world in which the Employer conducts business, whether
alone or as a partner, officer, director, consultant, agent, employee or
stockholder of any company or other commercial enterprise, engage in any
business or other commercial activity which is competitive with the products and
services being designed, conceived, marketed, distributed or developed by the
Employer at the time of termination of such employment, unless written approval
is obtained from the Company's Board of Directors. For purposes of this Section,
competitive products and services shall be defined to mean non-photographic
imaging, computer-to-plate, direct-to-press, thermal laser or chemistry-free
printing plate technology products and services or any other products and
services substantially similar to the products and services designed, conceived,
marketed, distributed or developed by the Employer at the time of termination of
the Employee's employment. The Employee acknowledges, understands and agrees
that accepting such competitive employment would cause him to inevitably use,
misappropriate and disclose the Employer's Confidential Information which the
Employee came to learn during his employment with the Employer.
(e) The
Employee acknowledges and agrees that during the course and solely as a result
of the Employee's employment with the Employer, the Employee has and will become
aware of some, most or all of the customers of the Employer, their names and
addresses, their representatives responsible for engaging the services of the
Employer and their specific needs and requirements. The Employee further
acknowledges and agrees that the loss of such customers will cause the Employer
serious loss of business and will be detrimental to the Employer's goodwill and
will cause great and irreparable harm. During the Term of the Agreement and for
a period of one (1) year after termination of employment (for any reason
whatsoever), the Employee will not directly or indirectly either for himself or
for any other person or commercial enterprise (1) divert or take away or attempt
to divert or take away, any of the Employer's customers or business in existence
at the time of termination of such employment that the Employee had contact
with, for whom the Employee performed services during his employment with the
Employer and/or that were made known to the Employee by the Employer during his
employment with the Employer; and/or (2) solicit or attempt to solicit, ask for,
accept, or seek to do business with, for the purpose or effect of engaging in
competition with the Employer, any of the Employer's customers or business in
existence at the time of termination of such employment with whom the Employee
had contact, for whom the Employee performed services during his employment with
the Employer and/or that were made known to the Employee by the Employer during
his employment.
(f) The
Employee acknowledges and agrees that during the course and solely as a result
of the Employee's employment with the Employer, the Employee has and will become
aware of some, most or all of the employees of the Employer, and has and will
acquire knowledge of their qualifications, skills, abilities, salaries,
commissions, benefits and other matters with respect to such employees not
generally known to the public. The Employee further acknowledges and agrees that
any solicitation, luring away or hiring of such employees of the Employer will
cause serious loss of business and will be detrimental to the Employer's
goodwill and will cause great and irreparable harm. During the Term of the
Agreement and for a period of two years after termination of employment (for any
reason whatsoever), the Employee will not directly or indirectly either for
himself or for any other person or commercial enterprise (1) solicit or induce
any employee to terminate his employment relationship with the Employer, and/or
(2) recruit, attempt to recruit, hire, or attempt to hire any employee of the
Employer other than on behalf of the Employer.
(g) The
Employee hereby acknowledges and agrees that the type and periods of
restrictions imposed in Sections 10(a) through 10(f) of this Agreement are fair
and reasonable and are reasonably required for the protection of the Employer's
Confidential Information and the goodwill associated with the business of the
Employer. Further, the Employee acknowledges and agrees that the restrictions
imposed in Sections 10(a) through 10(f) will not prevent him from obtaining
suitable employment after his employment with the Employer ceases or from
earning a livelihood. The Employee hereby acknowledges, agrees and understands
that he would not be entitled to the Severance Payments (as described in Section
9(a)(ii)) or the Change in Control payment (as described in Section 12(a)),
except for his agreement to fulfill his obligations under this Agreement,
including, but not limited to, his obligations under Sections 10 (a) through
10(f) and Section 11 of this Agreement.
11. Assignment of
Inventions. The Employee expressly understands and agrees that
any and all right or interest he may obtain in any designs, trade secrets,
technical specifications and technical data, know-how and show-how, customer and
vendor lists, marketing plans, pricing policies, inventions, concepts, ideas,
works of authorship, documentation, formulae, data, designs, techniques,
discoveries, improvements or intellectual property rights of any kind or any
interest therein (whether or not patentable or registrable under copyright,
trademark or similar statutes (including, but not limited to, the Semiconductor
Chip Protection Act) or subject to analogous protection) that he, whether alone
or jointly with others, authors, conceives, devises, develops, reduces to
practice, or otherwise obtains during the Employee's employment with the
Employer, and that (i) relate to or arise out of his employment with the
Employer; (ii) relate to the Employer's present or planned business or any of
the products or services being designed, conceived, developed, marketed,
manufactured or distributed by the Employer or that may be used in relation
therewith; (iii) result from the use of premises or personal property (whether
tangible or intangible) owned, leased or contracted for or by the Employer; (iv)
result from activities engaged in during the Employer's time; and/or (v) result
from use of Confidential Information of the Employer whether such use occurred
prior to or during the Employee's employment with the Employer (the
"Inventions"), are and shall immediately become the sole and absolute property
of the Employer and its assigns, as works made for hire or
otherwise.
The Employee hereby assigns to the
Employer the sole and exclusive right to such Inventions. The Employee agrees
that he will promptly disclose to the Employer any and all such Inventions, and
that, upon request of the Employer, the Employee will execute and deliver any
and all documents or instruments and take any other action which the Employer
shall deem necessary to assign to and vest completely in the Employer, to
perfect trademark, copyright and patent protection with respect to, or to
otherwise protect the Employer's trade secrets and proprietary interest in such
Inventions. The Employer agrees to pay any and all copyright, trademark and
patent fees and expenses or other costs incurred by the Employee for any
assistance rendered to the Employer pursuant to this Section.
In the event the Employer is unable,
after reasonable effort, to secure the Employee's signature on any letters,
patent, copyright or other analogous protection relating to an Invention, the
Employee hereby irrevocably designates and appoints the Employer and any of its
officers as his agent and attorney-in-fact, to act for and on his behalf and
stead to execute and file any such application or applications and to do all
other lawfully permitted acts to further the prosecution and issuance of letters
patent, copyright or other analogous protection thereon with the same legal
force and effect as if executed by the Employee. The obligations in this Section
shall continue beyond the termination of the Employee's employment.
12. Change in
Control.
(a)
(i) If
during the Term of this Agreement there is a Change in Control of the Employer,
and the Employee's employment with the Employer is terminated involuntarily
(other than for Cause), or voluntarily for Good Reason (as defined below), in
connection with or within one and one-half (1 1/2) years after such Change in
Control, then the Employee shall be entitled to receive a lump sum cash payment
as provided in Section 12(a)(ii) below. The Employer shall have no obligation to
make the payment set forth in this Section unless the Employee fully complies
with his obligations under this Agreement, including, but not limited to, his
obligations under Sections 10 and 11 of this Agreement. The Employer shall have
no obligation to make the payment set forth in this Section in the event of the
Employee's death or upon Employee becoming "Totally Disabled" (as described in
Section 9(a)(c)) on the date of a Change in Control or within one and one-half
(1 1/2) years after such Change in Control. In such event, the payments and
benefits, if any, to which the Employee may be entitled shall be determined in
accordance with Section 9(c) of this Agreement.
(ii) Subject
to Section 12(c) hereof, the lump sum cash payment (the "Payment") shall be in
an amount equal to three (3) times the Employee's average annual base salary
paid to the Employee by the Employer over the five (5) most recent years ending
prior to such Change in Control of the Employer (or such portion of such period
during which the Employee was a full-time employee of the Employer). In
addition, in the event of a Change in Control, all existing options that have
been granted to the Employee shall be subject to immediate vesting.
(iii) As
used herein, the term "Good Reason" means, unless previously consented to in
writing by the Employee, the occurrence of any one of the
following:
(A) the
assignment to the Employee of duties and responsibilities that are not at least
substantially equivalent to the Employee's duties and responsibilities with the
Employer immediately prior to such Change in Control;
(B) the
failure to continue the Employee in a position and title that is at least
substantially equivalent to the position held by the Employee with the Employer
immediately prior to such Change in Control, except in connection with the
termination of the Employee's employment for Cause or as a result of death or
upon the Employee becoming Totally Disabled (as described in Section
9(2)(c));
(C) a
reduction in or failure to pay currently total annual cash compensation in an
amount equal to or greater than the sum of (i) the Employee's salary at the
highest annual rate in effect during the 12-month period immediately prior to
such Change in Control, and (ii) the bonus paid to similarly situated employees
pursuant to the acquiring Employer's executive bonus plan for the fiscal year
ending immediately prior to such Change in Control, provided that bonus
eligibility is never less than the 60% provided for in this
agreement.
(D) the
Employee's benefits under any employee benefit or welfare plan of the acquiring
Employer are less, or are reduced to less (subject to Employer's right to
provide equivalent benefits in cash or otherwise in kind), other than reductions
mandated by a change in law, than the benefits of similarly situated employees
under any employee benefit or welfare plan of the acquiring Employer in effect
immediately prior to such Change in Control;
(E) the
Employee is reassigned to a place of business which is more than 35 miles from
the current Employer's headquarters; or
(F) any
material breach by the Employer of this Agreement.
(iv) Payment
under this Section 12(a) shall be in lieu of any amount owed to the Employee as
severance payments for termination without Cause under Sections 9(a) hereof.
However, payment under this Section 12(a) shall not be reduced by any
compensation which the Employee may receive from other employment with another
employer after termination of his employment with the Employer. The Employer
shall have no obligation to make any contributions to any retirement plan that
may be applicable to the Employee after a Change in Control of the Employer. The
Employee shall be entitled to contributions made by the Employer to any
retirement plan that may be applicable to the Employee on the Employee's behalf
prior to a Change in Control of the Employer, which have vested and for which
the Employee is otherwise eligible in accordance with the written terms of the
official plan documents governing any applicable retirement plan.
(b) A
"Change in Control of the Employer," for purposes of this Agreement, shall be
deemed to have taken place if as the result of, or in connection with, any cash
tender or exchange offer, merger, or other business combination, sale of assets
or contested election, or any combination of the foregoing transactions, the
persons who were directors of the Employer before such transaction shall cease
to constitute a majority of the Board of Directors of the Employer or any
successor institution.
(c) The
Employer shall have no obligation to make the payments set forth herein if the
Employee is in material breach of the Employee's obligations under this
Agreement. The Employee shall be obligated to execute a general release of
claims in favor of the Employer, its current and former parents, subsidiaries,
subdivisions, divisions, shareholders, Board of Directors, or affiliated
entities or persons, and the current and former directors, officers, employees
and agents of the Employer, in a form acceptable to the Employer (the
"Release"), as a condition to receiving the payments set forth in this
Section.
13. Remedies. The
Employee acknowledges and agrees that compliance with the covenants set forth in
this Agreement is necessary to protect the business and goodwill of the Employer
and that any breach of Sections 10 through 11 of this Agreement will result in
irreparable and continuing harm to the Employer, for which money damages may not
provide adequate relief. Accordingly, in the event of any breach or anticipatory
breach of Sections 10 and 11 by the Employee, the Employer and the Employee
agree that the Employer shall be entitled to the following particular forms of
relief as a result of such breach, in addition to any remedies otherwise
available to it at law or equity: (a) injunctions, whether temporary,
preliminary or permanent, enjoining or restraining such breach or anticipatory
breach, and the Employee hereby consents to the issuance thereof forthwith and
without bond by any court of competent jurisdiction; and (b) recovery of all
reasonable sums and costs, including attorneys' fees, incurred by the Employer
to enforce the provisions of Sections 10 and 11.
14. Expenses: Automobile
Allowance.
(a) The
Employee is authorized to incur, during the Term of this Agreement, reasonable
expenses for promoting the business of the Employer, including without
limitation expenses for entertainment, travel and similar items. The Employer
will promptly reimburse the Employee for all such expenses, upon the
presentation by the Employee, from time to time, of an itemized account of such
expenses.
(b) During
the Term of this Agreement, the Employer shall provide Employee with an
automobile allowance of $1000 per month, and the Employer shall reimburse the
Employee (upon submission by him of reasonably itemized accounts thereof) for
all gasoline, tolls, and parking.
15. Legal Expenses. The
Employer shall indemnify and hold harmless the Employee from and against any and
all costs and liabilities, including without limitation reasonable attorneys'
fees, arising out of or in connection with becoming, being or having been an
officer or director of the Employer, except in relation to matters as to which
the Employee shall be finally adjudged not to have acted in good faith in the
reasonable belief that his action or failure to act was in the best interest of
the Employer.
16. Successors and Assigns;
Assumption by Successors. All rights hereunder shall inure to the benefit
of the parties hereto, their personal or legal representatives, heirs,
successors or assigns. This Agreement may not be assigned or pledged by the
Employee. The Employer will require any successor (whether direct or indirect,
by purchase, assignment, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Employer in any
consensual transaction expressly to assume this Agreement and to agree to
perform hereunder in the same manner and to the same extent that the Employer
would be required to perform if no such succession had taken place. References
herein to the Employer will be understood to refer to the successor or
successors of the Employer, respectively.
17. Other Contracts. The
Employee shall not, during the Term of this Agreement, have any other paid
employment (other than with a subsidiary or affiliate of the Employer), except
with the prior approval of the Board of Directors of the Employer.
18. Entire Agreement.
This Agreement constitutes the entire agreement between the parties with respect
to the subject matter contained herein, and supersedes all prior employment
agreements and understandings, whether written or oral, except for the
Employer's Code of Business Conduct and Ethics, Corporate Communications
Disclosure Procedures, Xxxxxxx Xxxxxxx Policy Statement and 2003 Stock Incentive
Plan which are incorporated herein by reference.
19. Amendments or
Additions. There are currently no oral representations,
agreements or understandings which affect the enforceability of this Agreement,
and no alteration or variation of the terms of this Agreement can be valid
unless made in writing and signed by both parties, wherein specific reference is
made to this Agreement.
20. Section
Headings. The section headings used in this Agreement are
included solely for convenience and shall not affect, or be used in connection
with, the interpretation of this Agreement.
21. Severability. Each
promise and provision contained in this Agreement shall be enforceable
independently of every other promise and provision in this Agreement. If any
provision contained in this Agreement is determined to be partially or totally
invalid or unenforceable in any respect, such determination shall not affect any
other provision of this Agreement, but this Agreement shall be considered
divisible as to such provision which shall become null and void, leaving the
remainder of this Agreement in full force and effect.
22. Governing Law. This
Agreement shall be governed by the laws of the United States where applicable
and otherwise by the laws of the State of New Hampshire, without giving effect
to the conflicts of laws principles thereof.
23. Arbitration of Disputes and
Jury Waivers.
(a) The
parties hereto agree to arbitrate any dispute, claim, or controversy ("claim")
against each other arising out of the cessation of the Employee's employment,
any claim of unlawful discrimination or harassment that might or did arise
during or as a result of the Employee's employment which could have been brought
before an appropriate government administrative agency or in an appropriate
court, including but not limited to claims of age discrimination under the Age
Discrimination in Employment Act of 1967, as amended, as well as any claim or
controversy arising under this Agreement. The Arbitration shall be arbitrated by
one arbitrator in accordance with the National Rules for the Resolution of
Employment Disputes of the American Arbitration Association. The decision or
award of the arbitration shall be final and binding upon the parties. Any
arbitral award may be entered as a judgment or order in any court of competent
jurisdiction. Any claims under Sections 10 and 11 of this Agreement shall not be
subject to arbitration, but shall be subject to the remedies set forth in
Section 13 hereof.
(b) If
for any reason this arbitration provision is declared unenforceable, the
Employee agrees to waive any right he may have to a jury trial with respect to
any dispute or claim against the Employer relating to this Agreement, his
employment, termination or any terms and conditions of employment, including,
but not limited to claims of age discrimination under the Age Discrimination in
Employment Act of 1967, as amended.
(c) The
Employee has been advised of his right to consult with counsel regarding this
Agreement. The Employee's acceptance of this Agreement can be revoked any time
within seven (7) days of signing this Agreement, but such revocation must be
signed and in writing. The Employee has been afforded at least twenty-one (21)
days to consider this Agreement.
IN
WITNESS WHEREOF, the parties have knowingly and voluntarily executed this
Agreement this 27th day of February, 2007.
PRESSTEK, INC. (the
“Employer”)
By: /s/
Xxxxxx X. Xxxxxx
Xxxxxx X.
Xxxxxx
Chief
Executive Officer,
By
Direction
Of the
Compensation Committee of the
Board of
Directors
/s/
Xxxxxxx Xxxx
Xxxxxxx
Xxxx
(the
"Employee")
