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EXHIBIT K
EMPLOYMENT AGREEMENT, dated as of October 2, 1995, between Innotech, Inc.,
a corporation organized under the laws of the State of Delaware ("Employer"),
and Xxxxxx Xxxxxxx ("Executive").
WHEREAS, Executive desires to provide services to Employer and Employer
desires to retain the services of Executive;
WHEREAS, Employer and Executive desire to formalize the terms and
conditions of Executive's employment with Employer.
NOW, THEREFORE, Employer and Executive hereby agree as follows:
1. Employment.
1.1. General. Employer hereby employs Executive in the capacity of
Vice President of Marketing. Executive hereby accepts such employment, upon
the terms and subject to the conditions herein contained.
1.2. Duties. During the Executive's employment with Employer,
Executive will report directly to the Chief Operating Officer, will be
responsible for performing those duties consistent with the position of
vice president of marketing and for performing such other duties as may
from time to time be assigned to or requested of Executive by Employer's
Chief Operating Officer, President or Chairman of the Board and/or the
Board of Directors (the "Board"). Executive shall use his reasonable
efforts to perform faithfully and effectively such responsibilities.
Executive shall conduct all of his activities in a manner so as to maintain
and promote the business and reputation of the Employer.
1.3. Full-Time Position. Executive, during his employment with
Employer, will devote all of his business time, attention and skills to the
business and affairs of Employer.
1.4. Location of Employment. Executive's place of employment during
his employment with Employer shall be in Roanoke, Virginia. Notwithstanding
anything to the contrary in this Agreement, in the event Employer requires
Executive to relocate to a location outside of the metropolitan Roanoke
area and Executive fails to so relocate, such failure shall not be deemed
to be grounds for termination for "Cause" (as defined in Section 3.2.3.
hereof).
1.5. Relocation. Employer will reimburse to Executive relocation
costs associated with his moving from Atlanta, Georgia to Roanoke, Virginia
in an amount not to exceed $10,000. Notwithstanding anything to the
contrary in this Agreement, if Executive has not moved to Roanoke, Virginia
on or before January 1, 1996, this Agreement will terminate, and Executive
shall not be entitled to any payments pursuant to Section 3.3.2 hereof.
2. Compensation and Benefits.
2.1. Salary. Employer will pay to Executive, and Executive will
accept, as full compensation for any and all services rendered and to be
rendered by him to Employer in all capacities during the term of his
employment under this Agreement, (i) a base salary at the annual rate of
$115,000 or at such rate as the Board, in its sole discretion, may
hereafter from time to time grant to Executive ("Base Salary"), payable in
accordance with the regular payroll practices of Employer, and (ii) the
additional benefits hereinafter set forth in this Section 2.
2.2. Additional Compensation. Executive shall be entitled to
participate in the Employer's Management Incentive Compensation Plan
commencing on the date hereof and shall be entitled to any awards granted
pursuant to the terms thereof as determined by the Board.
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2.3. Executive Benefits.
2.3.1. Expenses. Employer will reimburse Executive for expenses
he reasonably incurs in connection with the performance of his duties
(including business travel and entertainment expenses), all in
accordance with Employer's policies with respect thereto.
2.3.2. Employer Plans. Executive will be entitled to participate
in such executive benefit plans and programs as Employer may from time
to time offer or provide to executives of Employer, including, but not
limited to, participation in life insurance, health and accident and
medical plans and programs.
2.3.3. Vacation. Executive shall be eligible for paid vacation
leave, accruing one day of leave for each 5.2 weeks of employment, or 10
days of paid leave per year. Executive shall be able to accrue vacation
days from year to year in accordance with Employer's published vacation
policies . Such vacation time shall be at such times as shall be
approved by the Chief Operating Officer, President or Chairman of
Employer.
3. Termination of Employment.
3.1. Termination. Executive's employment by Employer pursuant to
this Agreement shall commence on the date hereof and will continue until
the second anniversary of the date of this Agreement. Thereafter, each
party will have the option of continuing this Agreement on such terms and
conditions as they may mutually agree. Upon termination of Executive's
employment with Employer pursuant to Sections 3.2.2 through 3.2.6 hereof,
inclusive, Executive will be released from any duties and obligations
hereunder (except those duties and obligations set forth in Sections 4,
5.11,.12 and 5.13 hereof) and the obligations of Employer to Executive will
be as set forth in Section 3.3 hereof.
3.2. Events of Termination. Executive's employment with Employer
will terminate upon the occurrence of any one or more of the following
events:
3.2.1. Death. In the event of the Executive's death, Executive's
employment will terminate on the date of death.
3.2.2. Disability. In the event of Executive's Disability (as
hereinafter defined), Employer will have the option to terminate
Executive's employment by giving a Notice of Termination to Executive.
The Notice of Termination shall specify the date of termination, which
date shall not be earlier than thirty (30) days after the Notice of
Termination is given. For purposes of this Agreement, "Disability" means
the inability of Executive to substantially perform his duties hereunder
for 90 days out of 180 consecutive days as a result of a physical or
mental illness, all as determined in good faith by the Board.
3.2.3. Termination by Employer for Cause. Employer may, at its
option, terminate Executive's employment for "Cause" based on objective
factors determined in good faith by a majority of the Board by giving a
Notice of Termination to Executive specifying the reasons for
termination and if Executive shall fail to cure same within ten (10)
days of his receiving the Notice of Termination his Employment shall
terminate at the end of such ten (10) day period; provided, that in the
event the Board in good faith determines that the underlying reasons
giving rise to such determination cannot be cured, then said cure period
shall not apply and Executive's employment shall terminate on the date
of Executive's receipt of the Notice of Termination. "Cause" shall mean
(i) Executive's conviction of, guilty plea to, or confession of guilt
of, a felony, (ii) dishonest or illegal conduct or misconduct or
malfeasance by Executive in the performance of services for or on behalf
of the Employer, or other conduct detrimental to the business,
operations or reputation of the Employer, regardless of whether such
conduct is within the scope of Executive's duties, (iii) failure by
Executive to perform his duties, as assigned to him by the Chief
Executive Officer, President, Chairman or the Board from time to time,
(iv) violation by Executive of the covenants set forth in this
Agreement, (v) the filing by or against Executive of any bankruptcy,
insolvency or reorganization proceeding, (vi) except as may be permitted
herein, disclosure of Confidential Information (as
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defined in Section 4.1 hereof) without the prior written consent of
Employer and (vii) Executive's failure to move to Roanoke, Virginia on
or prior to January 1, 1996.
3.2.4. Without Cause By Employer. Employer may, at its option,
terminate the Executive's employment for any reason whatsoever (other
than for the reasons set forth above in this Section 3.2) by giving a
Notice of Termination to Executive, and Executive's employment shall
terminate on the later of the date the Notice of Termination is given or
the date set forth in such Notice of Termination.
3.2.5. Employer's Material Breach. Executive may, at his option,
terminate the Executive's employment upon Employer's material breach of
this Agreement by giving Employer written notice of such breach (which
notice will identify the manner in which Employer has materially
breached this Agreement) and if such breach is not cured within thirty
(30) days of Employer receiving such written notice, the Executive's
employment shall terminate at the end of such thirty (30) day period.
Employer's "Material Breach" of this Agreement shall mean (i) the
failure of Employer to pay Base Salary or additional compensation
hereunder in accordance with this Agreement or (ii) the assignment to
Executive without Executive's consent of duties substantially
inconsistent with his duties as set forth in Section 1.2 hereof.
3.2.6. Without Cause By Executive. Executive may terminate the
Executive's employment for any reason whatsoever by giving a Notice of
Termination to Employer. The Executive's employment shall terminate on
the earlier of (i) the date, following the date of the Notice of
Termination, upon which a suitable replacement for Executive is found by
the Employer, or (ii) 5 days after the date of receipt by Employer of
the Notice of Termination.
3.3. Certain Obligations of Employer Following Termination of the
Executive's Employment. Following the termination of the Executive's
employment under the circumstances described below, Employer will pay to
Executive in accordance with its regular payroll practices the following
compensation and provide the following benefits in full satisfaction and
final settlement of any and all claims and demands that Executive now has
or hereafter may have hereunder against Employer:
3.3.1. Death; Disability. In the event that the Executive's
employment is terminated by reason of Executive's death or Disability,
Executive or his estate, as the case may be, shall be entitled to the
following payments:
(i) Base Salary through the date the Executive's employment is
terminated; and
(ii) Employer shall pay to Executive or his estate, as the case
may be, the amounts and shall provide all benefits generally
available under the employee benefit plans, and the policies and
practices of Employer, determined in accordance with the applicable
terms and provisions of such plans, policies and practices, in each
case, as accrued to the date of termination or otherwise payable as a
consequence of Executive's death or Disability.
3.3.2. Without Cause by Employer; Material Breach by Employer. In
the event that the Executive's employment is terminated by Employer
pursuant to Section 3.2.4 hereof or by Executive pursuant to Section
3.2.5 hereof, Executive shall be entitled to the following payments:
(i) Base Salary through the date the Executive's employment is
terminated; and
(ii) a pro-rata portion of any amounts Executive would be
entitled to under the MICP, if any, accrued on or prior to date
Executive's employment is terminated for any reason hereunder.
(iii) continuing payments of Base Salary, payable in accordance
with the regular payroll practices of Employer, for six (6) months
following the date of termination of Executive's employment.
3.3.3. Termination by Executive Without Cause or by Employer for
Cause. In the event the Executive's employment is terminated by
Executive pursuant to Section 3.2.6 hereof or by Employer
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pursuant to Section 3.2.3 hereof, Executive shall be entitled to no
further compensation or other benefits under this Agreement except as to
that portion of any unpaid Base Salary and other benefits accrued and
earned by him hereunder up to and including the effective date of such
termination. In addition, Executive shall be entitled to receive any
additional compensation earned but not yet paid with respect only to any
calendar year prior to the calendar year of termination.
3.4. Nature of Payments. All amounts to be paid by Employer to
Executive pursuant to this Section 3 are considered by the parties to be
severance payments. In the event such payments are treated as damages, it
is expressly acknowledged by the parties that damages to Executive for
termination of employment would be difficult to ascertain and the above
amounts are reasonable estimates thereof.
4. Confidentiality; Nonsolicitation; Non-Compete.
4.1. Confidential Information Defined. "Confidential Information"
means any and all information (oral or written) relating to Employer or any
person controlling, controlled by, or under common control with Employer or
any of their respective activities, including, but not limited to,
information relating to: discoveries, innovations, chemistry, patents,
patent applications, know how, secret processes, research, test procedures
and results, machinery and equipment; manufacturing processes; financial
information; products; identity and description of materials and services
used; purchasing; costs; pricing; customers and prospects; advertising,
promotion and marketing; trademarks and trademark registrations; copyrights
and copyright registrations; and information pertaining to any governmental
investigation, except such information which can be shown by Executive to
be generally in the public domain (such information not being deemed to be
in the public domain merely because it is embraced by more general
information which is in the public domain), other than as a result of a
breach of the provisions of Section 4.2 hereof.
4.2. Nondisclosure of Confidential Information. Executive will not,
at any time (other than as may be required or appropriate in connection
with the performance by him of his duties hereunder) directly or
indirectly, use, communicate, disclose or disseminate any Confidential
Information in any manner whatsoever (except as may be required under legal
process by subpoena or other court order; provided, that, Executive will
take reasonable steps to give Employer sufficient prior written notice in
order to contest such requirement or order).
4.3. Certain Activities. Executive will not while employed by
Employer and thereafter, directly or indirectly, hire, offer to hire,
entice away or in any other manner persuade or attempt to persuade any
officer, employee, agent, lessor, lessee, licensor, licensee, customer,
prospective customer, supplier or shareholder or prospective shareholder of
Employer to discontinue or alter his or its relationship with Employer.
4.4. Covenant Not to Compete. During the Executive's employment and
for a period of two (2) years after the termination of Executive's
employment, Executive will not directly or indirectly engage in competition
with Employer by being associated with any competitor of Employer that
sells or offers to sell any products or services which compete with the
products or services offered or sold by Employer or being developed by
Employer for sale at the time of termination of the Executive, or induce or
attempt to induce, directly or indirectly, any then current or potential
customer of Employer to cease doing business, in whole or in part, with
Employer or solicit business of any such customer for any products or
services of any competitor of Employer which compete with the products or
services offered or sold by Employer or being developed by Employer for
sale at the time of termination of the Executive. Notwithstanding the
foregoing, in the event Executive's employment is terminated by Employer
without Cause or due to Employer's Material Breach of this Agreement, this
Section 4.4 shall only apply to the products or services offered or sold by
Employer that relate to its SurfaceCasting technology.
4.5. Injunctive Relief. Executive acknowledges and agrees that (a)
Employer will be irreparably injured in the event of a breach by Executive
of any of his obligations under this Section 4; (b) monetary damages will
not be an adequate remedy for any such breach; (c) Employer will be
entitled to injunctive relief, in addition to any other remedy which it may
have, in the event of any such breach, including, but
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not limited to, termination of the Executive's employment for Cause; and
(d) the existence of any claims which Executive may have against Employer,
whether under this Agreement or otherwise, will not be a defense to the
enforcement by Employer of any of its rights under this Section 4.
4.6. Nonexclusivity and Survival. The covenants and obligations of
Executive contained in this Section 4 are in addition to, and not in lieu
of, any covenants and obligations which Executive may have with respect to
the subject matter hereof, whether by contract, as a matter of law or
otherwise, and such covenants and obligations, and their enforceability,
will survive any termination of the Executive's employment by either party
and any investigation made with respect to the breach thereof by Employer
at any time.
5. Miscellaneous Provisions.
5.1. Severability. If in any jurisdiction any term or provision
hereof is determined to be invalid or unenforceable, (a) the remaining
terms and provisions hereof shall be unimpaired, (b) any such invalidity or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction, and (c) the invalid
or unenforceable term or provision shall, for purposes of such
jurisdiction, be deemed replaced by a term or provision that is valid and
enforceable and that comes closest to expressing the intention of the
invalid or unenforceable term or provision.
5.2. Execution in Counterparts. This Agreement may be executed in
one or more counterparts, and by the different parties hereto in separate
counterparts, each of which shall be deemed to be an original but all of
which taken together shall constitute one and the same agreement (and all
signatures need not appear on any one counterpart), and this Agreement
shall become effective when one or more counterparts has been signed by
each of the parties hereto and delivered to each of the other parties
hereto.
5.3. Notices. All notices, requests, demands and other
communications hereunder shall be in writing and shall be deemed duly given
when delivered by hand, or when delivered if mailed by registered or
certified mail or private courier service, postage prepaid, return receipt
requested or via facsimile (with written confirmation of receipt) as
follows:
If to Employer, to:
InnoTech, Inc.
0000 Xxxxxxx Xxxx
Xxxxxxx, XX 00000
Attention: Dr. Xxxxxx Xxxx, Chairman
Telefax No.: (000) 000-0000
Copy to:
Xxxx X. Xxxxxxx, Esq.
c/x Xxxxxxx, Calamari & Xxxxxxx
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Telefax No.: (000) 000-0000
If to Executive, to:
Xx. Xxxxxx Xxxxxxx
000 Xxxxxxxxxxx Xxxxx
Xxxxxx, Xxxxxxx 00000
or to such other address(es) as a party hereto shall have designated by
like notice to the other parties hereto.
5.4. Amendment. No provision of this Agreement may be modified,
amended, waived or discharged in any manner except by a written instrument
executed by Employer and Executive.
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5.5. Entire Agreement. This Agreement constitutes the entire
agreement of the parties hereto with respect to the subject matter hereof,
and supersedes all prior agreements and understandings of the parties
hereto, oral or written, with respect to the subject matter hereof.
5.6. Applicable Law. This Agreement shall be governed by and
construed in accordance with the laws of the Commonwealth of Virginia
applicable to contracts made and to be wholly performed therein without
regard to its conflicts or choice of law provisions.
5.7. Headings. The headings contained herein are for the sole
purpose of convenience of reference, and shall not in any way limit or
affect the meaning or interpretation of any of the terms or provisions of
this Agreement.
5.8. Binding Effect; Successors and Assigns. Executive may not
delegate his duties or assign his rights hereunder. This Agreement will
inure to the benefit of, and be binding upon, the parties hereto and their
respective heirs, legal representatives, successors and permitted assigns.
5.9. Waiver, etc. The failure of either of the parties hereto to at
any time enforce any of the provisions of this Agreement shall not be
deemed or construed to be a waiver of any such provision, nor to in any way
affect the validity of this Agreement or any provision hereof or the right
of either of the parties hereto to thereafter enforce each and every
provision of this Agreement. No waiver of any breach of any of the
provisions of this Agreement shall be effective unless set forth in a
written instrument executed by the party against whom or which enforcement
of such waiver is sought, and no waiver of any such breach shall be
construed or deemed to be a waiver of any other or subsequent breach.
5.10. Capacity, etc. Executive and Employer hereby represent and
warrant to the other that: (a) he or it has full power, authority and
capacity to execute and deliver this Agreement, and to perform his or its
obligations hereunder; (b) such execution, delivery and performance will
not (and with the giving of notice or lapse of time or both would not)
result in the breach of any agreements or other obligations to which he or
it is a party or he or it is otherwise bound; and (c) this Agreement is his
or its valid and binding obligation in accordance with its terms.
5.11. Enforcement. If any party institutes legal action to enforce
or interpret the terms and conditions of this Agreement, the prevailing
party shall be awarded reasonable attorneys' fees at all trial and
appellate levels, and the expenses and costs incurred by such prevailing
party in connection therewith. Venue for any such action shall exclusively
be Roanoke, Virginia.
5.12. Arbitration.
(i) Any dispute under Section 3 hereof, including but not limited
to the determination by the Board of a termination for Cause pursuant to
Section 3.2.3 hereof or in respect of the breach thereof will be settled
by arbitration in Roanoke, Virginia. The arbitration will be
accomplished in the following manner. Either party may serve upon the
other party written demand that the dispute, specifying the nature
thereof, shall be submitted to arbitration. Within ten (10) days after
the service of such demand, each of the parties will designate an
arbitrator and serve written notice of such appointment upon the other
party. If either party fails within the specified time to appoint such
arbitrator, the other party will be entitled to appoint both
arbitrators. The two (2) arbitrators so appointed will appoint a third
arbitrator.
(ii) The decision of the arbitrators will be final and binding upon
the parties. The arbitration will be conducted, to the extent consistent
with this Section 5.12, in accordance with the then prevailing rules of
commercial arbitration of the American Arbitration Association or its
successor.
5.13. Continuing Effect. Where the context of this Agreement
requires, the respective rights and obligations of the parties shall
survive any termination or expiration of the term of this Agreement.
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WITNESS WHEREOF, this Agreement has been executed and delivered by the
parties hereto as of the date first above written.
INNOTECH, INC.
By: /s/ Xxxxxx X. Xxxx
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Xxxxxx X. Xxxx
Chairman and Chief
Executive Officer
/s/ Xxxxxx Xxxxxxx
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XXXXXX XXXXXXX
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