Exhibit 10.10
SECOND AMENDED AND RESTATED
EMPLOYMENT AGREEMENT
This Second Amended and Restated Employment Agreement (the "Agreement")
shall be effective, as of February 20, 2004, by and between OrthoLogic Corp., a
Delaware corporation (the "Company"), and Xxxxxx X. Xxxxxxx ("Employee").
RECITALS:
A. Employee has been employed by the Company in the position of
President/CEO, pursuant to an Amended and Restated Employment Agreement that was
effective as of July 15, 2002 (the "2002 Employment Agreement"), as amended
August 30, 2003 and further amended December 19, 2003.
B. The parties now wish to amend the 2002 Employment Agreement by
replacing it with this Agreement for all purposes.
AGREEMENTS:
The parties hereby agree as follows:
1. Replacement of 2002 Employment Agreement. Effective
immediately, the 2002 Employment Agreement shall be replaced by this Agreement
for all purposes. The consideration for such amendment and replacement is solely
as stated in this Agreement and neither party shall have any further rights or
duties under the 2002 Employment Agreement.
2. Definitions. Capitalized terms used in this Agreement and not
otherwise defined herein shall have the meanings assigned to them in Exhibit A.
3. Employment and Duties.
(a) Definition of "Election." Within the limitations
described in Sections 9 and 10 of this Agreement, either party may give the
other notice that he or it has elected to begin a three-year transition leading
to the termination of Employee's employment by the Company. Such a notice is
referred to in this Agreement as an "Election" and the date on which an Election
is made is referred to in this Agreement as the "Election Date."
(b) Duties Before an Election. Subject to the terms and
conditions of this Agreement, prior to an Election, the Company employs Employee
to serve in a managerial capacity and as a member of its Board of Directors (the
"Board") and Employee accepts such employment and agrees to perform such
reasonable responsibilities and duties as may be assigned to him from time to
time by the Board. Employee's title shall be President/CEO of the Company, with
general responsibility for Company operations. Employee will report to the
Board. Prior to an Election, the Company shall use its best efforts to maintain
Employee as a member of the Board.
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(c) Duties After an Election. Effective immediately upon
an Election, Employee will report to the Company's President and CEO or to the
Board as determined by the Board. Employee shall not have an official title or
any set work hours. While various projects assigned to Employee may require more
or less time within any given month, it is contemplated that, without his
consent, Employee will not be asked to work on Company matters for more than the
following: (i) during the period commencing on the Election Date and ending on
the first anniversary of the Election Date, 6 days per quarter or 24 days total;
(ii) during the 12-month period following the period described in the foregoing
clause (i), 3 days per quarter or 12 days total; and (iii) during the 12-month
period following the period described in the foregoing clause (ii), 1 day per
quarter or 4 days total. Effective upon an Election, Employee hereby resigns as
an officer of the Company. Employee understands that from and after the
Election, and until the end of the term of this Agreement, the Company will not
provide him with an office, but will provide reasonable secretarial and other
staff support and will provide ancillary office equipment such as a fax machine,
dictating equipment and a desk-top computer that Employee may continue to use
until the end of the term at another location selected by him. After an
Election, Employee shall not be entitled to use any Company owned or supported
laptop computers or cell phones except to the extent required by specific
projects assigned to Employee.
At the Company's option, Employee agrees to continue serving as a
director of the Company after the Election Date and until the Company's 2005
annual meeting of shareholders to assist in the transition to a new CEO and
President, and Employee consents to being named as a nominee in any proxy
statement of the Company relating to the election of directors for a term prior
to the Company's 2005 annual meeting of shareholders
4. Term. Before an Election, Employee's employment shall have an
indefinite term and shall continue until terminated as provided in this
Agreement. Upon an Election, the term of Employee's employment by the Company
shall convert automatically to a term beginning on the Election Date and ending
on the third anniversary of the Election Date. After the Election, any extension
or renewal of such term shall require the written consent of both parties.
5. Compensation.
(a) Salary. (i) Before an Election, the Company shall pay
Employee a minimum base annual salary, before deducting all applicable
withholdings, of $350,000 per year, payable at the times and in the manner
dictated by the Company's standard payroll policies. The minimum base annual
salary shall be reviewed annually, at the end of the Company's fiscal year, by
the Compensation Committee of the Board and may be increased, but shall not be
decreased; (ii) during the period commencing on the Election Date and ending on
the first anniversary of the Election Date, Employee's base annual salary shall
remain at the same level as it was on the Election Date; (iii) during the 12
months following the period described in the foregoing clause (ii), Employee's
base annual salary shall be $330,000, regardless of the level of base annual
salary being paid to Employee prior to the Election Date; and (iv) during the 12
months following the period described in the foregoing clause (iii), Employee's
base annual salary shall be $100,000, regardless of the level of base annual
salary being paid to Employee prior to the Election Date.
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(b) Bonuses. (i) Before an Election, Employee shall be
eligible to participate in an incentive bonus program as developed and adopted,
and as revised from time to time, by the Board. Such program shall be based upon
the achievement of individual goals by Employee and upon Company performance.
The program shall provide for a target bonus of 50% of Employee's base salary
for achievement of a Board-approved plan. (ii) Additionally, Employee shall be
entitled to receive the special bonus as provided in, and subject to the
conditions set forth in, Exhibit B. (iii) Except as provided in Exhibit B,
Employee shall not be entitled to accrue any additional bonus amounts after an
Election occurs, but any bonuses fully earned prior to the Election shall remain
due in accordance with their terms, and any bonuses accruing prior to an
Election pursuant to an incentive bonus program shall be paid on a pro rata
basis depending on the percentage of the bonus measurement period that has
elapsed at the time of the Election.
(c) Stock Options. From time to time, as determined by
the Board in its discretion, the Company shall grant to Employee options to
purchase shares of the Company's common stock, with an exercise price equal to
the fair market value of the stock on the effective date of the grant.
6. Fringe Benefits. Both before and after an Election, Employee
shall be entitled to participate in all employee benefit plans (including
without limitation pension, savings, medical, dental and disability plans)
generally available to employees. The manner of implementation of such benefits
with respect to such items as procedures and amounts are discretionary with the
Company but shall be commensurate with Employee's executive capacity. The
Company agrees to maintain term life insurance during the term of Employee's
employment under this Agreement in an amount equal to two times Employee's base
salary, as it may be adjusted from time to time, with the beneficiary to be
designated by Employee. Until an Election occurs, the Company will also provide
Employee with an automobile expense allowance of $450 per month. Upon Employee's
acceptance of employment with another employer in connection with which Employee
works, or is expected to work, 1,000 hours or more per year, Employee shall no
longer be entitled to participate in any health, dental, retirement or other
employee benefit plans of the Company. During the term of Employee's employment
under this Agreement, Employee shall be considered as an employee for the
purposes of any Company stock option plans.
7. Expenses. In addition to the compensation and benefits
provided above, the Company shall, upon receipt of appropriate documentation,
reimburse Employee each month for his reasonable travel, lodging, entertainment,
promotion and other ordinary and necessary business expenses consistent with
Company policies.
8. Termination.
(a) For Cause. The Company may terminate Employee's
employment for Cause upon written notice to Employee stating the facts
constituting such Cause, provided that Employee shall have 30 days following
such notice to cure any conduct or act, if curable, alleged to provide grounds
for termination for Cause hereunder. In the event of termination for Cause, the
Company's sole obligation under this agreement shall be to pay Employee the
minimum base salary due him through the date of termination and thereafter
Employee shall not be entitled to any incentive bonus, special bonus or other
benefit or payment whatsoever hereunder. The
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written notice shall state the Cause for termination. "Cause" shall include
gross or willful neglect of duty, willful failure to abide by instructions or
policies from or set by the Board of Directors, or conviction of a felony or
misdemeanor punishable by at least one year in prison, or pleading guilty or
nolo contendere to same; provided that the fact that the Company does not
request services from Employee with respect to any period or periods of time
after an Election shall not constitute Cause.
(b) Without Cause. The Company may not terminate
Employee's employment at any time without Cause.
(c) Disability. In the event that, prior to an Election,
Employee fails to perform his duties hereunder on account of illness or other
incapacity for a period of 60 consecutive days, or for 90 days during any
six-month period, an Election shall be deemed to have been made by the Company
the day prior to such illness or other incapacity.
(d) Death. In the event of the death of Employee prior to
an Election, the Election shall be deemed to have been made by the Company on
the day prior to Employee's death, and the Employee's legal representatives
shall be entitled to receive only (i) the proceeds of any appropriate life
insurance policies, (ii) the base salary due Employee through the end of the
term at a time and in a manner similar to when it would have been paid to
Employee if he had survived, except for any change in withholding justified by
the change in circumstances, and (iii) any bonuses payable pursuant to Section
5(b).
(e) Resignation. Employee may resign his employment by
giving notice to the Company, which shall also include his resignations as an
officer and as a director of the Company. In the event of such a resignation,
the Company shall be obligated to pay Employee only the minimum base salary due
him through the effective date of the resignation (any vested options will
remain vested, and will expire as provided in the Company's Stock Option Plan
and Employee's Letter of Grant).
9. Elections by the Company. The Company may make an Election at
any time with or without Cause.
10. Elections by Employee.
(a) After December 31, 2004. Employee may make an
Election at any time after December 31, 2004.
(b) Before January 1, 2005. Employee shall be entitled to
make an Election before January 1, 2005 only if "Good Reason" exists. Good
Reason shall exist if the Company has done any of the following:
(1) failed to maintain Employee's base salary at
the level required by Section 5(a);
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(2) failed to provide for Employee's
participation in the Company's or an
Affiliate's annual bonus plan; stock option
plan or other equity incentive programs; or
group medical, dental, life, disability,
retirement, profit sharing, thrift,
nonqualified and deferred compensation
plans, in each case on a basis comparable to
that enjoyed by other executive employees of
the Company or any of its Affiliates;
(3) failed to provide vacation and perquisites
substantially equivalent to those provided
by the Company or any of its Affiliates to
executive employees;
(4) changed Employee's duties and
responsibilities so that they are not at
least commensurate with those described in
Section 3(b);
(5) changed Employee's primary place of
employment by more than 25 miles from
Employee's current office location or more
than 10 additional miles from Employee's
primary residence; or
(6) terminated or attempted to terminate this
Agreement for Cause if it is thereafter
determined that Cause did not exist under
this Agreement with respect to such
termination.
11. Limitations on Transitional Compensation and Benefits.
(a) General Rules. The Code places significant tax
consequences on Executive and Company if the total payments made to Executive
due, or deemed due, to a Change in Control exceed prescribed limits. For
example, if Executive's "Base Period Income" (as defined below) is $100,000 and
Executive's "Total Payments" exceed 299% of such Base Period Income (the "Cap"),
Executive will be subject to an excise tax under Section 4999 of the Code of 20%
of all amounts paid to him in excess of $100,000. In other words, if Executive's
Cap is $299,999, he will not be subject to an excise tax if he receives exactly
$299,999. If Executive receives $300,000, he will be subject to an excise tax of
$40,000 (20% of $200,000). If an excise tax is imposed on Executive as a result
of the application of Sections 280G and 4999 of the Code, for any reason, due to
this Agreement or otherwise, Company shall pay to Executive a "gross-up
allowance" equal in amount to the sum of (i) the excise tax liability of
Executive on the Total Payments, and (ii) all the total excise, income, and
payroll tax liability of Executive on the "gross-up allowance," further
increased by all additional excise, income, and payroll tax liability thereon,
which increase shall be part of the "gross-up allowance" for purpose of
computing the "gross-up allowance." Company shall indemnify and hold Executive
harmless from such additional tax liability for the income and payroll tax
arising from the "gross-up allowance" and all excise tax arising with respect to
compensation and other payments made to Executive under this Agreement and
excise, income, and payroll tax on the "gross-up allowance," and all penalties
and interest thereon. The purpose and effect of the gross-up allowance is to
cause Executive to have the same net compensation after income, excise, and
payroll taxes that Executive would have if there was no tax under Code Section
4999.
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(b) Special Definitions. For purposes of this Section,
the following specialized terms will have the following meanings:
(1) "Base Period Income." "Base Period Income"
is an amount equal to Executive's
"annualized includable compensation" for the
"base period" as defined in Sections
280G(d)(1) and (2) of the Internal Revenue
Code of 1986, as amended (the "Code") and
the regulations adopted thereunder.
Generally, Executive's "annualized
includable compensation" is the average of
his annual taxable income from the Company
for the "base period," which is the five
calendar years prior to the year in which
the Change of Control occurs.
(2) "Cap" or "280G Cap." "Cap" or "280G Cap"
shall mean an amount equal to 2.99 times
Executive's "Base Period Income." This is
the maximum amount which he may receive
without becoming subject to the excise tax
imposed by Section 4999 of the Code or which
Company may pay without loss of deduction
under Section 280G of the Code.
(3) "Total Payments." The "Total Payments"
include any "payments in the nature of
compensation" (as defined in Section 280G of
the Code and the regulations adopted
thereunder), made pursuant to this Agreement
or otherwise, to or for Executive's benefit,
the receipt of which is contingent or deemed
contingent on a Change of Control and to
which Section 280G of the Code applies.
(c) Inclusion of Successor Sections. For purposes of this
Section 11, any reference to any Section of the Code shall also be deemed a
reference to any Code Section resulting from the modification, amendment,
renumbering or replacement of such Code Section.
(d) Effect of Repeal. If the provisions of Sections 280G
and 4999 of the Code are repealed without succession, this Section 11 shall be
of no further force or effect.
12. Confidential Information. Employee acknowledges that Employee
may receive, or contribute to the production of, Confidential Information. For
purposes of this Agreement, Employee agrees that "Confidential Information"
shall mean any and all information or material proprietary to the Company or
designated as Confidential Information by the Company and not generally known by
non-Company personnel, which Employee develops or of or to which Employee may
obtain knowledge or access through or as a result of Employee's relationship
with the Company (including information conceived, originated, discovered or
developed in whole or in part by Employee). Confidential Information includes
the following types of information and other information of a similar nature
(whether or not reduced to writing) related to the Company's business:
discoveries, inventions, ideas, concepts, research, development, processes,
procedures, "know-how," formulae, marketing or manufacturing techniques and
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materials, marketing and development plans, business plans, customer names and
other information related to customers, price lists, pricing policies, methods
of operation, financial information, employee compensation, and computer
programs and systems. Confidential Information also includes any information
described above which the Company obtains from another party and which the
Company treats as proprietary or designates as Confidential Information, whether
or not owned by or developed by the Company, including Confidential Information
acquired by the Company from any of its Affiliates. Employee acknowledges that
the Confidential Information derives independent economic value, actual or
potential, from not being generally known to, and not being readily
ascertainable by proper means by, other persons who can obtain economic value
from its disclosure or use. Information publicly known without breach of this
Agreement that is generally employed by the trade at or after the time Employee
first learns of such information, or generic information or knowledge which
Employee would have learned in the course of similar employment or work
elsewhere in the trade, shall not be deemed part of the Confidential
Information. Employee further agrees:
(a) To furnish the Company on demand, at any time during
or after employment, a complete list of the names and addresses of all present,
former and potential suppliers, financing sources, clients, customers and other
contacts gained while an employee of the Company in Employee's possession,
whether or not in the possession or within the knowledge of the Company.
(b) That all notes, memoranda, electronic storage,
documentation and records in any way incorporating or reflecting any
Confidential Information shall belong exclusively to the Company, and Employee
agrees to turn over all copies of such materials in Employee's control to the
Company upon request or upon termination of Employee's employment with the
Company.
(c) That while employed by the Company and thereafter
Employee will hold in confidence and not directly or indirectly reveal, report,
publish, disclose or transfer any of the Confidential Information to any person
or entity, or utilize any of the Confidential Information for any purpose,
except in the course of Employee's work for the Company.
(d) That any idea in whole or in part conceived of or
made by Employee during the term of his employment, consulting, or similar
relationship with the Company which relates directly or indirectly to the
Company's current or planned lines of business and is made through the use of
any of the Confidential Information of the Company or any of the Company's
equipment, facilities, trade secrets or time, or which results from any work
performed by Employee for the Company, shall belong exclusively to the Company
and shall be deemed a part of the Confidential Information for purposes of this
Agreement. Employee hereby assigns and agrees to assign to the Company all
rights in and to such Confidential Information whether for purposes of obtaining
patent or copyright protection or otherwise. Employee shall acknowledge and
deliver to the Company, without charge to the Company (but at its expense) such
written instruments and do such other acts, including giving testimony in
support of Employee's authorship or inventorship, as the case may be, necessary
in the opinion of the Company to obtain patents or copyrights or to otherwise
protect or vest in the Company the entire right and title in and to the
Confidential Information.
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13. Loyalty During Employment Term. The provisions of this Section
shall be applicable only during Employee's term of employment hereunder.
Employee agrees that prior to an Election, Employee will devote substantially
all of Employee's business time and effort to and give undivided loyalty to the
Company. Both before and after an Election, Employee will not engage in any way
whatsoever, directly or indirectly, in any business that is competitive with the
Company or its affiliates, nor solicit, or in any other manner work for or
assist any business which is competitive with the Company or its affiliates,
except that, after an Election, Employee may work for or assist a division or
affiliate of an entity which competes with the Company through one or more
separately managed divisions or affiliates so long as Employee has no business
responsibilities, relationship or communication with the competing division or
affiliate. Both before and after an Election, Employee will undertake no
planning for or organization of any business activity competitive with the
Company or its affiliates, and Employee will not combine or conspire with any
other employee of the Company or any other person for the purpose of organizing
any such competitive business activity. However, Employee shall be entitled to
make a passive investment in a publicly traded stock of a competitor of the
Company so long as he does not at any time own more than 5% of the total
outstanding stock of such competitor.
14. Non-competition; Non-solicitation. The parties acknowledge
that Employee will acquire much knowledge and information concerning the
business of the Company and its affiliates as the result of Employee's
employment. The parties further acknowledge that the scope of business in which
the Company is engaged as of the date of execution of this Agreement is
world-wide and very competitive and one in which few companies can successfully
compete. Certain activities by Employee after this Agreement is terminated would
severely injure the Company. Accordingly, until one year after Employee resigns
pursuant to Section 8(e) or Employee's employment is terminated for Cause as
contemplated by Section 8(a), Employee will not:
(a) Engage in any work activity for or in conjunction
with any business or entity that is in competition with or is preparing to
compete with the Company;
(b) Persuade or attempt to persuade any potential
customer or client to which the Company or any of its Affiliates has made a
proposal or sale, or with which the Company or any of its Affiliates has been
having discussions, not to transact business with the Company or such Affiliate,
or instead to transact business with another person or organization;
(c) Solicit the business of any customers, financing
sources, clients, suppliers, or business patrons of the Company or any of its
predecessors or affiliates which were customers, financing sources, clients,
suppliers, or business patrons of the Company at any time during Employee's
employment by the Company, or within three years prior to the commencement of
Employee's employment by the Company, provided, however, that if Employee
becomes employed by or represents a business that exclusively sells products
that do not compete with products then marketed or intended to be marketed by
the Company, such contact shall be permissible; or
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(d) Solicit, endeavor to entice away from the Company or
any of its Affiliates, or otherwise interfere with the relationship of the
Company or any of its Affiliates with, any person who is employed by or
otherwise engaged to perform services for the Company or any of its Affiliates,
whether for Employee's account or for the account of any other person or
organization.
15. Injunctive Relief. It is agreed that the restrictions
contained in Sections 12, 13 and 14 of this Agreement are reasonable, but it is
recognized that damages in the event of the breach of any of those restrictions
will be difficult or impossible to ascertain; and, therefore, Employee agrees
that, in addition to and without limiting any other right or remedy the Company
may have, the Company shall have the right to an injunction against Employee
issued by a court of competent jurisdiction enjoining any such breach without
showing or proving any actual damage to the Company. This Section shall survive
the termination of Employee's employment.
16. Part of Consideration. Employee also agrees, acknowledges,
covenants, represents and warrants that he is fully and completely aware that,
and further understands that, the restrictive covenants contained in Sections
12, 13 and 14 of this Agreement are an essential part of the consideration for
the Company entering into this Agreement and that the Company is entering into
this Agreement in full reliance on these acknowledgments, covenants,
representations and warranties.
17. Time and Territory Reduction. If any of the periods of time
and/or territories described in Sections 12, 13 and 14 of this Agreement are
held to be in any respect an unreasonable restriction, it is agreed that the
court so holding may reduce the territory to which the restriction pertains or
the period of time in which it operates or may reduce both such territory and
such period, to the minimum extent necessary to render such provision
enforceable.
18. Survival. The obligations described in Sections 12 and 14 of
this Agreement shall survive any termination of this Agreement or any
termination of the employment relationship created hereunder.
19. Nondelegability of Employee's Rights and Company Assignment
Rights. Except as otherwise provided in this Agreement, the obligations, rights
and benefits of Employee hereunder are personal and may not be delegated,
assigned or transferred in any manner whatsoever, nor are such obligations,
rights or benefits subject to involuntary alienation, assignment or transfer.
Upon mutual agreement of the parties, the Company upon reasonable notice to
Employee may transfer Employee to an Affiliate of the Company, which Affiliate
shall assume the obligations of the Company under this Agreement. This Agreement
shall be assigned automatically to any entity merging with or acquiring the
Company.
20. Governing Law. This Agreement shall be governed by and
construed and enforced in accordance with the internal laws of the State of
Arizona, exclusive of the conflict of law provisions thereof, and the parties
agree that any litigation pertaining to this Agreement shall be in courts
located in Maricopa County, Arizona.
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21. Attorneys' Fees. If any party finds it necessary to employ
legal counsel or to bring an action at law or other proceeding against the other
party to enforce any of the terms hereof, the party prevailing in any such
action or other proceeding shall be paid by the other party its reasonable
attorneys' fees as well as court costs all as determined by the court and not a
jury.
22. Notices. All notices, demands, instructions, or requests
relating to this Agreement shall be in writing and, except as otherwise provided
herein, shall be deemed to have been given for all purposes (i) upon personal
delivery, (ii) one day after being sent, when sent by professional overnight
courier service from and to locations within the Continental United States,
(iii) five days after posting when sent by United States registered or certified
mail, with return receipt requested and postage paid, or (iv) on the date of
transmission when sent by facsimile with a hard-copy confirmation; if directed
to the person or entity to which notice is to be given at his or its address set
forth in this Agreement or at any other address such person or entity has
designated by notice.
To the Company: OrthoLogic Corp.
0000 X. Xxxxxxxxxx Xx.
Xxxxx, XX 00000
Attention: Chairman of the Board
To Employee: Xxxxxx X. Xxxxxxx
0000 X. Xxxxxxxxxx Xx.
Xxxxx, XX 00000
23. Entire Agreement. This Agreement and the Invention,
Confidential Information and Non-Competition Agreement executed in October 1997
constitute the final written expression of all of the agreements between the
parties (except those relating to Employee's service as a director of the
Company), and are a complete and exclusive statement of those terms. They
supersede all understandings and negotiations concerning the matters specified
herein. Any representations, promises, warranties or statements made by either
party that differ in any way from the terms of these two written Agreements
shall be given no force or effect. The parties specifically represent, each to
the other, that there are no additional or supplemental agreements between them
related in any way to the matters herein contained unless specifically included
or referred to herein. No addition to or modification of any provision of either
of such Agreements shall be binding upon any party unless made in writing and
signed by all parties. To the extent that there is any conflict between this
Agreement and the Invention, Confidential Information and Non-Competition
Agreement, the provisions of this Agreement shall govern.
24. Exhibits. All Exhibits to this Agreement are incorporated
herein by this reference as though fully set forth herein. In the event of any
conflict, contradiction or ambiguity between the terms and conditions in this
Agreement and any of its Exhibits, schedules or attachments, the terms of this
Agreement shall prevail.
25. Construction. The language in all parts of this Agreement
shall in all cases be construed as a whole according to its fair meaning and not
strictly for or against either party.
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The Section headings contained in this Agreement are for reference purposes only
and will not affect the meaning or interpretation of this Agreement in any way.
All terms used in one number or gender shall be construed to include any other
number or gender as the context may require. The parties agree that each party
has reviewed this Agreement and has had the opportunity to have counsel review
the same and that any rule of construction to the effect that ambiguities are to
be resolved against the drafting party shall not apply in the interpretation of
this Agreement or any amendment or any exhibits thereto. Whenever the words
"include," "includes," or "including" are used in the Agreement, they shall be
deemed to be followed by the words "without limitation.
26. Waiver. The waiver by either party of the breach of any
covenant or provision in this Agreement shall not operate or be construed as a
waiver of any subsequent breach by either party.
27. Invalidity of Any Provision. The provisions of this Agreement
are severable, it being the intention of the parties hereto that should any
provisions hereof be invalid or unenforceable, such invalidity or
unenforceability of any provision shall not affect the remaining provisions
hereof, but the same shall remain in full force and effect as if such invalid or
unenforceable provisions were omitted.
28. Counterparts. This Agreement may be executed simultaneously in
any number of counterparts, each of which shall be deemed an original but all of
which together shall constitute one and the same agreement.
29. Binding Effect; Benefits. This Agreement shall be binding upon
and shall inure to the benefit of the parties hereto and their respective heirs,
successors, executors, administrators and assigns. Notwithstanding anything
contained in this Agreement to the contrary, nothing in this Agreement,
expressed or implied, is intended to confer on any person other than the parties
hereto or their respective heirs, successors, executors, administrators and
assigns any rights, remedies, obligations or liabilities under or by reason of
this Agreement.
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This Agreement has been executed by the parties as of February 20,
2004.
ORTHOLOGIC CORP.
(the "Company")
By: /s/ Xxxx X. Xxxxxxxx, III
---------------------------------
Xxxx X. Xxxxxxxx, III
Chairman of the Board
XXXXXX X. XXXXXXX
By: /s/ Xxxxxx X. Xxxxxxx
--------------------------------
"Employee"
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EXHIBIT "A"
DEFINITIONS
I. DEFINITIONS
Capitalized terms used in this Exhibit A and not otherwise defined
herein shall have the meanings assigned to them in the Agreement to which this
Exhibit A is attached (the "Agreement"). Additionally, the following terms shall
have the meanings set forth below.
"Affiliate," means an entity affiliated with the Company.
"Change in Control". For purposes of this Agreement, a "Change in
Control" means any one or more of the following events:
(1) When the individuals who, at the beginning of any period of
two years or less, constituted the Board cease, for any reason, to constitute at
least a majority thereof unless the election or nomination for election of each
new director was approved by the vote of at least two thirds of the directors
then still in office who were directors at the beginning of such period;
(2) A change of control of the Company through a transaction or
series of transactions, such that any person (as that term is used in Section 13
and 14(d)(2) of the Securities Exchange Act of 1934 ["1934 Act"]), excluding
Affiliates of the Company as of the Effective Date, is or becomes the beneficial
owner (as that term is used in Section 13[d] of the 0000 Xxx) directly or
indirectly, of securities of the Company representing 20% or more of the
combined voting power of the Company's then outstanding securities;
(3) Any merger, consolidation or liquidation of the Company in
which the Company is not the continuing or surviving company or pursuant to
which stock would be converted into cash, securities or other property, other
than a merger of the Company in which the holders of the shares of stock
immediately before the merger have the same proportionate ownership of common
stock of the surviving company immediately after the merger;
(4) The shareholders of the Company approve any plan or proposal
for the liquidation or dissolution of the Company; or
Substantially all of the assets of the Company are sold or otherwise
transferred to parties that are not within a "controlled group of corporations"
(as defined in Section 1563 of the Internal Revenue Code of 1986, as amended
(the "Code") in which Parent is a member prior to such sale or transfer.
(5) "Code," means the Internal Revenue Code of 1986, as amended.
****Text has been omitted pursuant to a confidentiality request. Omitted text
has been filed with the Securities and Exchange Commission.
EXHIBIT B
CALCULATION OF SPECIAL BONUS
BONUS UPON A CHANGE IN CONTROL
Upon the closing of a Change in Control prior to the Election Date,
Employee shall be entitled to receive, as a lump sum, a special bonus payment
according to the following schedule:
****
****Text has been omitted pursuant to a confidentiality request. Omitted text
has been filed with the Securities and Exchange Commission.
