NICOLLET PROCESS ENGINEERING, INC.
EMPLOYMENT AGREEMENT
WITH
This Employment Agreement (the "Agreement") is effective as of SEPTEMBER 1, 1998
by and between NICOLLET PROCESS ENGINEERING, INC. (the "Company") and XXXXXX X.
XXXXXX (the "Employee").
RECITALS
WHEREAS, the Company desires to employ Employee and Employee desires to be
employed by the Company;
WHEREAS, Employee and the Company recognize the importance of protecting
the Company's rights with respect to its business information and inventions as
well as its business relationships and goodwill;
WHEREAS, the Company and the Employee agree that it is fair to provide
Employee severance pay in the event Employee is terminated and unable to find
new employment as a result of his agreement not to compete with the Company;
NOW THEREFORE, in consideration of the foregoing and the mutual promises
contained in this Agreement, the parties, intending to be legally bound, agree
as follows:
1. DEFINITIONS. As used in this Agreement:
(a) "Company" means Nicollet Process Engineering, Inc., its
successors and assigns, and any of its present or future subsidiaries, or
organizations controlled by, controlling, or under common control with it.
(b) "Confidential Information" means any and all information
disclosed or made available to the Employee or known by the Employee as a direct
or indirect consequence of, or through, his employment by the Company and not
generally known in the industry in which the Company is, or may become, engaged,
or any information related to the Company's products, processes, or services,
including, but not limited to, information relating to research, development,
Inventions (as hereinafter defined), manufacture, purchasing, accounting,
engineering, marketing, merchandising, selling, or methods of doing business.
Any information that Employee reasonable considers Confidential Information, or
that the Company treats as confidential Information, will be presumed to be
Confidential Information (whether Employee or others originated it and
regardless of how Employee obtained it). Notwithstanding the foregoing,
"Confidential Information" does not include any information which is properly
published or in
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the public domain; provided, however, that information which is published by or
with the aid Employee outside the scope or contrary to the requirements of this
Agreement will not be considered to have been properly published, and therefore
will not be in public domain for purposes of this Agreement.
(c) "Inventions" means discoveries, improvements, concepts,
ideas, and works of authorship, whether patentable or copyrightable or not,
whether or not they are in writing or reduced to practice, relating to any
present or prospective activities of the Company, including, but not limited to,
devices, processes, methods, formulae, techniques, computer software and
programs, and any improvements to the foregoing.
(d) "Company Monthly Base Pay" means the Employee's last monthly
remuneration, prior to termination of his employment with the Company, before
federal, state, and local taxes and other withholding, but exclusive of extra
compensation, such as that attributable to bonuses, overtime, or employee
retirement or pension benefits.
(e) "Conflicting Organization" means any person or organization
engaged, directly or indirectly, in the research, development, production,
marketing or selling of a Conflicting Product or Service in the United States.
(f) "Conflicting Product or Service" means any product, process
or service of any person or organization, other than the Company, in existence
or under development, which resembles, competes with or is marketed or offered
for sale or lease to the same or similar potential customers as a product,
process, or service which is the subject of research, development, production,
marketing or selling activities of the Company.
2. DUTIES. The Employee shall be employed by the Company as its
Chief Executive Officer and Chief Financial Officer and shall faithfully, and to
the best of his ability, perform such duties and render such services as may be
directed by the Company. During the term of his employment with the Company,
the Employee shall devote all of his working time to the Company.
3. COMPENSATION AND TERM.
(a) SALARY. As Compensation for his services, the Employee
shall receive a base salary of $120,000 per annum, payable in biweekly
installments, subject to periodic revision.
(b) TERM AND TERMINATION.
(i) Employment hereunder shall continue subject to the
right of the Company or Employee to terminate the employment for whatever reason
or no reason on a six month's notice.
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(ii) The Company shall have the right to terminate such
employment immediately, without notice of any kind, at any time in the event of
default or nonperformance by the Employee of any of the provisions of this
Agreement.
(iii) In the event of notice given by either party, the
Employee shall continue to work for the Company for the full notice period, if
so requested by the Company. The Company reserves the right at any time to pay
to the Employee his full salary for any required notice period and to terminate
his employment immediately or at any time during such notice period.
(c) STOCK RIGHTS.
(i) As of the date hereof, the Employee shall receive a
incentive stock option to purchase 351,834 shares of the Company's Common
Stock within five years of the date hereof at a price of $.25 per share.
(ii) Such incentive stock options shall be generally on
terms and conditions comparable to the 1995 Amended and Restated Stock Incentive
Plan.
(d) PERFORMANCE BONUS. Annually, the Board of Directors of the
Company shall, in its sole discretion, consider a bonus of $100,000 for the
Employee. Such bonus, if granted, may be payable in cash, additional stock
options, or in any other manner the Board of Directors in its discretion may
choose.
(e) BENEFIT PLANS AND PROGRAMS. Subject to the terms and
conditions of such plans and programs, during the term of this Agreement
described in Paragraph 3(b) the Employee shall be entitled to participate in any
medical or other benefit plan of the Company now existing and hereafter
maintained or hereafter adopted. The Employee will continue vacation benefits
of four weeks (120 Hours) per year.
(f) EXPENSES. The Employee is authorized to incur reasonable
expenses for promoting the business of the Company, as determined by the Board
of Directors. The Company will reimburse the Employee for all such expenses
upon the presentation of an itemized account of such expenditures from time to
time.
(g) AUTOMOBILE ALLOWANCE. In addition to the compensation set
forth above, during the term of this agreement, the Company shall lease a car
for the Employee's use.
4. RIGHT TO INVENTIONS. Employee agrees that all inventions made by
Employee during the term of this Agreement, and for a period of six months after
termination, will be the Company's sole and exclusive property. With respect to
all Inventions made or conceived by the Employee, whether or not during the
hours of his employment, either solely or jointly with others, consultant will,
with respect to any invention, without royalty or any other consideration:
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(a) Inform the Company promptly and fully of such Inventions by
a written report, setting forth in detail the structures, procedures, and
methodology employed and the results achieved. A report shall also be submitted
by the Employee upon completion of any study or research project undertaken on
the Company's behalf, whether or not in the Employee's opinion a given study or
project has resulted in an Invention.
(b) Assign (and Employee does hereby assign) to the Company all
of Employee's rights to such Inventions and to all proprietary rights therein,
based thereon or related thereto, including, but not limited to, copyright and
applications for United States and foreign letters patent and resulting letters
patent; provided, however, that Employee shall not be required to assign his
rights to any Invention for which no equipment, supplies, facility or trade
secret information of the Company was used and which was developed entirely on
the Employee's own time, and (1) which does not relate (a) directly to the
business of the Company or (b) to the Company's actual or demonstrably
anticipated research or development, or 92) which does not result from any work
performed by the Employee for the Company.
(c) Execute, acknowledge and deliver such documents and provide
such assistance as may be deemed necessary by the Company to preserve property
rights in the Invention against forfeiture, abandonment or loss and to apply
for, defend or enforce any United States and foreign copyrights or letters of
patent based on, or related to, such Inventions and to vest the entire right and
title to the Invention in the Company.
(d) TRADE NAMES AND TRADEMARKS. The Employee hereby assigns and
agrees to assign to the Company any right or interest he may have in any trade
name or trademark used by the Company.
Employee represents that, except as previously disclosed to the Company in
writing, as of the date of this Agreement, Employee has no rights under, and
will make no claims against the Company with respect to any inventions,
discoveries, improvements, ideas or works of authorship which would be
Inventions if made, conceived, authored or acquired by Employee during the term
of this Agreement. With respect to any obligations performed by Employee under
this subsection following termination of this Agreement, the Company will pay or
reimburse all reasonable out-of-pocket expenses.
5. DISCLOSURE OF CONFIDENTIAL INFORMATION.
(a) CONFIDENTIALITY. Except as required in the performance of
Employee's duties to the Company, the Employee shall treat as confidential and
shall not, directly or indirectly, use, disseminate, disclose, publish, or
otherwise make available any Confidential Information or any portion thereof
during the term hereof and thereafter.
(b) RETURN OF CONFIDENTIAL INFORMATION. Upon termination of
Employee's employment with the Company, all documents, records, notebooks,
computer disks and tapes, and similar repositories containing Confidential
Information, including copies thereof,
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then in the Employee's possession, whether prepared by him or others, shall be
promptly returned to the Company. If at any time after the termination of
employment the Employee determines that he has any Confidential Information in
his possession or control, the Employee shall immediately return to the Company
all such Confidential Information, including all copies and portions thereof.
(c) WAIVER. Unless expressly set forth in detail in Exhibit A,
the Employee waives any and all rights to claim that any discoveries, concepts,
ideas, structures, processes, methods, formulae, or techniques have been made,
acquired, conceived, or reduced to practice prior to his employment by the
Company and not subject to the terms and conditions of this Agreement.
(d) RESTRICTIVE COVENANTS. Employee covenants and agrees that
during his employment, he will not plan, organize or engage in any Conflicting
Organization o conspire with others to do so. For a period of one year after
termination by the Employee or by the Company of his employment with the
Company, the Employee covenants and agrees that he will not, without the express
consent of the Company, give advice or render services as an employee, director
of or consultant to, not invest or acquire any interest in, any Conflicting
Organization or any person or organization which is engaged, or plans to engage
in, the business of producing, marketing, offering to sell or lease a
Conflicting Product or Service, provided, however, that Employee may invest in
securities of any company which is listed on a national securities exchange.
Employee further covenants and agrees that, for a period of one year after
termination by the Employee or by the Company of his employment with the
Company, Employee will not in any manner personally solicit or cause to be
solicited in competition with the Company any persons or companies who were,
are, or will be employees or customers of the Company during the term of this
Agreement.
6. SUBSEQUENT EMPLOYMENT. With respect to employment after
termination of his employment with the Company:
(a) BASE PAY. If the Employee is unable, after conscientious
effort, to obtain employment consistent with his training and education, solely
because of the provisions of Paragraph 5(d), such provisions shall bind the
Employee only so long as the Company shall make monthly payment to the Employee
equal to one hundred percent (100%) of the Employee's termination of employment
hereunder, as if he were an employee of the Company (hereinafter, the period
during which Employee receives payment pursuant to this Paragraph 6(a) shall be
referred to as the "Severance Period"; provided however, the Company's
obligation to make payments pursuant to this Paragraph 6(a) shall terminate
after the Company has paid the Employee a maximum of twelve (12) times one
hundred percent (100%) of the Employees" Company Monthly Base Pay or after the
Employee has found employment consistent with his training and education with a
Non Conflicting Organization.
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(b) CONTINUATION OF BENEFITS. Employee shall be entitled to
continuation of health insurance coverage and automobile benefits during the
Severance Period as if he were an employee of the Company.
(c) EMPLOYMENT SEARCH. The Employee will, before the close of
each month of such unemployment for which he claims payment pursuant to
Subparagraph (a) of the Paragraph, give the Company a detailed written account
of his efforts to obtain employment, and such account will include a statement
by the Employee that although he conscientiously sought employment, he was
unable to obtain comparable employment solely because of the provisions of
Paragraph 5(d).
(d) FAILURE TO REPORT. It is understood that the Company shall,
at its option, be relieved of making a monthly payment to the Employee pursuant
to Subparagraph (a) of the Paragraph for any month during which the Employee
either failed to seek comparable employment or failed to account to the Company,
as required in Subparagraph (c) of the Paragraph.
(e) INCONSISTENT EMPLOYMENT. If the Company so authorizes, the
Employee may accept employment not necessarily consistent with his training and
education, and the Company shall pay the Employee the difference between the New
Monthly Base Pay earned and the monthly amount to be paid to the Employee
pursuant to Subparagraph (a) of the paragraph in each month during the period of
time the Employee is bound by the provisions of Paragraph 5(d).
(f) PRIOR APPROVAL. The Company is obligated to make payments
to the Employee pursuant to Subparagraphs (a) and (e) of this Paragraph upon the
fulfillment of the conditions wet forth herein, unless the Company gives the
Employee written permission to accept available employment, or gives the
Employee a written release from his obligations under Paragraph 5(d).
(g) EMPLOYMENT BY A NON CONFLICTING ORGANIZATION. If the
Employee chooses to accept employment in whatever capacity with an employer
which in not a Conflicting Organization, the Company shall thereafter have no
obligation for payments under this Paragraph.
(h) NOTICE OF EMPLOYMENT. In all events, the employee shall
promptly give written notice to the Company of any employment during the term of
the post- employment obligations of Paragraph 5(d).
(i) LIMITATION OF LIABILITY. In no event shall the Company be
liable to the Employee, under the Agreement, for any amount greater than the
twelve (12) times one hundred percent (100%) of the Company Monthly Base Pay
plus the value of the benefits provided to the Employee under Paragraph 6(b).
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7. SPECIFIC ENFORCEMENT. Employee acknowledges and agrees that a
breach by him of the provisions of this Agreement, including without limitation
the provisions of Paragraph 5 hereof, may cause the Company irreparable injury
and damage which cannot be reasonably or adequately compensated by damages at
law. Employee, therefore, expressly agrees that the Company shall be entitled
to injunctive relief or other equitable relief to prevent a breach of this
Agreement or any part thereof, in addition to any other remedies legally
available to it.
8. BINDING EFFECT. This Agreement shall be binding upon the parties
hereto and upon their respective executors, administrators, legal
representatives, successors and assigns.
9. APPLICABLE LAW. This Agreement shall be governed for all
purposes by the laws of the State of Minnesota. If any provision of this
Agreement is declared void, such provision shall be deemed severed from this
Agreement, which shall otherwise remain in full force and effect.
10. EMPLOYEE'S OBLIGATIONS. Employee's obligation to the Company
hereunder are in addition to, and not exclusive of, any and all of Employee's
other obligations and duties to the Company, whether express or implied, in fact
or in law (including without limitation any rights of the Company with respect
to protection of trade secrets or confidential information arising out of common
or statutory laws), and will survive completion or termination of the Services
for a period of five years.
11. EMPLOYMENT AT-WILL. Employee acknowledges that Employee's
employment with the Company is at-will. Employee acknowledges that Company may,
at any time, for any reason, terminate the Employee's employment with the
Company.
IN WITNESS WHEREOF, the parties have executed this Agreement effective as
of the day and year first above written.
/s/ Xxxxxx X. Xxxxxx
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Employee
NICOLLET PROCESS ENGINEERING, INC.
("Company")
By: Xxxxxx X. XxXxxxx
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Its: Chairman of the Board
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