EXHIBIT 10.10
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
This Amended and Restated Employment Agreement ("Agreement") is entered
into and made effective as of August 1, 2002, by and between PhotoMedex, Inc.
(formerly Laser Photonics, Inc.) ("Employer") and Xxxxxxx X. X'Xxxxxxx
("Employee").
RECITALS
WHEREAS, Employer and Employee entered into an employment agreement as of
November 19, 1999 and now wish to substitute this Agreement for such agreement
according to the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
covenants and obligations herein contained, the parties hereto agree as follows:
AGREEMENT
1. Employment. Employer hereby employs Employee, and Employee hereby
accepts employment with Employer, upon the terms and conditions set forth in
this Agreement.
2. Term of Employment. The employment of Employee pursuant to the terms
of this Agreement shall commence as of August 1, 2002, and shall continue until
December 31, 2003, unless sooner terminated pursuant to the provisions hereof
(the "Term"), provided, however, that this Agreement, unless earlier terminated
according to the provisions hereof, shall, December 1 of each year, beginning
with December 1, 2003, be automatically extended for an additional year.
3. Duties.
3.1. Basic Duties. Subject to the direction and control of the
Board of Directors of Employer, Employee shall serve as the President and Chief
Executive Officer of Employer and shall fulfill all duties and obligations of
such office.
1
3.2. Other Duties of Employee. In addition to the foregoing,
Employee shall perform such other or different duties related to those set forth
in Paragraph 3.1 as may be assigned to him from time to time by Employer;
provided, however, that any such additional assignment shall be at a level of
responsibility commensurate with that set forth in Paragraph 3.1.
3.3. Time Devoted to Employment. Employee shall devote his full
time to the business of Employer during the term of this Agreement to fulfill
his obligations hereunder.
3.4. Place of Performance of Duties. The services of Employee shall
be performed at Radnor, Pennsylvania.
3.5 Membership of Board of Directors. Employee shall be a director
of Employer until the next annual meeting of shareholders of Employer.
4. Compensation and Method of Payment.
4.1 Total Compensation. As compensation under this Agreement,
Employer shall pay and Employee shall accept the following:
(a) For each year of this Agreement, measured from the effective
date hereof, base compensation ("Base Salary") of Three
Hundred Fifty Thousand Dollars ($350,000).
(b) Employer shall reimburse Employee for all reasonable travel,
entertainment and other expenses incurred or paid by Employee
in connection with, or related to, the performance of
Employee's duties, responsibilities or services under this
Agreement, upon presentation by the Employee of documentation,
expense statements, vouchers and/or such other supporting
information as Employer may request.
(c) Participation in Employer's employee fringe benefit, health
insurance, life insurance, key man insurance and other
programs in effect from time to time for employees of Employer
and its affiliates at comparable levels of responsibility.
Participation will be in accordance with any applicable
policies adopted by Employer. Employee shall be entitled to
vacations, absences for illness, and to similar benefits of
employment, and shall be subject to such policies and
procedures as may be adopted by Employer.
(d) Employee shall be entitled to an automobile allowance of
$1,000 per month.
4.2 Payment of Compensation. Employer shall pay the compensation
provided for in Section 4 hereof as follows:
2
(a) Employer shall pay the base compensation in cash, semi-monthly
in twenty-four equal installments or in accordance with
Employer's payroll practices for all its employees, but in no
event less frequently than monthly.
(b) Employer shall pay in cash the reimbursement of such
discretionary expenses provided in Section 4 hereof.
5. Termination of Agreement.
5.1. By Notice. This Agreement and the employment of Employee
hereunder, may be terminated by Employee or Employer upon thirty (30) days'
written notice of termination. Notwithstanding anything to the contrary herein,
in the event that Employee shall be terminated for an occurrence described in
Section 5.2(b) which shall be the subject of an effective Disability Policy,
Employee shall not be entitled to receive any further payment from Employer
other than Employer's obligation to pay regular premiums to maintain the
effectiveness of such Disability Policy following the date from which Employee
shall be entitled to receive payment under such Disability Policy.
5.2 Other Termination by Employer. Employer may terminate Employee
immediately for any of the reasons set forth below:
(a) For "Cause," immediately upon written notice from
Employer to the Employee. For the purpose of this Section 5.2, "Cause" for
termination shall be deemed to include only (i) the direct or indirect
competition by Employee with Employer (as hereinafter defined in Section 6);
(ii) the conviction of Employee of a felony or an act involving moral turpitude;
(iii) the drug or alcohol abuse by Employee, but only if Employee fails to seek
appropriate counseling or fails to complete a prescribed counseling program; and
(iv) the failure of Employee to comply with any material term of this Agreement.
(b) Upon the Disability of the Employee. As used in this
Agreement, the term "Disability" shall mean the inability of the Employee, due
to a physical or mental disability, for a period of thirty (30) days, whether or
not consecutive, during any sixty (60) day period to perform the normal and
customary services required of Employee pursuant to this Agreement. A
determination of disability shall be made by a physician satisfactory to both
Employee and the Employer, provided that, if Employee and the Employer do not
agree on a physician, Employee and Employer shall each select a physician and
such two physicians together shall select a third physician, whose determination
as to disability shall be binding on the parties.
(c) Death of Employee.
3
5.3 Other Termination of Employee. Employee may terminate this
Agreement for "Good Reason." "Good Reason" shall mean the following unless such
circumstances are fully corrected within ten (10) days after the Employee
notifies Employer in writing that he intends to terminate his employment for
Good Reason:
(i) the assignment, without the Employee's prior
written consent to another person, of Employee's primary duties that the
Employee was responsible for during the term of this Agreement, or a significant
adverse alteration in the nature or status of the Employee's employment from
those in effect during the term of this Agreement; or
(ii) any reduction by Employer in Employee's base
compensation (other than as agreed to by Employee) in effect on the date hereof
or as the same may be increased after such date;
5.4 Effect of Termination.
(a) Termination due to Expiration of Employment Period. If
Employee's employment is terminated due to the expiration of the Term, Employer
shall pay Employee the compensation (including accrued bonuses, if any) and
benefits due to Employee under Section 4 through the last day of Employee's
actual employment hereunder. In addition, Employer shall pay Employee Three
Hundred Fifty Thousand Dollars ($350,000) in twelve (12) monthly installments.
(b) Termination for Cause. In the event that Employee's
employment is terminated for "Cause" pursuant to Section 5(a), Employer shall
pay Employee the compensation (not including accrued bonuses, if any) and
benefits due to Employee under Section 4 through the last day of Employee's
actual employment hereunder.
(c) Other Termination. In the event that Employee's
employment is terminated by Employer other then under Section 5.2 or Section 7,
Employer shall pay Employee Three Hundred Fifty Thousand Dollars ($350,000) in
twelve (12) monthly installments.
(d) Termination for Death or Disability. If Employee's
employment is terminated by reason of death or disability pursuant to Section
5.2(b) or (c), Employer shall pay the estate of Employee or Employee, as the
case may be, the compensation and benefits under Section 4 which would otherwise
be payable to Employee up to the end of the month in which the termination of
this Agreement for such death or disability occurred.
(e) Termination for Good Reason. In the event the Employee's
employment is terminated by him for "Good Reason" pursuant to Section 5.3
Employer shall pay the Employee Three Hundred Fifty Thousand Dollars ($350,000)
in twelve (12) monthly installments.
(f) Termination by Employee not for Good Reason. In the
event Employee's employment is terminated by him not for "Good Reason", as
defined in Section 5.3,
4
Employer shall pay Employee the compensation (not including accrued bonus, if
any) and benefits due Employee under Section 4 through the last day of
Employee's actual employment.
6. Property Rights and Obligations of Employee.
6.1. Trade Secrets. For purposes of this Agreement, "trade secrets"
shall include without limitation any and all financial, cost and pricing
information and any and all information contained in any drawings, designs,
plans, proposals, customer lists, records of any kind, data, formulas,
specifications, concepts or ideas, where such information is reasonably related
to the business of Employer, has been divulged to or learned by Employee during
the term of his employment by Employer, and has not previously been publicly
released by duly authorized representatives of Employer or otherwise lawfully
entered the public domain.
6.2. Preservation of Trade Secrets. Employee will preserve as
confidential all trade secrets pertaining to Employer's business that have been
obtained or learned by him by reason of his employment. Employee will not,
without the prior written consent of Employer, either use for his own benefit or
purposes or disclose or permit disclosure to any third parties, either during
the term of his employment hereunder or thereafter (except as required in
fulfilling the duties of his employment), any trade secret connected with the
business of Employer.
6.3. Trade Secrets of Others. Employee agrees that he will not
disclose to Employer or induce Employer to use any trade secrets belonging to
any third party.
6.4. Property of Employer. Employee agrees that all documents,
reports, files, analyses, drawings, designs, tools, equipment, plans (including,
without limitation, marketing and sales plans), proposals, customer lists,
computer software or hardware, and similar materials that are made by him or
come into his possession by reason of and during the term of his employment with
Employer are the property of Employer and shall not be used by him in any way
adverse to Employer's interests. Employee will not allow any such documents or
things, or any copies, reproductions or summaries thereof to be delivered to or
used by any third party without the specific consent of Employer. Employee
agrees to deliver to the Board of Directors of Employer or its designee, upon
demand, and in any event upon the termination of Employee's employment, all of
such documents and things which are in Employee's possession or under his
control.
6.5 Non-Competition by Employee.
6.5.1 General. Employee agrees during the two years following the
termination of his Employment, not to recruit, engage in passive hiring efforts,
solicit or induce any person or entity who, during such two-year period, or
within one (1) year prior to the termination of Employee's employment with
Employer, was an employee, agent, representative or sales person of Employer or
any of its affiliates ("Employer Group") to leave or cease his employment or
other relationship with
5
Employer Group for any reason whatsoever or hire or engage the services of such
person for Employee in any business substantially similar to or competitive with
that in which Employer Group was engaged during the Employee's employment.
6.5.2 Non-Solicitation of Customers. Employee acknowledges that in
the course of his employment, he will learn about Employer Group's business,
services, materials, programs and products and the manner in which they are
developed, marketed, served and provided. Employee knows and acknowledges that
Employer Group has invested considerable time and money in developing its
programs, agreements, offices, representatives, services, products and marketing
techniques and that they are unique and original. Employee further acknowledges
that Employer Group must keep secret all pertinent information divulged to
Employee about Employer Group business concepts, ideas, programs, plans and
processes, so as not to aid Employer Group's competitors. Accordingly, Employer
Group is entitled to the following protection, which Employee agrees is
reasonable:
Employee agrees that for a period of two (2) years following the
termination of his employment, he will not, on his own behalf or on behalf of
any person, firm, partnership, association, corporation, or other business
organization, entity or enterprise, knowingly solicit, call upon, or initiate
communication or contact with any person or entity or any representative of any
person or entity, with whom Employee had contact during his employment, with a
view to the sale or the providing of any product, equipment or service sold or
provided or under development by Employer Group during the period of two (2)
years immediately preceding the date of Employee's termination. The restrictions
set forth in this section shall apply only to persons or entities with whom
Employee had actual contact during the two (2) years prior to termination of his
employment with a view toward the sale or providing of any product, equipment or
service sold or provided or under development by Employer Group.
6.5.3 Non-Competition. Employee acknowledges that he will be a "high
impact" person in Employer Group's business who is in possession of selective
and specialized skills, learning abilities, customer contacts, and customer
information as a result of his relationship with Employer Group and prior
experience, and agrees that Employer Group has a substantial business interest
in the covenant described below. Employee, therefore, agrees for a period of two
(2) years from the termination of his employment, not to, either directly,
whether as an employee, sole proprietor, partner shareholder, joint venture or
the like, in the same or similar capacity in which he worked for Employer Group,
compete with Employer Group in the manufacture, marketing or sales of excimer
laser technology in connection with interventional cardiology, psoriasis or any
other field in which Employer enters or considers entering into, provided
Employee has actual knowledge of such field. The territory in which this
non-competition covenant shall apply will be limited to the area commensurate
with the territory in which Employee marketed, sold or provided products or
services for Employer Group during the two years preceding termination of
Employment.
6.6 Survival Provisions and Certain Remedies. Unless otherwise
agreed to in writing between the parties hereto, the provisions of this Section
6 shall survive the termination of
6
this Agreement. The covenants in this Section 6 shall be construed as separate
covenants and to the extent any covenant shall be judicially unenforceable, it
shall not affect the enforcement of any other covenant. In the event Employee
breaches any of the provisions of this Section 6, Employee agrees that Employer
shall be entitled to injunctive relief in addition to any other remedy to which
Employer may be entitled.
7. Change of Control.
(a) For the purpose of this Agreement, a "Change of Control" shall
mean:
(i) the acquisition by any individual, entity or group
(within the meaning of Section 13(d)(3) or 14(d)(2) or the Securities Exchange
Act of 1934, and as amended (the "Exchange Act")) (a "Person") of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act)
of 50% or more of either (i) the then outstanding shares of common stock of the
Company (the "Outstanding Company Common Stock") or (ii) the combined voting
power of the then outstanding voting securities of the Company entitled to vote
generally in the election of directors (the "Outstanding Company Voting
Securities"), which acquisition is effected without the consent of at least a
majority in interest of the Board of Directors of Employer as of the date
hereof. Specifically excluded from this definition is the sale of shares by
Employer in any offering of its securities effectuated through any resolution of
a majority of the Board of Directors as constituted from time to time.
(ii) INTENTIONALLY OMITTED;
(iii) Approval by the shareholders of the Company of (i) a
complete liquidation or dissolution of the Company or (ii) the sale of other
disposition of all or substantially all of the assets of the Company.
(b) Employer and Employee hereby agree that, if Employee is in the
employ of Employer of the date on which a Change of Control occurs (the "Change
of Control Date"), Employer will continue to employ Employee and Employee will
remain in the employ of Employer for the period commencing on the Change of
Control Date and ending on the expiration of the Term, to exercise such
authority and perform such duties as are commensurate with the authority being
exercised and duties being performed by Employee immediately prior to the Change
of Control Date. If after a Change of Control, Employee is requested and, in his
role and absolute discretion consents to change his principal business location,
Employer will reimburse Employee for his relocation expenses, including without
limitation, moving expenses, temporary living and travel expenses, temporary
living and travel expenses for a time while arranging to move his residence to
the changed location, closing costs, if any, associated with the sale of his
existing residence and the purchase of a replacement residence at the changed
location, plus an additional amount representing a gross-up of any state or
federal taxes payable by Employee as a result of any such reimbursements. If
Employee shall not consent to change his business location, Employee may
continue to provide services
7
required of him hereunder in Radnor, Pennsylvania and Employer shall continue to
maintain an office for Employee at that location with the Company's office prior
to the Change of Control Date.
(c) During the remaining Term after the Change of Control Date,
Employer will continue to honor the terms of this Agreement, including payment
of the compensation set forth in Section 4 herein.
(d) If during the remaining Term on or after the Change of Control
Date (i) Employee's employment is terminated by the Company other than for
"Cause" (as defined in Section 5.2(a) hereof), or (ii) there shall have occurred
a material reduction in Employee's compensation or employment related benefits,
or a material change in Employee's status, working conditions or management
responsibilities, or a material change in the business objectives or policies of
Employer and Employee voluntarily terminates employment within sixty (60) days
of any such occurrence, or the last in a series of occurrences, the Employee
shall be entitled to receive as a severance payment, subject to the provisions
of subparagraphs (e) and (f) below, a lump-sum payment equal to 200% of
Employee's current Base Salary (the "Lump-sum Payment") in addition to any other
compensation that may be due and owing to Employee under Section 4 hereof.
(e) The amounts payable to Employee under any other compensation
arrangement maintained by the Company which became payable, after payment of the
lump-sum provided for in paragraph (d), upon or as a result of the exercise by
Employee of rights which are contingent on a Change of Control (and would be
considered a "parachute payment" under Internal Revenue Code 280G of the
Internal Revenue Code of 1986, as amended (the "Code"), shall be reduced to the
extent necessary so that such amounts, when added to such lump-sum, do not
exceed 100% of the Employee's "base amount" as defined in Code Section
280G(b)(3)(A). Any such excess amount shall be deferred and paid in the next tax
year.
(f) In the event of a proposed Change in Control, Employer will
allow Employee to participate in all meetings and negotiations related thereto.
8. General Provisions.
8.1. Notices. Any notices or other communications required or
permitted to be given hereunder shall be given sufficiently only if in writing
and served personally or sent by certified mail, postage prepaid and return
receipt requested, addressed as follows:
If to Employer: PhotoMedex, Inc.
5 Xxxxxx Xxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxxxxxx 00000
Fax: (000) 000-0000
If to Employee: Xxxxxxx X. X'Xxxxxxx
8
000 Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxxxxxx 00000
Fax: (000) 000-0000
However, either party may change his/its address for purposes of this Agreement
by giving written notice of such change to the other party in accordance with
this Paragraph 7.1. Notices delivered personally shall be deemed effective as of
the day delivered and notices delivered by mail shall be deemed effective as of
three days after mailing (excluding weekends and federal holidays).
8.2. Choice of Law and Forum. Except as expressly provided
otherwise in this Agreement, this Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware, and both parties consent
to the jurisdiction of the courts of the State of Delaware with respect thereto.
8.3. Entire Agreement; Modification and Waiver. This Agreement
supersedes any and all other agreements, whether oral or in writing, between the
parties hereto with respect to the employment of Employee by Employer and
contains all covenants and agreements between the parties relating to such
employment in any manner whatsoever. Each party to this Agreement acknowledges
that no representations, inducements, promises, or agreements, oral or written,
have been made by any party, or anyone acting on behalf of any party, which are
not embodied herein, and that no other agreement, statement, or promise not
contained in this Agreement shall be valid or binding. Any modification of this
Agreement shall be effective only if it is in writing signed by the party to be
charged. No waiver of any of the provisions of this Agreement shall be deemed,
or shall constitute, a waiver of any other provision, whether or not similar,
nor shall any waiver constitute a continuing waiver. No waiver shall be binding
unless executed in writing by the party making the waiver.
8.4. Assignment. Because of the personal nature of the services to
be rendered hereunder, this Agreement may not be assigned in whole or in part by
Employee without the prior written consent of Employer. However, subject to the
foregoing limitation, this Agreement shall be binding on, and shall inure to the
benefit of, the parties hereto and their respective heirs, legatees, executors,
administrators, legal representatives, successors and assigns.
8.5. Severability. If for any reason whatsoever, any one or more of
the provisions of this Agreement shall be held or deemed to be inoperative,
unenforceable, or invalid as applied to any particular case or in all cases,
such circumstances shall not have the effect of rendering any such provision
inoperative, unenforceable, or invalid in any other case or of rendering any of
the other provisions of this Agreement inoperative, unenforceable or invalid.
8.6 Corporate Authority. Employer represents and warrants as of
the date hereof that Employer's execution and delivery of this Agreement to
Employee and the carrying out of the provisions hereof have been duly authorized
by Employer's Board of Directors and authorized by Employer's shareholders and
further represents and warrants that neither the execution and delivery
9
of this Agreement, nor the compliance with the terms and provisions thereof by
Employer will result in the breach of any state regulation, administrative or
court order, nor will such compliance conflict with, or result in the breach of,
any of the terms or conditions of Employer's Certificate of Incorporation or
Bylaws, as amended, or any agreement or other instrument to which Employer is a
party, or by which Employer is or may be bound, or constitute an event of
default thereunder, or with the lapse of time or the giving of notice or both
constitute an event of default thereunder.
8.7. Attorneys' Fees. In any action at law or in equity to enforce
or construe any provisions or rights under this Agreement, the unsuccessful
party or parties to such litigation, as determined by the courts pursuant to a
final judgment or decree, shall pay the successful party or parties all costs,
expenses, and reasonable attorneys' fees incurred by such successful party or
parties (including, without limitation, such costs, expenses, and fees on any
appeals), and if such successful party or parties shall recover judgment in any
such action or proceedings, such costs, expenses, and attorneys' fees shall be
included as part of such judgment.
8.8. Counterparts. This Agreement may be executed simultaneously in
one or more counterparts, each of, which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
8.9. Headings and Captions. Headings and captions are included for
purposes of convenience only and are not a part hereof.
10
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
effective as of the day and year first written above at Radnor, Pennsylvania.
"Employer"
PHOTOMEDEX, INC.
By: /s/ Xxxxxx XxXxxxx
______________________________________
Xxxxxx XxXxxxx, Chief Financial Officer
"Employee"
/s/ Xxxxxxx X. X'Xxxxxxx
__________________________________________
Xxxxxxx X. X'Xxxxxxx
11
