EXHIBIT 10.8
EMPLOYMENT AGREEMENT
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THIS EMPLOYMENT AGREEMENT ("Agreement") is made and entered into as of the
first day of April, 1996, by and between Alyn Corporation ("Employer"), and Xx.
Xxxxxx X. Xxxxxxxx ("Employee").
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, and other good and valuable consideration, receipt of which is
hereby acknowledged, the parties agree as follows:
1. Employment: Employer hereby employs Employee, and Employee hereby accepts
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employment with Employer, on the terms and conditions set forth herein.
2. Duties:
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(a) So long as he shall be elected to such offices, Employee shall
continue to occupy the position of and perform all the acts and duties of Chief
Operating Officer of Employer. Employer's Board of Directors may extend
Employee's duties and titles from time to time; provided, however, that during
the term of this Agreement, Employee's responsibilities shall be commensurate
with his current responsibilities as Chief Operating Officer of Employer.
(b) Employee shall be required to devote his entire time, ability and
attention to the business of Employer.
3. Term: Subject to the provisions for termination as herein provided, the
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term of employment of Employee shall be twenty-four (24) months, beginning
May 1, 1996, and ending May 1, 1998. Thereafter, this Agreement shall
automatically be renewed for a renewal term of one (1) year after the expiration
of the initial term, and for successive one-year renewal terms thereafter,
unless either party gives the other written notice ("Notice") to terminate the
Agreement at the expiration of the initial term or of the first one-year renewal
term or of any such successive one-year renewal term. In view of the significant
confidential information, including proprietary trade secrets, that will be
provided to Employee by Employer, the notice must be given at least six (6)
months prior to the expiration of any such Term; provided, however, Employer may
shorten such Notice period in the event Employer is terminating Employee's
employment for Cause (in accordance with section 14 hereof), and Employee may
shorten such Notice period in the event Employee is terminating Employee's
employment hereunder for Employer's Breach (in accordance with section 14(e)
hereof). The Initial Term and any one-year renewal term or subsequent successive
renewal term shall be collectively referred to as the "Term of Employment".
4. Compensation:
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(a) Base Salary. The compensation to be paid Employee by Employer for
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all services rendered to Employer during the term of this Agreement, or to a
parent or subsidiary of Employer, shall be determined by the Compensation
Committee of the Board of the Employer, but in no event shall such annual salary
be less than One hundred thousand dollars ($100,000.00) ("Base Salary"), payable
in twenty-four (24) equal bi-weekly installments in arrears, on the last day of
each week after the effective date hereof. The Base Salary shall be reduced by
income
tax and other applicable withholdings, and may be payable by Employer, or by a
parent or subsidiary of Employer, at the Employer's discretion.
(b) Bonus. In addition to his Base Salary, the Employee shall be
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considered for an annual bonus in accordance with the Employer's bonus plan, and
based on company and individual performance.
5. Vacation: Employee shall be entitled each year to a vacation of not
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less than three (3) weeks, during which time his compensation shall be paid in
full. For vacation purposes, a year shall be deemed to run from July 1 to July
1. Employee's entitlement to such paid vacation shall accrue ratably over each
such year.
6. Working Facilities: Employee shall be furnished with facilities,
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amenities and services as are presently or may be hereinafter furnished to
senior management officers of Employee and as are adequate for the performance
of their duties.
7. Other Benefits:
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(a) Employee shall be entitled to participate on a basis consistent
with other executive employees of Employer in stock option, deferred
compensation, savings, hospitalization, medical, disability, and life insurance
programs in accordance with such plans as Employer or its corporate parent may
now have in effect or may adopt from time to time, commensurate with the
Employee position.
(b) Employee shall also receive such other additional compensation,
rights and other benefits as the Management of Employer shall from time to time,
in its absolute and sole discretion, grant to him.
8. Expenses: Employee is authorized to incur on behalf of Employer
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reasonable expenses in connection with the performance of his duties hereunder
or in promoting or furthering the business of Employer, including dues for
reasonable expenses for entertainment, travel, lodging and similar items, in
accordance with the standards and policies that the Management of Employer may
establish from time to time. Any such charges may be paid for directly by
Employee, who shall be reimbursed by Employer upon the submission to Employer's
Treasurer of an itemized account of such expenditures.
9. Confidentiality: Except as required in the ordinary course of
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Employer's Business (which currently is the design, development, manufacture and
marketing of advanced materials and industrial and consumer products for a
variety of selected markets, including, but not limited to, products and uses
based on the Employer's proprietary patented technology for the application of
boron carbide in lightweight metal matrix composites under the name Boralyn (R)
and silicon nitride blanks and finished shapes sold under the Ceralyn (TM)
name), Employee shall hold in confidence and not disclose to any person or
entity without the express prior written authorization of Employer, either
during the term of this Agreement or any time thereafter, the names or addresses
of any of Employer's customers; Employer's past or prospective dealings with its
customers; the parties, dates, or terms of any of Employer's contracts; any
information, trade
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secrets, systems, processes or business methods, or any other secret or
confidential matter relating to the customers or the business affairs of
Employer or any companies affiliated with Employer. Employee acknowledges that
in the course of performing his duties he may have access to confidential
information, the ownership and confidential status of which are highly important
to Employer and he agrees to comply with all known policies and procedures of
Employer for the protection of said confidential information. The term
"confidential information" as used in this Agreement means (1) proprietary
information of Employer including, but not limited to, formulas, procedures,
processes, materials, client lists and vendor lists (2) information marked or
designated by Employer as confidential (3) information whether or not in written
form which is known by the Employee to be treated by Employer as confidential
and (4) information provided to employee by third parties which Employer is
obligated to keep confidential. Employee agrees as follows:
(a) Employee will not copy, transmit, reproduce, summarize, quote or make
any commercial or other use whatsoever of Employer's confidential
information except as may by necessary in the performance of his
duties for Employer.
(b) Employee will exercise the highest degree of care in safeguarding
Employer's confidential information against loss, theft or other
inadvertent disclosure and agree generally to take all steps necessary
to ensure the maintenance of confidentiality.
(c) Upon termination of Employee's employment, or as otherwise requested
by Employer, Employee will deliver promptly to Employer all of
Employer's confidential information in whatever form that may be in
Employee's possession or under Employee's control.
(d) Employee will not to disclose Employer's confidential information
directly or indirectly under any circumstances or by any means to any
third person without the express written consent of Employer.
10. Non-Competition: During the Term of Employment and for a period of two
(2) years after Employee's termination of employment, Employee shall not,
without the prior written consent of Employer, compete with Employer, its
subsidiaries, successors, or assigns, either directly or indirectly, as an
owner, member, partner, officer, director or agent of any sole proprietorship,
association, partnership or corporation. For the purposes of this paragraph, the
terms "compete" and "competition" and "competitor" shall refer to activities
commercially similar to those that constitute all or any reasonably material
part of Employer's Business, as such was constituted, or as Employee knew or
reasonably expected was contemplated, at any time during the Term of Employment.
Should any term or condition of these covenants against competition be
found to be unreasonable or excessive by any court of competent jurisdiction,
the parties agree to accept as binding in lieu thereof any lessor restrictions
which said court may deem reasonable.
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Both Employer and Employee recognize that no adequate remedy at law exists
in which to enforce the terms and conditions of this Agreement. Therefore, in
the event Employee breaches the confidentiality or covenant not-to-compete
provisions of this Agreement, Employer shall be entitled to injunctive relief
prohibiting the continued breaches of the Agreement by the Employee.
11. Right to Employer Materials: Employee agrees that all documents
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relating to Employer's Business, including, but not limited to the following;
advertising literature, drawings, blueprints, notes, memorandum, specification,
devices, mechanical parts, formula, lists, materials,books, files, reports,
correspondence, records and other documents or similar electronic material
("Employer Materials"), shall remain the property of Employer. Employer
Materials constitute trade secrets of Employer and shall not be disclosed to any
other party except as expressly authorized by Employer. Upon termination of
employment, for any reason, all Employer Materials shall be returned immediately
to Employer, and Employee shall not make or retain any copies thereof.
Employee acknowledges and agrees that any knowledge, information and materials
in Employee's possession relating Employer's Business which Employee possessed
at any time, shall also be deemed to constitute part of Employer Materials for
purposes of this Section.
12. Inventions and Patents: Employee agrees that he will promptly
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and from time to time fully inform and disclose to Employer all inventions,
designs, improvements, and discoveries which he now has or may hereafter have
during the term of this Agreement which pertain to or relate to the Business of
Employer or to any experimental work carried on by Employer, whether conceived
by the Employee alone or with others and whether or not conceived during regular
working hours. All such inventions, designs, improvement and discoveries shall
be the exclusive property of Employer. Employee shall assist Employer to
obtain patents on all such inventions, designs, improvements, and discoveries
deemed patentable by Employer and shall execute all documents and do all things
necessary to obtain letters patent, vest Employer will full and exclusive title
thereto, and protect the same against infringement by others. This provision
shall apply with equal force and effect to any items that may be subject to
copyright or trademark protection. This provision does not apply to an
invention for which no equipment, supplies, facility or trade secret information
of the Employer was used and which was developed entirely on the Employee's own
time, and (a) which does not relate, at the time the invention is conceived or
reduced to practice, to (1) the Business of Employer, or (2) actual or
demonstrably related anticipated research or development of Employer; or
(b) which does not result from any work performed by the Employee for the
Employer. The provisions set forth in the preceding sentence shall not,
however, in any way authorize Employee to engage in any such activities set
forth therein in contravention of the provisions of his duties and obligations
hereunder.
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13. Termination:
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(a) The Employer may terminate the employment of Employee hereunder for
Cause at any time and without prior Notice or for any other reason on six (6)
months' Notice in writing to the Employee. Employee may terminate his employment
hereunder at any time on six (6) months' written Notice to the Employer, or on
two (2) weeks' notice after the last period provided in Section 14(e) hereof.
(b) If the Employer terminates Employee's employment for "Cause" (as
defined below) or Employee terminates his employment for any reason other than
an Employer's Breach (as defined herein) then the Employer shall pay Employee
all accrued and unpaid Base Salary and benefits (including accrued but unused
vacation time) through the termination date and Employer shall have no further
obligations hereunder.
(c) If the Employer terminates Employee's employment other than for Cause,
or if Employee terminates his employment on account of an Employer's Breach or
as a result of Employee's death or disability, then the Employer shall, subject
to the Employee's compliance with Sections 10, 11, 12 and 13 hereof, pay
Employee (i) all accrued and unpaid Base Salary and benefits (including accrued
but unused vacation time) through the termination date and (ii) continued Base
Salary until the earlier of (A) the expiration of the then current Term without
any further extensions thereof or (B) the date which is six (6) months after the
termination date and thereafter Employer shall have no further obligations
hereunder. Any amount paid pursuant to this Section 14(c) shall be reduced by
the amount of any disability benefits or life insurance proceeds paid to
Employee or Employee's beneficiary pursuant to a policy maintained by Employer.
(d) The phrase "Cause" means any of the following:
(i) breach by Employee of Sections 10, 11, 12, or 13 of this
Agreement;
(ii) material breach of any other provision of this Agreement by
Employee (other than any such breach resulting from Employee's incapacity
due to physical or mental illness), if that breach is not remedied within
30 days after written notice to Employee describing the acts alleged to
constitute Cause:
(iii) any act of fraud, misappropriation, embezzlement or similar
willful and malicious conduct by Employee against the Employer; or
(iv) indictment of Employee for a felony or any conviction of, or
guilty plea by Employee to, a crime involving moral turpitude if that crime
of moral turpitude tends or would reasonably tend to bring the Employer
into disrepute.
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(c) The phrase "Employer's Breach" shall mean Employer's material
breach of the terms of this Agreement if such breach is not remedied within
45 days after written notice to Employer describing the acts alleged to
constitute such material breach. Notwithstanding anything herein to the
contrary, Employee's termination shall not be on account of Employer's
Breach unless it occurs within five (5) days after the expiration of the
45-day period referred to in this paragraph.
(d) The phrase "disability" shall mean a physical or mental
disability which renders Employee incapable of satisfactorily performing
his duties under the Agreement for a period of 90 days out of any 180
consecutive days.
14. Successors and Assigns: The rights and obligations of Employer under
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this Agreement shall inure to the benefit of and be binding upon the successors
and assigns of Employer, and the rights and obligations of Employee under this
Agreement shall inure and be binding upon his heirs, executors and
administrators.
15. Definitions: For purposes of this Agreement unless the context
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indicates otherwise, the term "Employer" shall be deemed to also include any
corporation which is in control of, controlled by or under common control with
Employer, whether or not Employee is directly employed by such other corporation
or corporations.
16. Notices: Any notice to be given to Employer under the terms of this
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Agreement shall be addressed to the President of the Employer at 00000 Xxxx
Xxxxxx, Xxxxxx, XX 00000, with a copy to the Compensation Committee, and any
notice to be given to Employee shall be addressed to him at his home address
last shown on the records of Employer, or at such other address as either party
may hereafter designate in writing to the other. Any such notice (except notice
of a change of address) shall have been deemed duly given when enclosed in a
properly sealed envelope or wrapper addressed as aforesaid, registered or
certified, and deposited (postage and registry or certification fee prepaid) in
a post office or branch post office regularly maintained by the United States
Government. Notice of a change of address shall be deemed given only when
received.
17. Waiver: Except as provided in Section 14(e), either party's failure
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to enforce any provision or provisions of this Agreement shall not in any way be
construed as a waiver of any such provision or provisions, or prevent that party
thereafter from enforcing each and every other provision of this Agreement. The
rights granted both parties herein are cumulative and shall not constitute a
waiver of either party's right to assert all other legal remedies available to
it under the circumstances.
18. Governing Law and Binding Effect: This Agreement shall be interpreted
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and construed in accordance with the laws of the State of California and shall
inure to the benefit of and be binding upon the parties hereto and their heirs,
personal representatives, successors and assigns.
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19. Captions and Paragraph Headings: Captions and paragraph headings
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used herein are for convenience only, are not a part of this Agreement, and
shall not be used in construing it.
20. Severability: The invalidity or unenforceability of any provision
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hereof or any part of any provision hereof shall in no way affect the validity
or enforceability of any other provision or part hereof, and this Agreement
shall be interpreted, construed and enforced as though the invalid or
unenforceable provision were not contained herein.
21. Counterparts: This Agreement may be executed in counterparts, each
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of which shall be deemed an original, but all of which taken together shall
constitute one and the same instrument.
22. Entire Agreement: This Agreement supersedes all prior agreements
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and understandings between the parties and may not be modified or terminated
orally. No modification, termination, or attempted waiver shall be valid unless
in writing and signed by the party against whom the same is sought to be
enforced.
IN WITNESS WHEREOF, the parties have duly executed this Agreement on the
day and year first set forth above.
EMPLOYER: Alyn Corporation
A Delaware Corporation
By: [SIGNATURE APPEARS HERE]
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Title: C.E.O.
EMPLOYEE:
/s/ Xxxxxx X. Xxxxxxxx
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Xxxxxx X. Xxxxxxxx
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