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Exhibit 10.8
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT (the "Agreement") dated as of May 7, 1999
by and between K-TRON INTERNATIONAL, INC., a New Jersey corporation ("K-Tron"),
and XXXXXX X. XXXXXX, a resident of Pennsylvania (the "Employee").
WHEREAS, K-Tron and the Employee desire to enter into an
agreement to provide for the Employee's employment by K-Tron or another member
of the K-Tron Group (K-Tron and its subsidiaries as they may exist from time to
time are collectively referred to herein as the "K-Tron Group" and each is
sometimes individually referred to herein as a "member" of the K-Tron Group),
upon the terms and conditions hereinafter set forth;
NOW, THEREFORE, the parties hereto, intending to be legally
bound, hereby agree as follows:
1. Employment. K-Tron agrees that either K-Tron or another
member of the K-Tron Group will employ the Employee, and the Employee hereby
accepts such employment and agrees to perform his duties and responsibilities
hereunder, in accordance with the terms and conditions hereinafter set forth.
1.1 Employment Term. The employment term of this Agreement
(the "Employment Term") shall commence on May 10, 1999 (the "Commencement Date")
and shall continue until terminated in accordance with Section 8 hereof or
otherwise.
1.2 Duties and Responsibilities. During the Employment Term,
the Employee shall be employed by K-Tron or another member of the K-Tron Group,
as determined by K-Tron, and he shall perform all duties and accept all
responsibilities incidental to any position in which he shall be so employed or
as may be assigned to him by the Board of Directors of K-Tron (the
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"K-Tron Board") or its chief executive officer and shall cooperate fully with
the K-Tron Board and K-Tron's chief executive officer. If the Employee is
employed by another member of the K-Tron Group, the foregoing reference to the
K-Tron Board and to K-Tron's chief executive officer shall also be deemed to
include the board of directors and chief executive officer of such other member.
The Employee's initial employment with K-Tron shall be as its Senior Vice
President, Chief Financial Officer and Treasurer.
1.3 Extent of Service. During the Employment Term, the
Employee shall use his best efforts in the business of the member of the K-Tron
Group by which he is employed, and he shall devote substantially his full time,
attention and energy to the business of the member of the K-Tron Group by which
he is employed and to the performance of his services and the discharge of his
duties and responsibilities hereunder. Except as provided in Section 5 hereof,
the foregoing shall not be construed as preventing the Employee from making
investments in other businesses or enterprises or from being engaged in civic or
charitable affairs provided that the Employee agrees not to become engaged in
any other activity which may interfere with his ability to discharge his duties
and responsibilities hereunder to K-Tron or another member of the K-Tron Group.
The Employee further agrees not to work on either a part time or independent
contractual basis for any other business or enterprise during the Employment
Term without the prior written approval of the K-Tron Board.
1.4 Compensation. For all the services rendered during the
Employment Term by the Employee hereunder as an employee of a member of the
K-Tron Group, such member of the K-Tron Group by which he is employed shall pay
the Employee an annual base salary of One Hundred Seventy Thousand U.S. dollars
($170,000), less such withholding and other deductions
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as may be required by law or any employee benefit plan in which the Employee
participates or agreed to by the Employee, payable in installments at such times
as such member of the K-Tron Group customarily pays its other officers (but in
no event less often than monthly). Such salary may be increased from time to
time during the Employment Term in the sole discretion of K-Tron, and any such
increased salary shall thereafter be the Employee's new base salary for purposes
of this Agreement. Notwithstanding the foregoing, either the K-Tron Board or
K-Tron's chief executive officer, or the board of directors or chief executive
officer of any other member of the K-Tron Group employing the Employee, shall
have the right at any time or times to reduce the Employee's base salary if such
reduction is generally being made for other officers of K-Tron or of other
members of the K-Tron Group holding comparable positions. The Employee shall
also be entitled to receive bonus payments in the sole discretion of the K-Tron
Board or its Compensation and Human Resources Committee. In addition to said
annual salary and bonus payments (if any), and except as may otherwise be agreed
with the Employee in writing, the Employee shall be entitled to receive an
automobile allowance of $10,000 per year (or a car in accordance with K-Tron
policy as it may exist from time to time, as the Employee may elect) and annual
paid vacation of four weeks and to participate in such employee benefit plans of
the member of the K-Tron Group employing the Employee as may exist from time to
time on the same basis as other persons holding comparable positions with such
member of the K-Tron Group, except that the Employee shall have no right solely
by virtue of this Agreement to participate in any such plans that are not
generally available to all employees of K-Tron or of the other member of the
K-Tron Group by which he is employed.
1.5 Stock Grant. On the Commencement Date and subject to the
Employee
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having purchased prior to such date and owning on such date 2,000 shares of
K-Tron Common Stock, K-Tron shall issue to the Employee 2,000 shares of its
Common Stock as a restricted stock grant under Section 6 of the K-Tron
International, Inc. 1996 Equity Compensation Plan, as amended (the "1996 Equity
Compensation Plan"). K-Tron and the Employee agree that the sole restriction
applicable to such restricted shares shall be that the Employee be employed by
K-Tron on the first anniversary of the Commencement Date, in which case the
restriction shall lapse at that time; provided, however, that the foregoing
restriction shall lapse immediately if the Employment Term is earlier terminated
by K-Tron for any reason other than "cause" as defined in Section 8.4 hereof. In
all other respects, the restricted stock grant shall be governed by Section 6
and other applicable provisions of the 1996 Equity Compensation Plan.
1.6 Stock Option Grant. On the Commencement Date, the Employee
will be granted a ten-year nonqualified stock option under the 1996 Equity
Compensation Plan to purchase a total of 7,500 shares of K-Tron Common Stock at
the last reported sale price on the Nasdaq Stock Market on that date (or, if
there are no trades on that date, the latest preceding date upon which a sale
was reported) and on the other terms and conditions to be set forth in a stock
option grant agreement to be entered into on that date between K-Tron and the
Employee, the form of which is attached hereto as Exhibit A. Provided that the
Employee is still employed by K-Tron or another member of the K-Tron Group on
the first and second anniversaries of the Commencement Date, respectively, he
will be granted similar stock options on those dates for 7,500 shares (first
anniversary) and 5,000 shares (second anniversary) of K-Tron Common Stock, using
the same form of stock option grant agreement or such other standard form of
grant agreement as may then be used by K-Tron.
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2. Reimbursement of Expenses. The member of the K-Tron Group
employing the Employee shall reimburse the Employee for all ordinary and
necessary out-of-pocket business expenses incurred by him in connection with the
discharge of his duties and responsibilities hereunder during the Employment
Term in accordance with such company's expense approval procedures then in
effect and upon presentation to such company of an itemized account and written
proof of such expenses.
3. Developments. The Employee shall disclose fully, promptly
and in writing to K-Tron or to any other member of the K-Tron Group by which he
is employed any and all inventions, discoveries, improvements, modifications and
the like, whether patentable or not, which he conceives, makes or develops,
solely or jointly with others, while employed by K-Tron or another member of the
K-Tron Group and which (i) relate to the business, work or activities of any
member of the K-Tron Group or (ii) result from or are suggested by the carrying
out of his duties hereunder, or from or by any information which he may receive
while employed by K-Tron or another member of the K-Tron Group. The Employee
hereby assigns, transfers and conveys to K-Tron or its designee all of his
right, title and interest in and to any and all such inventions, discoveries,
improvements, modifications and the like and agrees to take all such actions as
may be requested by K-Tron at any time and with respect to any such invention,
discovery, improvement, modification or the like to confirm or evidence such
assignment, transfer and conveyance. Furthermore, at any time and from time to
time, upon the request of K-Tron, the Employee shall execute and deliver to
K-Tron, or to another member of the K-Tron Group designated by K-Tron, any and
all instruments, documents and papers, give evidence and do any and all other
acts which, in the opinion of counsel for K-Tron, are or may be necessary or
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desirable to document such assignment, transfer and conveyance or to enable
K-Tron or such other member of the K-Tron Group to file and prosecute
applications for and to acquire, maintain and enforce any and all patents,
trademark registrations or copyrights under United States or foreign law with
respect to any such inventions, discoveries, improvements, modifications or the
like or to obtain any extension, validation, reissue, continuance or renewal of
any such patent, trademark or copyright. K-Tron or such other member of the
K-Tron Group shall be responsible for the preparation of any such instruments,
documents and papers and for the prosecution of any such proceedings and shall
reimburse the Employee for all reasonable expenses incurred by him in compliance
with the provisions of this Section 3.
4. Confidential Information. The Employee acknowledges that,
by reason of his employment by K-Tron or another member of the K-Tron Group, he
will have access to confidential information of the K-Tron Group, including,
without limitation, information and knowledge pertaining to products,
inventions, discoveries, improvements, innovations, designs, ideas, trade
secrets, proprietary information, manufacturing, packaging, advertising,
distribution and sales methods, sales and profit figures, customer and client
lists and relationships between members of the K-Tron Group and dealers,
distributors, sales representatives, wholesalers, customers, clients, suppliers
and others who have business dealings with them ("Confidential Information").
The Employee acknowledges that such Confidential Information is a valuable and
unique asset of K-Tron and the other members of the K-Tron Group and covenants
that, both during and after the Employment Term, he will not disclose any
Confidential Information to any person (except as his duties as an employee of
K-Tron or another member of the K-Tron Group may require) without the prior
written authorization of the K-Tron Board. The obligation of
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confidentiality imposed by this Section 4 shall not apply to information which
appears in issued patents or printed publications, which otherwise becomes
generally known in the industry through no act of the Employee in breach of this
Agreement or which is required to be disclosed by court order or applicable law.
5. Non-Competition. During (i) the term of the Employment Term
and (ii) for one year thereafter only in the event that (A) such Employment Term
is terminated under Section 8.2 or 8.4 (but only if it is terminated by a member
of the K-Tron Group) hereof or (B) the Employee terminates employment with the
member of the K-Tron Group employing him without giving the notice required by
Section 8.1 hereof, the Employee shall not, unless acting as an employee
pursuant hereto or with the prior written consent of the K-Tron Board, directly
or indirectly, own, manage, operate, finance, join, control or participate in
the ownership, management, operation, financing or control of, or be connected
as an officer, director, employee, partner, principal, agent, representative,
consultant or otherwise with, or use or permit his name to be used in connection
with, any business or enterprise engaged in the business of designing,
engineering, manufacturing, marketing or distributing feeding or blending
equipment, or in any other business then engaged in by K-Tron or any other
member of the K-Tron Group, within (i) any state of the United States or the
District of Columbia or (ii) any other country in which K-Tron or any member of
the K-Tron Group has engaged in any such business within the prior year or is
about to engage in any such business; provided, however, that notwithstanding
the foregoing, this provision shall not be construed to prohibit the passive
ownership by the Employee of not more than 1% of the capital stock of any
corporation which is engaged in any of the foregoing businesses having a class
of securities registered pursuant to the Securities
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Exchange Act of 1934. In the event that the provisions of this Section 5 should
ever be adjudicated to exceed the time, geographic, product or other limitations
permitted by applicable law in any jurisdiction, then such provisions shall be
deemed reformed in such jurisdiction to the maximum time, geographic, product or
other limitations permitted by applicable law.
6. No Solicitation. During (i) the term of the Employment Term
and (ii) for one year thereafter only in the event that (A) such Employment Term
is terminated under Section 8.2 or 8.4 (but only if it is terminated by a member
of the K-Tron Group) hereof or (B) the Employee terminates employment with the
member of the K-Tron Group employing him without giving the notice required by
Section 8.1 hereof, the Employee shall not, unless acting as an employee
pursuant hereto or with the prior written consent of the K-Tron Board, call on
or solicit, either directly or indirectly, any person, firm, corporation or
other entity who or which is, or within two years prior thereto had been, a
customer of any member of the K-Tron Group, with respect to any matters
involving the designing, engineering, manufacturing, marketing or distributing
of feeding or blending equipment or involving any other businesses then engaged
in by any member of the K-Tron Group.
7. Equitable Relief.
(a) The Employee acknowledges that the restrictions
contained in Sections 3, 4, 5 and 6 hereof are, in view of the nature of the
business of K-Tron and the other members of the K-Tron Group, reasonable and
necessary to protect the legitimate interests of the K-Tron Group, that K-Tron
would not have entered into this Agreement in the absence of such restrictions,
that the business of the K-Tron Group is international in scope and that any
violation of any provision of those Sections will result in irreparable injury
to K-Tron and the other
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members of the K-Tron Group.
(b) The Employee agrees that in the event of any violation
of the restrictions referred to in Section 7(a) above, K-Tron and any other
member of the K-Tron Group shall be entitled to preliminary and permanent
injunctive relief, without the necessity of posting a bond or proving actual
damages, and to an equitable accounting of all earnings, profits and other
benefits arising from any such violation, which rights shall be cumulative and
in addition to any other rights or remedies to which K-Tron or any other member
of the K-Tron Group may be entitled.
(c) The Employee irrevocably and unconditionally agrees
that in the event of any violation of the restrictions referred to in Section
7(a) above, an action may be commenced for preliminary and permanent injunctive
relief and other equitable relief in any federal or state court of competent
jurisdiction sitting in Gloucester or Camden County, New Jersey or in any other
court of competent jurisdiction. The Employee hereby waives, to the fullest
extent permitted by law, any objection that he may now or hereafter have to such
jurisdiction or to the laying of the venue of any such suit, action or
proceeding brought in such a court and any claim that such suit, action or
proceeding has been brought in an inconvenient forum. The Employee agrees that
effective service of process may be made upon him by mail under the notice
provisions contained in Section 10 hereof and that all pleadings, notices and
other papers may be served upon him in the same manner.
(d) The Employee agrees that he will provide, and that any
member of the K-Tron Group may similarly provide, a copy of Sections 3, 4, 5 and
6 of this Agreement to any business or enterprise (i) which he may directly or
indirectly own, manage, operate, finance, join,
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control or participate in the ownership, management, operation, financing or
control of, or (ii) with which he may be connected with as an officer, director,
employee, partner, principal, agent, representative, consultant or otherwise, or
in connection with which he may use or permit his name to be used; provided,
however, that this provision shall not apply in respect of Sections 5 and 6 of
this Agreement after expiration of the time periods set forth therein.
(e) The Employee represents and acknowledges that (i) he
has been advised by K-Tron to consult his own legal counsel in respect of this
Agreement and (ii) he has had full opportunity to do so.
8. Termination.
8.1 Generally. Either party may terminate the Employment Term
upon not less than one year's prior notice to the other party. Should either
party elect to terminate the Employment Term on this basis, neither K-Tron nor
any member of the K-Tron Group shall have any liability or obligation to the
Employee after the date on which the Employment Term ends except for unpaid
salary and benefits accrued to such date and any additional benefits or payments
(excluding any other severance benefits or payments) payable to the Employee
under any applicable formal policy or plan of any member of the K-Tron Group
which covers the Employee at the time of his termination.
8.2 Partial or Total Disability. If in the judgment of the
K-Tron Board, the Employee is unable to perform his duties and responsibilities
hereunder by reason of illness, injury or incapacity for six consecutive months,
or for more than six months in the aggregate during any period of 12 calendar
months, during which time K-Tron or the member of the K-
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Tron Group actually employing the Employee at the time of his disability shall
continue to compensate the Employee hereunder (with such compensation to be
reduced by the amount of any payments due the Employee for this time period
under any applicable disability benefit programs, including Social Security
disability, worker's compensation and disability retirement benefits), the
Employment Term may be terminated by K-Tron in which event neither K-Tron nor
any other member of the K-Tron Group shall have any further liability or
obligation to the Employee except for unpaid salary and benefits accrued to the
date of his termination and for any additional disability or other benefits or
payments (excluding any other severance benefits or payments) payable to the
Employee under any applicable formal policy or plan of any member of the K-Tron
Group which covers the Employee at the time of his termination. The Employee
agrees, in the event of any dispute under this Section 8.2 and if requested by
K-Tron, to submit to a physical examination by a licensed physician selected by
K-Tron, the cost of such examination to be paid by K-Tron.
8.3 Death. In the event that the Employee dies during the
Employment Term, the member of the K-Tron Group actually employing the Employee
at the time of his death shall pay to his executors, administrators or personal
representatives, as appropriate, an amount equal to the installment of his
salary payable for the month in which he dies. Thereafter, neither K-Tron nor
any other member of the K-Tron Group shall have any further liability or
obligation hereunder to the Employee's executors, administrators, personal
representatives, heirs, assigns or any other person claiming under or through
him, except for any benefits or other payments (excluding any severance benefits
or payments) payable to the Employee under any applicable formal policy or plan
of any member of the K-Tron Group which covered the Employee at the
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time of his death.
8.4 For Cause. Nothing in this Agreement shall be construed to
prevent the termination of the Employment Term at any time either (i) by the
Employee for the failure of K-Tron or any other member of the K-Tron Group
actually employing the Employee at the time to observe or perform any of the
material terms or provisions hereof provided that the Employee has given written
notice of such failure to K-Tron and any other member of the K-Tron Group
employing the Employee and such failure has continued for 30 days thereafter, or
(ii) by K-Tron, by action of the K-Tron Board, for "cause." For purposes of this
Agreement, "cause" shall mean the failure of the Employee to observe or perform
(other than by reason of illness, injury or incapacity) any of the material
terms or provisions of this Agreement provided that the Employee has been given
written notice of such failure and such failure has continued for 30 days
thereafter, dishonesty, disloyalty, willful misconduct, conviction of a felony
or other crime involving moral turpitude, misappropriation of funds, habitual
insobriety, substance abuse, similar like cause, any action on the part of the
Employee involving willful and deliberate malfeasance or gross negligence in the
performance of his duties and responsibilities hereunder, any other action on
the part of the Employee that is damaging or detrimental in a significant way to
any member of the K-Tron Group or any willful violation by the Employee of a
written directive from the K-Tron Board or K-Tron's chief executive officer.
8.5 Without Cause. K-Tron, by action of the K-Tron Board, may
terminate the Employment Term at any time without cause upon notice to the
Employee accompanied by payment to the Employee of a lump sum amount equal to
100% of the Employee's then-annual base salary hereunder, in which event neither
K-Tron nor any other member of the K-Tron Group
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shall have any further liability or obligation to the Employee after the date of
termination of the Employment Term except for any unpaid salary and benefits
accrued to such date and for any additional or other benefits or payments
(excluding any other severance benefits or payments) payable to the Employee
under any applicable formal policy or plan of any member of the K-Tron Group
which covers the Employee at the time of his termination. Notwithstanding the
foregoing, if notice of termination shall have previously been given to the
Employee under Section 8.1 hereof and be in effect, the amount to be paid to the
Employee shall be reduced to 100% of the base salary hereunder to which the
Employee would otherwise have been entitled for the remaining balance of his
Employment Term.
9. Survival. Notwithstanding the termination of the Employment
Term for any reason whatsoever, the obligations of the Employee under Sections
3, 4, 5 and 6 hereof shall survive and remain in full force and effect for the
periods therein provided, and the provisions for equitable relief found in
Section 7 hereof shall continue in force.
10. Notices. All notices and other communications hereunder
shall be in writing and deemed to have been given when hand delivered, in person
or by a recognized courier or delivery service, when telefaxed to the
recipient's correct telefax number (with receipt confirmed) or when mailed by
registered or certified mail, return receipt requested, or by air mail to any
addressee located outside the United States, as follows (provided that notice of
change of address shall be deemed given only when received):
If to K-Tron, to:
K-Tron International, Inc.
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Xxxxxx 00 xxx 000
Xxxxxx, XX 00000
Attention: Chief Executive Officer
With a required copy to:
Xxxxxx, Xxxxx & Bockius LLP
0000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxx, Esquire
If to the Employee, to:
Xxxxxx X. Xxxxxx
000 Xxxxxxxx Xxxx
Xxxxxxxxx, XX 00000
or to such other name or address as any designated recipient shall specify by
notice to the other designated recipients in the manner specified in this
Section 10. Any communication delivered in another manner shall be deemed given
when actually received.
11. Governing Law. This Agreement shall be governed by and
interpreted under the laws of the State of New Jersey, United States of America
without giving effect to any conflict of laws provisions.
12. Contents of Agreement, Amendment and Assignment.
(a) This Agreement sets forth the entire understanding of
the parties with respect to the subject matter hereof, supersedes any prior
employment agreement between the parties and shall not be changed, modified or
terminated except upon written amendment executed by a duly authorized officer
of K-Tron and the Employee. Furthermore and without
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limitation, nothing in this Agreement shall be construed as giving the Employee
any right to be retained in the employ of any member of the K-Tron Group beyond
the expiration of the Employment Term, and if employed thereafter the Employee
specifically acknowledges that he shall be an employee-at-will and thus subject
to discharge with or without cause and without further compensation of any
nature.
(b) Employee acknowledges that from time to time, K-Tron
and other members of the K-Tron Group may establish, maintain and distribute
employee manuals or handbooks or personnel policy manuals, and officers or other
representatives of K-Tron or other members of the K-Tron Group may make written
or oral statements relating to personnel policies and procedures. Such manuals,
handbooks and statements are intended only for general guidance. No policies,
procedures or statements of any nature by or on behalf of any member of the
K-Tron Group (whether written or oral, and whether or not contained in any
employee manual or handbook or personnel policy manual), and no acts or
practices of any nature, shall be construed to modify this Agreement or to
create express or implied obligations of employment or continued employment by
K-Tron or any other member of the K-Tron Group.
(c) All of the provisions of this Agreement shall be
binding upon and inure to the benefit of and be enforceable by the respective
heirs, executors, administrators, personal representatives, successors and
assigns of the parties hereto, except that the duties and responsibilities of
the Employee hereunder are of a personal nature and shall not be assignable or
delegable in whole or in part by the Employee.
(d) In the event that the Employee is employed by a member
("such other member") of the K-Tron Group other than K-Tron, and in the further
event that either (i) K-Tron
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or another member of the K-Tron Group shall sell 50% or more of the voting stock
of such other member to a third party after such other member shall have assumed
all of K-Tron's obligations hereunder or (ii) such other member shall sell
substantially all of its operating assets to a third party which agrees in
writing to assume all of K-Tron's obligations hereunder, then K-Tron shall, upon
the closing of any such transaction, have no further duties or obligations
hereunder.
(e) All references in this Agreement to the "K-Tron Board"
shall also be deemed to include the Executive Committee of the K-Tron Board.
13. Severability. If any provision of this Agreement or the
application thereof to anyone or any circumstance is held invalid or
unenforceable in any jurisdiction, the remainder of this Agreement, and the
application of such provision to such person or entity or such circumstance in
any other jurisdiction or to other persons, entities or circumstances in any
jurisdiction, shall not be affected thereby, and to this end the provisions of
this Agreement are severable.
14. Remedies Cumulative; No Waiver. No remedy conferred upon
any party by this Agreement is intended to be exclusive of any other remedy, and
each and every such remedy shall be cumulative and in addition to any other
remedy given hereunder or now or hereafter existing at law or in equity. No
delay or omission by any party in exercising any right, remedy or power
hereunder or existing at law or in equity shall be construed as a waiver
thereof, and any such right, remedy or power may be exercised by such party from
time to time and as often as may be deemed expedient or necessary by such party
in its or his sole discretion.
15. Miscellaneous. The masculine pronoun whenever used shall
include the feminine and the singular shall be construed as the plural, where
applicable. All section headings
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are for convenience only. This Agreement may be executed in several
counterparts, each of which shall be an original. It shall not be necessary in
making proof of this Agreement or any counterpart hereof to produce or account
for any of the other counterparts.
IN WITNESS WHEREOF, K-Tron and the Employee have executed this
Agreement as of the date first above written.
[Corporate Seal] K-TRON INTERNATIONAL, INC.
Attest:
By:
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Secretary As its Chairman and
Chief Executive Officer
EMPLOYEE
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Witness Xxxxxx X. Xxxxxx
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