EMPLOYMENT AGREEMENT
Exhibit 10.17
THIS EMPLOYMENT AGREEMENT, dated as of the 1st day of June, 2008, between Nocopi
Technologies, Inc., a Maryland corporation, with an address at 0-X Xxxxxxxx Xxxx, Xxxx
Xxxxxxxxxxxx, XX 00000 (the “Company”) and Xxxxxxx X. Xxxxxxxxx, M.D., an individual, with an
address at 000 Xxxxxx Xxxxxx, Xxxxx 000, Xxxxxxxxxxxx, XX 00000 (the “Executive”).
In consideration of the mutual promises and covenants set forth herein, and intending to be
legally bound hereby, Company and Executive agree as follows:
1. Employment. Company employs Executive and Executive accepts such employment on the
terms and conditions hereinafter set forth.
2. Term. The initial term of this Agreement shall be for a period of three (3) years,
commencing on June 1, 2008 (“Initial Term”) and shall renew for successive periods of one (1) year
after expiration of the Initial Term (each, a “Renewal Term”), unless either party gives the other
party written notice of termination at least one hundred and eighty (180) days prior to the
termination date of the Initial Term or the then Renewal Term, or unless this Agreement is sooner
terminated in accordance with Paragraph 6 or 7 hereof. The Initial Term and each Renewal Term are
sometimes referred to below as “the Term” of this Agreement.
3. Duties. Executive is engaged as President & Chief Executive Officer of Company and
shall perform the duties and services customarily incident to that position as determined by
Company’s Board of Directors from time to time. Executive shall report directly to Company’s Board
of Directors. Except as may be necessary to enable Executive to continue his medical practice in a
manner consistent with the time and effort being expended to fulfill such responsibilities as of
the commencement date of this Agreement, Executive shall devote his full time, sole attention,
energies and best efforts to the performance of his duties and to the promotion of the business and
interests of Company.
4. Compensation; Expenses.
(a) Base Salary. Executive shall earn an annual base salary equal to Eighty-five
Thousand Dollars ($85,000.00). Company’s Board of Directors shall review Executive’s base salary
on an annual basis and may increase it at their sole discretion based on relevant circumstances.
Such salary (less withholdings required by law) shall be payable in installments at such times as
Company customarily pays other management employees (but in any event no less often than monthly).
(b) Fringe Benefits. Executive shall be entitled to participate in all insurance, and
other fringe benefit programs of Company to the extent and on the same terms and conditions as are
accorded to other management employees of Company.
(c) Business Expenses. Company will pay, or reimburse Executive for, all ordinary and
reasonable out-of-pocket business expenses incurred by Executive in connection with his employment
upon presentation of an itemized accounting of such expenses.
(d) Annual Bonuses. In addition to any other compensation provided for in this
Agreement, Executive shall be entitled to receive an annual, performance-based bonus as determined
in the sole discretion of Company’s Board of Directors, based such criteria as they shall
establish.
(e) Entire Compensation. Except as otherwise authorized by the Board of Directors in
writing, the compensation provided for in this Agreement is in full payment for the services to be
rendered by Executive to Company hereunder.
5. Insurance.
Company, in its sole discretion and at its own expense, may apply for and procure in its own
name and for its own benefit life insurance on the life of Executive in any amount or amounts
considered advisable by Company, and Executive shall submit to any medical or other examination and
execute and deliver such application or other instrument as may be reasonably necessary to
effectuate such insurance.
6. Death or Total Disability of the Executive.
(a) Death. In the event of the death of Executive during the Term of this Agreement,
Company shall not have any further obligation or liability under the Agreement except that Company
shall pay to Executive’s designated beneficiary or, if none, to his estate, the portion, if any, of
Executive’s base salary for the period up to Executive’s date of death which remains unpaid.
(b) Total Disability. In the event of Executive’s Total Disability (as hereinafter
defined), Company shall have the right to terminate Executive’s employment hereunder and the
Company shall not have any further obligation or liability under this Agreement except that Company
shall pay to Executive the base salary for the period ending on the date the Total Disability is
confirmed to have occurred. The term “Total Disability,” shall mean a mental, emotional or physical
condition which either (i) has rendered Executive unable to perform his responsibilities hereunder
for a period of ninety (90) consecutive days, or for a total of one hundred and twenty (120) days
during any period of twelve (12) consecutive months, during the Term of this Agreement, or (ii) in
the reasonable opinion of Company is expected to render Executive, for a period of one hundred and
eighty (180) days, unable or incompetent to carry out, on a substantially full-time basis, the job
responsibilities he held or tasks that he was assigned at the time the disability was incurred.
Executive agrees, in the event of any dispute as to the determination made pursuant to this
paragraph, to submit to a physical or other examination by a licensed physician in the Philadelphia
metropolitan area selected by Company, the cost of which examination shall be paid by Company.
7. Other Terminations of Employment.
(a) Termination by Company. In addition to termination of Executive’s employment
under Paragraph 6, Company may discharge Executive and terminate his employment hereunder For Good
Cause. The term “For Good Cause” shall include any of the following occurrences: (i) habitual
intoxication; (ii) drug addiction; (iii) conviction of a felony; (iv) adjudication as an
incompetent; (v) misappropriation of corporate funds; (vi) gross incompetence or serious and
willful misconduct; (vii) repeated unexcused absences from prescheduled Company
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meetings during
normal business hours; (viii) repeated violation of any policies, rules, regulations or
standards of practice of Company; (ix) Executive’s engaging in other conduct inconsistent with his
position or his breaching this Agreement in any other respect that is not cured within thirty (30)
days following written notice by Company to Executive; (x) Company’s discontinuing its business
operations, or (xi) the filing by or against Company of a petition in bankruptcy or a petition for
reorganization under any state or federal bankruptcy law which, with respect to an involuntary
proceeding, is not dismissed within 90 days of the filing thereof.
(b) Termination by Executive. Executive may terminate his employment with Company at
any time For Good Reason. The term “For Good Reason” shall mean (i) any material breach of this
Agreement by Company that is not cured within thirty (30) days following written notice thereof by
Executive to Company, or (ii) a Change in Control of Company. A “Change in Control” shall be
deemed to have occurred (i) if Company shall become a subsidiary of another corporation or other
entity, (ii) if Company shall be merged or consolidated into another corporation or other entity,
(iii) if substantially all of the assets of Company shall be sold to another corporation or entity,
or (iv) if a controlling interest in Company shall be obtained by a person, group, corporation or
other entity that does not hold such interest as of the commencement date of this Agreement,
and thereafter a material change or diminution takes place to Executive’s position,
authority, duties, responsibilities, status or location without Executive’s prior written consent.
(c) Payments upon Certain Terminations of Employment. In the event Company terminates
the employment of Executive For Good Cause, Company shall have no obligation to pay to Executive
any sum for the period after such date, other than payment of any unpaid portion of Executive’s
base salary for the period ending on the date of such termination. In the event Company terminates
the employment of Executive for any reason other than For Good Cause or other than pursuant to
Paragraphs 6(a) or 6(b), or in the event the Executive terminates his employment For Good Reason,
Company shall pay Executive an amount equal to twelve (12) months of his then base salary, which
sum shall be payable on a bi-weekly basis from and after the date of Executive’s termination. The
sums payable to Executive under this Paragraph 7(c) are hereinafter referred to as “Severance
Payments,” and shall only be payable upon Executive’s execution and delivery of a release in form
and content acceptable to Company’s Board of Directors.
8. Non-Disclosure.
(a) Non-Disclosure. Executive recognizes and acknowledges that he has and will
continue to have access to certain confidential information of Company and that such information
constitutes valuable, special and unique property of Company. Executive agrees that he will not,
for any reason or purpose, during or after the Term of this Agreement, disclose to any third party
or utilize for his own benefit or for the benefit of any third party any of such confidential
information without express authorization of Company’s Board of Directors, except as necessary in
the ordinary course of performing his duties hereunder.
(b) Inventions, Designs and Product Developments. All inventions, discoveries,
concepts, improvements, formulas, processes, devices, methods, innovations, designs, ideas and
product developments (collectively, the “Developments”), developed or conceived by Executive,
solely or jointly with others, whether or not patentable or copyrightable,
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at any time
during the Term of this Agreement or within one year after its termination and which relate to the
actual business activities of Company, and all of Executive’s right, title and interest therein,
shall be the exclusive property of Company. Executive hereby assigns, transfers and conveys to
Company all of his right, title and interest in and to any and all such Developments. Executive
shall disclose fully, as soon as practicable and in writing, all Developments to Company. At any
time and from time to time, upon the request of Company and at Company’s sole expense, Executive
shall execute and deliver to Company any and all instruments, documents and papers, give evidence
and do any and all other acts which, in the opinion of counsel for Company, are or may be necessary
or desirable to document such transfer or to enable Company 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 Developments or to obtain any
extension, validation, reissue, continuance or renewal of any such patent, trademark or copyright.
Company will be responsible for the preparation of any such instruments, documents and papers and
for the prosecution of any such proceedings and will reimburse Executive for any reasonable
expenses Executive incurs in connection therewith.
9. Noncompetition. Executive agrees that during the Term of this Agreement and for a
period of two (2) years thereafter, whether the Agreement is terminated voluntarily or
involuntarily, in order for Company to protect its trade secrets and confidential information to
the fullest extent permitted by law, Executive shall not, unless acting pursuant hereto or with the
prior written consent of Company’s Board of Directors, directly or indirectly:
(a) solicit business from or perform services for, any person, company or other entity which
at any time during Executive’s employment by Company is or was a client or customer of the Company
if such business or services are of the same general character as those engaged in or performed by
Company;
(b) solicit for employment or in any other fashion hire any of the employees of Company;
(c) 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 any business or enterprise engaged
in any business engaged in by Company. Recognizing (i) his status as a senior executive of
Company, (ii) that Company does business throughout North America, and (iii) that his violation of
this covenant would irreparably damage Company irrespective of the location from which such
violation takes place, Executive expressly acknowledges and agrees that it is reasonable for the
territorial scope of the foregoing covenant to extend throughout the entire geographical area in
which Company is conducting business as of the date of termination of this Agreement;
(d) use or permit his name to be used in connection with any enterprise then engaged in
business activities similar in nature to business activities then being engaged in by Company;
(e) use or disparage the name of Company or any name similar thereto,
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but nothing in this
clause shall be deemed, by implication, to authorize or permit use or disparagement of
such name after expiration of such period;
provided, however, that this Paragraph 9 shall not be construed to prohibit the ownership by
Executive of not more than five (5%) percent of any class of the outstanding equity securities of
any corporation having a class of securities registered pursuant to the Securities Exchange Act of
1934.
In the event that the provisions of this Paragraph 9 should ever be adjudicated to exceed the
time, geographic, service or product limitations permitted by applicable law, such provisions shall
be deemed reformed to the maximum time, geographic, service or product limitations permitted by
applicable law.
10. Remedies; Equitable Relief; Survival.
(a) Executive acknowledges that the restrictions contained in Paragraphs 8 and 9 hereof are,
in view of the nature of the business of Company, reasonable and necessary to protect the
legitimate interests of Company, and that any violation of any provisions of those Paragraphs will
result in irreparable injury to Company. Executive also acknowledges that Company shall be
entitled to temporary and permanent injunctive relief, without the necessity of proving actual
damages, which rights shall be cumulative and in addition to any other rights or remedies to which
Company may be entitled. Executive irrevocably submits to the jurisdiction and venue of the
Pennsylvania courts in Xxxxxxxxxx County or the Federal court for the Eastern District of
Pennsylvania over any suit, action or proceeding arising out of or relating to this Agreement.
Executive waives, to the fullest extent permitted by law, any objection to such jurisdiction or to
the venue of any such suit, action or proceeding and any claim that such suit, action or proceeding
has been brought in an inconvenient forum. If Company is successful in enforcing any of the
provisions of Paragraphs 8 or 9 at law or in equity, Executive shall be responsible for and shall
reimburse Company’s attorney’s fees and costs incurred in connection with such enforcement.
(b) Forfeiture of Severance Payments. In addition to the remedies available to
Company pursuant to the provisions of Paragraph 10(a) above, upon the occurrence of any breach by
Executive of the provisions of Paragraphs 8 and 9 of this Agreement, Executive shall immediately
forfeit all Severance Payments due and payable pursuant to the provisions of Paragraph 7(c) of this
Agreement, and return any Severance Payments made prior to such breach. Executive acknowledges and
agrees that Company’s obligation to make the Severance Payments is expressly conditioned upon
Executive’s compliance with the provisions of Paragraphs 8 and 9 of this Agreement.
(c) Survival of Covenants. The provisions of Paragraphs 8 and 9 shall survive the
termination of this Agreement.
11. Remedies Cumulative; No Waiver. No remedy conferred upon Company by this
Agreement is intended to be exclusive of any other remedy, and each and every such remedy shall be
cumulative and shall be in addition to any other remedy given hereunder or now or hereafter
existing at law or in equity. No delay or omission by Company 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,
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remedy or power may be exercised by Company from time to time and as often as may be deemed
expedient or necessary by Company in its sole discretion.
12. Notices. All notices, requests, demands, claims, and other communications
hereunder will be in writing and addressed to the intended recipient as set forth below:
| If to Company: | 0-X Xxxxxxxx Xxxx Xxxx Xxxxxxxxxxxx, XX 00000 Attention: Board of Directors |
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| If to Executive: | 000 Xxxxxx Xxxxxx, Xxxxx 000 Xxxxxxxxxxxx, XX 00000 |
Either party may change the address to which notices, requests, demands, claims, and other
communications hereunder are to be delivered by giving the other party notice in the manner set
forth above.
13. Governing Law. This Agreement shall be governed by and construed in accordance
with the internal laws (and not the law of conflicts) of the Commonwealth of Pennsylvania.
14. Contents of Agreement; Amendment and Assignment. This Agreement sets forth the
entire understanding between the parties with respect to its subject matter and supersedes and
replaces all other employment arrangements between Executive and Company. This Agreement cannot be
changed, modified or terminated except upon written amendment duly executed by the parties. All of
the terms and provisions of this Agreement shall be binding upon and inure to the benefit of and be
enforceable by the respective heirs, representatives, successors and assigns of the parties, except
that the duties and responsibilities of Executive are of a personal nature and shall not be
assignable in whole or in part by Executive.
IN WITNESS WHEREOF, this Agreement has been executed by the parties on the date first above
written.
| Nocopi Technologies, Inc. | ||||||
| BY: | /s/ Xxxxxx X. Xxxxxxx
|
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| /s/ Xxxxxxx X. Xxxxxxxxx, M.D.
|
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