EMPLOYMENT AGREEMENT
EXHIBIT 10.5
THIS
AGREEMENT, effective as of the 1st day of
January, 1998, by and between An-Con Genetics, Inc. a corporation, organized and
existing under the laws of the State of Delaware, and Xxxxx Medical Industries,
Inc. organized and existing under the laws of the State of Florida or any
successor entity thereof (hereinafter referred to as ("the Company"), and J.
Xxxxxx Xxxxx (hereinafter referred to as "the Employee").
WITNESSETH:
WHEREAS,
the Company is a corporation existing and authorized to do business in the State
of Delaware (An-Con); and Florida (Xxxxx) and
WHEREAS,
the Company is desirous of securing Employee's services and Employee is willing
to provide such services.
NOW,
THEREFORE, for and in consideration of the mutual covenants contained herein,
the parties hereto agree as follows:
1)
EMPLOYMENT
OF EMPLOYEE: The
Company hereby agrees to employ the Employee, and Employee hereby agrees to
accept said employment pursuant to the terms and conditions of
Agreement.
2)
DUTIES: The
Employee shall render, as an employee, professional services as President and
shall perform such additional duties as may be assigned to the Employee by the
Board of Directors of the Company. The Employee agrees to devote all of his time
and efforts to the performance of his duties, except for customary vacations and
reasonable absences due to illness or other incapacity as set forth herein, and
to perform all of his duties to the best of his professional ability and comply
with such reasonable policies, standards, and regulations of the Company as are
from time to time established by the Board of Directors of the Company. Nothing
contained herein shall be construed so as to prohibit or prevent the Employee
from engaging in any business activity as long as such activities do not
conflict or interfere with the adequate performance of his duties
hereunder.
3)
TERM: The
initial term of employment under this Agreement shall be effective as of the
1st day of
January, 1998, and shall continue until December 31, 2002 or until terminated as
hereinafter provided. After December 31, 2002 the term of this Agreement shall
be automatically extended for continuous terms of one year each unless the
Employer provides the Employee with written notice of termination by March
31st of the
year the Employer plans to terminate.
J. Xxxxxx
Xxxxx
January
1, 1998
Page
2
4)
PLACE
OF EMPLOYMENT: It is
understood that the employee will permanently reside and work in the Tampa Bay,
Florida area.
5)
COMPENSATION: For all
services rendered to the Company, the Employee agrees to accept as total
compensation a sum computed as set forth in this section.
a. During
the employment of the Employee, the Employee shall receive the sum equal to ONE
HUNDRED THIRTY SIX THOUSAND ONE HUNDRED TWENTY TWO DOLLARS AND 68/100
($136,122.68) per year, payable in equal weekly installments.
b. During
the term of employment. Employee shall receive an automobile allowance in the
amount of FIVE HUNDRED TWENTY FIVE AND 81/100 DOLLARS ($525.81) per month,
payable in equal weekly installments.
c.
Bonuses: Shall be determined from time to time by the Board of Directors at its
discretion.
d. During
the term of employment, the Employee shall receive an Annual Raise in the amount
of 7.5% on June I of every year, subject to review and adjustment by the Board
of Directors.
6)
VACATION/SICK: The
Company agrees that the Employee shall be entitled to a vacation, with full pay,
of three (3) weeks (fifteen working
days), during each year of Employee's employment. The scheduling of any vacation
shall be coordinated with the Company so that the staffing needs of the Company
are met to the extent reasonably possible. The Employee may be entitled to such
further paid vacation as is approved in writing by the Board of Directors of the
Company. Any accrued vacation not taken by the Employee during a year shall be
available for use in subsequent years. The employee may elect to receive cash
payment for one weeks vacation every calendar year. The employee shall be
granted sick time in accordance with the policy outlined in the company's policy
manual.
7)
REIMBURSEMENT
OF BUSINESS EXPENSES: The
Company agrees to pay, either directly, or indirectly by payment to the
Employee, for all of the Employee's approved entertainment, travel and
miscellaneous business expenses incurred by him during the course of his
employment. Employee shall be entitled, on each business related travel to Coach
Airline tickets on Domestic Travel and Business Class Airline tickets on
International Travel and a full size rental automobile. As a prerequisite to any
payment or reimbursement by the Company for business expenses, the Employee
shall submit receipts of all such expenses to the Company; and Company's
obligation to effect payment or reimbursement of such expenses shall be only to
the extent of such receipts.
J. Xxxxxx
Xxxxx
January
1, 1998
Page
3
8)
ADDITIONAL
BENEFITS: The
Company shall obtain and pay for group medical and dental insurance for the
Employee and his dependents under such group insurance program and plan that the
Board of Directors of the Company deems appropriate. The Company shall obtain
and pay for group term life insurance in the amount of $50,000.00 for the
Employee under such group
insurance program and plan that the Board of Directors of the Company deems
appropriate. The Company shall further provide a disability plan upon such terms
and conditions that are, at a minimum, equal to or better than those maintained
by the Company as of the date of this agreement.
9)
PROPERTY
DEFINED: The
Employee understands and agrees that all Company files, customer files, legal
files, legal research files, form files, forms, examples, samples, and all
briefs and memoranda, and other work product are the sole and exclusive property
of the Company; and the same shall remain in the possession of the Company and
shall constitute the property of the Company irrespective of who prepared the
same. The Employee shall not remove, photocopy, photograph or in any other
manner duplicate or remove said property of the Company.
10)
DISPOSITION
OF PROPERTY UPON TERMINATION OF EMPLOYMENT: In the
event the employment of the Employee with the Company is terminated, the
Employee agrees and understands that all files and all customers of the Company
are the sole and exclusive property of the
Company, and the Employee shall have no right, title or interest in the
same.
11)
TERMINATION
OF EMPLOYMENT: The
employment of the Employee may be terminated as follows:
a) By the
death of the Employee and the Employee's estate shall be paid the basic annual
compensation due the Employee pro-rated through the date of
termination.
b) By the
Employee at any time upon at least thirty (30) days prior written notice to the
Company; and the Company shall be obligated to pay the Employee the basic annual
compensation due him pro-rated to the effective date of
termination,
c) By the
Company, without cause, with the majority approval of the Board of Directors of
the Company at any time upon at least thirty (30) days prior written notice to
the Employee: and the Company shall be obligated to pay the Employee
compensation currently in effect including all bonuses, accrued or prorata, and
expenses up to the date of termination. During any subsequent years remaining on
the contract, the Employee shall be paid the salary in effect at the time of
termination payable weekly. Employee shall not have to account for other
compensation other sources or otherwise mitigate his damages due to termination
pursuant to this subparagraph.
J. Xxxxxx
Xxxxx
January
1, 1998
Page
4
d) If the
Company terminates this agreement, without cause, or fails to meet its
obligations to the employee on a timely basis, or if there is a change in the
control of the Company, the Employee may elect to terminate his employment
agreement. Upon any such termination or breach of any of the Company's
obligations hereunder, the Company shall pay the Employee a lump severance equal
to three times the annual salary and bonus
in effect the month preceding such termination or breach as well as any other
sums which may be due under the terms hereof up to the date of
termination.
e) By the
Company, if during the term of this Employment Agreement the Employee violates
the provisions of Paragraph 12 hereof, or is found guilty in a court of law of
any crime of moral turpitude.
f)
Employee agrees that the precise value of the covenants in this Section 11 are
so difficult to evaluate that no accurate measure of liquidated damages could
possibly be established and that, in the event of a breach or threatened
temporary and permanent injunctive relief restraining Employee from such breach
or threatened breach. In the event that any covenants made in this Section shall
be more restrictive than permitted by applicable law, it shall be limited to the
extent which is so permitted.
12)
NON-COMPETITION
AND PRESERVATION OF NON-TRADE SECRET PROTECTIVE BUSINESS
INTERESTS: Upon
the termination of Employee's employment relationship with Employer and for
twelve (12) months thereafter, irrespective of the time, manner, or method of
such termination, the Employee shall not, without the express written consent of
the Employer, directly or indirectly, consult with, render services to, or
otherwise participate or attempt to participate in any manner in a business
which competes with the Employer within the geographic areas where the Employer
and/or the Employee conducted business during the twenty-four (24) month period
directly preceding his/her termination of employment with the Employer,
and/or:
a) Shall
not use or disclose any Confidential Information to any person or entity without
the written authorization of the Employer. Confidential Information includes,
but is not limited to, information concerning Employer's customers: pricing
information and methods; training and operational procedures; advertising,
marketing, and sales information; financial information: and other data,
concepts, strategies, methods, procedures or other confidential information that
is not a Trade Secret as defined by Florida Statute Section
688.042;
b} Shall
not solicit, directly or indirectly, any existing or potential client or
customer with whom the Employer has or may have a substantial relationship. A
potential client or customer is defined as any person or entity that the
Employer or Employee actively solicited during the twenty-four (24) month period
directly preceding the Employee's termination of employment with the
Employer;
J. Xxxxxx
Xxxxx
January
1, 1998
Page
5
c) Shall
not hire, recruit or attempt to recruit any person employed by the Employer at
the time of the Employee's termination of employment with the Employer for any
person or business entity which competes or plans to compete with the
Employer.
d) Shall
not adversely affect the Employer's customer goodwill associated with (1) an
ongoing business by way of trade name, trademark, service xxxx, trade dress and
the like; (2) a specific geographic location; or (3) a specific marketing or
trade area; and/or
e) Shall
not use extraordinary or specialized training received from the Employer.
f) This
Non-Competition and Protection of Non-Trade Secret Protectible Business Interest
provision is expressly intended to benefit the Employer, its successors and
assigns (the Third Party Beneficiaries) and the Employer and the Third Party
Beneficiaries are expressly authorized to enforce this provision.
13)
PRESERVATION
OF TRADE SECRETS: Upon
the termination of the Employee's employment relationship with the Employer the
Employee shall not, directly or indirectly, use or disclose any trade secret, as
that term is defined by Florida Statute Section 688.002, of the
Employer or allow any such trade secret to be disclosed to or used by any person
or entity, for any reason or purpose whatsoever. In addition, the Employee will
not accept any employment or other business relationship which would, by the
nature of the position, involve the inevitable disclosure of any trade
secret.
This
Non-Disclosure of Trade Secrets provision is expressly intended to benefit the
Employer and the Third Party Beneficiaries and the Employer and the Third Party
Beneficiaries are expressly authorized to enforce this provision.
14)
INDEMNIFICATION: The
employee shall be indemnified from liability in connection with his acting as an
officer and or director of both Xxxxx and An-Con including but not limited to
indemnification for legal expenses and out-of-pocket disbursements in connection
with defense of any claim or lawsuit against him based upon acts or omissions by
him during the period that he was an officer and director of the corporation.
However, the foregoing indemnification as to certain acts shall not apply in the
event it is determined by a court of competent jurisdiction that the employee,
during his tenure as an officer and director had a) breached his duty of loyalty
to the corporation or the stockholders: b) acted not in good faith or had
intentional conducted himself improperly and had violated the law; c) paid
unlawful dividends or made unlawful stock repurchases or redemptions; d) engaged
in a transaction in which he had received an improper personal benefit against
the interests of the corporation or its shareholders.
J. Xxxxxx
Xxxxx
January
1, 1998
Page
6
15)
NOTICES: Any
notice required or permitted to be given pursuant to the provisions of
this hall
be sufficient if in writing, and if personally delivered to the party to be
notified or if sent by registered or certified mail to said party at the
following addresses:
If to the
Company: An-Con Genetics, Inc./Xxxxx Medical Industries, Inc.
0000 -
00xx Xxxxxx Xxxxx
Xx.
Xxxxxxxxxx, XX 00000
If to the
Employer: J. Xxxxxx Xxxxx
0000
Xxxxxx Xxxxx
Xxxxxxxx, XX 00000
16)
UNREASONABLE
COMPENSATION: It is
agreed that in the event all or any part of the compensation paid to the
employee shall be disallowed by the Internal Revenue Service as a deduction by
the Company under section 162 of the Internal Revenue Code of 1986, as amended,
(or shall be disallowed as a deduction for state or local income tax purposes)
and such disallowance becomes final, the Federal, state or local income tax
deficiency and interest or other tax "costs" to the Company, as the case may be,
attributable to said disallowance shall be determined and shall be a debt
payable on demand by the Employee to the Company which the Company may recover
as a setoff against future compensation.
17) BY
LAWS; MISCELLANEOUS: This
Agreement is made subject to and with reference to the By Laws of the Company,
which are incorporated herein by reference and which the Employee accepts as
binding upon him.
18)
SEVERABILITY: In the
event any portion of this Agreement is held to be invalid or unenforceable, the
invalid or unenforceable portion or provision shall not affect any other
provision hereof and this Agreement shall be construed and enforced as if the
invalid provision had not been included.
19)
BINDING
EFFECT: This
Agreement shall inure to the benefit of and shall be binding upon the Company
and upon any person, firm or corporation with which the Company may be merged or
consolidated or which may acquire all or substantially all of the Company's
assets through sale, lease, liquidation or otherwise. The rights and benefits of
Employee are personal to him and no such rights or benefits shall be subject to
assignment or transfer by Employee.
20)
GOVERNING
LAW: This
Agreement shall be construed and interpreted in accordance with the laws of the
State of Florida.
J. Xxxxxx
Xxxxx
January
1, 1998
Page
7
21)
ENTIRE
AGREEMENT: This
Agreement constitutes the entire agreement between the parties and supersedes
and replaces any prior agreement; and there are no other agreements between the
parties except as set forth herein.
22)
AMENDMENT
AND MODIFICATION: All
terms, conditions and provisions of this Agreement shall remain in full force
and effect unless modified, changed, altered or amended, in writing, executed by
both parties.
IN
WITNESS WHEREOF, the parties hereto have set their hands and seals effective on
the day and year first above written.
An-Con
Genetics, Inc.
/s/J.Xxxxxx
Xxxxx /s/J.Xxxxxx
Xxxxx
J. Xxxxxx
Xxxxx, Employee J. Xxxxxx Xxxxx, Chief Executive Officer
/s/Xxxxxx
Xxxxxxxx
Xxxxxx
Xxxxxxxx. President
Signed
Sealed and delivered in the presence of:
/s/
/s/
Witness Witness
