1
Exhibit 4.(e)
EMPLOYMENT AGREEMENT
THIS AGREEMENT made as of this 30th day of September, 1997 by and between
Xxxxxx Xxxx ("Executive") and Biosystems, Inc., a corporation organized under
the laws of Pennsylvania (the "Company").
W I T N E S S E T H :
WHEREAS, Bacou USA, Inc. has entered into an agreement to purchase the
Company and desires to clarify the terms and conditions upon which Executive
shall continue to be employed by the Company; and
WHEREAS, Executive is now Vice President of Sales of the Company;
WHEREAS, the Company wishes to secure the services of Executive as its
Vice President of Sales for the period provided in this Agreement; and
WHEREAS, Executive is willing to enter into this Agreement for such period
and on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the mutual promises herein contained,
the Company and Executive hereby agree as follows:
1. EMPLOYMENT. During the period of employment set forth in Section 2 of
this Agreement, the Company shall employ Executive, and Executive shall serve as
Vice President of Sales of the Company. Executive agrees to faithfully perform
the duties assigned to him to the best of his ability and, except for vacations
and periods of temporary illness, to devote his full time and attention to the
Company's business. Ancillary employment such as writing, teaching or lecturing
as well as the acceptance of honorific titles may be undertaken by the Executive
only with the approval of the Chief Executive Officer of Bacou USA, Inc. or his
designee ("Chairman"). Executive also agrees that he will not engage in any
other business activities without the prior approval of the Chairman. Executive
may only serve as an officer, director, trustee or committee member, or in any
similar position, of a reasonable number (maximum two) of trade associations and
religious, charitable, educational, civic or other non-business organizations,
subject to the approval of the Chairman. The Executive represents and warrants
to Company that he is now under no contract or agreement nor will he execute any
contract or agreement that will in any manner interfere, conflict with or
prevent him from performing his duties under the terms and conditions of this
Agreement, recognizing that his performance hereunder will require the devotion
of his full time and attention during and beyond regular business hours during
the Term (as hereinafter defined), including substantial travel.
2. PERIOD OF EMPLOYMENT. This Agreement shall become effective upon the
closing of the transaction in which Bacou USA, Inc. becomes the direct or
indirect owner of the Company and its terms shall be applicable to the first day
of the Initial Term, as defined herein. The Executive's employment under this
Agreement shall initially cover the period October 1, 1997 to
2
December 31, 2000 (the "Initial Term"). On January 1, 2001, and at the end of
each year thereafter, the period of employment shall be automatically extended,
without further action by either party, for successive one year periods (the
"Renewal Term") unless at least six months prior to the end of any Term either
party shall have served written notice on the other of its election to allow
this Agreement to terminate at the end of such Term. The Initial Term and any
Renewal Terms are hereinafter sometimes collectively referred to as the "Term."
If either party notifies the other party that it shall not extend the
period of employment, Company may, at its option, decide that the Executive
shall take a leave-of-absence for part or all of the remaining time of his
employment, continuing to receive all compensation as if actively working.
3. TERMINATION. The period of employment shall be terminated upon
the first to occur of the following:
(i) The expiration of the period of employment pursuant to Section 2
of this Agreement.
(ii) The Executive's death.
(iii) The Executive becoming permanently disabled. Permanent disability
shall mean physical or mental incapacity of a nature which
prevents Executive from performing his duties under this
Agreement for a period of more than six months in any twelve
month period.
(iv) The Executive's employment being terminated by the Company for
cause. Termination for cause shall mean termination by action of
the Board of Directors of the Company because of the willful
failure of Executive to perform his duties and obligations under
this Agreement or failure to execute in a reasonable and
responsible manner the policies of the Company or gross
negligence in the performance of his duties under this Agreement
or the commission by Executive of a felony.
4. COMPENSATION AND BENEFITS.
(a) During the Employment Period, the Executive shall receive regular
compensation (the "Base Salary") at the initial rate of One Hundred and Sixty
Thousand Dollars ($160,000.00) per annum for the period January 1, 1997 through
December 31, 1998. The executive shall receive a salary of fifty thousand
dollars ($50,000.00) for the period October 1, 1997 through December 31, 1997
(the "Stub Period Salary"). The Base Salary and the Stub Period Salary shall be
payable in arrears less the usual payroll deductions at the same times and in
the same manner as salaries paid to other employees. The Executive shall
participate in any wage increases applicable generally to the Company's salaried
employees. The Base Salary prevailing at any time shall be reviewed annually for
a possible increase on January 1 of each year beginning in 1999.
-2-
3
(b) In addition to the Base Salary, the Executive shall be entitled to
receive annual incentive compensation payments ("Incentive Compensation") at
such time and in such amounts as may be determined pursuant to the Bonus Plan
for Executives of subsidiaries of Bacou USA, Inc., as in effect for the
applicable year; provided, however, that the percentage bonus for the Fiscal
Year ending December 31, 2000 shall not exceed thirty-five percent (35%) of
Executive's Base Salary for such year. Executive acknowledges that, by agreeing
to participate in the Bonus Plan for Executives of subsidiaries of Bacou USA,
Inc., he thereby waives any rights to participate in any other incentive
compensation plan of the Company. The Executive will not be eligible to receive
any Incentive Compensation for the period October 1, 1997 through December 31,
1997.
(c) Incentive Compensation shall be paid by the Company for the prior
fiscal year within ten (10) days after a decision is made by the Board of
Directors of the Company as to the amount of such Incentive Compensation, but in
any event no later than the earlier of the annual meeting of the Board of
Directors of the Company or March 31.
(d) The Executive shall be entitled to participate in any stock option
plan which Bacou USA, Inc. may adopt for the Company at levels to be determined
by the board of directors of the Company in their sole discretion. In connection
with the execution of this Agreement and subject to the execution of the stock
option agreement attached hereto as Exhibit A, Executive shall be granted
options to purchase three thousand (3,000) shares of common stock of Bacou USA,
Inc. at a per share price equal to the closing price on September 30, 1997.
(e) The Executive shall be entitled to participate in all savings, thrift,
retirement or pension, short term and long term disability, health and accident,
Blue Cross/Blue Shield, Major Medical or other hospitalization, holiday,
vacation, and other fringe benefit programs generally available to senior
executives of the Company in accordance with and subject to the terms and
conditions of such programs.
(f) In addition, the Executive shall be entitled to receive the following
benefits:
(i) The Executive will have the use of a Company car, subject to
the Automobile Policy of Bacou USA, Inc..
(ii) The Executive shall be entitled to vacation pursuant to the
Company's Executive Vacation Policy. Vacation days will be taken at a time
convenient for both the Executive and the Company. To the extent the Executive
does not take all vacation days the remaining days will be carried forward for
an unlimited period or be paid to the Executive at the level of his Base Salary
valid for the fiscal year in which vacation days are not taken.
(iii) When traveling on Company business, the Executive will be
provided coach-class airfare on domestic trips; business class airfare will be
provided on international trips with a duration of seven hours or greater if
requested by the Executive.
-3-
4
(iv) The Executive is authorized to incur reasonable expenses in
connection with and for the promotion of the business of the Company, including
expenses for meals and lodging, (regular hotel room, no suites) entertainment,
and similar items as required from time to time by the Executive's duties. The
Company shall reimburse the Executive for all such expenses upon the
presentation of an account therefor, together with appropriate supporting
documentation.
5. LIMITATIONS ON AUTHORITY. Except as otherwise provided herein, approval
by the Chairman must be obtained prior to the Executive taking any of the
following actions on behalf of the Company or any of its affiliates:
(a) Acquisition or disposition of real property or any rights
deriving therefrom, or changing title in any such real
property.
(b) Making unplanned capital expenditures or any commitment
therefore;
(c) Borrowing or guaranteeing any borrowings from or on behalf
of any party, or altering the terms of any loan agreements
for such borrowings except for any such loans or borrowings
as shall be agreed upon by the Board of Directors of the
Company;
(d) Hiring or terminating salaried personnel;
(e) Granting retirement benefits or other non-earned income to
any individual which is not available to all employees;
(f) Modification of the pension plan or other benefit plan,
e.g., health insurance;
(g) Acquiring the assets or shares of another company or
partnership;
(h) Acquiring or disposing of the assets or shares of the
Company or any of its affiliates;
(i) Entering into or terminating agreements of any kind or
nature with a monthly financial obligation in excess of
U.S. $3,000 for more than six (6) months;
(j) Making basic changes in the administration, organization,
production, and distribution of the Company or any of its
affiliates, as well as closing or curtailing the functions
of the Company or any of its affiliates;
(k) Filing any lawsuit;
(l) Entering into any transaction on behalf of the Company or
its affiliates which is not in the usual course of its
business;
-4-
5
(m) Adoption or modification of the annual budget.
Notwithstanding the foregoing, approval is not required for any action
provided for in the approved and applicable annual budget or annual plan of the
Company. In addition, should the Chairman be unavailable, if an emergency arises
which requires the Executive to take immediate action in which approval as set
forth in this Section would otherwise be required, the Executive is no longer
bound by the limitations described above and is authorized to make a decision in
the best interests of the Company. The Executive will immediately inform the
Chairman of any such decisions made by him.
6. NON-DISCLOSURE OF INFORMATION. It is understood that the business of
the Company and its affiliates is of a confidential nature. During the period of
the Executive's employment with the Company, the Executive may have received
and/or may secure confidential information concerning the Company or any of the
Company's affiliates or subsidiaries which, if known to competitors thereof,
would damage the Company or its said affiliates or subsidiaries. The Executive
agrees that during and after the term of this Agreement he will not (except as
authorized by the Company or in the proper performance of his duties or except
as ordered by a court or other body of competent jurisdiction or as otherwise
required by law), directly or indirectly, divulge, disclose or appropriate to
his own use, or to the use of any third party, any secret, proprietary or
confidential information or knowledge obtained by him during the term hereof
concerning such confidential matters of the Company or its subsidiaries or
affiliates, including, but not limited to, information pertaining to trade
secrets, systems, manuals, confidential reports, methods, processes, designs,
equipment lists, operating procedures, equipment and methods used and preferred
by the Company's customers. Upon termination of this Agreement, the Executive
shall promptly deliver to the Company all materials of a secret or confidential
nature relating to the business of the Company or any of its subsidiaries or
affiliates which are, directly or indirectly, in the possession or under the
control of the Executive. The provisions of this paragraph shall continue to
apply after the Executive ceases to be employed by the Company for a period of
three (3) years except in respect of any information or knowledge disclosed to
the public, other than through an unauthorized disclosure by the Executive.
7. TRADE SECRETS. The Executive covenants that he shall, while employed by
the Company, assign, transfer, and set over to the Company or its designee all
right, title and interest in and to all trade secrets, secret processes,
inventions, improvements, patents, patent applications, trademarks, trademark
applications, copyrights, copyright registrations, discoveries and/or other
developments (hereinafter "Inventions") which he may, thereafter, alone or in
conjunction with others, during or outside normal working hours, conceive, make,
acquire or suggest at any time which relate to the products, processes, work,
research, or other activities of the Company or any of its subsidiaries or
affiliates. Any and all Inventions which are of a proprietary nature and which
the Executive may conceive, may acquire or suggest, either alone or in
conjunction with others, during his employment with the Company (whether during
or outside normal working hours) relating to or in any way pertaining to or
connected with the Company's business, shall be the sole and exclusive property
of the Company or its designee and the Executive, whenever requested to do so by
the Company, shall, without further compensation or consideration
-5-
6
properly execute any and all applications, assignments or other documents which
the Company or its designee shall deem necessary in order to apply for and
obtain Letters Patent of the United States and/or comparable rights afforded by
foreign countries for the Inventions, or in order to assign and convey to the
Company or its designee the sole and exclusive right, title and interest in and
to the Inventions. This obligation shall continue beyond the termination of this
Agreement with respect to Inventions conceived or made by the Executive during
the term of his employment by the Company, and shall be binding upon his
assigns, executors, administrators, and other legal representatives.
8. NON-COMPETITION. (a) During the term of this Agreement or any renewal
thereof and, at the Company's option for a period of up to one year thereafter,
should the Executive's contract be terminated or not be renewed, the Executive
agrees that he will not within the geographical area of the United States,
engage, either directly or indirectly, individually or as an owner, partner,
joint venturer, employee, officer, director, stockholder, consultant,
independent contractor or lender of or to any corporation, holding company or
other business entity which is in a business similar to that of the Company or
any of its affiliates. In the event that the Company chooses to exercise its
option to prevent the Executive from competing with the Company following
termination or non-renewal of his employment, the Company shall notify the
Executive in writing within two (2) weeks following his last day of employment
or within two (2) weeks of notice by the Company of its decision that the
Executive shall take a leave-of-absence, in either case specifying the period of
up to one year following termination, resignation, or non-renewal of employment
during which such competitive activity shall be prohibited. In the event the
Company exercises its option, the Company shall continue to pay Executive his
Base Salary at the time of termination, resignation or non-renewal for the
period during which the Executive is prohibited from competition with the
Company. Notwithstanding the foregoing, the Executive (as hereinbefore described
in Section 2(d)) may own five (5%) percent of the securities of any business in
competition with the business of the Company or any of its affiliates, which
securities are regularly traded on a public exchange, provided that any such
ownership shall not result in the Executive becoming a record or beneficial
owner at any time of more than five (5%) percent of equity securities of said
business entity.
(b) The Executive shall not during the term of his Employment under this
Agreement or any renewal thereof, and for a period of one (1) year thereafter,
employ, retain or arrange to have any other person or entity employ or retain
any person who was employed by the Company or any of its affiliated companies
having an annual compensation of at least U.S. $50,000 per annum during the term
of this Agreement or any renewal thereof.
(c) If any provision of this Section is held to be unenforceable because
of the scope, duration or area of its applicability or otherwise, the legal
entity making that determination will have the power to modify the scope,
duration or area, or all of them, and the provision will then apply in its
modified form.
9. PROPERTY. All letters, memoranda, documents, business notes (including
all copies thereof) and other information contained on any other computer media
including computer disks
-6-
7
and hard drives of the Executive in any manner relating to the duties of
Executive under this agreement are the property of the Company.
10. NOTICES. Any notices or other communications required to be given
pursuant to this Agreement shall be in writing and shall be deemed given: (i)
upon delivery, if by hand; (ii) three (3) business days after mailing, if sent
by registered or certified mail, postage prepaid, return receipt requested;
(iii) one (1) business day after mailing, if sent via overnight courier; or (iv)
upon transmission, if sent by telex or facsimile except that if such notice or
other communication is received by telex or facsimile after 5:00 p.m. on a
business day at the place of receipt, is shall be effective as of the following
business day. All notices and other communications hereunder shall be given as
follows:
(a) If to the Company, to it at:
Biosystems, Inc.
000 Xxxxx Xxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxx 00000
Attention: President
Telephone Number 000-000-0000
Facsimile 000-000-0000
with copies to:
Bacou USA, Inc.
00 Xxxxxxx Xxxxxxxxx
Xxxxxxxxxx, Xxxxx Xxxxxx 00000
Attention: President
Telephone Number 000-000-0000
Facsimile Number 000-000-0000
Xxxxxxx & Xxxxxx
0000 Xxxxxxxx Xxxxx Xxxxx
Xxxxxxxxxx, Xxxxx Xxxxxx 00000
Attention: Xxxxx Xxxxxx, Esq.
Telephone Number 000-000-0000
Facsimile Number 401-276-6611
(b) If to Executive, to him at:
C/O Biosystems, Inc.
000 Xxxxx Xxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxx 00000
Telephone Number 000-000-0000
Facsimile Number 000-000-0000
-7-
8
Any party may change its address for receiving notice by written notice given to
the other names above in the manner provided above.
11. FULL AND COMPLETE AGREEMENT; AMENDMENT. This Agreement constitutes the
full and complete understanding and agreement of the parties and supersedes all
prior understandings and agreements. This Agreement may be modified only by a
written instrument executed by both parties.
12. CONSTRUCTION. This Agreement shall be construed under the laws of the
State of Connecticut.
13. ARBITRATION. Notwithstanding the fact that the parties shall be
entitled to equitable relief in order to enforce certain provisions hereunder
(e.g., temporary restraining orders or injunctive relief), any dispute,
controversy or claim arising out of or relating to this Agreement, or the breach
hereof, shall be settled by arbitration in accordance with the "Commercial
Arbitration Rules" of the American Arbitration Association in effect on the date
of this Agreement, except as varied below. The site of any such arbitration
shall be Hartford, Connecticut and any award shall be deemed to be a Hartford,
Connecticut award. There shall be a single arbitrator who shall be admitted to
practice law in Connecticut, with no less than ten (10) years experience in the
handling of commercial or corporate matters or disputes. The arbitrator shall
render a written decision stating his reasons therefor, and shall render an
award within six (6) months of the request for arbitration, and such award shall
be final and binding upon both parties. Judgment upon the award rendered by the
arbitrator may be entered in any court of competent jurisdiction in any state of
the United States or country or application may be made to such court for a
judicial acceptance of the award and an enforcement, as the law of such
jurisdiction may require or allow. The substantive law to be applied to any case
determined pursuant to this Section 13 is that of State of Connecticut. The
expense of arbitration shall be borne by the respective parties except to the
extent that the arbitrators shall determine that the entire expense shall be
borne by a single party.
14. BINDING NATURE. This Agreement shall be binding upon and shall inure
to the benefit of the parties and their respective, heirs, personal
representatives, successors, and assigns.
-8-
9
IN WITNESS WHEREOF, the Company and the Executive have duly executed this
Agreement as of the day and year first written above.
BIOSYSTEMS, INC.
By: /s/ Xxxx X. Xxxx, Xx.
-----------------------------------------
Xxxx X. Xxxx, Xx.
President and Chief Executive Officer
By: /s/ Xxxxxx Xxxxxx
-----------------------------------------
Xxxxxx Xxxxxx, Chairman
EXECUTIVE:
/s/ Xxxxxx Xxxx
---------------------------------------------
Xxxxxx Xxxx
-9-
