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EXHIBIT (c)(5)
CONSULTING AND NONCOMPETITION AGREEMENT
AGREEMENT, dated as of June 30, 1997, by and among Xxxxx
Corporation, an Ohio corporation, having its principal place of business at
Xxxxx Xxxxxx, Xxxxxxxxx, Xxxx 00000-0000 ("Parent"), Xxxxxx X. Xxxxxx
("Consultant") and Fusion Systems Corporation, a Delaware corporation having its
principal place of business at 0000 Xxxxxxxx Xxxxx, Xxxxxxxxx, Xxxxxxxx 00000
(the "Company").
WHEREAS, pursuant to an Agreement and Plan of Merger ("Merger
Agreement") of even date herewith by and among Parent, a subsidiary of Parent
("Subsidiary"), and the Company, the Company and Parent have agreed to commence
a tender offer to purchase all of the outstanding shares of the Company's common
stock, par value $.01 per share, and the associated preferred share purchase
rights, and the parties thereto have agreed, subject to the terms and provisions
thereof, that Subsidiary shall be merged with and into the Company (the
"Merger");
WHEREAS, Parent and the Company desire by this Agreement to
provide for certain items and conditions relating to the rendering of consulting
services by the Consultant to the Company and Parent after consummation of the
Merger and for the protection of the goodwill and proprietary rights of Parent
and the Company; and
WHEREAS, the Consultant desires to render consulting services
to the Company upon the terms and conditions stated herein; and
NOW, THEREFORE IN CONSIDERATION OF THE MUTUAL COVENANTS
CONTAINED HEREIN, INTENDING TO BE LEGALLY BOUND, PARENT, THE
COMPANY AND THE CONSULTANT HEREBY AGREE AS FOLLOWS:
1. Consulting Period. The Consultant shall make himself
available to render consulting services, on the terms and conditions set forth
in this Agreement, for the period beginning on the date of the Merger and ending
on the earlier of (i) the fifth anniversary of the date of the Merger or (ii)
the date on which the Consultant becomes disabled or dies (the "Consulting
Period").
2. Consulting Services. During the Consulting Period, the
Consultant shall render services regarding business opportunities in the
semiconductor equipment industry and such other services relating to the
business of
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the Company and Parent as may be requested from time to time by the Board of
Directors or the Chief Executive Officer of the Company or the Board of
Directors or the Chief Executive Officer of Parent. The Consultant's services
shall be performed at such times and locations as shall be mutually convenient
to the Consultant and the Company or Parent, as the case may be.
3. Fee. In consideration of the foregoing and of the covenants
set forth below, the Company shall pay the Consultant a fee (the "Fee")
consisting of (a) $750,000 in a lump sum payment promptly following the first
day of the Consulting Period, and (b) $12,500 per month thereafter during the
Consulting Period.
4. Confidential Information. During the Consulting Period and
at all times thereafter, the Consultant shall hold in a fiduciary capacity for
the benefit of the Company and Parent all secret or confidential information,
knowledge or data relating to the Company, Parent or any of their respective
affiliated companies, and their respective businesses, which shall have been
obtained by the Consultant during the Consultant's employment by or consulting
service to the Company, Parent or any of their respective affiliated companies
(whether before, on or after the date of this Agreement) and which shall not be
or become public knowledge (other than by acts by the Consultant or
representatives of the Consultant in violation of this Agreement). After
termination of the Consultant's services to the Company and Parent the
Consultant shall not, without the prior written consent of the Company, Parent
or as may otherwise be required by law or legal process, communicate or divulge
any such information, knowledge or data to anyone other than the Company, Parent
and those designated by them.
5. Noncompetition. (a) Non-Competition. In con-
sideration of the Fee and other good and valuable consideration,
the Consultant hereby agrees that during the Consulting Period, the
Consultant shall not, as a shareholder, employee, officer,
director, partner, lender, investor, advisor, consultant or
otherwise (whether or not being compensated in any way in any such
capacity), engage directly or indirectly in any business or
enterprise which is in Competition with Parent/Company (as defined
below), without the prior written consent of Parent.
(b) "Competition with Parent/Company" shall mean any of
the following:
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(i) Competition with the semiconductor equipment
business of the Parent, of any entity controlled by Parent or of the respective
successors and assigns of Parent or any such entity;
(ii) Competition with the Company or an entity
controlled by it or the respective successors and assigns of the Company or any
such entity;
(iii) Any business activity which is the same as or
comparable to any business activity of the Company or any other entity described
in clause (ii) above or of the semiconductor equipment business of Parent or of
any other entity described in clause (i) above, in any case from time to time
during the Consulting Period in any geographic area throughout the world in
which Parent or the Company or any such entity is engaged in such business
activity.
Notwithstanding the foregoing, nothing in this Section 5 shall prevent the
Consultant from purchasing and holding for investment (i) less than five percent
of the equity of any entity, if such equity is listed on a national securities
exchange or regularly traded in an over-the-counter market or such entity
consists of a pooled investment vehicle in which the Consultant is a purely
passive investor, or (ii) less than one percent of the equity of any
corporation, partnership or similar entity.
(c) Enforcement. If any of the covenants set forth in Section
4 or this Section 5 (the "Covenants") is finally determined by a court of
competent jurisdiction to be unenforceable in whole or in part, the Consultant
and the Company hereby agree that such court shall have jurisdiction to reform
this Agreement or any provision hereof so that such Covenant is enforceable to
the maximum extent permitted by law, and the parties agree to abide by such
court's determination. If any of the Covenants is determined to be wholly or
partially unenforceable in any jurisdiction, such determination shall not be a
bar to or in any way diminish the right of the Company, Parent and their
respective affiliates and successors to enforce any such Covenant in any other
jurisdiction. The Consultant acknowledges and agrees that: (i) the purpose of
the Covenants is to protect the goodwill, trade secrets and other confidential
information of the Company being acquired by Parent, that because of the nature
of the businesses in which the Company, Parent and their respective affiliates
and successors are engaged and because of the nature of the Confidential
Information to which the Consultant has access, it would be impractical and
excessively difficult to determine the actual damages of the
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Company, Parent and their respective affiliates and successors in the event the
Consultant breached any of the Covenants, and that remedies at law (such as
monetary damages) for any breach of the Consultant's obligations under the
Covenants would be inadequate. The Consultant therefore agrees and consents that
if he commits any breach of any Covenant or threatens to commit any such breach,
the Company, Parent and their respective affiliates and successors shall have
the right (in addition to, and not in lieu of, any other right or remedy that
may be available to them) to temporary and permanent injunctive relief from a
court of competent jurisdiction, without posting any bond or other security and
without the necessity of proof of actual damage.
6. Fusion Lighting, Inc. The parties hereto acknowledge that
the Consultant is the President and a significant shareholder of Fusion
Lighting, Inc., a manufacturer of lighting systems and light sources employing
technology common to the Company's technology, and that nothing contained in
this Agreement shall limit the Consultant's freedom to engage in or further such
business of that corporation in those capacities.
7. Successors. (a) This Agreement is personal to the
Consultant and, without the prior written consent of the Company, shall not be
assignable by the Consultant otherwise than by will or the laws of descent and
distribution. This Agreement shall inure to the benefit of and be enforceable by
the Consultant's legal representatives.
(b) This Agreement shall inure to the benefit of and be
binding upon the Company, Parent and their respective successors and assigns.
8. Miscellaneous. (a) This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Maryland, without
reference to principles of conflict of laws. The captions of this Agreement are
not part of the provisions hereof and shall have no force or effect. This
Agreement may not be amended or modified except by a written agreement executed
by the parties hereto or their respective successors and legal representatives.
(b) The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.
(c) The Consultant acknowledges that his services hereunder
are to be rendered as an independent contractor,
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and that he is solely responsible for the payment of all Federal, state, local
and foreign taxes that are required by applicable laws or regulations to be paid
with respect to the Fee.
(d) The Consultant, the Company and Parent acknowledge that
this Agreement supersedes any other agreement between them concerning the
provision of consulting services by the Consultant to the Company and Parent.
IN WITNESS WHEREOF, the Consultant has hereunto set his hand
and, pursuant to the authorization of their respective Board of Directors, the
Company and Parent have caused this Agreement to be executed in their names on
their behalf, all as of the day and year first above written.
/s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx
XXXXX CORPORATION
By /s/ Xxxxxx X. Xxxxxxxx
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FUSION SYSTEMS CORPORATION
By /s/ Xxxxxx X. Xxxxxxx
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