Exhibit 10.8
RETENTION AGREEMENT
-------------------
This Retention Agreement ("Retention Agreement") is made by and between
Startech Environmental Corporation, successors and assigns (the "Company"), and
Xxxxx Xxxxxxx, 000 Xxxxx Xxx., Xxxx Xxxxx, XX, 00000 ("Xx. Xxxxxxx"), dated
November 20, 2008 and effective January 1, 2009.
WHEREAS, Xx. Xxxxxxx had planned to retire, and announced his retirement to
the Company, effective October 31, 2008;
WHEREAS, the Company wishes to retain Xx. Xxxxxxx in employment with the
Company through May 15, 2009, and Xx. Xxxxxxx has agreed to defer his retirement
in exchange for certain consideration described herein;
WHEREAS, Xx. Xxxxxxx and the Company each have been afforded a reasonable
time to consider this Retention Agreement;
NOW THEREFORE, Xx. Xxxxxxx and the Company agree as follows:
1. The Company will pay Xx. Xxxxxxx, on May 1, 2009, the amount of one
hundred forty-four thousand three hundred fifty-three dollars and eighty-five
cents ($144,353.85) in a single lump sum, less lawful deductions, as a retention
bonus payment ("Retention Bonus") whether or not Xx. Xxxxxxx'x employment
terminates on or prior to such date.
2. The Company will provide Xx. Xxxxxxx with continued health insurance
coverage for Xx. Xxxxxxx and his spouse for twelve (12) months following
termination of his employment whenever such termination occurs. Such continued
health insurance will apply to all health insurance coverages in which Xx.
Xxxxxxx is enrolled as of the date of his termination of employment. Following
such twelve (12) months Xx. Xxxxxxx and his spouse shall have the right to elect
continued coverage under the Consolidated Omnibus Budget Reconciliation Act
("COBRA"), or any applicable state law, for such additional period provided
under COBRA or such applicable state law.
3. The Company will reimburse Xx. Xxxxxxx for his legal fees incurred by
Littler Xxxxxxxxx, PC in advising him and in preparing this Retention Agreement
on December 1, 2008.
4. In consideration for remaining in the Company's employ through May 15,
2009 and in compliance with the promises made herein and provided Xx. Xxxxxxx
does not voluntarily terminate his employment prior to May 15, 2009, the Company
agrees to the following:
a. To provide Xx. Xxxxxxx on a non-taxable basis with medical insurance,
life insurance, long term disability insurance, and short term
disability insurance that is provided to Xx. Xxxxxxx as of the date of
this Retention Agreement for the following: (i) Xx. Xxxxxxx for three
(3) years beginning May 1, 2009 (up to and including April 30, 2012),
and (ii) Xx. Xxxxxxx'x spouse, Xxxxxxxx Xxxxxxx, for five (5) years
beginning May 1, 2009 (up to and including June 30, 2014)
(collectively, benefits for both Mr. and Xxx. Xxxxxxx are referred to
herein as "Retention Benefits"); provided, however, the amount of
expenses eligible for reimbursement, or in-kind benefits provided,
during a calendar year may not affect the expenses eligible for
reimbursement, or in-kind benefits to be provided, in any other
calendar year. In the event the Retention Benefits cannot be provided
under Company sponsored group benefit plans or pursuant to COBRA or
other applicable state law with respect to benefit continuation
rights, the Company agrees to reimburse Xx. Xxxxxxx for the cost of
individual insurance coverage for the equivalent of the Retention
Benefits, or to provide the Retention Benefits on a Company
self-insured basis if such individual insurance coverage is not
available, for the period set forth in (i) and (ii) above, with such
reimbursed cost or such benefits grossed up for taxes so that such
cost is reimbursed to Xx. Xxxxxxx on the equivalent of a non-taxable
basis.
b. To fully release Xx. Xxxxxxx from any and all claims arising out of
his employment, and to execute a release of claims, in the form of
Exhibit A attached hereto, on his last day of employment.
5. Nothing in this Retention Agreement shall be effective to change or
amend Xx. Xxxxxxx'x rights under any grant of stock options made to him by the
Company under the 1995 Nonqualifying Stock Option Plan or under the 2000 Stock
Option Plan (the "Company Stock Plans"), provided that, for the avoidance of
doubt, upon termination of his employment at any time after October 31, 2008 Xx.
Xxxxxxx shall be deemed to have "Retired" and have entered "Retirement" as of
such termination for purposes of the post-termination exercise rights under the
Company Stock Plans with respect to stock options granted to Xx. Xxxxxxx under
the Company Stock Plans. In the event of a Change in Control as defined in the
Company Stock Plans, in connection with the successor or surviving company does
not assume the stock options granted under the Company Stock Plans, Xx. Xxxxxxx
shall receive a lump sum payment, within 90 days following the consummation of
the Change in Control, and for each share of Company common stock underlying the
stock options, equal to the difference between the per share exercise price with
respect to each share underlying such stock option and the per share
consideration paid to shareholders of the Company in connection with the Change
in Control.
6. In the event that the Company breaches its obligations set forth in this
Retention Agreement the Company agrees to pay any and all fees and costs,
including attorney's fees, incurred by Xx. Xxxxxxx in enforcing this Retention
Agreement and obtaining the monies and benefits set forth in said Agreement.
2
7. (a) The Company owns and has developed and compiled, and will own,
develop and compile, certain techniques, information, and materials tangible or
intangible, relating to itself, its customers, suppliers and others, which are
secret, proprietary and confidential, and which have great value to its business
(referred to in this Retention Agreement, collectively, as "Confidential
Information"). Confidential Information shall not in any event include
information which: (i) was generally known or generally available to the public
prior to its disclosure to Xx. Xxxxxxx; (ii) becomes generally known or
generally available to the public subsequent to disclosure to Xx. Xxxxxxx
through no wrongful act of any person; or (iii) which Xx. Xxxxxxx is required to
disclose by applicable law or regulation; provided that Xx. Xxxxxxx provides the
Company with prior notice of the contemplated disclosure and reasonably
cooperates with the Company at the Company's expense in seeking a protective
order or other appropriate protection of such information. Confidential
Information includes, but is not limited to, manuals, documents, computer
programs, compilations of technical, financial, legal or other data, client or
prospective client lists, names of suppliers, specifications, designs, business
or marketing plans, forecasts, financial information, work in progress, and
other technical or business information.
(b) Xx. Xxxxxxx acknowledges and agrees that in the performance of his
duties while employed with the Company, the Company disclosed to and entrusted
Xx. Xxxxxxx with Confidential Information. Xx. Xxxxxxx also acknowledges and
agrees that the unauthorized disclosure of Confidential Information, among other
things, may be prejudicial to the Company's interests and an improper disclosure
of trade secrets. Xx. Xxxxxxx agrees that he will not, directly or indirectly,
use, make available, sell, disclose or otherwise communicate to any corporation,
partnership, individual or other third party, other than in the proper
performance of his duties for the Company while employed, any Confidential
Information. Xx. Xxxxxxx agrees that he will not retain or take any Confidential
Information in a Tangible Form (as defined below), and Xx. Xxxxxxx shall
immediately deliver to the Company any Confidential Information in a Tangible
Form, as well as all other property, equipment, documents or things that were
issued to Xx. Xxxxxxx or otherwise received or obtained by Xx. Xxxxxxx.
"Tangible Form" includes information or materials in written or graphic form, on
a computer disk or other medium, or otherwise stored in or available through
electronic or other form.
8. Xx. Xxxxxxx acknowledges that, during his employment with the Company,
he obtained Confidential Information that if used by or given to a competitor of
the Company, the Company's competitive advantage will be materially adversely
affected and that he would inevitably draw on this Confidential Information if
he were to work for a competitive business. Accordingly, during his employment
with the Company and for twelve (12) months thereafter, Xx. Xxxxxxx will not,
directly or indirectly, engage in or participate as an owner, officer, employee,
director, manager, partner or agent of, or consultant for, any business
competitive with any business of the Company without the prior written consent
of the Company.
9. Xx. Xxxxxxx acknowledges that all clients of the Company are the
Company's clients and are not his personally. Xx. Xxxxxxx further acknowledges
that by virtue of his employment with the Company, he may gain or have gained
3
knowledge of the identity, characteristics and preferences of its clients
("Client Information"), and that he would inevitably have to draw on this Client
Information and on other Confidential Information if he were to solicit or
service the Company's clients on behalf of a competing business enterprise.
Accordingly, Xx. Xxxxxxx agrees that during his employment with the Company and
for twelve (12) months thereafter, he will not, directly or indirectly, solicit
the business of or perform any services for any actual client, any person or
entity that has been a client within the twelve (12) months preceding such
termination or any actively solicited prospective client as to whom he provided
any services or as to whom he had knowledge of Client Information or
Confidential Information during the course of his employment at the Company. Xx.
Xxxxxxx agrees that, during this period, he will not, directly or indirectly,
encourage or assist any person or entity in competition with the Company to
solicit or service any actual client, any person or entity that has been a
client within the twelve (12) months preceding such termination or any actively
solicited prospective client of the Company covered by this paragraph 9, or
otherwise seek to encourage or induce any such client to cease doing business
with, or lessen its business with, the Company, or otherwise interfere with or
damage (or attempt to interfere with or damage) any of the Company's
relationships with its clients.
10. Xx. Xxxxxxx further agrees that during his employment with the Company
and for twelve (12) months following the termination of his employment with the
Company, he will not, directly or indirectly, hire or seek to hire (whether on
his own behalf or on behalf of some other person or entity) any person who is,
at the time of the termination of Xx. Xxxxxxx'x employment, an employee of the
Company or who had left the employ of the Company within twelve (12) months
prior to such solicitation or hire. Nor will he, during this period, directly or
indirectly encourage or induce any employee of the Company to leave the
Company's employ.
11. This Retention Agreement shall inure to the benefit of and be
enforceable by Xx. Xxxxxxx, and his heirs, representatives, executors and
administrators. This Retention Agreement shall also be binding upon the Company,
it successors and assigns, and in the event of a change of control.
12. Xx. Xxxxxxx agrees not to make any public statements that disparage the
Company in any way or, and in the case of the Company, disparage its respective
affiliates, employees, officers, directors, products or services.
Notwithstanding the foregoing, statements made in the course of sworn testimony
in administrative, judicial or arbitral proceedings (including, without
limitation, depositions in connection with such proceedings) shall not be
subject to non-disparagement provisions.
13. This Retention Agreement shall be governed by, and construed and
enforced in accordance with, the laws of the State of Connecticut, without
giving effect to the principles of conflicts of law.
4
14. Notwithstanding anything herein to the contrary, the Company's payment
described in Section 1 hereof shall be contingent on Xx. Xxxxxxx'x execution of,
and delivery to the Company on April 20, 21, or 22, 2009, the General Release
attached hereto as Exhibit B and Xx. Xxxxxxx not revoking such release within
seven days of his delivery of such release. Should Xx. Xxxxxxx fail to timely
execute and deliver the release or revoke the release, the Company shall not be
obligated to make the payment described in Section 1 hereof.
15. Notwithstanding anything herein to the contrary, the Company's
obligations to Xx. Xxxxxxx pursuant to Section 4 and 5 hereof shall be
contingent on Xx. Xxxxxxx'x execution of, and delivery to the Company within 15
days after May 15, 2008, the General Release attached hereto as Exhibit C and
Xx. Xxxxxxx not revoking such release within seven days of his delivery of such
release. Should Xx. Xxxxxxx fail to timely execute and deliver the release or
revoke the release, the Company shall not be obligated to provide the benefits
or make the changes set forth in Section 4 and 5 hereof.
5
SIGNATURE PAGE
IN WITNESS WHEREOF, the parties have executed this Retention Agreement as of the
dates set forth below.
Date: By
-------------------------- ------------------------------------
Xxxxx X. Xxxxxxx, CFO
Startech Environmental Corporation
Date: By
-------------------------- ------------------------------------
Xxxxxx X. Xxxxx, Chairman & CEO
Startech Environmental Corporation
6
EXHIBIT A
---------
RELEASE OF XX. XXXXXXX. In accordance with the Retention Agreement executed by
the parties on November 20, 2008, Startech Environmental Corporation, (the
"Company"), for and in consideration of Xx. Xxxxxxx'x promise to remain with the
Company up to and including May 15, 2009 and the obligations set forth in the
Retention Agreement, the sufficiency of which is acknowledged, on behalf of
itself and its current and former officers, directors, agents, employees, board
members, partners, representatives, affiliates, predecessors, successors and
assigns, hereby agrees to fully release, discharge and forever hold harmless Xx.
Xxxxxxx, his estate, his representatives, his executors, and his heirs from any
and all liability or claims (including, but not limited to, claims for damages,
punitive damages, costs or attorneys' fees), whether known or unknown, that the
Company, its current or former officers, directors, agents, partners, employees,
board members, representatives, affiliates, predecessors, successors and
assigns, shall, can or may have from the beginning of the world to the execution
of this Release.
Startech Environmental Corporation
Date: By
------------------ -------------------------------------
Title:
7
Exhibit B
---------
Release
-------
In exchange for and in full consideration of the payment set forth in
Section 1 of the Retention Agreement, by and between Startech Environmental
Corporation (the "Company") and Xxxxx Xxxxxxx (the "Executive"), dated November
20, 2008 (the "Retention Agreement"), and as a material inducement to the
Company to agree to such payment, the Executive, for himself and his executors,
administrators, heirs and assigns, unconditionally and forever releases and
discharges the Company, together with its past, present and future parents,
subsidiaries (whether wholly- or partially-owned, direct or indirect),
affiliates and divisions, and each of their respective past, present and future
officers, directors, agents, employees, shareholders, predecessors, successors
and assigns, in each case, where applicable, in both their personal and
corporate capacities (collectively, the "Company Released Persons"), jointly and
individually, to the maximum extent permitted by law, from any and all Claims
(as defined below) which any of them has or may have for any period prior to the
date of the execution of this Release. By signing this Release, the Executive
agrees that (i) he will not seek or be entitled to any personal recovery for any
matters covered by this Release and (ii) except for actions or suits based on
breaches of the Retention Agreement, the Executive will refrain from commencing
any action or suit against any of the Company Released Persons arising out of
events, activities or other similar circumstances that took place prior to the
effective date of this Release.
8
For purposes of this Release, "Claims" means any and all manner of claims,
demands, causes of action, suits, judgments, executions, obligations, damages or
liabilities whatsoever of every kind and nature, at law or in equity, known or
unknown, and whether or not discoverable, that the Executive now has, may have,
or at any time had, against any Company Released Person. The term "Claims" shall
also include things that the Executive may not know or suspect, as well as any
claims the Executive may have arising out of or based upon:
(i) defamation, wrongful discharge, breach of contract, claims for unpaid
wages, and/or other compensation;
(ii) the Fair Labor Standards Act of 1938, as amended or the Family and
Medical Leave Act;
(iii) discrimination under the Americans with Disabilities Act, Title VII
of the Civil Rights Act of 1964, the Age Discrimination in Employment
Act of 1967, each as amended, and all other federal, state and local
laws, including, but not limited to, claims arising, inter alia under
any applicable laws in the State of Connecticut;
(iv) the Executive's employment with the Company and the termination
thereof;
(v) the letter agreement, dated September 1, 2005, between the Company and
the Executive;
(vi) any stock option agreement or any stock options;
(vii) bonuses, additional compensation, remuneration or vacation pay; and
(viii) attorneys' fees or costs incurred in pursuing this or any other
legal claim against the Company.
The foregoing notwithstanding, the term "Claims" does not include (and the
Executive is not releasing the Company from):
(i) any claims against the Company for promises and obligation under the
Retention Agreement;
(ii) any claims covered by workers compensation laws; or
(iii) any rights the Executive may have to indemnification under the
Company's By-laws, directors and officers liability insurance or this
Agreement.
The Executive acknowledges that he has been given in excess of 21 days from
the day he received a copy of this Release to sign it and that he has been
advised to consult an attorney. He understands that he has the right to revoke
this Release for seven days following his execution and delivery of this Release
to the Company. This Release shall not become effective or enforceable until the
expiration of the seven-day period following his execution and delivery of this
Release to the Company.
By executing this Release, the Executive states that he has read this
Release, knows and understands the content of this Release and he has knowingly
and voluntarily executed this Release. Witness my hand this __ day of April
2009.
-----------------------------
Xxxxx Xxxxxxx
10
Exhibit C
---------
Release
-------
In exchange for and in full consideration of the Company's obligations set
forth in Sections 4 and 5 of the Retention Agreement, by and between Startech
Environmental Corporation (the "Company") and Xxxxx Xxxxxxx (the "Executive"),
dated November 20, 2008 (the "Retention Agreement"), and as a material
inducement to the Company to agree to such payment, the Executive, for himself
and his executors, administrators, heirs and assigns, unconditionally and
forever releases and discharges the Company, together with its past, present and
future parents, subsidiaries (whether wholly- or partially-owned, direct or
indirect), affiliates and divisions, and each of their respective past, present
and future officers, directors, agents, employees, shareholders, predecessors,
successors and assigns, in each case, where applicable, in both their personal
and corporate capacities (collectively, the "Company Released Persons"), jointly
and individually, to the maximum extent permitted by law, from any and all
Claims (as defined below) which any of them has or may have for any period prior
to the date of the execution of this Release. By signing this Release, the
Executive agrees that (i) he will not seek or be entitled to any personal
recovery for any matters covered by this Release and (ii) except for actions or
suits based on breaches of the Retention Agreement, the Executive will refrain
from commencing any action or suit against any of the Company Released Persons
arising out of events, activities or other similar circumstances that took place
prior to the effective date of this Release.
11
For purposes of this Release, "Claims" means any and all manner of claims,
demands, causes of action, suits, judgments, executions, obligations, damages or
liabilities whatsoever of every kind and nature, at law or in equity, known or
unknown, and whether or not discoverable, that the Executive now has, may have,
or at any time had, against any Company Released Person. The term "Claims" shall
also include things that the Executive may not know or suspect, as well as any
claims the Executive may have arising out of or based upon:
(ix) defamation, wrongful discharge, breach of contract, claims for unpaid
wages, and/or other compensation;
(x) the Fair Labor Standards Act of 1938, as amended or the Family and
Medical Leave Act;
(xi) discrimination under the Americans with Disabilities Act, Title VII of
the Civil Rights Act of 1964, the Age Discrimination in Employment Act
of 1967, each as amended, and all other federal, state and local laws,
including, but not limited to, claims arising, inter alia under any
applicable laws in the State of Connecticut;
(xii) the Executive's employment with the Company and the termination
thereof;
(xiii) the letter agreement, dated September 1, 2005, between the Company
and the Executive;
(xiv) any stock option agreement or any stock options;
(xv) bonuses, additional compensation, remuneration or vacation pay; and
(xvi) attorneys' fees or costs incurred in pursuing this or any other legal
claim against the Company.
The foregoing notwithstanding, the term "Claims" does not include (and the
Executive is not releasing the Company from):
(i) any claims against the Company for promises and obligation under the
Retention Agreement;
12
(ii) any claims covered by workers compensation laws; or
(iv) any rights the Executive may have to indemnification under the
Company's By-laws, directors and officers liability insurance or this
Agreement.
The Executive acknowledges that he has been given in excess of 21 days from
the day he received a copy of this Release to sign it and that he has been
advised to consult an attorney. He understands that he has the right to revoke
this Release for seven days following his execution and delivery of this Release
to the Company. This Release shall not become effective or enforceable until the
expiration of the seven-day period following his execution and delivery of this
Release to the Company.
By executing this Release, the Executive states that he has read this
Release, knows and understands the content of this Release and he has knowingly
and voluntarily executed this Release.
Witness my hand this __ day of May 2009.
-----------------------------
Xxxxx Xxxxxxx
13
