EXHIBIT 10(r)
EMPLOYMENT AGREEMENT
AGREEMENT dated this 15th day of March, 1996, by and between
MediVators, Inc., a Minnesota corporation (the "Company"), and Xxxxxx X.
Xxxxxxxxxx (the "Employee").
R E C I T A L :
A. Employee currently serves as President and Chief Executive
Officer of the Company pursuant to an Employment Agreement dated as of June 15,
1991 (the "1991 Agreement"). Said Employment Agreement terminates in accordance
with its terms on June 30, 1996.
B. Simultaneously with the execution of this Agreement, the Company
and Cantel Acquisition Corp. ("Newco") are executing and filing with the
Secretary of State of the State of Minnesota, Articles of Merger pursuant to
which Newco, a wholly-owned subsidiary of Cantel Industries, Inc. ("Cantel"),
will merge with and into the Company (the "Merger"). Upon consummation of the
Merger, the Company will become a wholly-owned subsidiary of Cantel.
C. The Company is desirous of continuing the employment of Employee
and Employee is desirous of continuing his employment by the Company after June
30, 1996 on the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, it is hereby agreed by and between the Company and Employee as
follows:
1. Engagement and Term. The Company hereby employs Employee and
Employee hereby accepts such employment by the Company on the terms and
conditions set forth herein, for the three-year period commencing on July 1,
1996 (the "Effective Date") and ending, unless sooner terminated in accordance
with the provisions of Section 4 hereof, on June 30, 1999 (the "Employment
Period"). As used in this Agreement, the term "Contract Year" shall refer to the
twelve-month period commencing on the Effective Date and each twelve-month
period thereafter during the term of this Agreement.
2. Scope of Duties. Employee shall be employed by the Company as its
President and Chief Executive Officer. In such capacities, the Employee shall
have such authority, powers and duties customarily attendant upon such offices.
If elected or appointed, Employee shall also serve, without additional
compensation, in one or more offices and, if and when elected, as a director of
the Company or any subsidiary or affiliate of the Company, provided that his
duties and responsibilities are not inconsistent with those pertaining to his
position as stated above. Employee agrees to perform the duties associated with
his employment to the best of his abilities, and shall faithfully devote his
full business time and efforts so as to advance the best interests of the
Company. During the Employment Period,
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Employee shall not be engaged in any other business activity, whether or not
such business activity is pursued for profit or other pecuniary advantage.
Notwithstanding the foregoing, Employee shall be permitted to serve as a
director of any other company, provided Employee shall first obtain the prior
written consent of the Company, which shall not be unreasonably withheld, and
provided further that any such service does not interfere with the performance
by Employee of his duties hereunder and is in no way, directly or indirectly,
competitive with, or opposed to the best interests of the Company.
3. Compensation.
3.1 Basic Compensation. In respect of services to be performed
by the Employee during the Employment Period, the Company agrees to pay the
Employee an annual base salary of $96,000 during the first Contract Year,
$103,000 during the second Contract Year, and $110,000 during the third Contract
Year ("Basic Compensation"), payable in accordance with the Company's customary
payroll practices for executive employees.
3.2 Discretionary Increases. The Employee shall also be
entitled to such additional increments and bonuses, if any, as shall be
determined from time to time by the Compensation Committee of the Board of
Directors of Cantel, based upon the performance of Employee and the Company.
3.3 Stock Options. The Company agrees to cause the grant to
Employee as of the date hereof of an option (the "Option") to purchase
Twenty-five Thousand (25,000) shares of
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Common Stock, par value $.10 per share of Cantel. The Option will be granted
under Cantel's 1991 Employee Stock Option Plan (the "Plan") pursuant to a
separate option agreement in the form annexed hereto as Exhibit A. The Option
shall have an option exercise price per share equal to the fair market value of
Cantel's Common Stock on the date hereof determined in accordance with the Plan.
3.4 Life Insurance. Provided that Employee is insurable at
rates that are comparable to those obtainable on other persons of similar age
and position in good health (if Employee is classified in a higher risk category
he may elect to pay the excess premium cost to obtain the coverage), during the
Employment Term the Company shall procure and maintain life insurance on the
life of Employee in the face amount of $250,000. Employee shall be the owner of
such life insurance policy and shall have the absolute right to designate the
beneficiaries thereunder. The type of policy (whether term, whole life, etc., or
combination of types) shall be in the sole discretion of the Company. The
Company shall pay all premiums for such life insurance. Employee agrees to
submit to all medical examinations, supply all information and execute all
documents required by insurance companies in connection with the issuance of
such policy.
3.5 Use of Automobile. During the Employment Term, Employee
shall at all times have the use of a Company-owned or leased automobile of style
and type selected by the Company,
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but comparable to the automobile currently being furnished by the Company to
Employee. At the end of the Employment Term, Employee shall have the right to
purchase the automobile from the Company at its then book value, or, if the
automobile is being leased, in accordance with the terms of the lease.
3.6 Other Benefits.
(a) During the Employment Period, Employee shall be entitled
to participate in the major medical health insurance plan, and all other health,
insurance or other benefit plans applicable generally to executive officers of
the Company on the same basis as such officers.
(b) During the Employment Period, Employee will be entitled to
paid vacations and holidays consistent with the Company's policy applicable to
executives generally. All vacations shall be scheduled at the mutual convenience
of the Company and the Employee.
4. Term of Employment. The provisions of Section 1 of this Agreement
notwithstanding, the Company may terminate this Agreement and Employee's
employment hereunder in the manner and for the causes hereinafter set forth, in
which event the Company shall be under no further obligation to Employee other
than as specifically provided herein:
A. If Employee is absent from work or otherwise substantially
unable to assume his normal duties for a period of sixty (60) successive days or
an aggregate of ninety (90) business days during any consecutive twelve-month
period during
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the Employment Period because of physical or mental disability, accident,
illness, or any other cause other than vacation or approved leave of absence,
the Company may thereupon, or any time thereafter while such absence or
disability still exists, terminate the employment of Employee hereunder upon ten
(10) days' written notice to Employee.
B. In the event of the death of Employee, this Agreement shall
immediately terminate on the date thereof.
C. If Employee materially breaches or violates any material
term of his employment hereunder, or commits any criminal act or an act of
dishonesty or moral turpitude, in the reasonable judgment of the Company's Board
of Directors, then the Company may, in addition to other rights and remedies
available at law or equity, immediately terminate this Agreement upon written
notice to Employee with the date of such notice being the termination date and
such termination being deemed for "cause."
D. In the event Employee's employment shall be terminated by
reason of the provisions of subparagraph A or B of this Section 4, then in such
event, the Company shall continue to pay to Employee, if living, or other person
or persons as Employee may from time to time designate in writing as the
beneficiary of such payments, the Basic Compensation in effect at the time which
such death or disability occurred during the three-month period following such
death or disability.
5. Disclosure of Confidential Information, Assignment of Inventions,
and Covenant Not to Compete.
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5.1 Confidential Information. Employee acknowledges that the
Company possesses confidential information, know-how, customer lists,
purchasing, merchandising and selling techniques and strategies, and other
information used in its operations of which Employee will obtain knowledge, and
that the Company will suffer serious and irreparable damage and harm if this
confidential information were disclosed to any other party or if Employee used
this information to compete against the Company. Accordingly, Employee hereby
agrees that except as required by Employee's duties to the Company, Employee
without the consent of the Company's Board of Directors, shall not at any time
during or after the Employment Period disclose or use any secret or confidential
information of the Company, including, without limitation, such business
opportunities, customer lists, trade secrets, formulas, techniques and methods
of which Employee shall become informed during his employment, whether learned
by him as an employee of the Company, as a member of its Board of Directors or
otherwise, and whether or not developed by Employee, unless such information
shall be or become public knowledge other than as a result of the Employee's
direct or indirect disclosure of the same.
5.2 Patent and Related Matters.
5.2.1 Employee will promptly disclose in writing to the
Company complete information concerning each and every invention, discovery,
improvement, idea, device, design, apparatus, practice, process, method or
product, whether
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patentable or not, and including those which may be subject to copyright
protection, made, developed, perfected, devised, conceived or first reduced to
practice by Employee, either solely or in collaboration with others, during the
term of his employment, whether or not during regular working hours (hereinafter
collectively referred to as the "Inventions"). Employee, to the extent that he
has the legal right to do so, hereby acknowledges that any and all of the
Inventions are property of the Company and hereby assigns and agrees to assign
to the Company any and all of Employee's right, title and interest in and to any
and all of the Inventions.
5.2.2 Limitation. It is further agreed and Employee is hereby
notified that the above agreement to assign the Inventions to the Company does
not apply to an Invention for which no equipment, supplies, facility or
confidential information of the Company was used and which was developed
entirely on Employee's own time, and
(i) which does not relate (aa) directly to the business
of the Company or (bb) to the Company's actual or demonstrably anticipated
research and development, or
(ii) which does not result from any work performed by
Employee for the Company.
5.2.3 Assistance. Upon request and without further
compensation therefor, but at no expense to Employee, and whether during the
Employment Period or thereafter, the Employee will do all lawful acts,
including, but not limited to, the
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execution of documents and instruments and the giving of testimony, that in the
opinion of the Company, its successors and assigns, may be necessary or
desirable in obtaining, sustaining, reissuing, extending or enforcing United
States and foreign copyrights and Letters Patent, including, but not limited to,
design patents, on any and all of the Inventions, and for perfecting, affirming
and recording the Company's complete ownership and title thereto, and to
cooperate otherwise in all proceedings and matters relating thereto.
5.2.4 Records. Employee will keep complete, accurate and
authentic accounts, notes, data and records of all the Inventions in the manner
and form requested by the Company. Such accounts, notes, data and records shall
be the property of the Company, and upon its request, Employee will promptly
surrender the same to it.
Upon the termination of the Employment Period, Employee agrees to
deliver promptly to the Company all records, manuals, books, blank forms,
documents, letters, memoranda, notes, notebooks, reports, data, tables,
accounts, calculations and copies thereof, which are the property of the Company
or which relate in any way to the business, products, practices or techniques of
the Company, and all other property, trade secrets and confidential information
of the Company, including, but not limited to, all documents which in whole or
in part contain any trade secrets or confidential information of the Company,
which
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in any of these cases are in his possession or under his control.
5.3 Non-Compete. Employee agrees that for a period of one year
following the termination of Employee's employment hereunder (the
"Non-Competition Period"), except as a result of the breach by the Company of
any material term or condition hereof, Employee will not, directly or
indirectly, alone or with others, individually or through or by a corporate or
other business entity in which he may be interested as a partner, shareholder,
joint venturer, officer, director, employee or otherwise, own, manage, control,
participate in, lend his name to, or render services to or for any business
within the continental United States which is competitive with that of the
Company or any of its affiliates, provided, however, that the foregoing shall
not be deemed to prevent the ownership by Employee of up to five percent of any
class of securities of any corporation which is regularly traded on any stock
exchange or over-the-counter market. For the purpose of this Agreement, a
business activity competitive with the business of the Company or any of its
affiliates shall include only the design, manufacture, marketing, sale, or
distribution of (i) endoscopes or endoscope disinfection equipment or (ii)
medical waste disposal systems or (iii) infection control equipment or supplies.
5.4 Non-interference. Employee further agrees that during the
Non-Competition Period he will not (i) induce or attempt to induce any other
employee of the Company or any of its
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affiliates to leave the employ of the Company or affiliate, or in any way
interfere with the relationship between the Company (or any of its affiliates)
and any other employee, or (ii) induce or attempt to induce any customer,
supplier, franchisee, licensee, distributor or other business relation of the
Company or any of its affiliates to cease doing business with the Company or
affiliate, or in any way interfere with the relationship between any customer,
franchisee or other business relation and the Company and any of its affiliates
without prior written consent of the Board of Directors of the Company (or
affiliate).
5.5 Enforcement. If, at the time of enforcement of any
provisions of this section, a court of competent jurisdiction holds that the
restrictions stated herein are unreasonable under the circumstances then
existing, the parties hereto agree that the maximum period, scope or
geographical area reasonable under such circumstances will be substituted for
the stated period, scope or area. Employee agrees that the covenants made in
this Section shall be construed as an agreement independent of any other
provision of this Agreement, and shall survive the termination of this
Agreement.
6. Reimbursement of Expenses. The Company shall further pay
directly, or reimburse the Employee, for all other reasonable and necessary
expenses and disbursements incurred by him for and on behalf of the Company in
the performance of his duties during the Employment Period upon submission of
vouchers
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or other evidence thereof in accordance with the Company's usual policies of
expense reimbursement.
7. Miscellaneous Provisions.
7.1 Section headings are for convenience only and shall not be
deemed to govern, limit, modify or supersede the provisions of this Agreement.
7.2 This Agreement is entered into in the State of Minnesota
and shall be governed pursuant to the laws of the State of Minnesota. If any
provision of this Agreement shall be held by a court of competent jurisdiction
to be invalid, illegal or unenforceable, the remaining provisions hereof shall
continue to be fully effective.
7.3 This Agreement contains the entire agreement of the
parties regarding this subject matter. There are no contemporaneous oral
agreements, and all prior understandings, agreements (except for the 1991
Agreement, which shall remain in full force and effect in accordance with its
terms), negotiations and representations are merged herein.
7.4 This Agreement may be modified only by means of a writing
signed by the party to be charged with such modification.
7.5 Notices or other communications required or permitted to
be given hereunder shall be in writing and shall be deemed duly given upon
receipt by the party to whom sent at the respective addresses set forth below or
to such other address as
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any party shall hereafter designate to the other in writing delivered in
accordance herewith:
If to Medivators:
MediVators, Inc.
6352 000 Xxxxxx Xxx
Xxxxxx Xxxxx, XX 00000
With a copy to:
Cantel Industries, Inc.
0000 Xxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, Xxx Xxxxxx 00000
If to Employee:
Xxxxxx X. Xxxxxxxxxx
0000 Xxxx Xxx Xxxxx Xxxxx
Xxxxxxx Xxxxxxx, XX 00000
7.6 This Agreement shall inure to the benefit of, and shall be
binding upon, the Company, its successors and assigns, including, without
limitation, any entity that may acquire all or substantially all of the
Company's assets and business or into which the Company may be consolidated or
merged. This Agreement may not be assigned by Employee.
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7.7 This Agreement may be executed in separate counterparts,
each of which shall constitute the original hereof.
IN WITNESS WHEREOF, the parties have set their hands as of the date
first above written.
MEDIVATORS, INC.
By:/s/ Xxxxxx X. Xxxxxxxxxx
------------------------
/s/ Xxxxxx X. Xxxxxxxxxx
------------------------
Xxxxxx X. Xxxxxxxxxx
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