EMPLOYMENT AGREEMENT
--------------------
THIS EMPLOYMENT AGREEMENT ("Agreement") is made and entered into as of September
16, 1996, by and between Lasersight, Inc., a Missouri corporation (the
"Company"), and Xxxxxxx X. Xxxxxxxx, an individual residing, at the time of
entering into this Agreement, in the State of Wisconsin (the "Executive").
RECITALS
--------
Whereas, Executive desires to be employed a the Chief Operating Officer of the
company with a title to be conferred immediately upon assuming the duties of the
position; and
Whereas, the Company desires to retain the Executive as its Chief Operating
Officer of the Company upon the terms and conditions herein set forth.
NOW, THEREFORE, in consideration of the foregoing recitals, the mutual covenants
of the parties hereinafter set forth and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
1. Employment of the Executive. Subject to the terms and conditions of this
Agreement, the Company hereby employs the Executive, and the Executive hereby
accepts such employment and agrees to perform the services specified herein.
2. Duties. The Executive shall report to the Chief Executive Officer of the
Company and have authority and responsibility, in accordance with policies of
the Company, for the operations of the various subsidiaries and departments of
the Company. During the term of his employment hereunder, the Executive shall:
(a) Perform to the best of his ability, those duties reasonably
assigned to him from time to time by the Chief Executive Officer and
the Board of Directors of the Company, provided, however, that such
duties shall be reasonably related to the positions held by the
Executive pursuant hereto;
(b) Devote his full time and first priority business efforts to
the Company's business, provided that nothing herein shall prohibit
Executive from spending reasonable amounts of time for personal
affairs, including, without limitation, serving as a director of
companies, and managing his personal investments, provided Executive
devotes an average minimum of forty (40) hours per week to performing
his duties hereunder; and
(c) Carry out Company policies and directives in a manner which
promotes and develops the Company's best interests.
3. Salary. The Company shall pay Executive an initial base salary at an
annual rate of One Hundred Fifty Thousand Dollars ($150,000.00) which shall be
payable in equal installments in accordance with the Company's customary method
of salary payments for senior executives of the Company (but not less than
monthly).
4. Additional Compensation. Immediately upon execution of this Agreement,
or if later, the date the Executive becomes employed by the Company, the
Executive will be granted Incentive Stock Options (as defined in Section 422 of
the Internal Revenue Code) for 100,000 shares of the Company's common stock at
an option price per share equal to the Fair Market Value per share, as defined
in the LaserSight Incorporated 1996 Equity Incentive Plan (the "1996 Equity
Incentive Plan"), on the date of grant which shall be September 25, 1996. Such
Incentive Stock Options shall be granted to Executive pursuant to that certain
1996 Equity Incentive Plan. The options for said one hundred thousand (100,000)
shares shall vest as follows: (a) 20,000 shares on December 1, 1996, (b) 20,000
shares on September 25, 1997, (c) 20,000 shares on September 25, 1998, (d)
20,000 shares on February 25, 1999, and (e) 20,000 shares on September 25, 2000.
Should Executive's employment end for any reason prior to the time all options
are vested, any and all non-vested options shall terminate and thereafter be
considered null and void.
5. Fringe Benefits. During the term of his employment hereunder, the
Executive shall be entitled to all fringe benefits and perquisites which that
Company from time to time makes available to other senior executives of the
Company, on such terms and levels as are at least commensurate with those
provided to such other senior executives, including, without limitation, health
insurance, vacation, sick days 401K pension contributions and any Local, State
and Federal contributions.
6. Expenses.
(a) The Company shall provide Executive with the sum of One
Thousand Dollars ($1,000.00) per month to cover expenses for travel.
Executive shall provide Company with receipts and other documentation
of all such expenses each month. From time to time, Company will
review the expenses of Executive for travel and related expenses, and
may increase or decrease the sum paid hereunder at any time.
(b) In addition to section 6(a), the Executive will be reimbursed
promptly for all reasonable costs and expenses not otherwise provided
for in this section 6(b), including, but not limited to, travel,
lodging and meals, incurred in connection with the performance of his
duties hereunder, consistent with the reimbursement guidelines
established and implemented from time to time by the Company for other
senior executives of the Company, including, but not limited to,
presentation of appropriate documentation. The Company shall also
promptly reimburse Executive for all reasonable costs and expenses of
a cellular phone insofar as such use relates to Executive's
performance of services for the Company (including, but not limited
to, long distance charges for business-related calls) for use by
Executive in connection with the performance of his duties hereunder.
The Company shall pay the initiation fees and dues to enable Executive
to belong to a country club or other club, such club to be selected
entirely at Executive's discretion.
7. Terms of Employment: Severance.
(a) The term of this Agreement shall begin on the date hereof and
shall continue for a period of four (4) years, unless terminated as
provided in this Section 7.
(b) Notwithstanding the foregoing, the Executive's employment
hereunder may be terminated by the Company at any time for Cause (as
defined in Section 10). Company also may terminate Executive's
employment at any time with or without Cause or advance notice.
(c) Notwithstanding the foregoing, the Executive's employment
hereunder shall terminate in the event of his death or Disability (as
defined in Section 10).
(d) Notwithstanding the foregoing, the Executive's employment
hereunder may be terminated by the Executive at any time for Good
Reason (as defined in Section 10) upon prior written notice to the
Company specifying therein the grounds for termination and the
effective date of termination.
(e) In addition to all other rights of Executive and obligations
of the Company described herein which arise or continue upon
termination of Executive's employment, the following shall apply: Upon
termination of the Executive's employment hereunder for any reason
whatsoever, the Company shall pay to the Executive all salary,
benefits, bonuses and other Compensation (as defined in Section 10)
(including reimbursements) earned through the effective date of
termination. In addition, if the Executive's employment hereunder is
terminated by the Company without Cause, Company shall continue to pay
Executive his Base Salary at its then-current level, for a period of
twelve (12) months after termination.
8. Restriction Against Competition.
(a) The Executive agrees that while he is employed by the Company
pursuant to this Agreement and during the twelve (12) month period
following the effective date of termination of this Agreement for any
reason, the Executive shall not, directly or indirectly, as a partner,
officer, director, agent, consultant, employee, or otherwise:
(i) engage in any business that competes with the business
of the Company (herein to mean all Subsidiaries,
divisions, and assigns of the Company) as conducted by
the Company as of the effective date of the
termination of this Agreement in any state where the
Company is conducting business;
(ii) purposefully interfere or attempt to interfere with
any of the Company's contracts or business
relationships or advantages existing and in effect as
of the effective date of termination of this
Agreement;
(iii) solicit for employment, either directly or indirectly,
for himself or for another, any of the technical or
professional employees employed by the Company, except
that with respect to the twelve (12) month period
following the effective date of termination of this
Agreement, such restriction shall apply only to such
employees employed by Company on the effective date of
termination of this Agreement or within six (6) months
prior thereto;
(iv) purposefully interfere with the business relationship
of or solicit the business or orders of (a) a customer
of the Company, except that with respect to the twelve
(12) month period following the effective date of
termination of this Agreement, such restriction shall
apply only to such customers existing on the effective
date of termination of this Agreement, or within sixty
(60) days prior thereto, or (b) a prospective or
potential customer of the Company, except that with
respect to the two-year period following the effective
date of termination of this Agreement, such
restriction shall apply only to prospective or
potential customers (i) to whom the Company has
submitted a formal quotation within the past one year
prior to the effective date of termination of this
Agreement, or (ii) that have been previously listed or
identified in writing by the Company as a business
prospect at any time during the twelve (12) months
preceding the effective date of termination of this
Agreement.
(b) The parties agree that if the Executive commits a breach of
the covenants of this Section 8, the Company shall have the right to
seek and obtain all appropriate injunctive and other equitable
remedies therefor, in addition to any other rights and remedies that
may be available at law, it being acknowledged and agreed that such
breach would cause irreparable injury to the parties and that money
damages would not provide an adequate remedy therefor.
9. Protection of Confidential Information and Trade Secrets of the Company.
(a) Confidentiality. During the term of this Agreement and for a
period of twelve (12) months after any termination or expiration
thereof, Executive agrees that he will not use for himself or others
or divulge or convey to others any secrets or confidential
information, knowledge or data of the Company obtained by the
Executive during his employment with the Company. The term "secret or
confidential information, knowledge or data" shall not be deemed to
include information that is published, information that is generally
known throughout the industry or which generally is available to the
industry without restriction through no fault of the Executive.
(b) Injunctive Relief. The Executive agrees that the Company's
remedies at law for any breach or threat of breach by him of the
provisions of paragraph (a) of this Section 9 will be inadequate, and
that the Company shall be entitled to an injunction or injunctions to
prevent breaches of the provision of paragraph (a) of this Section 9
and to enforce specifically the terms and provisions thereof, in
addition to any other remedy to which the Company may be entitled to
by law or equity.
(c) Return of Document and Other Property. Upon the termination
of the Executive's employment with the Company, or any time upon the
request of the Company, the Executive shall deliver to the Company (i)
all documents and materials containing secret or confidential
information, knowledge or data relating to the Company's business and
affairs, and (ii) all documents, materials and other property
belonging to the Company, which in either case are in the possession
or under the control of the Executive.
10. Certain Defined Terms. For the purposes of this Agreement, the
following definitions shall apply:
(a) "Affiliate" shall mean with respect to any Person, (i) any
Person which directly, or indirectly through one or more
intermediaries, controls, or is controlled by, or is under common
control with, such Person or (ii) any Person who is a director or
executive officer (A) of such Person, (B) of an Subsidiary of such
Person or (C) of any Person described in the foregoing clause(i). For
purposes of this definition, "control" of a Person shall mean the
power, direct or indirect, (1) to vote or direct the voting of more
than 20% of the outstanding voting securities of such Person, or (2)
to direct or cause the direction of the management and policies of
such Person, whether by contract or otherwise.
(b) "Cause" shall mean any of the following:
(i) The Executive's conviction (including a plea of nolo
contendere) of any crime involving moral turpitude,
the theft or willful destruction of money or other
property of the Company or any customer or his
conviction of any felony crime.
(ii) The Executive's continuous inability to perform his
responsibilities due to his habitual abuse of alcohol
or prescribed drugs or any use of illegal drugs;
(iii) The Executive's commission of theft, embezzlement or
fraud against the Company;
(iv) The Executive's willful damage of the Company's
property, business reputation, or good will;
(v) The Executive's deliberate neglect of duty, or
material breach of this Agreement;
(vi) The Executive's refusal to perform any reasonable
order of the Company; or
(vii) The Executive's misrepresentation or concealment of a
material fact for the purpose of securing or
maintaining this Agreement.
The term "Cause" shall not mean any act or omission believed by the Executive to
have been in or not opposed to the best interests of the Company, any act or
omission lacking the intent of the Executive to gain a profit to which he is not
legally entitled, or any other matter not specifically described in clauses (i)
through (viii) above.
(c) "Compensation" shall mean, with respect to any Person, all
payments and accruals, if any, commonly considered to be compensation,
including, without limitation, all wages, salary, deferred payment
arrangements, bonus payments and accruals, profit sharing arrangement,
payments in respect of equity options or phantom equity options or
similar arrangements, equity appreciation rights or similar rights,
incentive payments, pension or employment benefit contributions or
similar payments, made to or accrue for the account of such Person
otherwise for the direct or indirect benefit of such Person, plus auto
benefits provided to such Person, if any.
(d) "Disability" shall mean the inability by reason of illness or
other incapacity, of the Executive to perform the essential functions
of his then regular employment with the Company.
(e) "Good Reason" shall mean:
(i) any material breach or default by the Company of any
material obligation of this Agreement;
(ii) any material change by the Chief Executive Officer or
Board of Directors of the Company in the duties to be
performed or titles to be held by the Executive
pursuant hereto without his prior written consent,
which consent may be reasonably withheld; or
(iii) any material reduction in the Executive's salary,
benefits, bonuses or other Compensation pursuant to
this Agreement, unless similar reductions are also
made to the salary, benefits, bonuses or other
compensation, as applicable, payable to other
executive officers of the Company or any Subsidiary or
Affiliate thereof and such reductions are made for
justifiable business reasons.
(f) "Person" shall mean an individual or corporation,
association, partnership, joint venture, organization, business,
individual, trust, or any other entity or organization, including a
government or any subdivision or agency thereof.
(g) "Subsidiary" shall mean as to any Person a corporation,
partnership or other entity of which 25% of outstanding shares of
voting stock or other equity ownership are at the time owned, directly
or indirectly through one or more intermediaries, or both, by such
Person and shall include any such entity which becomes a Subsidiary of
such Person after the date hereof. Consolidated Subsidiary shall mean
any Subsidiary of which 51% or more of the outstanding shares or
voting stock or other equity ownership are at the time owned, directly
or indirectly through one or more intermediaries, or both, by such
Person and shall include any such entity which becomes a Subsidiary of
such Person after the date hereof.
11. Payment. Except as specifically provided herein, all amounts payable
pursuant to this Agreement shall be paid without reduction regardless of any
amounts of salary, compensation or other amounts paid or payable to the
Executive form any source and regardless of any amounts of salary, compensation
or other amounts which would have been payable to Executive had Executive sought
other employment; provided that the Company shall be permitted to make all
payments pursuant to this Agreement net of any legally required tax
withholdings. The Executive shall not be required to seek other employment, and
there shall be no offset to amounts due hereunder as a result of any salary,
compensation or other amount the Executive may be paid from other sources. The
Company shall not be entitled to offset any claim it may have against the
Executive pursuant to the Stock Option Agreement or otherwise against its
obligations to the Executive hereunder.
12. Expenses. In the event of any litigation between the parties relating
to this Agreement and their rights hereunder, the prevailing party, if any,
shall be entitled to recover all litigation costs and reasonable attorney's fees
and expenses from the non-prevailing party.
13. Entire Agreement. This Agreement and the Stock Option Agreement
comprises the entire agreement between the parties hereto and as of the date of
this Agreement, supersedes, cancels and annuls any and all prior agreements
between the parties hereto with respect to the Executive's employment by the
Company.
14. Severability. If all or any part of this Agreement is declared by any
court or governmental authority to be unlawful or invalid, such unlawfulness or
invalidity shall not serve to invalidate any portion of this Agreement not
declared to be unlawful or invalid. Any portion so declared to be invalid shall,
if possible, be construed in a manner which will give effect to the terms of
such portion to the fullest extent possible while remaining lawful.
15. Successors and Assigns. This Agreement shall be binding upon, and inure
to the benefit of the parties hereto and their respective heirs, successors,
assigns and personal representatives. The Executive may not assign, pledge, or
encumber his interest in this Agreement, or any part thereof, without the
written consent of the Company; provided, however, that Executive may, without
the Company's prior consent, assign his rights to payment hereunder.
16. Notice. Any notice required or permitted pursuant to the provisions of
this Agreement shall be deemed to have been properly given if in writing and
when received by certified and registered United States mail, postage prepaid,
by overnight courier, telecopy or when personally delivered, addressed as
follows:
If to the Company:
LaserSight, Inc.
00000 Xxxxxxxx Xxxx
Xx. Xxxxx, Xxxxxxxx 00000
Attn: Xxxxxxx Xxxxxx, President and Chief Executive Officer
Fax No.: (000) 000-0000
If to the Executive:
Xxxxxxx X. Xxxxxxxx
00000 00xx Xxxxxx
Xxxxxxx, Xxxxxxxxx 00000
Each party shall be entitled to specify a different address for the receipt of
subsequent notices by giving written notice thereof to the other party; in
accordance with this Section. Telecopy notices must be followed up with the
original by certified mail, postmarked within one (1) business date of the
telecopy.
17. Amendments and Waivers. Any provision of this Agreement may be amended
or waived only with the prior written consent of the Company and the Executive.
No failure or delay on the part of either party to this Agreement in the
exercise of any provision or right, and no course of dealing between the parties
hereto, shall operate as a waiver of such power or right.
The signatories affirm that they have the authority to execute this Agreement
and do so willingly.
LaserSight, Inc.
/s/ Xxxxxxx X. Xxxxxx
-------------------------------
By: Xxxxxxx Xxxxxx
Title: President and Chief
Executive Officer
/s/ Xxxxxxx X. Xxxxxxxx
-------------------------------
Xxxxxxx X. Xxxxxxxx
