Exhibit 10.19
EMPLOYMENT AGREEMENT, agreed to be entered into on and effective as of
October 1, 2001 (the "Effective Date"), by and between XXXXX MEDICAL CORP., a
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Delaware corporation with an office in New Britain, Connecticut (the
"Employer"), and XXX XXXXXXX of 000 Xxxxxxx Xxxx Xxxx, Xxxxxx, XX 00000 (the
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"Employee").
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The Employer and Employee hereby agree as follows:
1. Term; Duties. For the period from October 1, 2001 through December 31,
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2002 (or earlier, pursuant to paragraphs 6, 7, 15 or 16) (the "Term"), the
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Employer will employ the Employee, and the Employee will serve the Employer, as
its Senior Vice President of Supply Chain, reporting to its President and
subject at all times to the direction of its Board of Directors and Executive
Committee. During the Term the Employee's office will be at such office of the
Employer in Connecticut as the Employer may designate. The Employee agrees that
during the Term he will devote his entire working time and give his best efforts
and attention to the business of the Employer. The Employee shall not be
required to perform duties inconsistent with those normally assigned by the
Employer to its executive level employees.
2. Salary. As compensation for his services during the Term, the Employer
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will pay the Employee, in installments on the Employer's regular payroll payment
dates and subject to statutory withholding amounts, a salary at the annual rate
of $172,000. The Compensation Committee of the Employer's Board of Directors
may, in its absolute discretion, approve an inflation-adjustment in the annual
rate of the Employee's salary for 2002.
3. Bonus Compensation. As additional compensation for his services during
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the Term, the Employer will pay the Employee such bonus compensation as may
become due to senior executive officers of the Employer under the 2001 Executive
Officers' Bonus Plan of the Employer. The Employee has received a copy of said
Plan. The Employee will, during the Term, be entitled to participate as a senior
executive officer of the Employer under such Executive Officers' Bonus Plan as
the Employer's Board of Directors may adopt for 2002.
4. Vacation; Benefits. The Employee will be entitled to three weeks
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vacation during each calendar year during the Term. The Employee has received a
list of the Employer's current benefit plans and policies regarding severance,
sick leave and the like, available or applicable to the Employer's executives,
including the Employee. The Employee acknowledges that said list does not set
forth all material terms and conditions of these plans and policies, and that
they are subject to modification or elimination by the Employer. If a new
benefit plan is made available to officers of the Employer generally, the
Employee will be a participant thereunder.
5. Non-Competition. The Employee covenants and agrees that during the
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Term, and until six months thereafter, he will not, directly or indirectly,
engage or own any interest in any distributor of medical or surgical supplies or
pharmaceutical, whether as principal, agent, partner, director, officer,
stockholder, investor, lender, consultant, employee, or in any other capacity.
The Employer will not unreasonably withhold its consent in writing to the
Employee's employment after the Term by a company not principally engaged in the
distribution of medical, surgical or pharmaceutical products which has a
subsidiary, division or other separate business unit engaged in such business if
the company in writing requests such consent from the Employer and gives the
Employer its written agreement, in form and substance satisfactory to the
Employer, which (i) provides that the Employee's services for said company will
not, directly or indirectly, relate to the business or affairs of said
subsidiary, division or unit or to the development of such a distribution
business, (ii) sets forth the practical steps that said company will take to
assure compliance with clause (i) hereof, and (iii) grants the Employer the
right and practical ability to have its independent accountants determine
compliance or non-compliance with said clause. The Employee agrees that a remedy
at law for any breach or threatened breach of the foregoing covenant will be
inadequate, and that Employer will be entitled to temporary and permanent
injunctive relief in respect thereof without the necessity of posting a bond or
proving actual damage to Employer.
6. Death. The death of the Employee will terminate the Term.
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7. Incapacity. If during the Term the Employee is unable, on account of
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illness or other incapacity, to perform his duties for a total of more than 45
consecutive, or an aggregate of 75 days during any twelve month period, the
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Employer has the right (subject to compliance with applicable law) to terminate
the Term on ten days' written notice to the Employee, and the Employee will
thereafter be entitled to receive only one-half of his salary installments
otherwise payable until the earlier of the last day of (i) the month-end after
the delivery of said notice, or (ii) the Term (determined without giving effect
to such termination).
8. Employer Information. All information and materials disclosed by the
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Employer to the Employee or acquired at the Employer's expense by the Employee
or acquired or developed by the Employee in connection with his services under
this Agreement, all trade secrets of the Employer and all Work-Product
(hereinafter defined) (herein collectively "Employer Information") shall be and
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remain the sole property of the Employer. The Employee shall protect all
Employer Information which may be in his possession or custody and shall deliver
all such Information (and all copies thereof, in any media) to the Employer at
its request. Notwithstanding the foregoing, Employment Information shall not
include information that the Employee can demonstrate (i) was known to him prior
to the disclosure to him by the Employer, or (ii) was publicly known at the time
of the disclosure or which thereafter became publicly known without fault of the
Employee.
9. Work-Product. All right, title and interest in and to any work-product
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which the Employee acquires, compiles, authors, invents, makes or otherwise
generates, in whole or in part, including all works authored and all inventions
made, for use in connection with or arising out of or in relation to his
services under this Agreement, whether or not copyrightable or patentable
(herein collectively "Work-Product"), shall belong exclusively to the Employer.
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During and after the Term of this Agreement, the Employee shall execute,
acknowledge, and deliver all documents, including, without limitation, all
instruments of assignment, and perform all acts, which the Employer may
reasonably request to secure its rights hereunder.
10. Confidentiality; Non-use. During and after the Term, the Employee
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shall not, without first obtaining the written consent of the Employer, divulge
or disclose to anyone outside the Employer, whether by private or public
communication or publication or otherwise, or use except pursuant to this
Agreement, any Employer Information; however, an incidental non-derogatory
disclosure by the Employee of Employer Information (other than trade secret or
Work Product information) after 18 months following the end of the Term will not
breach this provision.
11. Conflicts of Interest; Conflicting Obligations. The Employee agrees
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that it is his responsibility to recognize and avoid, and disclose to the
President of the Employer in writing, any situation which might, either directly
or indirectly, adversely affect his judgment in serving the Employer or which
might otherwise involve a conflict between his personal interests and the
interests of the Employer. The Employee represents and warrants to the Employer
that at the date hereof no such situation exists or is contemplated or
anticipated. The Employee agrees not to disclose or use in the course of his
services for the Employer any trade secret, confidential or proprietary
information, or work-product of any party other than the Employer. The Employee
represents and warrants to the Employer that his entry into and performance of
this Agreement do not and will not conflict with any obligation by which he is
or may become bound or any right of a third party to which he is or may become
subject. The Employee will not serve as a Board member of another company unless
he seeks and obtains the Employer's approval prior to making a commitment to do
so.
12. Non-Solicitation. The Employee agrees that, until one year after the
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Term, he will not solicit, induce, attempt to hire, or hire any employee of the
Employer, or assist in such hiring by any other party, or encourage any such
employee to terminate his or her employment with the Employer.
13. Standard Intellectual Property Agreement. The Employee agrees to
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execute the Employer's standard employee agreement relating to intellectual
property and employment information. To the extent any of the provisions of this
Agreement are in conflict with any of the provisions of such standard agreement,
the provisions of this Agreement will control.
14. Stock Option as an Inducement. As an inducement to the Employee to
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enter into this Agreement, the Compensation Committee of the Employer's Board of
Directors has authorized the grant to him, subject to his execution of this
Agreement, of a non-qualified stock option pursuant to the Employer's 2000
Incentive Compensation Program to purchase 10,000 shares of the common stock of
the Employer at an exercise price equal to the closing market price of said
stock on the date of approval by the Compensation Committee. Said option is to
become exercisable in four equal cumulative annual installments commencing
November 2002 and is to expire no later than October 2006. Employee
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has received a copy of said Program and of the form of option used by the
Employer. Although the option will have the tax treatment of a non-qualified,
non-incentive option, it will be subject to terms and conditions required for an
incentive stock option, and to the condition that the Employee not be in
material breach of this Agreement. It will be subject to acceleration of
exercisability of 50% of all otherwise non-exercisable installments in the event
the Employee becomes entitled to a severance payment under paragraph 15.
15. Effect of "Change of Control"; Termination; Severance. The Employer or
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Employee may terminate the Term on written notice to the other within 30 days
after a "Change of Control" (as defined in Section 3(b) of the Employer's Change
of Control and Change of Position Payment Plan). The Employee has received a
copy of said Plan. The Employee may also terminate the Term on written notice to
the Employer within 30 days after "Change of Position" (as defined in Section
3(c)(ii) of the Plan)) occurring within twelve months after a Change of Control.
A termination will be effective 30 days after the delivery of the notice. In the
event of a termination by the Employer, the Employee will be entitled to a
severance payment, under Section 4 of the Plan and subject thereto, in the
amount of 100% of the "Base Amount" (as defined in Section 4 of the Plan). In
the event of a termination by the Employee after a Change of Position within
twelve months of a Change of Control, the Employee will be entitled to a
severance payment, under Section 4 of the Plan and subject thereto, in the
amount of 75% of said Base Amount. The provisions of this paragraph 14 supersede
any prior agreement between the Employer and the Employee relating to any
severance, termination or change of control arrangement or payment.
16. Termination. The Employer will have the right to terminate the Term
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for cause. However, in the event the Employee's employment is terminated by the
Employer without cause, the Employee will be entitled to receive his salary
payments through the end of the Term, less the compensation earned and
consideration received by the Employee from any subsequent employment or for
otherwise providing services. However, the Employee will not have an affirmative
duty to seek employment not consistent with his experience (including prior
levels of responsibility) and expertise. "Cause" shall include material breach
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of this Agreement not cured within 10 days, breach of fiduciary duty, gross
insubordination, willful neglect of duties, habitual unreliability, personal
conduct in material violation of the Employer's policies or universally accepted
good business practices, and other matters of comparable severity to any of the
above.
17. Governing Law; Etc. This Agreement is governed by the laws of
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Connecticut. It represents the entire agreement of the parties and it can not be
changed except by a writing signed by the President of the Employer and the
Employee. All notices by the Employee to the Employer under this Agreement shall
be delivered to the President of the Employer.
IN WITNESS WHEREOF, the parties have signed and delivered this Employment
Agreement, effective as of the Effective Date.
XXXXX MEDICAL CORP.
/s/ Xxx Xxxxxxx by /s/ Xxxxx X. Xxxxxx
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XXX XXXXXXX Xxxxx X. Xxxxxx, President
State of Connecticut
County of Middlesex
I certify that I know or have sufficient evidence that Xxx Xxxxxxx is the
person who appeared before me, and that said person acknowledged that he signed
this instrument and acknowledged it to be his free and voluntary act.
Dated: November 13, 2001 /s/ Xxxxxxx Xxxxxx
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Notary Public for the State of Connecticut
My commission expires May 31, 2003
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