AMENDED AND RESTATED EMPLOYMENT AGREEMENT
THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT ("Employment
Agreement") made as of November 1, 0000, xxxxxxx XXXXXX, XXX.,x Delaware
corporation, of Millbrook, New York (the "Company"), and XXXXXX X. XXXXXX
("Employee"), residing at Xxxxx Xxxxx Xxxx Xxxx, XX Xxx X, Xxxxxxxxx, XX 00000.
W I T N E S E T H:
WHEREAS, Employee is presently employed as Chairman of the Board and
Chief Executive Officer of the Company;
WHEREAS, the Company and Employee desire to assure the continued
services of Employee to the Company on the terms and conditions set forth below;
WHEREAS, by employment Contract originally dated April 20, 1994 and
amended and restated from time to time, the Company and Employee agreed upon the
terms on which Employee would be employed by the Company; and
WHEREAS, the Company and Employee desire to amend and restate such
employment Contract as hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual covenants herein set
forth and other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the Company and Employee agree as follows:
1. EMPLOYMENT
(a) The Company agrees to continue to employ Employee to render
executive and managerial services to the Company and Employee accepts such
appointment with the title of Chairman of the Board and Chief Executive Officer.
In such capacities Employee shall be Chairman of the Board of Directors of the
Company and Chief Executive Officer of the Company, possessing such powers and
authority and charged with such duties and responsibilities in relation to the
business and affairs of the Company as are customarily associated with such
offices, subject to the direction of the Board of Directors of the Company.
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(b) Employee's principal place of employment shall be as required
by the Company and agreed by Employee from time to time in the United States of
America or abroad. Unless and until otherwise mutually agreed, the principal
location for the performance of Employee's services shall be in Millbrook, New
York. Notwithstanding the foregoing, Employee recognizes that the operations of
the Company may require travel by Employee on behalf of the Company, and agrees
that he will be available to engage in such travel (which will not, however,
require the relocation of his residence for the performance of his services)
when and as required and at the Company' s expense.
2. TERM
The term of Employee's employment under this Employment Agreement
commenced effective as of April 20, 1994 and, subject to the terms and
conditions of this Employment Agreement, shall continue from April 6, 1999 for a
period of sixty (60) consecutive months. On April 6 of each year, beginning
April 6, 2000, such term of this Employment Agreement shall be automatically
extended for an additional year unless prior to such date Employee or the
Company shall have notified the other in writing of its intention not to extend
the term of this Employment Agreement.
3. COMPENSATION
(a) Employee shall receive as full compensation for his services
hereunder, direct from the Company, a salary at the rate of $189,000 per annum,
paid by monthly installments, which salary shall be increased by $50,000 per
annum on April 6 of each year, increases to start in the year of 1995, during
the term of this Employment Agreement. At the discretion of the Board, Employee
may be given merit increases and bonuses during the term hereof.
(b) Upon the issuance of equity securities in the Company pursuant
to the sale thereof for a cash consideration or in lieu of a cash payment upon
the conversion of debt into such equity securities or for services or any other
consideration, after the date hereof and during the term hereof or any extension
thereof, Employee is hereby awarded such number of additional shares of Common
Stock in the Company that will restore or otherwise increase his equity position
in the Company on a fully diluted basis to 33 1/3% of the total issued and
outstanding Common Stock of the Company on a fully diluted basis, such grant to
be automatic upon the occurrence of such event.
(c) In addition, in the event Employee is instrumental in obtaining
equity financing for the Company during the term hereof for a cash infusion to
the capital of the Company of $1,000,000 or more, Employee shall receive as
compensation therefor equity securities equal to 33.33% of the equity securities
issued pursuant to such financing.
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(d) At the request of the Employee, the Company will undertake to
file as promptly as practicable a Registration Statement on Form S-8 or other
applicable form with respect to the securities underlying the Options granted to
or equity securities issued to Employee pursuant to this Employment Agreement.
4. EXPENSES
Employee shall be reimbursed for all ordinary and reasonable
out-of-pocket expenses properly incurred while engaged in the business of the
Company pursuant to the Company policy then in effect, provided that such are
itemized and presented to the Company in accordance with the Company policy then
in effect. The Company shall provide a secretary for the Employee at his office.
5. BENEFITS
(a) The Company shall provide Employee or Employee shall be
entitled to reimbursement for the premium costs of the following insurance
policies for the term hereof:
(i) $750,000 of whole life insurance under which Employee is
the insured and has the sole right to designate the
beneficiary thereunder;
(ii) long term disability insurance; and
(iii) health insurance.
(iv) All prescriptions not reimbursable by such insurance
polcies.
(v) Medical expenses not covered by insurances.
Following the termination of Employee's employment hereunder for any reason
other than for cause (as hereinafter defined), including, without limitation, by
reason of the expiration of the term of this Employment Agreement, and for a
period of ten years thereafter, the Company shall (A) continue to reimburse
Employee upon demand for the premium costs of the policy described in clause
(i); (B) reimburse Employee upon demand for the premium costs of an individual
health insurance policy for Employee and his spouse, if any, that provides
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substantially the same coverage as the health insurance policy covering the
Company's most senior executive; and (C) at the Company's expense, provide
Employee with an office comparable to his office immediately prior to his
termination of employment at a location selected by Employee, together with a
full-time secretary of his choice. Further, at least 15 days prior to the date
Employee is required to make any federal income tax payments, including, without
limitation, estimated tax payments, Employee shall notify the Company of the
amount, in cash, that is necessary to be paid to Employee to ensure that the sum
of (x) such cash payment, plus (y) the amount of such premiums, plus (z) the
value of the office and secretary, to the extent the same constitute taxable
income to Employee, less all federal or state taxes on such aggregate amount,
will equal the gross amount of the sum of such premiums and the value of the
office and the secretary. Within seven days after receipt of such notice, the
Company shall pay Employee such amount.
(b) The Company will reimburse Employee for dues and related
expenses of memberships that are used for the benefit of the Company.
(c) Employee shall be entitled to the full-time use a new Company
owned automobile, on which the Company shall purchase all appropriate insurance
policies and pay all maintenance and operating expenses. Employee shall,
however, reimburse the Company for his personal use of the automobile on a basis
to be determined by the Company from time to time.
(d) Following the termination of Employee's employment with the
Company, other than for cause (as hereafter defined), Employee shall be retained
as a consultant and entitled to receive an annual supplemental cash retirement
and consulting benefit equal to his salary for the year immediately preceding
such termination of employment. Such annual supplemental cash retirement and
consulting benefit shall be payable for the number of years equal to the number
of full years that Employee was employed by the Company prior to the termination
of his employment. The amount due in each year shall be payable in twelve (12)
equal monthly installments. In the event of the death of Employee during the
term of this Employment Agreement, any extension thereof or during the period
such annual supplemental retirement and consulting benefits are payable, the
Company shall pay to the estate of Employee, within 120 days after the death of
Employee, the present value of all amounts that would become due under Section
5(d), which present value shall be calculated by using as a discount rate the
prime rate of interest charged by Chemical Bank, N.A., or its successor, on the
date of Employee's death.
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6. TERMINATION OF EMPLOYMENT
(a) The Board of Directors may terminate Employee's employment upon
one (1) month's notice to the Employee for "cause" as hereinafter defined.
The term "cause", as used in subsection 7(a) above with respect to
the termination of Employee's employment by the Company, shall mean (i)
embezzlement of property of the Company; or (ii) conviction of a crime which
constitutes a felony.
(b) The Company shall pay all legal fees, court costs, fees of
experts and other costs and expenses when incurred by Employee in connection
with Employee's interpretation of, or determinations under, or any actual,
threatened or contemplated litigation or legal, administrative or other
proceeding involving, the provisions of this Employment Agreement, whether or
not initiated by Employee.
7. OFFICE
Employee shall be entitled, at no cost to himself and at the
Company's expense, to maintain the existing office in Millbrook, New York for
the Company.
8. EMPLOYEE' S COVENANTS
Upon and subject to the terms am conditions of this Employment
Agreement, Employee covenants and agrees with the Company as follows:
(a) Employee shall remain in the employ of the Company and will
carry out the duties and responsibilities assigned to him from time to time by
the Company's Board of Directors.
(b) Employee shall devote a substantial portion of his business
time, efforts and abilities to the performance of his duties and the advancement
of the Company's interests and the achievement of its corporate goals and
objectives; will observe the policies and practices established by the Company's
Board of Directors; and will otherwise conduct himself in a manner reasonably
calculated to benefit the Company.
(c) During the term of this Employment Agreement, Employee shall
promptly advise the Company's Board of Directors of any business opportunities
of which he may become aware related to the business and corporate goals of the
Company.
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9. REPORTS
Employee shall promptly communicate and disclose to the Company, on
request, all information obtained by him in the course of his employment
relating to the business of the Company. All written reports, recommendations,
advice, records, documents and other materials prepared or obtained by Employee
or coming into his possession during his employment hereunder which relate to
the progress and performance of the Company shall be the sole and exclusive
property of the Company and, at the end of Employee's employment hereunder or at
the request of the Company during the period of Employee's employment hereunder,
Employee shall promptly deliver all such written materials to the Company.
Employee shall prepare and submit to the Company such regular periodic reports
as the Company may request with respect to the activities undertaken by him or
conducted under his direction in connection with the business of the Company
during his employment hereunder. Such reports and the information contained
herein shall be and remain the sole property of the Company.
10. CONFIDENTIALITY
Employee shall not, during any period of his employment by the
Company, divulge, furnish, or make accessible to or use for the benefit of,
anyone other than the Company, its directors and officers, otherwise than in the
regular course of the business of the Company, or with the prior written consent
of the Company, any trade secret or confidential knowledge or information
relating in any way to the customers of the Company or to the business or
manufacturing processes from time to time carried out or conducted by the
Company.
11. PATENTS, TRADEMARKS, TRADE SECRETS
Except as the same may be pledged as security for debt, Employee
shall assign to the Company, immediately upon making or acquiring them, as the
case may be, any and all patent rights, letters patent, copyrights, trade-marks,
service marks, trade names and applications therefor in any country and all
rights and interests in, to and under the same which he may legally transfer,
now possessed by him or hereafter made, acquired, or possessed by him during the
term of this Employment Agreement, relating in any way to the business and
activities of the Company and its subsidiary and affiliated companies and agrees
that, upon request, he will promptly make all disclosures, execute all
instruments and papers, and perform all such other actions whatsoever necessary
or desired by the Company to vest and confirm in it, its successors, assigns and
nominees, fully and completely, all rights created or contemplated by this
section 11 and to which may be necessary or desirable to enable the Company and
its successors, assigns and nominees to secure and enjoy the full benefits and
advantages thereof.
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12. INDEMNIFICATION AND DIRECTORS AND OFFICERS LIABILITY INSURANCE
The Company shall indemnify Employee and advance expenses with
respect to any indemnifiable matter to Employee to the fullest extent permitted
by applicable law. To the extent that the Company maintains an insurance policy
or policies providing liability insurance for directors, officers, employees,
agents or fiduciaries of the Company, the Employee shall be covered by such
policy or policies in accordance with their terms to the maximum extent of the
coverage available for any such director, officer, employee, agent or fiduciary
under any such policy or policies.
13. PROHIBITED SOLICITATION
At no time during the full year following the termination of this
Employment Agreement shall Employee attempt to induce any person to leave the
employment of the Company.
14. REGISTRATION RIGHTS
The Employee shall have all of the rights and benefits, pari passu,
with the beneficiaries of any Registration Rights Agreement binding upon the
Company.
15. INJUNCTIVE RELIEF
The Company and Employee acknowledge and agree that the executive
and managerial services to be rendered by Employee hereunder are of such a
special, unique and extraordinary character that it gives them a peculiar value
impossible of replacement and for the loss of which the Company cannot be
reasonably or adequately compensated in damages. Employee acknowledges and
agrees that a breach by him of the provisions of Sections 10, 11 or 13 hereof
will cause the Company irreparable injury and damage, and the Company shall be
entitled to injunctive relief to prevent any such prospective or continuing
breach.
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16. ARBITRATION
Any dispute arising with respect to this Employment Agreement shall
be submitted to arbitration by a single arbitrator in New York, New York in
accordance with the rules of the American Arbitration Association then in
effect, and judgment upon any award of such arbitrator may be entered in any
court having jurisdiction thereof. The costs of any arbitration proceeding
hereunder, excluding the out-of-pocket costs and accounting and legal fees and
related disbursements of each party which shall be borne by the party incurring
same, shall be shared equally by the parties.
17. WAIVER
Failure to insist upon compliance with any of the terms, covenants,
or conditions hereof shall not be deemed a waiver of such term, covenant, or
condition, nor shall any waiver or relinquishment of any right or power
hereunder at any one time or more times be deemed a waiver or relinquishment of
such right or power at any other time or times.
18. SEVERABILITY
The invalidity or unenforceability of any provision hereof shall in
no way affect the validity or enforceability of any other provision. The parties
to this Employment Agreement agree and intend that this Employment Agreement
shall be enforced as fully as it may be enforced consistent with applicable
statutes and rules of law.
19. NOTICES
Any notices required or permitted hereunder shall be given in
writing by registered or certified first class mail (air mail if international),
postage prepaid, addressed to the parties at their respective addresses first
above set forth, or to such other address as either party may from time to time
designate by notice to the other hereunder.
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20. CHOICE OF LAW
This Employment Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York without regard to
conflicts of laws principles thereof.
21. ENTIRE AGREEMENT
This Employment Agreement represents the entire agreement of the
parties hereto, and supersedes any other agreements between the parties with
respect to the subject matter thereof, and may not be amended, modified or
supplemented in any respect, except by a subsequent writing executed by both
parties hereto.
IN WITNESS WHEREOF, the parties hereto have executed this Employment
Agreement as of the day and year first above written.
EPIGEN, INC.
By: /s/: Xxxxxxx X. Xxxx
------------------------------------
Name: Xxxxxxx X. Xxxx
Title: Vice Chairman
/s/: Xxxxxx X. Xxxxxx
-----------------------------------------
Xxxxxx X. Xxxxxx
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