Exhibit 10.1
INTERMAGNETICS - XXXXX
EMPLOYMENT AGREEMENT
THIS AGREEMENT is made as of November 24, 1997 (the "Effective Date")
between Intermagnetics General Corporation, a New York corporation with its
principal office located at 000 Xxx Xxxxxxxxx Xxxx, Xxxxxx, Xxx Xxxx 00000
("Intermagnetics"), and Xxxxxx X. Xxxxx, who resides at 0000 Xxxxxxxx Xxxxx,
Xxxxxxxxx, Xxxxxxxxxx 00000 ("Xx. Xxxxx").
WHEREAS, Xx. Xxxxx has been employed as President of Polycold Systems
International, Inc. ("Polycold") and has worked for Polycold on an at will
basis since 1991; and
WHEREAS, effective November 24, 1997, Polycold merged with a wholly
owned subsidiary of Intermagnetics; and
WHEREAS, Intermagnetics wishes to enter into an Agreement with Xx.
Xxxxx to (i) provide for continuation of Xx. Xxxxx' employment with Polycold
for a period of one year from the Effective Date, (ii) reinforce and encourage
the continued dedication of Xx. Xxxxx to Polycold, and (iii) provide for
certain additional benefits to Xx. Xxxxx;
NOW, THEREFORE, in consideration of the matters recited and the
respective covenants and promises of the parties contained in this Agreement,
the parties agree as follows:
1. Employment. From the Effective Date until December 31, 1998 (the
"Employment Term"), Intermagnetics shall employ Xx. Xxxxx as Vice President
and General Manager of Polycold. Xx. Xxxxx shall report directly to
Intermagnetics' President. Xx. Xxxxx shall perform the duties generally
associated with the job description set forth in Schedule "A" of this
Agreement, as updated from time to time. Notwithstanding the foregoing,
Intermagnetics, through its President, retains the discretion to vary the
title and duties of Xx. Xxxxx from time to time; provided that Xx. Xxxxx'
title and duties shall not be less than at an executive level during the
Employment Term. Xx. Xxxxx' employment with Intermagnetics shall cease at the
end of the Employment Term, unless Intermagnetics elects, and Xx. Xxxxx
agrees, to extend Xx. Xxxxx employment for an additional period not to exceed
one year (the "Extension Term").
2. Consulting Term: During the twelve month period following the end of the
Employment Term, or any applicable Extension Term, Xx. Xxxxx agrees to provide
up to three hundred (300) hours of consulting services as requested from time
to time by Intermagnetics (the "Consulting Term"). Xx. Xxxxx acknowledges and
agrees that during such Consulting Term, he shall be acting as an independent
contractor and not an employee of, agent for, partner of, or joint venturer
with Intermagnetics or any of its subsidiaries or affiliated companies. As an
independent contractor, Xx. Xxxxx will not be eligible for any benefit or
right under the Company's employee benefit or welfare plans, including,
without limitation, insurance, pension and 401(k) savings plan.
3. Performance. During the Employment Term and any applicable Extension Term,
Xx. Xxxxx shall devote his entire business time and effort rendering services
as Vice President and General Manager of Polycold, (or in such other capacity
as may be determined by the President of Intermagnetics consistent with the
provisions in Paragraph 1 above). Xx. Xxxxx shall perform his services
diligently to the best of his ability. Xx. Xxxxx agrees that in performing his
services, and in all aspects of his employment as an executive of
Intermagnetics, he will comply in all material respects with any directives,
policies, standards and regulations from time to time established by
Intermagnetics to the extent they do not conflict with this Agreement.
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4. Compensation, Benefits and Non-Compete Fee.
a. Salary. For the period of the Employment Term and any applicable
Extension Term, Xx. Xxxxx shall receive salary compensation in the
amount of $14,666.66 per month ("Salary").
b. Bonus. At the end of the Employment Term, Xx. Xxxxx shall be
entitled to a bonus in the amount of $176,000.00. The bonus shall be
payable as a lump sum within thirty (30) days of the expiration of
the Employment Term.
c. Benefits. During the Employment Term and any applicable Extension
Term, Xx. Xxxxx shall be entitled to receive group medical insurance
and other employee benefits, including, but not limited to, life
insurance, disability insurance, pension benefits and 401(k)
participation, subject to the same eligibility requirements afforded
other executive employees of Intermagnetics. Xx. Xxxxx acknowledges
that these employee benefit plans may be amended, enlarged,
diminished or eliminated on a non-discriminatory basis by
Intermagnetics from time to time at its discretion.
d. Reimbursement of Expenses. During the Employment Term and any
applicable Extension Term, Xx. Xxxxx shall be entitled to
reimbursement by Intermagnetics for all reasonable expenses incurred
by him in the performance of his duties as Vice President and General
Manager or executive in accordance with Company policy. During the
Consulting Term, Xx. Xxxxx shall be entitled to reimbursement for
reasonable authorized expenses incurred in the performance of his
consulting services.
e. Non-Compete Fee. Within sixty (60) days of the expiration of the
Employment Term, or, if the parties agree to an Extension Term, at
the expiration of such Extension Term, Intermagnetics shall pay to
Xx. Xxxxx a lump sum payment in the amount of $176,000.00
("Non-Compete Fee"); provided, however, that such Non-Compete Fee
shall be reduced by $0.50 for each $1.00 paid to Xx. Xxxxx in salary
during any applicable Extension Term. Such payment shall be in place
of any other termination payment program which may be in effect for
other Intermagnetics' employees at the expiration of the Employment
Term or any applicable Extension Term.
5. Vacations, Holidays, Personal and Sick Time. During the Employment Term and
any applicable Extension Term, Xx. Xxxxx shall be entitled to holiday,
personal and sick time, in accordance with Intermagnetics' policies for exempt
employees. Xx. Xxxxx shall also be entitled to three (3) weeks of vacation
time during the Employment Term and up to three (3) weeks of vacation on a
pro-rata basis for any applicable Extension Term.
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6. Confidential and Proprietary Information. As used in this Paragraph 6,
"secret" and "confidential" are used in the ordinary sense and do not refer to
official security classifications of any government. As used in this
Paragraph, "Intermagnetics" includes its subsidiaries and affiliated
companies, including Polycold. Xx. Xxxxx agrees:
a. to communicate to Intermagnetics promptly and fully, and assign to
Intermagnetics all inventions or significant technical or business
innovations developed or conceived solely by him or jointly with
others from the time of entering Intermagnetics' employ until any
termination of employment, (1) which are along the lines of the
business, work or investigations of Intermagnetics, or (2) which
result from or are suggested by any work which he may do for or on
behalf of Intermagnetics;
b. to execute all necessary papers and otherwise to assist
Intermagnetics and its nominees during and subsequent to his
employment in every proper way (entirely at its or their expense) to
obtain for its or their own benefit, patents, copyrights, or other
legal protection for such inventions or innovations, or for
publications pertaining to them, in any and all countries, said
inventions and innovations to be the exclusive property of
Intermagnetics or its nominees, whether or not patented or
copyrighted;
c. to make and maintain adequate and current written records of all
such inventions or innovations, in the form of notes, sketches,
drawings, or reports relating to Intermagnetics at all times;
d. upon any termination of employment, promptly to deliver to
Intermagnetics all drawings, blueprints, manuals, letters, notes,
notebooks, reports, models, and other materials (including all
copies) which are of a secret or confidential nature relating to the
business of Intermagnetics, which are in his possession or under his
control;
e. except as Intermagnetics may otherwise consent in writing, not to
publish or otherwise disclose (except as his job duties may require)
either during or subsequent to his employment, any information,
knowledge, or data of Intermagnetics or its customers which he may
receive or develop during the course of his employment relating to
inventions, discoveries, formulas, processes, machines, manufacturing
methods, compositions, computer programs, accounting methods,
information systems or business or financial plans or reports, or
other matters which are of a secret or confidential nature;
f. to notify Intermagnetics in writing before making any disclosure
or performing or causing to be performed any work for or on behalf of
Intermagnetics, which appears to conflict with (1) rights he claims
in any invention or idea (a) conceived by Xx. Xxxxx or others prior
to his employment or (b) otherwise outside the scope of this
Agreement, or (2) rights of others arising out of obligations
incurred by Xx. Xxxxx (a) prior to this Agreement or (b) otherwise
outside the scope of this Agreement. In the event Xx. Xxxxx fails to
give notice under the circumstances specified above, Intermagnetics
may assume that no such claim exists against Intermagnetics with
respect to the use of any such invention or idea for or on behalf of
Intermagnetics.
7. Agreement not to Compete. In consideration of his employment rights under
this Agreement and in recognition of the fact that he has access to
Intermagnetics' confidential information, Xx. Xxxxx agrees:
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a. During the term of this Agreement, that he will not participate
directly or indirectly, in any capacity, in any business or business
activity that is in competition with Intermagnetics or its
subsidiaries or affiliated companies.
b. For a period of three (3) years after the date of termination of
his employment, for any reason, unless acting with Intermagnetics'
express written consent, that he will not directly or indirectly own
or participate in, or be connected with, as an officer, director,
employee, partner, investor, consultant or advisor, any business that
engages, or proposes to engage in the development, manufacture or
sale of products similar to the products of Intermagnetics or of its
subsidiaries or affiliated companies; except that Intermagnetics
acknowledges and agrees that Xx. Xxxxx may continue to own shares in
Intermagnetics' stock and up to 2% of the shares of any other
publicly traded company so long as Xx. Xxxxx does not participate in
the management or control of such company.
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c. For a period of three (3) years after the date of termination of
his employment, for any reason, that he will not employ either
directly or on behalf of a third party, any person who is an employee
of Intermagnetics as of the date of the termination of Xx. Xxxxx'
employment.
8. Termination.
a. For Cause. Intermagnetics may terminate Xx. Xxxxx' employment
under this Agreement for "cause" which shall mean: (i) theft or other
dishonesty; (ii) conviction of a felony, or conviction of a
misdemeanor involving fraud; (iii) use of illegal substances; (iv)
neglect of duties or persistent refusal to adhere to Intermagnetics'
policies or directions; or (v) material breach of any term of this
Agreement. In the event Intermagnetics determines that termination of
Xx. Xxxxx is justified under (iv) or (v) above, Intermagnetics shall
give Xx. Xxxxx thirty (30) days notice to cure his neglect or rectify
his breach. If after thirty (30) days, Xx. Xxxxx has failed to cure
his neglect or rectify his breach, Intermagnetics may terminate his
employment. For all other causes of termination under this Paragraph
8(a), Intermagnetics may terminate Xx. Xxxxx immediately upon
discovery of the cause.
b. Disability. Intermagnetics may terminate this Agreement if Xx.
Xxxxx is unable, as a result of physical or mental disability, to
perform his duties as provided in this Agreement for a period in
excess of twelve (12) weeks, consecutively or non-consecutively,
during the Employment Term or any applicable Extension Term.
Termination under this provision shall be executed by written notice
from Intermagnetics to Xx. Xxxxx and shall be effective thirty (30)
days following the written notice. For purposes of determining
whether Xx. Xxxxx has a "physical or mental disability" under this
Paragraph 8(b), he shall be evaluated by a physician retained by
Intermagnetics at Intermagnetics' expense. Xx. Xxxxx shall make all
relevant medical records available to the physician retained by
Intermagnetics and shall otherwise cooperate in such evaluation.
c. Death. This Agreement shall terminate in the event of Xx. Xxxxx'
death during the Employment Term or any applicable Extension Term,
effective on the date of his death.
d. By Xx. Xxxxx. Xx. Xxxxx may terminate this Agreement at any time
upon one-hundred-eighty days prior written notice.
9. Forfeiture of Bonus and Non-Compete Fee. If this Agreement is terminated
for any of the reasons set forth in Paragraphs 8(a) or 8(d) above, Xx. Xxxxx
shall forfeit the amounts payable under Paragraphs 4(b) and 4(e), and any pro
rata portion of his Salary, as set forth in Paragraph 4(a), that is unearned
as of the date of termination.
10. Miscellaneous.
a. Governing Law. This Agreement is made under, and shall be
interpreted, construed, and enforced in accordance with, the laws of
the State of California.
b. Disputes. Any controversy or claim arising out of or relating to
this Agreement or Xx. Xxxxx employment shall be settled by
arbitration conducted in San Francisco, California, in accordance
with the then current rules of the American
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Arbitration Association. Judgment upon the award rendered shall be binding on
the parties and may be entered by either party in the court or forum, state or
federal, having jurisdiction.
c. Injunctive Remedy. Xx. Xxxxx acknowledges that the remedy at law for any
breach of the provisions of Paragraphs 6 and 7 will be inadequate and agrees
that, notwithstanding Paragraph 10(b) above, such provisions may be enforced
by an injunction or restraining order in any court, state or federal, having
jurisdiction, in addition to any other remedies that may be available to the
Company.
d. Damages. In no event shall either party be liable to the other party for
any special, incidental, indirect or consequential damages, from any cause
whatsoever, whether founded on contract, tort (including negligence), strict
liability or otherwise.
e. Surviving Terms. The restrictions contained in Paragraphs 6 and 7 shall
survive and remain enforceable following the termination of the Agreement for
any reason, including, but not limited to, termination by Intermagnetics with
or without cause.
f. Headings. The headings of the several sections are inserted for convenience
of reference only and are not intended to be a pert of, or to affect the
meaning or interpretation of, this Agreement.
g. Severability. If any provision or provisions of this Agreement are held to
be invalid or unenforceable, such invalidity or unenforceability shall not
affect or impair the validity or enforceability of the remaining provisions of
this Agreement, which shall remain in full force and effect.
h. Successors and Assigns. This Agreement shall benefit and bind the parties
and the successors and assigns of Intermagnetics. This Agreement shall not be
assignable by Xx. Xxxxx without the prior written consent of Intermagnetics.
i. Entire Agreement. This Agreement contains the entire agreement of the
parties relating to its subject matter, and supersedes all prior agreements,
negotiations and representations not specifically set forth in this Agreement.
j. Modifications. The parties further agree that no changes or modifications
of this Agreement shall be made without the express written consent of the
parties.
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IN WITNESS HEREOF, the parties have caused this Employment Agreement
to be executed as of the date first written above.
INTERMAGNETICS GENERAL CORPORATION
By: /s/Xxxx X. Xxxxxx /s/Xxxxxx X. Xxxxx
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Name: Xxxx X. Xxxxxx Xxxxxx X. Xxxxx
Title: Chairman and Chief
Executive Officer
Date: November 24, 1997 Date: November 24, 1997
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CONFIDENTIAL DRAFT: December 3, 1997
SCHEDULE A
JOB DESCRIPTION
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JOB TITLE: Vice President and General Manager - Polycold Systems
International, Inc.
Effective Date: _______ Revision No.: 0
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President Director of Administration
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Fair Labor Standards Act Status: Exempt
Supervision Received: Minimum
1. DUTIES AND RESPONSIBILITIES:
A. Contacts:
Chairman of the Board and Chief Executive Officer of Intermagnetics
President and Chief Operating Officer of Intermagnetics
Chief Financial Officer of Intermagnetics
General Counsel
All levels within Polycold
Senior level customers and suppliers and other business relationships
Collaborators
Agencies
B. Supervision:
Directly supervises an Administrative Assistant and all function
managers for Polycold. Indirectly responsible for supervision of all
Polycold employees.
C. Work Direction:
As agreed with the President of Intermagnetics.
D. General Responsibilities:
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The Vice President and General Manager of Polycold is responsible to
the President of Intermagnetics for coordinating and directing the
activities of Polycold in accordance with the policies and objectives
established in collaboration with the President. Specific functions
include development of Polycold's Operating Policies and Procedures
for all Polycold's activities in accordance with Corporate Policies;
establishing controls to maintain adequate communication and
information flows; regularly evaluating the results of overall
business operations and; ensuring that all business unit activities
comply with government laws and regulations.
In collaboration with the President of Intermagnetics and with
corporate staff and other business units, hire all staff for
Polycold; develop, formulate and communicate strategies and
operational plans for Polycold; identify and evaluate new business
opportunities; develop and monitor internal operations; develop and
initiate external collaborations; initiate and monitor technology
development.
Prepare for approval all budgets for Polycold, and hold
responsibility for adherence to the same; report formally on a
monthly basis to the President of Intermagnetics.
Develop plans for full commercial exploitation of promising
opportunities with corporate and business unit staff, and other
organizations as appropriate.
Implement and monitor training of personnel.
2. QUALIFICATIONS:
A. Preferred:
A minimum of 12 years of management experience including prior
experience managing a profit and loss business unit.
B. Alternative:
A minimum of 15 years experience including experience as functional
manager of at least 2 of Polycold' primary functions: engineering,
manufacturing, marketing/sales, quality assurance or materials.
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