EXHIBIT 10 (ll)
RETIREMENT AGREEMENT
This RETIREMENT AGREEMENT (the "Agreement") is made as of the 7th day of
January, 2003 by and between Presstek, Inc., including its affiliates and
subsidiaries (collectively, the "Company"), and Xxxxxxx X. Xxxxxxxx ("Xx.
Xxxxxxxx").
WHEREAS, Xx. Xxxxxxxx has been employed with the Company as Chief
Scientific Officer for several years;
WHEREAS, Xx. Xxxxxxxx desires to retire from employment with the Company
and all officer positions he holds at the Company or its affiliates or
subsidiaries; and
WHEREAS, the Company and Xx. Xxxxxxxx desire to specify the terms and
conditions of his retirement.
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and in consideration of the mutual
covenants and obligations herein contained, the parties hereto agree as follows.
1. Employment/Director/Officer Status.
(a) Retirement Date. Effective as of January 8, 2003 (the
"Retirement Date"), Xx. Xxxxxxxx shall retire and resign from (a) his employment
with the Company, its affiliates and subsidiaries; (b) his officer position as
Chief Scientific Officer of the Company and any other officer positions that he
may hold with the Company, its affiliates and subsidiaries; and (c) all duties
associated with such positions and status. Simultaneously with the execution of
this Agreement, Xx. Xxxxxxxx will execute a letter in the form attached hereto
as Exhibit A tendering his resignation from his officer positions with the
Company. Xx. Xxxxxxxx will remain as the Chairman of the Board of Directors of
the Company (the "Board"), and as a member of the board of directors of
Lasertel, Inc., until he resigns from, is removed from, or is not re-elected to,
each respective board position.
(b) Termination of Benefits and Employment Agreement. As of the
Retirement Date, Xx. Xxxxxxxx' salary shall cease, and any entitlement he has or
might have had under any Company-provided benefit plan, program, contract or
practice shall terminate, except as otherwise described below or as otherwise
required by law. Also as of the Retirement Date, that certain Employment
Agreement dated as of May 25, 2000 between Xx. Xxxxxxxx and the Company shall
terminate and shall become null and void (the "Prior Employment Agreement").
(c) Payments of Accrued Obligations. By the next regularly scheduled
pay date after the Retirement Date, the Company will provide Xx. Xxxxxxxx with a
check for his final earned, unpaid salary, at the annualized rate of $300,000
that he has been receiving for the 2002 calendar year, and his unused earned
time off accrued through the Retirement Date. In addition, provided that within
two weeks after his Retirement Date Xx. Xxxxxxxx submits to the Company an
expense report and itemized documentation to the Company's satisfaction for all
final expenses incurred on behalf of the Company, the Company will reimburse Xx.
Xxxxxxxx for such
expenses within two weeks after he submits such documentation, all to be done in
accordance with the Company's expenses-related policies and/or practices.
(d) No Other Rights. Xx. Xxxxxxxx and the Company acknowledge and
agree that other than the Stock Options discussed in Section 2(c) hereof, Xx.
Xxxxxxxx is not entitled to any options to purchase, rights to purchase or other
rights convertible into the capital stock of the Company and/or any of its
subsidiaries or affiliates, or to any securities of, shares of capital stock of,
and/or any other form of equity in, the Company and/or any of its subsidiaries
or affiliates (collectively, the "Stock Rights"). Xx. Xxxxxxxx and the Company
further acknowledge and agree that other than the payments and benefits
described in Sections 1 and 2 hereof, Xx. Xxxxxxxx is not entitled to any
payments or benefits from the Company or any of its subsidiaries or affiliates.
Notwithstanding the foregoing, Xx. Xxxxxxxx and the Company acknowledge and
agree that commencing on the Retirement Date, Xx. Xxxxxxxx will be entitled to
those benefits generally available to all non-employee directors of the Company.
(e) Ongoing Obligations. Xx. Xxxxxxxx hereby affirms his ongoing
confidentiality, inventions, noncompetition and related obligations pursuant to
any agreements he signed in connection with his relationship with the Company,
all of which shall remain in effect after the Retirement Date.
2. Retirement and Severance Benefits.
(a) Severance. In exchange for and in consideration of Xx. Xxxxxxxx'
execution and compliance with this Agreement and in consideration for past
services rendered to the Company, the Company will provide Xx. Xxxxxxxx with the
following severance payments: (i) for the 2003 calendar year, severance payments
at a gross bi-weekly rate of $7692.31, to begin on the first regularly scheduled
payroll date in 2003; and (ii) for the 2004 calendar year, severance payments at
a gross bi-weekly rate of $3846.15, to begin on the first regularly scheduled
payroll date in 2004 (collectively, the "Severance Payments"). Such Severance
Payments shall be subject to Xx. Xxxxxxxx' compliance with his obligations set
forth in Sections 4, 5, 6 and 7 of this Agreement and subject to the Company's
normal payroll practices as may be modified from time to time. In the event that
Xx. Xxxxxxxx dies prior to receiving all of the Severance Payments set forth
above, the Company will pay those Severance Payments that remain unpaid to the
Xxxxxxx X. Xxxxxxxx Revocable Trust managed by Divine, Millimet and Branch of
Manchester, NH.
(b) COBRA Payments. The Retirement Date shall be the date of the
"qualifying event" under the Consolidated Omnibus Budget Reconciliation Act of
1985 ("COBRA") for purposes of medical insurance continuation. If Xx. Xxxxxxxx
elects to continue medical insurance coverage in accordance with the provisions
of COBRA, the Company agrees to pay Xx. Xxxxxxxx' COBRA premiums for two-person
coverage for the shorter period of (i) eighteen (18) months following the
Retirement Date or (ii) the period from the Retirement Date through the date on
which Xx. Xxxxxxxx becomes covered under another group medical insurance plan
(such period, the "Coverage Period"), all subject to the terms and conditions
set forth in COBRA. After the expiration of such time period, Xx. Xxxxxxxx will
be solely
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responsible for any and all payments for any period of continued medical
insurance coverage under COBRA. Xx. Xxxxxxxx will receive additional COBRA
information under separate cover. In the event that Xx. Xxxxxxxx dies during the
Coverage Period, the Company will continue to pay COBRA premiums for the benefit
of his spouse for the remainder of the Coverage Period.
(c) Stock Options. During Xx. Xxxxxxxx' employment with the Company,
he was granted the following stock options (collectively, the "Stock Options"):
On August 8, 1994, an non-qualified stock option to purchase 30,000 shares of
common stock of the Company (the "1994 Non-Qualified Stock Option"); on August
8, 1994, an incentive stock option to purchase 25,000 shares of common stock of
the Company (the "1994 Incentive Stock Option"); on April 6, 1998, a
non-qualified stock option to purchase 40,000 shares of common stock of the
Company (the "1998 Non-Qualified Stock Option"); on May 25, 2000, a
non-qualified stock option to purchase 100,000 shares of common stock of the
Company (the "2000 Non-Qualified Stock Option"); on February 25, 2002, a
non-qualified stock option to purchase 10,000 shares of common stock of the
Company (the "2/25/02 Non-Qualified Stock Option"); and on April 3, 2002, a
non-qualified stock option to purchase 50,000 shares of common stock of the
Company (the "4/3/02 Non-Qualified Stock Option").
(i) In consideration for past services rendered to the
Company, the Company agrees to accelerate the vesting of the 2/25/02
Non-Qualified Stock Option so that it is 100% vested; all of the other Stock
Options are already fully vested as of the Retirement Date. Accordingly, Xx.
Xxxxxxxx shall be 100% vested in each of the Stock Options.
(ii) In consideration for past services rendered to the
Company, for each Stock Option, the Company further agrees to extend the time
period within which Xx. Xxxxxxxx may exercise each Stock Option until the last
date of the respective term of each Stock Option (each, the "Exercise
Deadline"). Xx. Xxxxxxxx agrees and understands that by virtue of this
provision, the 1994 Incentive Stock Option shall become a Non-Qualified Stock
Option. Any vested portion of the Stock Options that are not exercised by Xx.
Xxxxxxxx by each respective Exercise Deadline shall be forfeited.
(iii) Except as amended herein, each Stock Option shall
continue to be governed by (i) the respective written stock option agreement
pursuant to which it was granted, as such agreement was executed by Xx. Xxxxxxxx
and the Company and as may be amended hereby (collectively, the "Option
Agreements"), and (ii) the applicable Company Stock Option Plan(s), as may be
amended (collectively, the "Option Plans").
(iv) Each of the Option Agreements is hereby amended by this
Agreement, in the manner set forth above, to fully accelerate the 2/25/02 Stock
Options, and to extend the exercise period of each Stock Option until the last
date of the respective term of each Stock Option, and this Agreement shall serve
as the amendment to each of the Option Agreements. Xx. Xxxxxxxx acknowledges and
agrees that, consistent with the terms of the Option Agreements and the Option
Plans, upon exercise of any Stock Option by Xx. Xxxxxxxx, the Company shall have
the right to deduct from payments of any kind otherwise due to Xx. Xxxxxxxx, any
federal, state or local taxes of any kind required by law to be withheld with
respect
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to any shares of Common Stock issuable upon exercise of any Stock Options. The
Company may elect to satisfy such obligation, in whole or in part, by requiring
delivery to the Company shares of Common Stock already owned by Xx. Xxxxxxxx to
satisfy the obligation (provided they have been held by Xx. Xxxxxxxx for more
than six months and are not subject to any repurchase or forfeiture
requirements). The shares so delivered or withheld shall have a fair market
value sufficient to satisfy such withholding obligation as of the date that the
amount of tax to be withheld is determined.
(d) Truck Lease Payments. The Company agrees that (i) Xx. Xxxxxxxx
may continue to use the Company-leased truck that he currently uses (the
"Truck"); and (ii) the Company will continue to pay the monthly Truck lease
payments on behalf of Xxxxxxxx, in each case for the remainder of the current
term of the Truck lease; provided that Xx. Xxxxxxxx assumes responsibility for,
and pays for, all costs, fees and/or expenses associated with the Truck (except
for the lease and insurance payments) including, but not limited to, those
relating to maintenance, repairs, gas, parking, inspection and/or fines that may
be imposed in connection with the operation of the Truck. Xx. Xxxxxxxx and the
Company agree that any such expense, cost, fee and/or fine not paid by Xx.
Xxxxxxxx will be deducted from the Severance Payments. Xx. Xxxxxxxx and the
Company further agree that on or before the expiration of the current term of
the lease, Xx. Xxxxxxxx shall be entitled to purchase the Truck from the leasing
company at the then prevailing fair market value. In the event that Xx. Xxxxxxxx
exercises this purchase option, all obligations of the Company under this
paragraph shall cease. In the event that Xx. Xxxxxxxx does not exercise this
purchase option, Xx. Xxxxxxxx shall be obligated to return the Truck to the
Company in substantially the same condition as the condition of the Truck on the
Retirement Date.
(e) Taxes. All payments made or benefits provided pursuant to
Sections 1 and 2 of the Agreement will be subject to all applicable federal,
state, and local income, withholding, payroll and other taxes.
3. Company Confidential Information and Property. Xx. Xxxxxxxx agrees that
by the Retirement Date, except for any documents he acquired or created, or will
acquire or create, in connection with his position as Chairman of the Board or
as member of the board of directors of Lasertel (collectively, "Board
Materials"), he will return to the Company all confidential and proprietary
information and tangible trade secrets, and property and materials of the
Company (including its subsidiaries and/or affiliates), including, but not
limited to, records, documents or other information, along with all copies
thereof, and all electronic information containing any such records, documents
or other information, all pagers, cellular telephones, personal computer
equipment and software, company credit cards, gas cards, telephone charge cards,
building keys and/or passes and any other equipment belonging to the Company.
Xx. Xxxxxxxx agrees that in the event he discovers any other Company materials
in his possession after the date he executes this Agreement, he will immediately
return such materials to the Company. Xx. Xxxxxxxx further agrees that he will
return all respective Board Materials to the Company upon each respective date
that he no longer serves as Chairman of the Board and a member of the board of
directors of Lasertel.
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4. Noncompetition. From the Retirement Date until January 8, 2005 (the
"Protected Period"), Xx. Xxxxxxxx agrees that he will not, in any jurisdiction
around the world in which the Company conducts business, whether alone or as a
partner, officer, director, consultant, agent, employee or stockholder of any
entity, engage in any business or other commercial activity that is or may be
competitive with the products and services being designed, conceived, marketed,
distributed or developed by the Company as of the Retirement Date or at any time
during the Protected Period.
5. Nonsolicitation.
(a) During the Protected Period, Xx. Xxxxxxxx agrees that he will
not directly or indirectly either for himself or for any other person or
commercial enterprise (1) divert or take away or attempt to divert or take away,
any of the Company's customers or business in existence as of the Retirement
Date or at any time during the Protected Period, with whom Xx. Xxxxxxxx had
contact, for whom Xx. Xxxxxxxx performed services and/or who were made known to
Xx. Xxxxxxxx by the Company, in each case, during his employment with the
Company; and/or (2) solicit or attempt to solicit, with the purpose or effect of
engaging in competition with the Company, any of the Company's customers or
business in existence as of the Retirement Date or at any time during the
Protected Period, with whom Xx. Xxxxxxxx had contact, for whom Xx. Xxxxxxxx
performed services and/or that were made known to Xx. Xxxxxxxx by the Company,
in each case, during his employment with the Company.
(b) During the Protected Period, Xx. Xxxxxxxx agrees that he will
not directly or indirectly either for himself or for any other person or
commercial enterprise (1) solicit or induce any employee to terminate his or her
employment relationship with the Company, and/or (2) recruit, attempt to
recruit, hire, or attempt to hire any Company employee other than on behalf of
the Company.
6. Nondisclosure Obligation. Xx. Xxxxxxxx will not at any time, whether
during or after the Protected Period, for any reason whatsoever, reveal or
disclose to any person or entity (both commercial and non-commercial) any of the
trade secrets or confidential business information of the Company (or of any
third party who has entrusted such information to the Company) including, but
not limited to, its research and development activities; product designs,
prototypes and technical specifications; show-how and know-how; marketing plans
and strategies; pricing and costing policies; customer and supplier lists and
accounts; personnel information; or nonpublic financial information of the
Company, so far as they have come or may come to Xx. Xxxxxxxx' knowledge. This
restriction shall not apply to: (i) information that is in the public domain
through no fault of Xx. Xxxxxxxx; (ii) information received from a third party
outside the Company that was disclosed without a breach of any confidentiality
obligation; (iii) information approved for release by written authorization of
the Company; or (iv) information that may be required by law or an order of any
court, agency or proceeding to be disclosed. Xx. Xxxxxxxx shall keep secret all
matters of such nature and all trade secrets or confidential business
information concerning the Company entrusted to him during his employment with
the Company or during his tenure as a director of the Company, its affiliates
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and subsidiaries and shall not rely upon, use or disclose any such information
for the benefit of Xx. Xxxxxxxx or any third party in any manner.
7. Assignment of Inventions.
(a) Xx. Xxxxxxxx expressly understands and agrees that any and all
right or interest he may have obtained or may obtain in any designs, trade
secrets, technical specifications and technical data, know-how and show-how,
customer and vendor lists, marketing plans, pricing policies, inventions,
concepts, ideas, works of authorship, documentation, formulae, data, designs,
techniques, discoveries, improvements or intellectual property rights of any
kind or any interest therein (whether or not patentable or registrable under
copyright, trademark or similar statutes (including, but not limited to, the
Semiconductor Chip Protection Act) or subject to analogous protection) that he,
whether alone or jointly with others, authored, conceived, devised, developed,
reduced to practice, or otherwise obtained during Xx. Xxxxxxxx' employment with
the Company and that (i) relate to or arise out of his employment with the
Company; (ii) relate to the Company's then present or planned business or any of
the products or services being designed, conceived, developed, marketed,
manufactured or distributed by the Company or that may be used in relation
therewith; (iii) result from the use of premises or personal property (whether
tangible or intangible) owned, leased or contracted for by the Company; (iv)
result from activities engaged in during Company time; (v) result from any
responsibilities assigned or performed in connection with Xx. Xxxxxxxx'
employment with the Company; and/or (vi) result from use of confidential or
proprietary information or trade secrets of the Company whether such use
occurred prior to or during Xx. Xxxxxxxx' employment with the Company (the
"Inventions"), are and shall immediately become the sole and absolute property
of the Company and its assigns, as works made for hire or otherwise.
(b) Xx. Xxxxxxxx hereby assigns to the Company the sole and
exclusive right to such Inventions. Xx. Xxxxxxxx agrees that he will promptly
disclose to the Company any and all such Inventions, and that, upon request of
the Company, Xx. Xxxxxxxx will execute and deliver any and all documents or
instruments and take any other action which the Company shall deem necessary to
assign to and vest completely in the Company, to perfect trademark, copyright
and patent protection with respect to, or to otherwise protect the Company's
trade secrets and proprietary interest in, such Inventions. The Company agrees
to pay any and all copyright, trademark and patent fees and expenses or other
costs incurred by Xx. Xxxxxxxx for any assistance rendered to the Company
pursuant to this Section.
(c) In the event the Company is unable, after reasonable effort, to
secure Xx. Xxxxxxxx' signature on any letters, patent, copyright or other
analogous protection relating to an Invention, Xx. Xxxxxxxx hereby irrevocably
designates and appoints the Company and any of its officers as his agent and
attorney-in-fact, to act for and on his behalf and stead to execute and file any
such application or applications and to do all other lawfully permitted acts to
further the prosecution and issuance of letters patent, copyright or other
analogous protection thereon with
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the same legal force and effect as if executed by Xx. Xxxxxxxx. The obligations
in this Section shall continue beyond the termination of Xx. Xxxxxxxx'
employment.
8. Reserved.
9. Remedies Upon Breach. Xx. Xxxxxxxx agrees that the obligations set
forth in Sections 4, 5, 6 and 7 of this Agreement are reasonable and necessary
for the protection of the Company's business; that any references in such
Sections and this Section 9 to the "Company" shall include the Company's
affiliates and subsidiaries; and that any breach or threatened breach by Xx.
Xxxxxxxx of any such Sections will cause irreparable harm to the Company. The
Company shall have, in addition to any and all remedies of law, the right to an
injunction or other equitable relief to prevent or cease any violation of Xx.
Xxxxxxxx' obligations hereunder. Moreover, in the event of any such breach or
violation, the Company shall cease all payments described in Section 2 hereof,
and such cessation shall be in addition to, and not in lieu of, any and all
other remedies, whether at law or in equity, available to the Company.
10. Future Conduct.
(a) Confidentiality. Xx. Xxxxxxxx agrees that he shall not divulge
or publish, directly or indirectly, any information regarding the substance,
terms or existence of this Agreement and/or any discussions or negotiations
relating to this Agreement to any person or entity other than his attorneys,
accountants, financial advisors or members of his immediate family, unless and
until such information is made public by the Company. The Company agrees that it
shall not divulge or publish, directly or indirectly, any information regarding
the substance, terms or existence of this Agreement and/or any discussions or
negotiations relating to this Agreement to any person or entity other than (i)
its attorneys, accountants, financial advisors and directors; (ii) any employee
of the Company or its subsidiaries and/or affiliates who needs to know such
information in order to perform his/her job responsibilities; and (iii) as
required by federal, state or local law, regulation, guidance or ordinance.
(b) Nondisparagement. Xx. Xxxxxxxx agrees that he shall not make any
disparaging, negative or otherwise detrimental statements to any person
(including any employee of the Company or its subsidiaries and/or affiliates) or
entity concerning the Company or its subsidiaries and/or affiliates and/or their
respective operations, financial condition, directors, officers, shareholders
and/or employees. The officers and directors of the Company agree that they
shall not make any disparaging, negative or otherwise detrimental statements to
anyone concerning Xx. Xxxxxxxx.
(c) Communications. Nothing in this Agreement shall prohibit or bar
the parties from providing truthful testimony in any legal proceeding or in
communicating with any governmental agency or representative or from making any
truthful disclosure required under law; provided, however, that in providing
such testimony or in making such disclosures or communications, the parties will
use their best efforts to ensure that this Section is complied with to the
maximum extent possible. Moreover, nothing in this Agreement shall prevent Xx.
Xxxxxxxx from contacting, seeking assistance from or participating in any
proceeding before any
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federal or state administrative agency to the extent permitted by applicable
federal, state and/or local law. However, notwithstanding this provision, Xx.
Xxxxxxxx will be prohibited to the fullest extent authorized by law from
obtaining monetary damages in any agency proceeding in which he does so
participate.
11. General.
(a) Entire Agreement. The parties agree that no other terms,
conditions, representations, agreements, understandings, or promises have been
made that are not contained herein, and that this Agreement, including its
Exhibit, the Option Agreements and the agreements described in Section 1(e)
hereof, represents the full and complete understanding between them. Moreover,
this Agreement, including its Exhibit, the Option Agreements and the agreements
described in Section 1(e) hereof, sets forth the complete, sole and entire
agreement between the parties, and supersedes and cancels any and all prior or
contemporaneous agreements, negotiations, discussions, offers, understandings,
proposals, or understandings by or between the parties, whether oral or written,
express or implied, draft or final including, without limitation, the Prior
Employment Agreement, as well as any draft agreements not signed by Xx. Xxxxxxxx
and the Company, whether or not such agreements were approved by the Board. The
language of all parts of this Agreement shall in all cases be construed as a
whole in accordance with its fair meaning and not strictly for or against either
party hereto.
(b) No Modification/Waiver/Assignment. This Agreement may not be
changed, amended, modified, superseded or rescinded except upon the express
written and signed consent of the President of the Company and Xx. Xxxxxxxx. The
failure by a party to exercise any right hereunder shall not operate as a waiver
of such party's right to exercise such right or any other right in the future.
Xx. Xxxxxxxx may not assign any of his rights or delegate any of his duties
under this Agreement, but this Agreement shall be binding upon and inure to the
benefit of Xx. Xxxxxxxx' successors, heirs, assigns, administrators, executors
and representatives. This Agreement may be assigned to, and shall be binding
upon and inure to the benefit of, the successors and assigns of the Company.
Each party hereto shall pay his or its own attorney's fees in connection with
the drafting and negotiation of this Agreement.
(c) Severability/Reformation. In the event that any provision of
this Agreement is determined by a tribunal of competent jurisdiction to be
legally invalid, void or voidable, the affected provision shall be stricken from
the Agreement, and the remaining terms of the Agreement and its enforceability
shall remain unaffected thereby. Moreover, if one or more of the provisions
contained in this Agreement shall for any reason be held by a tribunal of
competent jurisdiction to be excessively broad or otherwise unenforceable at
law, such provision or provisions shall be reformed and construed by the
appropriate judicial body by limiting or reducing it or them, so as to be
enforceable to the maximum extent compatible with the applicable law as it shall
then appear.
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(d) Governing Law. This Agreement shall in all respects be
interpreted, enforced and governed under and in accordance with the laws of the
State of New Hampshire, without giving effect to the principles of conflicts of
law thereof or of any other jurisdiction.
(e) Headings/Counterparts. The paragraph headings used in this
Agreement are included solely for convenience and shall not affect or be used in
connection with the interpretation of this Agreement. This Agreement may be
executed in any number of counterparts, each of which will be deemed an
original, but all of which will be deemed one and the same instrument.
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IN WITNESS WHEREOF, the parties hereby execute this Retirement Agreement
as of the day, month and year first written above.
/s/ X.X. Xxxxxxxx
------------------------------------------
Xxxxxxx X. Xxxxxxxx
PRESSTEK, INC.
By: /s/ Xxxxxx X. Xxxxxx
--------------------------------------
Title: President and CEO
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EXHIBIT A
January 7, 2003
Presstek, Inc.
00 Xxxxxxxxx Xxxxx
Xxxxxx, XX 00000-0000
Attention: Chief Executive Officer
Ed:
Effective January 8, 2003, I hereby resign from my officer position of
Chief Scientific Officer and any other officer positions I may hold with
Presstek, Inc. or Lasertel, Inc., as well as all duties associated with any such
positions.
Sincerely yours,
/s/ X.X. Xxxxxxxx
Xxxxxxx X. Xxxxxxxx
