1
EXHIBIT 10.12
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") is entered into by and between
PARAVAX, INC., a California corporation with its principal office at ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ("Company") and R. ▇▇▇
▇▇▇▇▇▇ ("Employee"), effective as of October 17, 1994.
W I T N E S S E T H:
Whereas Company desires to employ Employee to act as its Vice
President, in an at-will capacity; and
Whereas Employee wishes to act as Company's Vice President as an
employee in an at-will capacity;
Now, Therefore, in consideration of the mutual covenants and
warranties contained herein, the parties agree as follows:
1. Employment. Company hereby employs Employee as its Vice
President, and Employee hereby accepts such employment.
2. Duties and Responsibilities. Employee shall serve as Vice
President of Company, with such duties and responsibilities as may be assigned
to him from time to time by the Board of Directors of Company, and with such
on-going daily duties and responsibilities as are typically entailed in the
position of Vice President. Employee shall devote 100% of his time and
energies to such duties.
3. Compensation. Company shall pay Employee, as compensation for
services rendered under this Agreement, compensation at the rate of $160,000
per year, payable in accordance with the usual and customary payroll practices
of Company. If for any reason during any given year, Employee does not work an
entire year, other than normal vacations as provided hereunder, the
compensation will be prorated to compensate only for the actual time worked.
4. Expenses. Company shall reimburse Employee for his reasonable
out-of-pocket expenses incurred in connection with the business of Company,
including travel away from the Company's facilities, upon presentation of
appropriate written receipts and reports and subject to the customary practices
of Company.
In addition, the Company will reimburse Employee all of his
reasonable expenses related to moving his household to the Fort ▇▇▇▇▇▇▇ area,
including reasonable travel expenses, moving expenses and temporary living
expenses. Such reimbursement will be made upon presentation of appropriate
written receipts. The Company will not reimburse Employee for any brokerage
commissions or other expenses relating to the sale of property in New Jersey or
the purchase of a home in Colorado. Employee may, upon request, ask for a loan
from the Company in order to make a down payment on the purchase of a home in
Colorado.
5. Employee Benefits. During the term of his employment
hereunder, Employee shall be entitled to receive the same benefits that the
Board of Directors establishes generally for the officers and other employees
of Company. These may include from time to time, medical insurance, life
insurance, paid vacation time and medical disability insurance.
6. Termination.
(a) At-Will. This is an at-will employment agreement and does not
bind either of the parties to any specific term or duration.
(i) Employee is free to terminate employment with Company at
any time, for any reason, or for no reason.
(ii) Company is free to terminate the employment of Employee
at any time, for any reason or for no reason, for cause or without cause, and
without any prior notice.
2
(b) Severance Pay.
(i) Upon involuntary termination of his employment,
Employee will be entitled to severance pay as provided below unless he is
terminated for "cause," as defined below. If Company terminates Employee for
"cause," Employee will not be entitled to any severance pay and shall only
receive pay and benefits which Employee earned as of the date of termination.
(ii) The parties agree that for the purposes of this
Employment Agreement, a termination for "cause" will be deemed to have occurred
when Company terminates Employee's employment because of the occurrence of any
of the following events:
(A) Employee shall die, be adjudicated to be mentally
incompetent or become mentally or physically disabled to such an
extent that Employee is unable to perform his duties under this
Employment Agreement for a period of ninety (90) consecutive days;
(B) Company shall discontinue its business (for the
purpose of this provision, a merger, acquisition or sale of Company in
which Company's business is carried on by the surviving entity shall
not be deemed to be a discontinuance of the business of Company);
(C) Employee shall commit any material breach of his
obligations under this Agreement;
(D) Employee shall commit any material breach of any
material fiduciary duty to Company;
(E) Employee shall be convicted of, or enter a plea of
nolo contendere to, any crime involving moral turpitude or dishonesty,
whether a felony or misdemeanor, or any crime which reflects so
negatively on Company to be detrimental to Company's image or
interests;
(F) Employee shall commit repeated insubordination or
refusal to comply with any reasonable request of the Board of
Directors of Company relating to the scope or performance of
Employee's duties;
(G) Employee shall possess any illegal drug on Company
premises or Employee shall be under the influence of illegal drugs or
abusing prescription drugs or alcohol while on Company business or on
Company premises; or
(H) Employee shall conduct himself in a manner, which in
the good faith and reasonable determination of the Board of Directors
demonstrated Employee's gross unfitness to serve.
(iii) In the event that severance pay is due to Employee as
a result of the involuntary termination of his employment without "cause"
within three years of the date of this Agreement, Employee will be paid one (1)
years' salary in twelve equal monthly installments, with the first such
installment due 15 days after the date of such termination and with the
following eleven installments due monthly thereafter.
(iv) In the event that severance pay is due to Employee as
a result of the involuntary termination of his employment without "cause" three
or more years after the date of this Agreement, Employee will be paid six (6)
months' salary in six equal monthly installments, with the first such
installment due 15 days after the date of such termination and with the
following five installments due monthly thereafter.
7. Proprietary Information. Employee agrees that he will
promptly execute Company's standard employee proprietary information and
assignment of inventions agreement. For three (3) years following his
termination as an employee, Employee agrees not
-2-
3
to undertake any employment or activity wherein the loyal and complete
fulfillment of the duties of such employment or activity would necessarily call
upon Employee to reveal, to make judgments on or otherwise to use, any
proprietary business information or trade secrets of Company's business to
which Employee had access by reason of Company's business.
8. Attorneys' Fees. If any legal action arises under this
Agreement or by reason of any asserted breach of it, the prevailing party shall
be entitled to recover all costs and expenses, including reasonable attorneys'
fees, incurred in enforcing or attempting to enforce any of the terms,
covenants or conditions, including costs incurred prior to commencement of
legal action, and all costs and expenses, including reasonable attorneys' fees,
incurred in any appeal from an action brought to enforce any of the terms,
covenants or conditions. For purposes of this section, "prevailing party"
includes without limitation a party who agrees to dismiss a suit or proceeding
upon the other's payment or performance of substantially the relief sought.
9. Notices. Any notice to be given to Company under the terms of
this Agreement shall be addressed to Company at the address of its principal
place of business, and any notice to be given to Employee shall be addressed to
him at his home address last shown on the records of Company, or to such other
address as a party shall have given notice of hereunder.
10. Miscellaneous. This Agreement shall be governed by the laws
of the State of Colorado as applied to contracts between residents of that
state to be performed wholly within that state. This Agreement is the entire
agreement of the parties with respect to the subject matter hereof and
supersedes all prior understandings and agreements. This Agreement may be
modified only by a writing signed by both parties.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
the day and year hereinabove written.
PARAVAX, INC.
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-------------------------------------
Its
------------------------------------
/s/ R. ▇▇▇ ▇▇▇▇▇▇
---------------------------------------
R. ▇▇▇ ▇▇▇▇▇▇
-3-
