EXHIBIT 10 (i)
EMPLOYMENT AGREEMENT
Employment Agreement ("Agreement") dated as of December 11, 1996 by
and between WATER-JEL TECHNOLOGIES, INC. a New York corporation with an office
at 000 Xxxxxxxx Xxxxxxxxx, Xxxxxxxxx, Xxx Xxxxxx 00000 (the "Company"), and
XXXXXX XXXXX, residing at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the
"Executive").
1. Employment. The Company hereby employs the Executive as Chairman and Chief
Executive Officer of the Company for and during the term hereof, subject to the
supervision and control of the Company's Board of Directors, and the terms and
conditions hereof. The Executive hereby accepts employment under the terms and
conditions set forth in this Agreement.
2. Duties of Executive. The Executive shall have such duties as may be
reasonably assigned to him from time to time by the Board of Directors
consistent with his position as Chief Executive Officer of the Company.
3. Business Time. The Executive agrees to devote such business time as may be
reasonably necessary to the performance of the duties, responsibilities, and
authorities which may be reasonably assigned to him and which are consistent
with his executive status under Section 1.1 of this Agreement. It is understood
that such business time might not constitute Executive's full business time and
that Executive may conduct such other business activities as are not in
violation of Section 8 hereof.
4. Term. The term of this Agreement shall commence effective January 1, 1997 and
shall terminate on December 31, 2001.
5. Compensation. The Company shall pay the Executive, as compensation for
services rendered by the Executive as an officer under this Agreement, as
follows:
5.1 Base Salary. The Company shall pay the Executive a base salary at
the rate of $500,000 per annum subject to withholding taxes, payable as per the
Company's normal payroll practices as in effect from time to time.
5.2 Options and Bonuses. The Company may also grant to Executive from
time to time such stock options, bonuses, and other incentives as the Company's
Board of Directors may determine, in its sole discretion.
5.3 Insurance. The Company will make all premium, interest, and other
payments necessary to maintain in effect: (1) life insurance policy no. I
1796442 with National Life of Vermont, which policy will insure the life of
Executive with a face value of at least $1,000,000 with such beneficiar(y)(ies)
as Executive may designate; (2) life insurance policy no. 35790938 with New York
Life Insurance Company, which policy will insure the life of Executive with a
face value of at least $100,000 with such beneficiar(y)(ies) as Executive may
designate; (3) life insurance policy no. 45258745 with New York Life Insurance
Company, which policy will insure the life of Xxxxx Xxxxxx Xxxxx with a face
value of at least $500,000
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with such beneficiar(y)(ies) as Xxx. Xxxxx may designate; (4) life insurance
policy no. 36704457 with New York Life Insurance Company, which policy will
insure the life of Executive with a face value of at least $500,000 with such
beneficiar(y)(ies) as Executive may designate; (5) life insurance policy no.
62539381 with Prudential Insurance Company, which policy will insure the life of
Executive with a face value of at least $200,000 with such beneficiar(y)(ies) as
Executive may designate; and (6) disability income policy no. D047049 with New
England Mutual Life Insurance Company. In the event of termination of this
Agreement, Executive shall have the option of continuing the aforementioned
insurance policies at his own expense. In addition, during the term of
Executive's employment hereunder Executive shall be eligible to participate in
any life insurance, medical, retirement and other benefit plans or arrangements
generally made available by the Company to comparable employees of the Company
to the extent Executive qualifies under the provisions of any such plans.
5.4 Reimbursement of Expenses. The Company shall reimburse Executive
for reasonable out-of-pocket expenses properly incurred by Executive on behalf
of and directly for the benefit of the Company in the performance of his duties
hereunder and in accordance with policies set by the Board of Directors of the
Company; provided that proper written vouchers are submitted to the Company by
Executive evidencing such expenses and the purposes for which the same were
incurred.
5.5 Automobile. The Company shall make available to Executive an
automobile and shall pay all business expenses associated with said automobile.
Said automobile may be leased or purchased at the Company's expense and shall be
a new full size model car. Executive shall be entitled to a new car if said
automobile becomes more than three (3) years old. Executive shall have the right
of first refusal to purchase said automobile assigned to him at the "Book Value"
as carried on the Company's books. The said right shall be afforded to Executive
each time the Company sells or trades in the automobile which is assigned to
Executive.
6. Termination. Notwithstanding any other provision in this Agreement:
6.1 Death. If the Executive dies during the term of this Agreement and
while in the employ of the Company, this Agreement shall automatically terminate
as of the date of the Executive's death; and, subject to Section 6.4 hereof, the
Company shall have no further obligation to the Executive or his estate.
6.2 Disability. If, during the term of this Agreement, the Executive is
unable to perform his duties hereunder as a result of any physical or mental
disability which continues for 180 days in any 365 day period, then the Company,
may terminate this Agreement upon written notice to Executive.
6.3 Termination by the Company for Cause. At any time during the term
of this Agreement, the Company may discharge the Executive for cause and
terminate this Agreement without any further liability hereunder to the
Executive or his estate. For purposes of this Agreement, a "discharge for cause"
shall mean termination of the Executive upon written notification to the
Executive limited, however, to one or more of the following reasons:
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6.3.1 Fraud, misappropriation or embezzlement by the Executive in
connection with the Company; or
6.3.2 Conviction by a court of competent jurisdiction in the
United States of a felony or a crime involving moral turpitude; or
6.3.3 Willful and unauthorized disclosure of confidential, or
proprietary trade secret information of the Company; or
6.3.4 The Executive's breach of any material term or provision of
this Agreement, after notice to the Executive of the particular details thereof
and a period of not less than (30) days thereafter within which to cure such
breach, if any.
6.4 Effects of Termination. If this Agreement is terminated for any
reason other than as set forth in Section 6.3 above, including without
limitation death or disability, all debts owed by the Executive to the Company
or to Journeycraft, Inc., shall be cancelled in full, and in addition, the
Company shall pay the Executive or his estate an amount in cash equal to 100% of
the amount of debt so cancelled.
7. Employment Benefits. While he is an employee of the Company, the Executive
shall be entitled to all employee benefits made available to other executive
officers of the Company. Without limiting the foregoing, the Company will use
reasonable efforts to procure disability insurance with the Executive as
beneficiary which shall be sufficient to provide Executive with his base
compensation for any remainder of the term of this Agreement that he is disabled
as defined in Section 6.2. The maintenance of the disability insurance policy
referred to in Section 5.3(6) shall be included in determining the Company's
compliance with the preceding sentence.
8. Protective Covenants.
8.1 Because
(i) Executive will become fully familiar with all aspects of the
Company's business during the period of his employment with the Company,
(ii) certain information of which the Executive will gain knowledge
during his employment is proprietary and confidential information which is of
special and peculiar value to the Company,
(iii) if any such proprietary and confidential information were
imparted to or became known by any persons, including Executive, engaging in a
business in competition with that of the Company, hardship, loss and irreparable
injury and damage could result to the Company, the measurement of which would be
difficult if not impossible to ascertain, and
(iv) it is necessary for the Company to protect its business from such
damage,
the following covenants constitute a reasonable and appropriate means,
consistent with the best interests of both the Executive and the Company, to
protect the Company against such damage and shall apply to and be binding upon
Executive as provided herein.
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8.2 Non-Competition by Executive. Executive covenants that, while he is
an employee of the Company and for 12 months thereafter, neither he nor any of
his affiliates will, directly or indirectly (whether as an investor,
shareholder, employee or otherwise), engage in or participate in any business
which is in competition with the business of the Company.
8.3 Trade Secrets, Proprietary and Confidential Information.
8.3.1 Executive recognizes that his position with the Company is
one of the highest trust and confidence by reason of Executive's access to and
contact with trade secrets and confidential and proprietary information of the
Company.
8.3.2 Executive shall use his best efforts and exercise utmost
diligence to protect and safeguard and keep confidential the trade secrets and
confidential and proprietary information of the Company.
8.3.3 Executive covenants that while he is an employee of the
Company and thereafter, he will not disclose disseminate or distribute to
another, nor induce any other person to disclose, disseminate, or distribute,
any trade secret or proprietary or confidential information of the Company,
directly or indirectly, either for Executive's own benefit or for the benefit of
another, whether or not acquired, learned, obtained or developed by Executive,
or use or cause to be used, any trade secret, proprietary or confidential
information in any way except as is required in the course of his employment
with the Company.
8.3.4 All trade secrets and confidential and proprietary
information relating to the business of the Company whether prepared by
Executive or otherwise coming into his possession, shall remain the exclusive
property of the Company and shall not, except in the furtherance of the business
of the Company, be removed from the premises of the Company under any
circumstances whatsoever without the prior written consent of the Company.
8.3.5 Executive hereby assigns to the Company all his right,
title and interest in any and all inventions, discoveries, improvements, ideas,
computer or other apparatus programs and related documentation, and other works
of authorship (hereinafter each designated "Intellectual Property") which he
develops, makes, creates or conceives in connection with his employment by the
Company.
8.3.6 Executive will, without charge to Company, but at its
expense, execute a specific assignment of title to the Company to secure a
patent, copyright or other form of protection for said Intellectual Property
anywhere in the world.
8.4 Remedies. In the event of breach or threatened breach by Executive
of any provision of this Section, the Company shall be entitled to apply for
relief by temporary restraining order, temporary injunction, or permanent
injunction and to all other relief to which it may be entitled, including any
and all monetary damages which the Company may incur as a result of said breach,
violation or threatened breach or violation. The Company may pursue any remedy
available to it concurrently or consecutively in any order as to any breach,
violation, and the pursuit of one of such remedies at any time will not be
deemed
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an election of remedies or waiver of the right to pursue any other of such
remedies as to such breach, violation, or as to any other breach, violation, or
threatened breach or violation.
9. Change in Control.
(a) After a Change in Control of the Company as defined under (b)
hereafter, Executive shall be entitled to a one-time additional compensation in
an amount equal to the three (3) times the Executive's then current annual
compensation (including bonuses). Such additional compensation will be paid to
Executive in a lump sum on or before the date such Change in Control takes
effect. Said amount shall be determined by counsel to the Company in
consultation with the Company's auditors.
(b) A "Change in Control" shall be deemed to have occurred in the
event (i) any person (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934 (the "Exchange Act"), or group of such
"persons", without the consent of the Board of Directors, is or becomes a
"beneficial owner" (as defined in Rule 13d-3 of the Exchange Act), directly or
indirectly, of securities of the Company representing 30% or more of the
combined voting power of the Company's then outstanding securities, or (ii) of a
merger, consolidation or other combination the result of which is the ownership
by shareholders of the Company of less than 75% of those voting securities of
the resulting or acquiring entity having the power to elect a majority of the
Board of Directors of such entity; or (iii) of the sale of transfer of in excess
of 50% of the gross assets of the Company as shown on the Company's then most
recent audited financial statements.
(c) Notwithstanding anything in the foregoing to the contrary, no
Change of Control shall be deemed to have occurred for purposes of this
Agreement by virtue of any transaction which results in the Executive or a group
of persons which includes the Executive, acquiring, directly or indirectly, 30%
or more of any class of voting securities of the Company.
10. No Violation. Executive represents and warrants to the Company that he is
free to enter into this Agreement in accordance with the terms hereof and is
under no restriction, contractual or otherwise, which would interfere with his
execution hereof or performance hereunder.
11. General Provisions.
11.1 Notices. All notices, requests, consents, and other communications
under this Agreement shall be in writing and shall be deemed to have been
delivered (i) on the date personally delivered or (ii) two days after the date
deposited in a receptacle maintained by the United States Postal Service for
such purpose, postage prepaid, by certified mail, return receipt requested,
addressed as set forth below or (iii) one day after properly sent by Federal
Express, addressed to the respective parties at their address set forth above.
Either party hereto may designate a different address by providing written
notice of such new address to the other party hereto as provided above.
11.2 Severability. If any provision contained in this Agreement is
determined to be void, illegal or unenforceable, in whole or in part, then the
other provisions contained herein
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shall remain in full force and effect as if the provision which was determined
to be void, illegal, or unenforceable had not been contained herein.
11.3 Waiver, Modification and Integration. The waiver by any party
hereto of a breach of any provision of this Agreement shall not operate or be
construed as a waiver of any subsequent breach of any party. This instrument and
the documents referred to herein contain the entire agreement of the parties
concerning employment and supersede any and all other agreements, either oral or
in writing, between the parties hereto with respect to the employment of the
Executive by the Company and contain all of the covenants and agreements between
the parties with respect to such employment in any manner whatsoever. This
Agreement may not be modified, altered or amended except by written agreement of
all the parties hereto.
11.4 Binding Effect. This Agreement shall be binding and effective upon
the Company and its successors and permitted assigns, and upon the Executive,
his heirs and representatives.
11.5 Governing Law. This Agreement shall be governed by the internal
laws of the State of New York.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
WATER-JEL TECHNOLOGIES, INC.
/s/ Xxxxxx Xxxxx By: /s/ X. Xxxxxxxx
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Xxxxxx Xxxxx Title: Secretary
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