EXHIBIT 10.54
EXECUTIVE EMPLOYMENT AGREEMENT
THIS AGREEMENT is dated the 17th day of April, 1998, between:
BIOJECT MEDICAL TECHNOLOGIES INC. ("BMT"), a Corporation incorporated under the
laws of the State of Oregon having its principal offices at 0000 XX Xxxxxxxxxx
Xx., Xxxxxxxx, Xxxxxx 00000
BIOJECT INC., a Corporation incorporated under the laws of the State of Oregon
having its principal offices at 0000 X.X. Xxxxxxxxxx Xxxx, Xxxxxxxx, Xxxxxx,
00000 (collectively referred to as the "Company")
AND:
Xxxxxxx X. Xxxxxx, an individual residing at:
0000 X.X. Xxxxxx Xxxx
Xxxxxxxx, XX 00000
(the "Executive")
RECITALS:
1. The Company desires to secure the services and expertise of the Executive
and to ensure the availability of the Executive to the Company; and
2. The Executive desires to serve in the employ of the Company on a full-time
basis for the period and upon the terms and conditions provided for in this
agreement.
3. The Executive and the Company desire to execute an agreement entered into
between them.
NOW THEREFORE, in consideration of the premises and mutual covenants contained
herein, the parties noted above agree as follows:
SECTION 1
1.1 Employment
The Company appoints the Executive to and retains the Executive for the position
of Chief Financial Officer for the Company, and the Executive accepts such
appointment. This appointment becomes effective as soon as the Executive can
make appropriate arrangements with his current employer, or on April 20 th,
1998, whichever date is earlier.
1.2 Approval by the Board
The Company represents, if required by its Bylaws, that the appointment of the
Executive to the position referred to in Section 1.1 will be approved by the
Board of Directors of the Company (the "Board") and that all corporate action
required to effect the appointment will be taken.
1.3 Definitions
As used in this agreement:
a. "Confidential Information" means any of the company's customers, employees,
products, processes, services, financial information, marketing techniques,
merchandising, business strategies, or plans, research, development,
systems, inventions or any other trade secret or information pertaining to
any of the preceding terms.
b. "Conflicting Product" means any product, process or service of any person
or organization other than the Company, in existence or under development,
which resembles or competes with the current or projected products,
processes or services of the Company.
c. "Conflicting Organization" means any person or organization engaged or
about to become engaged in research, development, production, marketing or
selling of a Conflicting Product.
d. "Inventions" means discoveries, concepts, and ideas, whether patentable or
not, including but not limited to, procedures, processes, methods,
formulas, and techniques, as well as improvements thereof or know-how
related thereto, concerning any present or prospective activities of the
Company with which the Employee becomes acquainted as a result of his
employment by the Company.
SECTION 2 - DUTIES/RESPONSIBILITIES
2.1 Duties/Responsibilities
During the employment term and any renewals thereof, the Executive will devote
such time, attention, skill and efforts as may be necessary to assure the full
performance of his duties and responsibilities, to the best of his abilities,
with such authority as is customarily associated with the position of Chief
Financial Officer. The Executive hereby accepts and agrees to such engagement of
services, and will devote himself solely to the operation of the Company's
business. The Executive may continue his existing involvement in an advisory or
board capacity with non-competing organizations.
2.2 Reporting
In conducting his duties under this Agreement, the Executive shall report to the
Chief Executive Officer and Chairman of the Board of Directors of the Company.
2.3 Location of Employment
The Executive shall conduct his duties under this Agreement at the offices of
the Company in Portland, Oregon, or such other geographical locations as shall
be reasonably required in order to assure the efficient and proper operation of
the Company. In the event that the location of the Company is moved outside the
Portland metropolitan area, the Executive will be offered a choice to either
relocate to the new location, or to accept a severance package as described in
Section 4.2b(ii).
SECTION 3 - COMPENSATION
3.1 Salary
For the Executive's services to the Company, the Executive shall be entitled to
receive a minimum annual gross salary of $110,000. Not less than once during
each year of employment, the Chief Executive Officer shall review the
Executive's performance, duties and compensation for the purpose of promotion
and/or increasing the compensation payable to the Executive. Executive's salary
shall be paid in bi-weekly installments during the calendar year for the term of
this Agreement. The Company shall deduct or withhold from such payments to the
Executive the sums as are required under applicable laws for worker's
compensation, income taxes and other benefits in accordance with Company policy.
3.2 Bonus Program
The Executive shall not be eligible to earn a cash bonus until the fiscal year
following the year the Company has achieved profitability. In the interim, the
Executive is eligible to earn bonuses in the form of stock options for fiscal
years in which the Company achieves its financial performance objectives,
including budget projections. Specific bonus requirements and objectives will be
determined by the Chief Executive Officer and the Board of Directors, and are
subject to approval by the Board.
At such time during Executive's employment by the Company, that the Company
attains two consecutive fiscal quarters of positive earnings per share from
ordinary income and expenditures (i.e., computed by utilizing customer sales
revenues less ordinary and usual operating expenses for each month, as well as
GAAP), the Executive will receive a grant of 15,000 incentive shares from the
Company's incentive stock plan, having a tax basis to Executive of zero. The
Executive is eligible for only one such bonus during his employment.
3.3 Reimbursement of Expenses
The Company shall pay or reimburse the Executive for all reasonable
out-of-pocket expenses, including, without limitation, all travel and
entertainment expenses payable or incurred by the Executive in connection with
his duties under this Agreement. It is the policy of the Company for employees
to travel as inexpensively as possible, utilizing economy airfare and standard
rental cars. All payments or reimbursements shall be made promptly upon
submission by the Executive of vouchers, bills or receipt for all expenses.
3.4 Disability
Should Executive become disabled and unable to perform substantially all of his
duties hereunder, as documented by an independent physician selected jointly by
the Executive and the Company, the Company will continue paying the Executive
any bonus earned and previously awarded, together with his then- current salary
at seventy-five percent (75%) of current salary for a period of not less than
six (6) months from the disability date, then reduced to fifty percent (50%) of
current salary for any remaining period of disability for a period of up to an
additional six (6) months, with health and dental insurance and other benefit
coverage to continue for the duration of such payments. Should payments to
Executive under worker's compensation and/or disability insurance programs, when
combined with Company payments, exceed seventy-five percent (75%) of employee's
current salary, the Company will reduce its payment by the excess amount.
SECTION 4 - TERMS OF EMPLOYMENT
4.1 Duration
The term of this Agreement shall commence on a mutually agreeable date, but not
later than April 20th, 1998. It shall continue for an initial term period of
two, consecutive one-year terms, subject to the early termination provisions of
this Section. Upon expiration of the initial term period, this Agreement will be
automatically renewed for successive one-year terms unless either the Executive
or the Company shall, upon three months written notice to the other, elect not
to renew this Agreement for any year.
4.2 Termination by the Company
(a) The Company may terminate this Agreement:
(i) Immediately if it is determined by the Board of Directors that the
Executive's actions: (1) constitute a material breach of his duties
hereunder or (2) constitute a criminal act reflecting adversely on the
business or reputation of the Company or (3) have resulted in the
Executive, in his personal capacity, being indicted or sanctioned or his
entering into a consent decree, in connection with any investigation of,
allegation of wrongdoing by, or other formal proceeding against the
Executive, by the United States Food and Drug Administration or the United
States Securities and Exchange Commission, whether related to the business
of the Company or to any other employment or activity of the Executive,
past or future; or
(ii) With or without other cause at any time by giving sixty (60) days prior
written notice to the Executive; or
(b) Upon termination of this Agreement by the Company:
(i) Pursuant to Sections 4.2(a)(i):
A. The salary payable to the Executive pursuant to Section 3.1 shall be paid
in regular bi-weekly installments for sixty (60) days following the date
of termination;
B. All other forms of compensation payable to the Executive pursuant to
Section 3 shall terminate on the date of termination, except that as
expeditiously as possible following the termination, the Company shall pay
or reimburse the Executive for all expenses incurred prior to the
termination pursuant to Section 3.3, together with any bonuses earned by
and previously awarded to the Executive pursuant to Section 3.2 prior to
the date of termination.
(ii) Pursuant to Section 4.2(a)(ii), and Section 2.3:
A. The salary payable to the Executive pursuant to Section 3.1 shall be paid
for the period commencing on the date of the termination, and continuing
for:
One hundred twenty (120) days following the date of termination.
B. All other forms of compensation payable to the Executive pursuant to
Section 3 shall terminate, except that as expeditiously as possible after
the termination the Company shall pay or reimburse the Executive for all
expenses incurred prior to the termination pursuant to Section 3.3,
together with any bonuses earned by and previously awarded to the Executive
pursuant to Section 3.2, prior to the date of termination.
4.3 Termination by Executive
The Executive may terminate this Agreement by giving sixty (60) days prior
written notice to the Company. Upon termination of this Agreement by the
Executive pursuant to this Section:
(a) The salary payable to the Executive pursuant to Section 3.1 shall be
prorated to the date of the termination;
(b) Except for the severance package made available to the Executive pursuant
to Section 2.3, all other forms of compensation payable to the Executive
pursuant to Section 3 shall terminate on the date of the termination. As
expeditiously as possible after termination of the Executive's employment,
the Company shall pay or reimburse the Executive for all expenses incurred
prior to the termination pursuant to Section 3.3, together with any bonuses
earned by and previously awarded to the Executive pursuant to Section 3.2,
prior to the date of termination.
(c) Executive shall utilize his best efforts to continue to perform all duties
assigned by the Company in the manner stated in paragraph 2.1 hereof, prior
to the date of termination.
4.4 Termination Upon Death
This Agreement shall terminate immediately upon the Executive's death. In the
event of the Executive's death:
(a) The Company shall pay to the Executive's estate the salary otherwise
payable to the Executive pursuant to Section 3.1 through the last day of
the calendar month in which the Executive's death occurs and for a period
of one hundred twenty (120) days thereafter.
(b) As expeditiously as possible after the Executive's death the Company shall
pay or reimburse the Executive's estate for all expenses incurred pursuant
to Sections 3.3 prior to such death, together with any bonuses earned by
and awarded to the Executive pursuant to Section 3.2, prior to the date of
such death.
4.5 Reorganization, Merger or Sale
If at any time during the term of this Agreement there is effected any
consolidation or merger of the Company with another corporation (other than a
consolidation or merger in which the Company is a continuing corporation) or the
sale of all or substantially all of the assets of the Company, then, as to such
consolidation, merger or sale, the Company will utilize its best efforts to make
appropriate provisions to preserve the rights and interests of the Executive
pursuant to this Agreement. Additionally, in the event of merger or acquisition,
all stock options which have been awarded to the Executive, but are not yet
vested, will vest immediately.
4.6 Acts Upon Termination
Upon termination of Executive's employment with the Company, all documents,
records, notebooks, and similar repositories of or containing Confidential
Information, including copies thereof, then in the Executive's possession,
whether prepared by himself or others will be delivered to the Company within
thirty (30) days of such termination. The obligations of the Executive in
Sections 6.1 and 6.2 of this Agreement shall survive any termination of the
Executive.
SECTION 5 - STOCK
5.1 Grant of Stock Options
As soon as possible following the execution hereof the Executive and the Company
shall execute an Incentive Stock Option Agreement granting the Executive the
following:
150,000 options to purchase shares of BMT at the mean between the bid and asked
price on April 20, 1998. These options vest as follows: 25% (37,500) on each of
the Executive's next four annual anniversaries of employment with the Company,
provided he remains employed by the Company during each year. All options
granted will be subject to the same terms and conditions as provided in the
Company's incentive stock program.
5.2 Registration
It is understood that BMT is a reporting company within the requirements of the
Securities and Exchange Commission ("SEC") and has elected to register the
options granted hereunder with the SEC.
SECTION 6 - MISCELLANEOUS
6.1 Disclosure of Information and Employee Restrictions
Executive agrees to the following:
a. Executive agrees that he shall not, during his employment, either as an
individual or as part of an organization, throughout North America or
Europe, compete with the Company or render services directly or indirectly,
to any conflicting organization or himself establish or acquire any
interest, directly or indirectly, in a conflicting organization, nor will
he assist any other person or entity to do so;
b. Executive will not during his employment solicit or sell to any of the
Company's present or future customers, a conflicting product or service nor
will he assist any other person or entity to do so;
c. Except as required in his duties to the Company, the Executive will never,
during or after his employment, directly or indirectly use, disseminate,
disclose, lecture upon, or publish any Confidential Information without
Company's written consent.
In the event this Agreement is terminated, for whatever reason, Executive agrees
that he shall not, for two years following the date of termination:
a. Either as an individual or as part of an organization, throughout Canada or
the United States, compete with the Company or render services directly or
indirectly, to any conflicting organization or himself establish or acquire
any interest, directly or indirectly, in a conflicting organization, nor
will he assist any other person or entity to do so; and
b. He will not employ, without the consent of the Company, directly or
indirectly, any past or present employees of the Company, nor will he
assist any other person or entity to do so; and
6.2 Arbitration and Jurisdiction
Subject to the remedies stated in Section 6.1, any controversy or claim arising
out of or relating to this Agreement or any breach of this Agreement shall be
finally settled by arbitration in accordance with the provisions of the
Commercial Arbitration Rules of the American Arbitration Association. Such
arbitration shall be conducted in Portland, Oregon by one arbitrator, with one
discovery allowed by each party to this agreement. This agreement is entered
into and shall be interpreted and enforced according to the laws of the State of
Oregon; both parties consent to personal jurisdiction for that purpose.
6.3 Notices
Any notice or other communication required or permitted to be given under this
Agreement shall be in writing, given by personal delivery or sent by first class
mail, postage prepaid, addressed as follows:
To the Executive: Xxxxxxx X. Xxxxxx
0000 X.X. Xxxxxx Xxxx
Xxxxxxxx, XX 00000
To the Company: Secretary to the Board of Directors
Bioject Medical Technologies Inc.
0000 X.X. Xxxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxx 00000
Either party, by notice as provided above, may change the address to which
subsequent notice shall be given. Any notice given herein shall be deemed
received seven (7) days after posting in a post office box; PROVIDED, HOWEVER,
that if there should be a postal strike, slow-down or other labor dispute which
may effect the delivery of such notice through the mail between the time of
mailing and the actual receipt of the notice, then such notice shall be
effective only if actually delivered.
6.4 Assignment
This Agreement is a personal services agreement and may not be assigned by
either party without the prior written consent of the other party; however,
during his employment term, the Executive may by written assignment assign all
or any portion of the compensation or benefits to which he is entitled under
Section 3 to any member of his immediate family or to any corporation,
partnership or other business entity controlled by the Executive. Except as
required by law, no right to receive payments under this Agreement shall be
subject to anticipation, commutation, alienation, sale, assignment, encumbrance,
charge, pledge or hypothecation or to execution, attachment, levy or similar
process or assignment by operation of law and any attempt, voluntary or
involuntary, to affect any such action shall be null, void, and of no effect.
6.5 Indemnity
The Executive, his heirs, executors, administrators, estate and effects, shall
at all times be indemnified and held harmless by the Company from and against:
a. All costs, charges and expenses whatsoever sustained or incurred as a
result of any action, suit or proceeding, whether civil, criminal,
administrative, or investigative, that is brought, commenced or prosecuted
for or in respect of any act, deed, matter or thing whatsoever made, done
or permitted in or about the execution of the Executive's duties; and
b. All other costs, charges and expenses sustained or incurred in or about or
in relation to the affairs of the Company;
Except such costs, charges or expenses as are occasioned by the criminal act,
willful neglect or default of duties by the Executive. At all such times that
the Company obtains and maintains directors and officers errors and omissions
insurance, Executive shall be a beneficiary of such policy(ies).
6.6 Amendment and Severability
This Agreement may not be amended or otherwise modified except by an instrument
in writing signed by both parties. All agreements and covenants herein contained
in this Agreement are deemed to be severable, and in the event any portion of
this Agreement is declared to be invalid, this Agreement shall be interpreted as
if such invalid portion or covenant were severed and not contained herein, with
all other terms of this Agreement remaining valid and binding on the parties
hereto.
6.7 Entire Agreement
This agreement specifies all of the terms and conditions of an employment
agreement entered into between the parties on April 17th, 1998, which terms and
conditions have been negotiated prior to that date.
6.8 Binding Effect
This Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective heirs, personal representatives, successors and
assigns, except as otherwise expressly provided herein.
6.9 Review of Legal Counsel
The Executive acknowledges that he has had adequate time and opportunity to
consult with legal counsel of his own selection prior to entering into and
executing this Agreement.
IN WITNESS WHEREOF the parties have executed this Agreement effective on the day
and year first written above.
/s/ Xxxxxxx Xxxxxx
Xxxxxxx Xxxxxx
BIOJECT MEDICAL TECHNOLOGIES INC.
/s/ Xxxxx X. X'Xxxx
Xxxxx X. X'Xxxx
Title: Chairman of the Board and
Chief Executive Officer
BIOJECT INC.
/s/ Xxxx Xxxxx
Xxxx Xxxxx
Title: Director, Human Resources
