EXHIBIT 10e
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KEY EMPLOYEE AGREEMENT
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To: Xxxxx X. Xxxxxxxx As of November 26, 1996
00000 Xxxxxxxx Xxxxx, Xxxxxxxxx 0
Xxxxxxxxx, Xxxxxxxxxx 00000
The undersigned, Applied Science and Technology, Inc., a Delaware
corporation, as well as its successors and assigns (hereinafter collectively
referred to as the "Company"), hereby agree with you as follows:
l. Position and Responsibilities.
1.1 You shall serve as Senior Vice President of Operations of the
Company (or in such other executive capacity as shall be designated by the
President or Board of Directors and be reasonably acceptable to you). You will,
to the best of your ability, devote your full time and best efforts to the
performance of your duties hereunder and the business and affairs of the Company
and perform such executive duties as may be assigned to you by or on authority
of the Company's President and Board of Directors from time to time and the
duties customarily associated with such executive capacity from time to time and
at such place or places as the Company shall designate are appropriate and
necessary in connection with such employment; provided, however, that you shall
not be required to relocate your place of employment beyond a twenty (20) mile
radius from Woburn, Massachusetts without your prior written consent.
1.2 You will duly, punctually and faithfully perform and observe any
and all rules and regulations which the Company may now or shall hereafter
establish governing the conduct of its business.
1.3 You will report directly to the Company's President.
2. Term of Employment.
2.1 The initial term of this Agreement shall be for the period set
forth on Exhibit A annexed hereto commencing with the date hereof. Thereafter,
this Agreement shall be automatically renewed for successive periods of one
year, unless you or the Company shall give the other party not less than thirty
(30) days written notice of non-renewal. Your employment with the Company may be
terminated as provided in Section 2.2 .
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2.2 The Company shall have the right, upon written notice to you, to
terminate your employment:
(a) immediately at any time for "Cause" (as defined herein
subject to your right of cure and right to dispute as provided in
Section 2.3 herein); or
(b) at any time, without "Cause," provided that the Company
shall be obligated to pay to you the Severance Benefits set forth in
Sections 6 or 7, as applicable, of Exhibit A, plus any sums then due
to you, including those expenses as are provided for in Section 8 of
Exhibit A, less (i) applicable taxes and other required withholdings,
and (ii) any amounts you may owe to the Company. Payments under this
Section 2.2 (b) shall not be due or payable if you are terminated at
any time for "Cause" or if you voluntarily resign from your
employment, except as set forth in Section 7 of Exhibit A.
2.3 For purposes of Section 2.2, the term "Cause" shall mean (a)
gross negligence in the performance of assigned duties; (b) material and
repetitive refusal to perform or discharge the duties or responsibilities
assigned by the Board of Directors of the Company provided the same are not
illegal, unethical or inconsistent with the position of Senior Vice President of
Operations of a corporation and the failure to correct such refusal and perform
such duties or responsibilities within a reasonable period of time (but in any
event no less than seven (7) calendar days after written notice of such
failure); (c) conviction of a felony involving moral turpitude; (d) willful or
prolonged absence from work not excused by a bona fide medical disability as
reasonably determined by a qualified physician mutually acceptable to both you
and the Company or other good cause as reasonably determined by the Board of
Directors; and (e) falseness of any warranty or representation by you herein or
the breach of your obligations under this Agreement to the material detriment of
the Company. Any dispute, controversy, or claim arising out of, in connection
with, or in relation to the definition of "Cause" shall be settled by
arbitration in accordance with the terms of Section 17 hereof.
2.4 In the event of the Involuntary Termination (as hereinafter
defined) of your employment with the Company at any time, the Company hereby
irrevocably agrees to provide you with Severance Benefits as defined in Section
6 of Exhibit A hereto or payments in the event of a "Change in Control" as
defined in Section 7 of Exhibit A. In this regard, the phrase "Involuntary
Termination" shall mean (a) any termination of your employment by the Company
other than for "cause," as defined in Section 2.3, (b) any notice by the Company
not to renew this Agreement pursuant to Section 2.1, or (c) for purposes of
Section 7 of Exhibit A (but not Section 6 of Exhibit A) any termination of your
employment by you due to any of the following circumstances: (i) a reduction in
your Base Salary or Company-paid benefits, (ii) a reduction in your eligibility
for any Company bonus or other benefit program, (iii) a material or substantial
change in your title, position, authority or duties, or (iv) a change of your
principal place of employment to a location beyond twenty (20) miles of Woburn,
Massachusetts.
2.5 You shall have the right to terminate this Agreement upon
not less than thirty (30) days prior written notice to the Company.
3. Compensation. You shall receive the compensation and benefits set
forth on Exhibit A ("Compensation") for all services to be rendered by you
hereunder and for your transfer of property rights pursuant to an agreement
relating to proprietary information and inventions of even date herewith
attached hereto as Exhibit C between you and the Company (the "Proprietary
Information and Inventions Agreement").
4. Other Activities During Employment.
4.1 Except for any outside employments and directorships currently
held by you as listed on Exhibit B, and except with the prior written consent of
the Company's Board of Directors, you will not during the term of this Agreement
undertake or engage in any other employment, occupation or business enterprise
other than one in which you are an inactive investor.
4.2 You hereby agree that, except as disclosed on Exhibit B hereto,
during your employment hereunder, you will not, directly or indirectly, engage
(a) individually, (b) as an officer, (c) as a director, (d) as an employee, (e)
as a consultant, (f) as an advisor, (g) as an agent (whether a salesperson or
otherwise), (h) as a broker, or (i) as a partner, coventurer, stockholder or
other proprietor owning directly or indirectly more than two percent (2%)
interest, in any firm, corporation, partnership, trust, association, or other
organization which is engaged in the research, development, production,
manufacture or marketing of equipment or processes in direct competition with
the Company or any other line of business engaged in or under demonstrable
development by the Company (such firm, corporation, partnership, trust,
association, or other organization being hereinafter referred to as a
"Prohibited Enterprise"). Except as may be shown on Exhibit B, you hereby
represent that you are not engaged in any of the foregoing capacities (a)
through (i) in any Prohibited Enterprise.
5. Former Employers.
5.1 You represent and warrant that your employment by the Company
will not conflict with and will not be constrained by any prior or current
employment, consulting agreement or relationship whether oral or written. You
represent and warrant that you do not possess confidential information arising
out of any such employment, consulting agreement or relationship which, in your
best judgment, would be utilized in connection with your employment by the
Company in the absence of Section 5.2.
5.2 If, in spite of the second sentence of Section 5.1, you should
find that confidential information belonging to any other person or entity might
be usable in connection with the Company's business, you will not intentionally
disclose to the Company or use on behalf of the Company any confidential
information belonging to any of your former employers; but during your
employment by the Company you will use in the performance of your duties all
information which
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is generally known and used by persons with training and experience comparable
to your own all information which is common knowledge in the industry or
otherwise legally in the public domain.
6. Proprietary Information and Inventions. You agree to execute,
deliver and be bound by the provisions of the Proprietary Information and
Inventions Agreement.
7. Post-Employment Activities.
7.1 For a period of two (2) years (or for a lesser period should the
Company so determine) after the termination or expiration, for any reason, of
your employment with the Company hereunder, absent the Company's prior written
approval, you will not directly or indirectly engage in activities similar or
reasonably related to those in which you shall have engaged hereunder during the
two years immediately preceding termination or expiration for, nor render
services similar or reasonably related to those which you shall have rendered
hereunder during such two years to, any person or entity whether now existing or
hereafter established which directly competes with (or proposes or plans to
directly compete with) the Company ("Direct Competitor") in any line of business
engaged in or under development by the Company. Nor shall you entice, induce or
encourage any of the Company's other employees to engage in any activity which,
were it done by you, would violate any provision of the Proprietary Information
and Inventions Agreement or this Section 7. As used in this Section 7.1, the
term "any line of business engaged in or under development by the Company" shall
be applied as at the date of termination of your employment, or, if later, as at
the date of termination of any post-employment consultation.
7.2 For a period of two (2) years after the termination of your
employment with the Company, the provisions of Section 4.2 shall be applicable
to you and you shall comply therewith. As applied to such two (2) year
post-employment period, the term "any other line of business engaged in or under
development by the Company," as used in Section 4.2, shall be applied as at the
date of termination of your employment with the Company or, if later, as at the
date of termination of any post-employment consultation with the Company.
7.3 No provision of this Agreement shall be construed to preclude
you from performing the same services which the Company hereby retains you to
perform for any person or entity which is not a Direct Competitor of the Company
upon the expiration or termination of your employment (or any post-employment
consultation) so long as you do not thereby violate any term of the Proprietary
Information and Inventions Agreement.
8. Remedies. Your obligations under the Proprietary Information and
Inventions Agreement and the provisions of Sections 4, 6, 7, 8, 9 and 17 of this
Agreement (as modified by Section 10, if applicable) shall survive the
expiration or termination of your employment (whether through your resignation
or otherwise) with the Company. You acknowledge that a remedy at law for any
breach or threatened breach by you of the provisions of the Proprietary
Information and Inventions Agreement or Section 7 hereof would be inadequate and
you therefore agree that the
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Company shall be entitled to such injunctive or other equitable relief in case
of any such breach or threatened breach.
9. Assignment. This Agreement and the rights and obligations of the
parties hereto shall bind and inure to the benefit of any successor or
successors of the Company by reorganization, merger or consolidation and any
assignee of all or substantially all of its business and properties, but, except
as to any such successor or assignee of the Company, neither this Agreement nor
any rights or benefits hereunder may be assigned by the Company or by you,
except by operation of law. The Company's obligations and those of any
successors or assignees of the Company under this Agreement, including but not
limited to the severance provisions and other compensation and benefits due to
you pursuant to Exhibit A hereto, will be a condition of and are to remain those
of any successor or assignee.
10. Interpretation. IT IS THE INTENT OF THE PARTIES THAT in case any
one or more of the provisions contained in this Agreement shall, for any reason,
be held to be invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect the other provisions of this
Agreement, and this Agreement shall be construed as if such invalid, illegal or
unenforceable provision had never been contained herein. MOREOVER, IT IS THE
INTENT OF THE PARTIES THAT in case any one or more of the provisions contained
in this Agreement shall for any reason be held to be excessively broad as to
duration, geographical scope, activity or subject, such provision shall be
construed by limiting and reducing it as determined by a court of competent
jurisdiction, so as to be enforceable to the extent compatible with applicable
law.
11. Notices. Any notice which the Company is required to or may desire
to give you shall be given by personal delivery or registered or certified mail,
return receipt requested, addressed to you at your address of record with the
Company, or at such other place as you may from time to time designate in
writing. Any notice which you are required or may desire to give to the Company
hereunder shall be given by personal delivery or by registered or certified
mail, return receipt requested, addressed to the Company at its principal
office, or at such other office as the Company may from time to time designate
in writing. The date of personal delivery or the date of mailing any notice
under this Section 11 shall be deemed to be the date of delivery thereof.
12. Waivers. If either party should waive any breach of any provision
of this Agreement, such party shall not thereby be deemed to have waived any
preceding or succeeding breach of the same or any other provision of this
Agreement.
13. Complete Agreement; Amendments. The foregoing including Exhibits A,
B and C hereto, is the entire agreement of the parties with respect to the
subject matter hereof, superseding any previous oral or written communications,
representations, understandings, or agreements with the Company or any officer
or representative thereof. Any amendment to this Agreement or waiver by the
Company of any right hereunder shall be effective only if evidenced by a written
instrument executed by the parties hereto, upon authorization of the Company's
Board of Directors.
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14. Headings. The headings of the Sections hereof are inserted for
convenience only and shall not be deemed to constitute a part hereof nor to
affect the meaning of this Agreement.
15. Counterparts. This Agreement may be signed in two counterparts,
each of which shall be deemed an original and both of which shall together
constitute one agreement.
16. Governing Law. This Agreement shall be governed by and construed
under Massachusetts law.
17. Arbitration of Disputes. Subject to the rights of the parties to
seek injunctive relief as described herein, any controversy or claim arising out
of, or relating to, any provision of this Agreement shall be settled by binding
arbitration in accordance with the laws of the Commonwealth of Massachusetts by
three arbitrators, one of whom shall be appointed by the Company, one of whom
shall be appointed by you, and the third arbitrator who shall be appointed by
the first two arbitrators. If the first two arbitrators cannot agree on the
appointment of a third arbitrator, then the third arbitrator shall be appointed
by the American Arbitration Association in the City of Boston. Such arbitration
shall be conducted in the City of Boston in accordance with the rules of the
American Arbitration Association, except with respect to the selection of
arbitrators, which shall be as provided in this Section. Judgment on the award
or determination rendered by the arbitrators shall be final, binding and
conclusive upon the parties, and may be entered in any court having jurisdiction
thereof and shall not be appealable. The prevailing party in such arbitration
proceeding shall be entitled to reimbursement by the other party of all
reasonable legal fees and other costs incurred by the prevailing party in
connection with such proceeding, including any legal fees and costs incurred in
connection with the enforcement of any award.
18. Advice of Separate Counsel. The Company has requested that the law
firm of X'Xxxxxx, Xxxxxx & Xxxxxxx prepare this document on behalf of the
Company. You acknowledge that you have been advised to review this Agreement
with your own legal counsel and other advisors of your choosing and that prior
to entering into this Agreement, you have had the opportunity to review this
Agreement with your attorney and other advisors and have not asked (or relied
upon) X'Xxxxxx, Broude & Xxxxxxx to represent you in this matter.
[THIS SPACE IS INTENTIONALLY LEFT BLANK]
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If you are in agreement with the foregoing, please sign your name below
and also at the bottom of the Proprietary Information and Inventions Agreement,
whereupon this Agreement shall become binding in accordance with its terms.
Please then return this Agreement to the Company. (You may retain for your
records the accompanying counterpart of this Agreement enclosed herewith).
ACCEPTED AND AGREED: APPLIED SCIENCE AND TECHNOLOGY, INC.
By:
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Xxxxx X. Xxxxxxxx Xx. Xxxxxxx X. Post, President
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EXHIBIT A
EMPLOYMENT TERM, COMPENSATION AND BENEFITS
OF XXXXX X. XXXXXXXX
l. Term. The term of the Agreement to which this Exhibit A is attached
and made a part shall be for a period from the date of this Agreement through
December 31, 1997.
2. Compensation.
(a) Base Salary. Your base salary ("Base Salary") shall be
$134,000.00 per annum through April 1, 1997, payable in accordance with the
Company's payroll policies at the rate of $11,166.66 per month. Commencing April
1, 1997, your Base Salary shall be increased to $147,400 per annum, payable at
the rate of $12,283.33 per month and shall thereafter as established by the
Board of Directors or Compensation Committee.
(b) Bonuses. Fiscal 1996 and 1997. The Company shall establish
appropriate incentive compensation plans ("Bonuses") for you each fiscal year
that you are employed hereunder. You shall be entitled to a bonus of up to 35%
of your then current Base Salary by the Company=s Compensation Committee and
ratified by the Company=s Board of Directors. Such Bonuses shall be properly
approved by the Board of Directors or any committee established and authorized
to perform such duties by the Board of Directors.
3. Vacation. You shall be entitled to all legal holidays recognized by
the Company , and 18 days paid vacation per annum. Any unused vacation may be
accrued or used in accordance with Company policy.
4. Insurance and Benefits. You shall be eligible for participation in
any health, dental, and other group insurance plans which may be established and
maintained by the Company for all full-time employees or which the Company is
required to maintain by law. The Company shall provide you with health insurance
for you and your family providing benefits at least equal to the benefits of the
policies currently in place and shall provide you with group life insurance
equal to two times your base salary. You shall also be entitled to participate
in any employee benefit programs which the Company's Board of Directors may
establish for its key employees, or for its employees generally, including, but
not limited to, bonuses and stock purchase or option plans. You will be eligible
to participate in the Company's 401(k) Plan.
5. Relocation Reimbursement. The Company shall pay for the cost of
airfare (in accordance with the Company=s travel policy) for you to travel to
Boston from California on two roundtrips. The Company shall also pay your
reasonable moving and temporary storage expenses (for up to three (3) months),
not to exceed $7,500.00. The Company shall also pay the cost of a mid-
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size car rental for a one month period starting January 5, 1997, and will
reimburse you for temporary housing at the Marriott Residence Inn or similar
temporary residence acceptable to both you and the Company not to exceed ninety
(90) days. Should you incur the loss of your security deposit or other rental
charges associated with terminating your current lease, the Company shall
reimburse you for such costs up to an amount not to exceed $2,800.00.
6. Severance Benefits.
(a) When provided for in this Agreement, you shall be entitled to
"Severance Benefits." When used in this Agreement, the term "Severance Benefits"
shall mean a total amount equal to (i) your then current annual Base Salary,
plus (ii) your Bonuses earned for the Company's most recent fiscal year. If the
Company's fiscal year is changed, the Bonuses shall be based upon your bonuses
received during the Company's most recent fiscal year. The Severance Benefits
shall be paid via check to you in twelve (12) equal monthly installments
commencing within ten (10) days after the date of your termination of employment
with the Company.
(b) In addition, the term "Severance Benefits" shall include the
continuation for you and your family, during the Severance Period, as defined
below, of all of the other benefits which are provided or available to you on
the last day of your actual service with the Company, including your continued
accrual and the vesting under the terms of any pension or 401(k) plan then
sponsored by the Company to the maximum extent permitted by law. For purposes of
this Agreement, the term "Severance Period" means the period of twelve (12)
months beginning on the Date of Termination.
(c) The Severance Benefits referred to above will be in addition to,
and not in substitution for, any accrued and unpaid salary, vacation, pension,
retirement or other benefits, unreimbursed expenses or other payments to which
you may be otherwise entitled.
(d) In the event of your death while you are employed by the
Company, your then current Base Salary shall continue to be paid to your legal
representative for a period of 60 days following the date of your death; and for
a period of one (1) years following your death, the Company shall continue to
provide to your spouse at Company cost the health insurance coverage described
above.
(e) You shall not be required to mitigate the amount of any payment
the Company becomes obligated to make to you in connection with this Agreement,
by seeking other employment or otherwise.
7. Change in Control.
(a) For purposes of this Agreement, "Change in Control" means and
shall be deemed to occur if any of the following occurs: (i) the acquisition by
an individual, entity or group, as defined in Section 13(d)(3) or 14(d)(2) of
the Securities Exchange Act of 1934, as amended (the
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"Exchange Act"), of beneficial ownership, as defined in Rule 13d-3 promulgated
under the Exchange Act, of 50% or more of either (A) the outstanding shares of
common stock, $ .01 par value per share, of the Company (the "Common Stock"), or
(B) the combined voting power of the voting securities of the Company entitled
to vote generally in the election of directors (the "Voting Securities"); or
(ii) individuals who, on April 30, 1996, constituted the Board of Directors of
the Company (the "Incumbent Board") cease for any reason to constitute at least
a majority of the Board of Directors of the Company; provided, however, that any
individual becoming a director subsequent to July 1, 1995, whose election, or
nomination for election by the Company's shareholders, was approved by a vote of
at least a majority of the directors then serving and comprising the Incumbent
Board shall be considered as though such individual were a member of the
Incumbent Board, but excluding, for this purpose, any such individual whose
initial assumption of office occurs as a result of either an actual or
threatened election contest (as such terms are used in Rule 14a-11 of Regulation
14A promulgated under the Exchange Act) or other actual or threatened
solicitation of proxies or consents; or (iii) approval by the Board of Directors
or the shareholders of the Company of a (A) tender offer to acquire any of the
Common Stock or voting securities, (B) reorganization, (C) merger or (D)
consolidation, other than a reorganization, merger or consolidation with respect
to which all or substantially all of the individuals and entities who were the
beneficial owners, immediately prior to such reorganization, merger or
consolidation, of the Common Stock and voting securities beneficially own,
directly or indirectly, immediately after such reorganization, merger or
consolidation, more than 80% of the then outstanding common stock and voting
securities (entitled to vote generally in the election of directors) of the
Company resulting from such reorganization, merger or consolidation in
substantially the same proportions as their respective ownership, immediately
prior to such reorganization, merger or consolidation, of the Common Stock and
the voting securities; or (iv) Approval by the Board of Directors or the
shareholders of the Company of (A) a complete or substantial liquidation or
dissolution of the Company, or (B) the sale or other disposition of all or
substantially all of the assets of the Company, excluding a reorganization of
the Corporation under the corporate laws of a state of Delaware.
(b) In the event of a Change in Control during the term of this
Agreement or any renewal or extension hereof and provided you remain employed by
the Company for a period of 12 months from the date of the Change in Control,
you will receive, at the one-year anniversary of the Change of Control, a
supplemental amount in a lump sum equal to 50% of your current Base Salary and
Bonuses paid during the preceding fiscal year, and the fair market value of all
other benefits then payable, irrespective of whether you thereafter actually
terminate employment with the Company.
(c) In the event of your actual termination of employment
contemporaneous with or following a Change in Control, except (x) because of
your death, (y) by the Company for Cause or Disability (as hereinafter defined)
or (z) by you other than for Good Reason (as hereinafter defined): (i) you shall
be entitled to receive, in lieu of the sums described in Section 6, an amount
equal to 100% of the Severance Benefits due and determined as if payable under
Section 6 above, for each full year or portion thereof you have been employed by
the Company, up to a maximum of 299% of the severance benefits mentioned in
Section 6 above, to be paid in accordance with the terms of this Agreement; and
(ii) the following additional provisions shall apply (which provisions
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shall supersede any other provisions of the Agreement, including but not limited
to Section 2 of the Agreement, to the extent such provisions are inconsistent
with the following provisions):
(1) Disability. For purposes of this Section 7(c), termination
by the Company of your employment based on "Disability" shall mean termination
because of your absence from your duties with the Company on a full time basis
for one hundred eighty (180) consecutive days as a result of your incapacity due
to physical or mental illness, unless within thirty (30) days after Notice of
Termination (as hereinafter defined) is given to you following such absence, you
shall have returned to the full time performance of your duties.
(2) Good Reason. Termination by you of your employment for "Good
Reason" shall mean termination based on:
(A) a determination by you, in your reasonable judgment,
that there has been a material adverse change in your status or position(s) as
an executive officer of the Company as in effect immediately prior to the Change
in Control, including, without limitation, a material adverse change in your
status or position as a result of a diminution in your duties or
responsibilities (other than, if applicable, any such change directly
attributable to the fact that the Company is no longer publicly owned) or the
assignment to you of any duties or responsibilities which are inconsistent with
such status or position(s), or any removal of you from, or any failure to
reappoint or reelect you to, such position(s) (except in connection with the
termination of your employment for Cause or Disability or as a result of your
death or by you other than for Good Reason) and further provided that you have
given the Company notice of this material adverse change and the Company has
failed to correct such material adverse change within a reasonable period of
time (but at least 14 days after written notice from you);
(B) a reduction by the Company (within three years following
the Change of Control) in your Base Salary as in effect immediately prior to the
Change in Control;
(C) the failure by the Company (within three years following
the Change of Control) to continue in effect any Plan (as hereinafter defined)
in which you are participating at the time of the Change in Control of the
Company (or Plans providing you with at least substantially similar benefits)
other than as a result of the normal expiration of any such Plan in accordance
with its terms as in effect at the time of the Change in Control, or the taking
of any action, or the failure to act, by the Company which would adversely
affect your continued participation in any of such Plans on at least as
favorable a basis to you as is the case on the date of the Change in Control or
which would materially reduce your benefits in the future under any of such
Plans or deprive you of any material benefit enjoyed by you at the time of the
Change in Control;
(D) the failure by the Company to provide and credit you
with the number of paid vacation days to which you are then entitled in
accordance with the Company's normal vacation policy as in effect immediately
prior to the Change in Control;
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(E) the Company's requiring you to be based at any office
that is greater than twenty (20) miles from where your office is located
immediately prior to the Change in Control except for required travel on the
Company's business to an extent substantially consistent with the business
travel obligations which you undertook on behalf of the Company prior to the
Change in Control;
(F) the failure by the Company to obtain from any Successor
(as hereinafter defined) the assent to this Agreement contemplated by Section
7(c)(7) hereof; or
(G) any purported termination by the Company of your
employment which is not effected pursuant to a Notice of Termination satisfying
the requirements of Section 7(c)(4) below (and, if applicable, Section 7(c)(1)
above); and for purposes of this Agreement, no such purported termination shall
be effective.
For purposes of this Agreement, "Plan" shall mean any compensation plan
or any employee benefit plan such as a thrift, pension, profit sharing, medical,
disability, accident, life insurance plan or a relocation plan or policy or any
other plan, program or policy of the Company intended to benefit employees.
(3) [INTENTIONALLY LEFT BLANK]
(4) Notice of Termination. Any purported termination by the
Company or by you following a Change in Control shall be communicated by written
notice to the other party hereto which indicates the specific termination
provision in this Agreement relied upon (the "Notice of Termination").
(5) Date of Termination. "Date of Termination" following a
Change in Control shall mean (A) if your employment is to be terminated for
Disability, thirty (30) days after Notice of Termination is given (provided that
you shall not have returned to the performance of your duties on a full-time
basis during such thirty (30) day period), (B) if your employment is to be
terminated by the Company for any reason other than death or Disability or by
you pursuant to Sections 7(c)(2)(F) or 7(c)(7) hereof or for any other Good
Reason, the date specified in the Notice of Termination, or (C) if your
employment is terminated on account of your death, the day after your death. In
the case of termination of your employment by the Company for Cause, if you have
not previously expressly agreed in writing to the termination, then within
thirty (30) days after receipt by you of the Notice of Termination with respect
thereto, you may notify the Company that a dispute exists concerning the
Termination, in which event the Date of Termination shall be the date set either
by mutual written agreement of the parties or by arbitration as described in '17
of the Agreement.
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(6) Compensation Upon Termination or During Disability; Other
Agreements.
(A) During any period following a Change in Control of the
Company that you fail to perform your duties as a result of incapacity due to
physical or mental illness, you shall continue to receive your Base Salary at
the rate then in effect and any benefits or awards under any Plan shall continue
to accrue during such period, to the extent not inconsistent with such Plans,
until and unless your employment is terminated pursuant to and in accordance
with this Section 7(c). Thereafter, your benefits shall be determined in
accordance with the Plans then in effect.
(B) If your employment is terminated for Cause following a
Change in Control of the Company, the Company shall pay to you your Base Salary
through the Date of Termination at the rate in effect just prior to the time a
Notice of Termination is given plus any benefits or awards (including both the
cash and stock components) which pursuant to the terms of any Plans have been
earned or become payable, but which have not yet been paid to you. Thereupon,
the Company shall have no further obligations to you under this Agreement.
(7) Successors, Binding Agreement.
(A) The Company will seek, by written request at least five
(5) business days prior to the time a Person becomes a Successor (as hereinafter
defined), to have such Person, by agreement in form and substance satisfactory
to you, assent to the fulfillment of the Company's obligations under this
Agreement. Failure of such Person to furnish such assent by the later of (i)
three (3) business days prior to the time such Person becomes a Successor or
(ii) two (2) business days after such Person receives a written request to so
assent shall constitute Good Reason for termination by you of your employment if
a Change in Control of the Company occurs or has occurred. For purposes of this
Section 7 of Exhibit A, "Successor" shall mean any person that succeeds to, or
has the practical ability to control, the Company's business directly, by merger
or consolidation, or indirectly, by purchase of the Company's securities
eligible to vote for the election of directors, or otherwise.
(B) This Agreement shall inure to the benefit of and be
enforceable by your personal legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees. If you should die while
any amount would still be payable to you hereunder if you had continued to live,
all such amounts, unless otherwise provided herein, shall be paid in accordance
with the terms of this Agreement to your devisee, legatee or other designee or,
if no such designee exists, to your estate.
(C) For purposes of this Section 7, the "Company" shall
include any subsidiaries of the Company and any corporation or other entity
which is the surviving or continuing entity in respect of any merger,
consolidation or form of business combination in which the Company ceases to
exist; provided, however, for purposes of determining whether a Change in
A-6
Control has occurred herein, the term "Company" shall refer to Applied Science
and Technology, Inc. or its Successor(s).
(8) Fees and Expenses; Mitigation.
(A) The Company shall reimburse you, on a current basis, for
all reasonable legal fees and related expenses incurred by you in connection
with the Agreement following a Change in Control of the Company, including
without limitation, (i) all such fees and expenses, if any, incurred in
contesting or disputing any termination of your employment or (ii) your seeking
to obtain or enforce any right or benefit provided by this Agreement, in each
case, regardless of whether or not your claim is upheld by a court of competent
jurisdiction; provided, however, you shall be required to repay any such amounts
to the Company to the extent that a court issues a final and non-appealable
order setting forth the determination that the position taken by you was
frivolous or advanced by you in bad faith.
(B) You shall not be required to mitigate the amount of any
payment the Company becomes obligated to make to you in connection with this
Agreement, by seeking other employment or otherwise.
(9) Taxes. All payments to be made to you under this Agreement
will be subject to required withholding of federal, state and local income and
employment taxes.
(d) Notwithstanding any other provision of this Agreement, in the
event that any payment or benefit received or to be received by you as a result
of or in connection with a Change in Control, whether pursuant to the terms of
this Agreement or any other plan, arrangement or agreement with the Company (all
such payment and benefits being hereinafter called the "Total Payments") would
subject you to the excise tax (the "Excise Tax") imposed under Section 4999 of
the Internal Revenue Code of 1986, as amended (the "Code"), then, to the extent
necessary to eliminate any such imposition of the Excise Tax (after taking into
account any reduction in the Total Payments in accordance with the provisions of
any other plan, arrangement or agreement, if any), (a) any non-cash severance
payments otherwise payable to you shall first be reduced (if necessary, to
zero), and (b) any cash severance payment otherwise payable to you shall next be
reduced. For purposes of the immediately preceding sentence, (i) no portion of
the Total Payments the receipt or enjoyment of which you shall have effectively
waived in writing shall be taken into account, (ii) no portion of the Total
Payment shall be taken into account which in the opinion of
nationally-recognized certified public accountants (in each case as mutually
selected by you and the Company) does not constitute a "parachute payment"
within the meaning of Section 280G of the Code, including, without limitation,
by reason of Section 280G(b)(2) or (b)(4)(A) of the Code, (iii) any payments to
you shall be reduced only to the extent necessary so that the Total Payments
[other than those referred to in clauses (i) and (ii)] in their entirety
constitute reasonable compensation for services actually rendered within the
meaning of section 280G(4)(B) of the Code or are otherwise not subject to
disallowance as deductions, in the opinion of the tax counsel or the accountants
referred to in clause (ii); and (iv) the value of any non-cash benefit or any
deferred payment
A-7
or benefit included in the Total Payments shall be determined by such
accountants in accordance with the requirements of section 280G(d)(3) and (4) of
the Code (and such determination shall be reviewed by such tax counsel).
8. Expenses. The Company shall reimburse you for all usual and ordinary
business expenses incurred by you in the scope of your employment hereunder.
9. Stock Options. You shall be entitled to receive stock options to
purchase up to an aggregate of 50,000 shares of common stock of the Company
issuable as follows: options to purchase 30,000 shares upon the date you
commence employment with the Company and up to an additional 20,000 shares under
options which may be issued by the Company on July 1, 1997 and/or July 1, 1998.
These options shall vest in accordance with the Company=s normal vesting policy
for stock option grants.
A-8
EXHIBIT B
OUTSIDE EMPLOYMENTS AND DIRECTORSHIPS OF
XXXXX X. XXXXXXXX
None
B-1
EXHIBIT C
--------------------------------------------------------------------------------
PROPRIETARY INFORMATION AND INVENTIONS AGREEMENT
--------------------------------------------------------------------------------
To: Applied Science and Technology, Inc.
00 Xxxxx Xxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
As of November 26, 1996
The undersigned, in consideration of and as a condition of my
employment or continued employment by you and/or by companies which you own,
control, or are affiliated with or their successors in business (collectively,
the "Company"), hereby agrees as follows:
1. Confidentiality. I agree to keep confidential, except as the Company
may otherwise consent in writing, and, except for the Company's benefit, not to
disclose or make any use of at any time either during or subsequent to my
employment, any Inventions (as hereinafter defined), trade secrets, confidential
information, knowledge, data or other information of the Company relating to
products, processes, know-how, designs, formulas, test data, customer lists,
business plans, marketing plans and strategies, pricing strategies, or other
subject matter pertaining to any business of the Company or any of its
affiliates, which I may produce, obtain, or otherwise acquire during the course
of my employment, except as herein provided. I further agree not to deliver,
reproduce or in any way allow any such trade secrets, confidential information,
knowledge, data or other information, or any documentation relating thereto, to
be delivered to or used by any third parties without specific direction or
consent of a duly authorized representative of the Company.
2. Conflicting Employment; Return of Confidential Material. I agree
that during my employment with the Company I will not engage in any other
employment, occupation, consulting or other activity relating to the business in
which the Company is now or may hereafter become engaged, or which would
otherwise conflict with my obligations to the Company. In the event my
employment with the Company terminates for any reason whatsoever, I agree to
promptly surrender and deliver to the Company all records, materials, equipment,
drawings, documents and data of which I may obtain or produce during the course
of my employment, and I will not take with me any description containing or
pertaining to any confidential information, knowledge or data of the Company
which I may produce or obtain during the course of my employment.
C-1
3. Assignment of Inventions.
3.1 I hereby acknowledge and agree that the Company is the owner of
all Inventions. In order to protect the Company's rights to such Inventions, by
executing this Agreement I hereby irrevocably assign to the Company all my
right, title and interest in and to all Inventions to the Company.
3.2 For purposes of this Agreement, "Inventions" shall mean all
discoveries, processes, designs, technologies, devices, or improvements in any
of the foregoing or other ideas, whether or not patentable and whether or not
reduced to practice, made or conceived by me (whether solely or jointly with
others) during the period of my employment with the Company which relate in any
manner to the actual or demonstrably anticipated business, work, or research and
development of the Company, or result from or are suggested by any task assigned
to me or any work performed by me for or on behalf of the Company.
3.3 Any discovery, process, design, technology, device, or
improvement in any of the foregoing or other ideas, whether or not patentable
and whether or not reduced to practice, made or conceived by me (whether solely
or jointly with others) which I develop entirely on my own time not using any of
the Company's equipment, supplies, facilities, or trade secret information
("Personal Invention") is excluded from this Agreement provided such Personal
Invention (a) does not relate to the actual or demonstrably anticipated
business, research and development of the Company, and (b) does not result,
directly or indirectly, from any work performed by me for the Company.
4. Disclosure of Inventions. I agree that in connection with any
Invention, I will promptly disclose such Invention to my immediate superior at
the Company in order to permit the Company to enforce its property rights to
such Invention in accordance with this Agreement. My disclosure shall be
received in confidence by the Company.
5. Patents and Copyrights; Execution of Documents.
5.1 Upon request, I agree to assist the Company or its nominee (at
its expense) during and at any time subsequent to my employment in every
reasonable way to obtain for its own benefit patents and copyrights for
Inventions in any and all countries. Such patents and copyrights shall be and
remain the sole and exclusive property of the Company or its nominee. I agree to
perform such lawful acts as the Company deems to be necessary to allow it to
exercise all right, title and interest in and to such patents and copyrights.
5.2 In connection with this Agreement, I agree to execute,
acknowledge and deliver to the Company or its nominee upon request and at its
expense all documents, including assignments of title, patent or copyright
applications, assignments of such applications, assignments of patents or
copyrights upon issuance, as the Company may determine necessary or desirable to
C-2
protect the Company's or its nominee's interest in Inventions, and/or to use in
obtaining patents or copyrights in any and all countries and to vest title
thereto in the Company or its nominee to any of the foregoing.
6. Maintenance of Records. I agree to keep and maintain adequate and
current written records of all Inventions made by me (in the form of notes,
sketches, drawings and other records as may be specified by the Company), which
records shall be available to and remain the sole property of the Company at all
times.
7. Prior Inventions. It is understood that all Personal Inventions, if
any, whether patented or unpatented, which I made prior to my employment by the
Company, are excluded from this Agreement. To preclude any possible uncertainty,
I have set forth on Schedule A attached hereto a complete list of all of my
prior Personal Inventions, including numbers of all patents and patent
applications and a brief description of all unpatented Personal Inventions which
are not the property of a previous employer. I represent and covenant that the
list is complete and that, if no items are on the list, I have no such prior
Personal Inventions. I agree to notify the Company in writing before I make any
disclosure or perform any work on behalf of the Company which appears to
threaten or conflict with proprietary rights I claim in any Personal Invention.
In the event of my failure to give such notice, I agree that I will make no
claim against the Company with respect to any such Personal Invention.
8. Other Obligations. I acknowledge that the Company from time to time
may have agreements with other persons or with the U.S. Government or agencies
thereof, which impose obligations or restrictions on the Company regarding
Inventions made during the course of work thereunder or regarding the
confidential nature of such work. I agree to be bound by all such obligations
and restrictions and to take all action necessary to discharge the Company's
obligations.
9. Trade Secrets of Others. I represent that my performance of all the
terms of this Agreement and as an employee of the Company does not and will not
breach any agreement to keep confidential proprietary information, knowledge or
data acquired by me in confidence or in trust prior to my employment with the
Company, and I will not disclose to the Company, or induce the Company to use,
any confidential or proprietary information or material belonging to any
previous employer or others. I agree not to enter into any agreement either
written or oral in conflict herewith.
10. Modification. I agree that any subsequent change or changes in my
employment duties, salary or compensation or, if applicable, in any Employment
Agreement between the Company and me, shall not affect the validity or scope of
this Agreement.
11. Successors and Assigns. This Agreement shall be binding upon my
heirs, executors, administrators or other legal representatives and is for the
benefit of the Company, its successors and assigns.
C-3
12. Interpretation. IT IS THE INTENT OF THE PARTIES THAT in case any
one or more of the provisions contained in this Agreement shall, for any reason,
be held to be invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect the other provisions of this
Agreement, and this Agreement shall be construed as if such invalid, illegal or
unenforceable provision had never been contained herein. MOREOVER, IT IS THE
INTENT OF THE PARTIES THAT in case any one or more of the provisions contained
in this Agreement shall for any reason be held to be excessively broad as to
duration, geographical scope, activity or subject, such provision shall be
construed by limiting and reducing it in accordance with a judgment of a court
of competent jurisdiction, so as to be enforceable to the extent compatible with
applicable law.
13. Waivers. If either party should waive any breach of any provision
of this Agreement, he or it shall not thereby be deemed to have waived any
preceding or succeeding breach of the same or any other provision of this
Agreement.
14. Complete Agreement, Amendments. I acknowledge receipt of this
Agreement, and agree that with respect to the subject matter thereof it is my
entire agreement with the Company, superseding any previous oral or written
communications, representations, understandings, or agreements with the Company
or any officer or representative thereof. Any amendment to this Agreement or
waiver by either party of any right hereunder shall be effective only if
evidenced by a written instrument executed by the parties hereto, and, in the
case of the Company, upon written authorization of the Company's Board of
Directors.
15. Headings. The headings of the sections hereof are inserted for
convenience only and shall not be deemed to constitute a part hereof nor to
affect the meaning thereof.
16. Counterparts. This Agreement may be signed in two counterparts,
each of which shall be deemed an original and both of which shall together
constitute one agreement.
17. Governing Law. This Agreement shall be governed and construed under
Massachusetts law.
18 Employment Status. Nothing in this Agreement shall affect in any
manner whatsoever the right or power of the Company to terminate the employment
of the Employee.
EMPLOYEE
------------------------------------
Xxxxx X. Xxxxxxxx
Accepted and Agreed:
APPLIED SCIENCE AND TECHNOLOGY, INC.
By:
-----------------------------------
Xx. Xxxxxxx X. Post, President
C-4
SCHEDULE A
LIST OF PRIOR INVENTIONS
OF XXXXX X. XXXXXXXX
Identifying Number or
Title Date Brief Description
----- ---- -----------------
NONE
C-5
