EMPLOYMENT AGREEMENT
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Agreement made this 1st day of August, 1995, by and between GELMAN
SCIENCES, INC. ("Employer") and CHARLES GELMAN ("Employee").
1. Employment.
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A. Employer hereby offers to Employee and Employee hereby accepts
continued employment by Employer on the conditions set forth herein.
2. Duties.
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A. Employee has been appointed and shall continue to serve
Employer as Chairman and Chief Executive Officer, reporting in such capacity
directly to the Employer's Board of Directors ("Board").
B. Employee's duties and powers in such capacity shall be as
determined, from time to time, by the Board.
3. Term.
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A. The term of this Agreement shall be three (3) years beginning
August 1, 1995, which term shall be automatically extended one (1) year on
August 1, 1996 and on August 1 of each year thereafter, unless Employer shall
have given:
(1) not less than six (6) months written notice of
termination to Employee where there has been no change in control of
Employer; or
(2) where there has been a change in control of Employer,
not less than twelve (12) months written notice of termination to
Employee.
B. This Agreement shall be automatically earlier terminated and
the earlier termination shall supersede the later effective date of an Employer
written notice of termination of Agreement provided for in Paragraph 3.A., only
in the following manner:
(1) Upon the death of Employee; or
(2) Upon Employee's resignation, at any time, after ninety
(90) calendar days written notice to Employer where there has been no
change in control of Employer, in which event Employee shall not be
entitled to any additional compensation or benefits; or
(3) Upon Employee's disability whereby Employee is unable
to perform the essential duties of his assigned position for a period
exceeding one hundred eighty (180) calendar days within a one (1) year
period; or
(4) Upon Employer's termination of Employee, without cause,
at any time, after Employer has given ninety (90) calendar days written
notice of termination to Employee, in which event Employee shall become
eligible for termination compensation as set forth in Paragraph 4.C
below; or
(5) Upon Employee's resignation within one (1) year of a
change in control of Employer, after ninety (90) calendar days written
notice to Employer, in which event Employee shall become eligible for
termination compensation in the amount as determined in Paragraph 4.C
below; or
(6) Upon Employer's termination of Employee for violating
any of the provisions of Paragraph 7 below, in which event Employee shall
not be entitled to any additional compensation or benefits.
4. Compensation.
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A. Employer shall pay, and Employee shall accept, as base
compensation for all services rendered, not less than the amount received per
annum effective as of August 1, 1995, less appropriate payroll taxes
("salary"), payable in equal installments in accordance with Employer's normal
payroll periods, with annual reviews and adjustments, if any, at the discretion
of the Employer's Board.
B. Employee shall, following the conclusion of each full Employer
fiscal year of active employment, become eligible for an incentive bonus,
established at the discretion of the Board, which incentive bonus effective for
the Employer's 1996 fiscal year and the fiscal years thereafter, shall consist
of an amount equal to:
(1) Fifty percent (50%) of the Employee's current annual
salary for achieving the corporate goals, established at the discretion
of Board; or
(2) Seventy-five percent (75%) of the Employee's current
annual salary for exceeding the corporate stretch goals, established at
the discretion of the Board.
Incentive bonus, if any, shall be payable to Employee on or
before the seventieth (70th) calendar day after the Employer's fiscal year end.
C. If this Agreement is earlier terminated pursuant to Paragraph
, 3.B.(4) or 3.B.(5), Employee shall become eligible for termination
compensation as follows:
(1) Where there has been no change in control of Employer,
and:
(a) the Employer is achieving or exceeding the
projected performance plan as approved by the Board, a severance
amount equal to the amount of base compensation and incentive bonus
the Employee would have received in the year of termination, for
the greater of the remaining balance of the contract or two (2)
years;
(b) the Employer is not achieving the projected
performance plan as approved by the Board, a severance amount equal
to the amount of base compensation the Employee would have received
in the year of termination, for the greater of the remaining
balance of the contract or two (2) years;
(2) Where there has been a change in control of Employer,
and:
(a) the Employer is achieving or exceeding the
projected performance plan as approved by the Board, a severance
amount equal to the amount of base compensation and incentive bonus
the Employee would have received in the year of termination, for
the remaining balance of the contract plus two (2) years;
(b) the Employer is not achieving the projected
performance plan as approved by the Board, a severance amount equal
to the amount of base compensation the Employee would have received
in the year of termination, for the remaining balance of the
contract plus two (2) years;
(c) immediate vesting of all stock options and
awards; and,
(d) immediate payment of all incentive awards earned.
To the extent the termination compensation and any other amounts
received as a result of termination are subject to the excise tax of Internal
Revenue Code Section 4999 (or any successor statute), the severance amount
shall be increased by a one (1) time calculation (without a pyramid effect) of
the product derived by multiplying the "excess parachute payments" (as defined
in Code Section 4999) as initially calculated by the applicable excise tax rate
(currently twenty percent (20%)).
Change in control of the Employer means:
i) the acquisition of beneficial ownership by
any person or entity (or more than one (1) person or entity
acting as a group) of a majority of the outstanding voting
shares of Employer: or
ii) a tender offer made and consummated for at
least thirty-three percent (33%) of Employer's common stock;
or
iii) the acquisition of beneficial ownership
by any person or entity (or more than one (1) person or
entity acting as a group) of more than fifty-one percent
(51%) of the total fair market value of the Employer's
assets; or
iv) a majority of the members of the Board are
replaced within a one (1) year period.
The severance amount shall be payable in equal annual installments to
the Employee, which annual installments shall be further divided into equal
payments made at the same frequency as Employee's salary, less appropriate
payroll taxes, commencing with the first payroll period following Employee's
termination, conditioned on Employee's execution of a release agreement
acknowledging that Employee is entitled to no other compensation and benefits,
except as provided in this Agreement, and effectively waiving any and all
claims against Employer, its officers, directors, employees, affiliates,
subsidiaries, successors and assigns arising out of Employee's employment or
separation from employment with Employer. The Employer shall have the right,
at its option and without penalty, to accelerate payments owed to the Employee.
5. Expenses.
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A. Employer shall reimburse Employee, upon presentation of proper
documentation, for reasonable expenses incurred by Employee in the performance
of his assigned duties.
B. Employer shall provide Employee with an automobile befitting
Employee's status among other executive employees as Chairman and Chief
Executive Officer, by which to perform his assigned duties, at no cost to the
Employee.
6. Benefits.
A. Employee shall be eligible to participate in all benefit
programs that Employer makes available, from time to time, to executive
employees, including such benefit programs as medical, dental, life, long-term
disability, 401(k), and others, on the same terms and conditions as other
executive employees.
B. Employee shall be eligible for up to six (6) weeks paid
vacation annually, scheduled at the discretion of Employee, and not
inconsistent with the best interest of the Employer.
C. Employer shall, during the term of this Agreement, pay the
dues and assessments required for Employee to maintain full membership
privileges at Travis Pointe Country Club .
7. Undertakings of Employee.
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A. The parties acknowledge that Employer is engaged in the
business of manufacturing, distributing and selling microporous membranes,
filters and microfiltration products, worldwide. Employee, because of his
position with Employer, will obtain, or have access to, highly confidential,
proprietary information and trade secrets and, as a result, Employee agrees
that:
(1) Employee will execute, and at all times honor and
comply with all of the conditions set forth in, the Confidentiality and
Patent Protection Agreement attached hereto and made a part hereof as
Exhibit A; and
(2) At all times during Employee's employment, and for
three (3) years following the termination of Employee's employment,
Employee will not, directly or indirectly, without the express written
consent of Employer's Board, perform service for, aid, assist, own,
operate, have any financial interest in, or serve as employee, officer,
director, agent, partner, consultant, part-owner, shareholder, or engage
in, any microporous filter business which is competitive with Employer,
or with microporous products provided by Employer, or with microporous
products provided by Employer, and among the remedies set forth in the
above-referenced Confidentiality and Patent Protection Agreement.
B. Employer relies upon Employee's representation that Employee
will:
(1) competently perform all assigned duties;
(2) carry out all policies, directives and decisions of
Employer's Board;
(3) not withhold from Employer's Board any information
which may affect Employer's business;
(4) refrain from any conduct which is illegal, dishonest,
fraudulent, or detrimental to Employer's business, as determined by
Employer's Board; and
(5) devote his entire time, attention and energies to the
operations of Employer and shall not, during the term of this Agreement,
without consent of the Board, be engaged in any other business activity
requiring any amount of his business time, whether or not such business
activity is pursued for gain, profit or pecuniary advantage.
8. Entire Agreement.
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This Agreement supersedes and cancels all prior agreements, whether verbal
or written, between Employer and Employee and constitutes the entire Agreement
between the parties. Any amendment or agreement supplemental hereto shall not
be binding upon either party unless executed in writing by Employer and the
Employee.
9. Miscellaneous.
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A. This Agreement shall be binding upon and inure to the benefit
of the parties and their respective heirs, successors, personal representatives
and assigns.
B. This Agreement shall be interpreted in accordance with and
governed by the laws of the State of Michigan.
C. Any and all notices or any other communication provided for
herein shall be given in writing by certified mail, return receipt requested,
which shall be addressed to the addresses shown immediately below each party's
signature unless notice of a change of address is furnished to the other
parties in the manner provided in this paragraph.
D. This Agreement will be executed simultaneously in two (2) or
more counterparts, each of which shall be deemed an original but all of which
shall constitute one (1) and the same instrument and agreement.
E. Each paragraph of this Agreement or portion thereof shall be
treated as severable, to the end that if any paragraph or portion thereof shall
be declared illegal, invalid or unenforceable, this Agreement shall be
interpreted so that part only is invalid, without invalidating the remainder of
this Agreement, which shall remain in full force and effect as though such
paragraph or portion thereof had never been contained in this Agreement, and
the affected part shall be interpreted, consistent with the law, to carry out
the intent of the parties.
IN WITNESS WHEREOF, the parties have signed this Employment Agreement as of
the date first above written.
WITNESSES: GELMAN SCIENCES, INC.
/s/ Kim A. Davis By /s/ John A. Geishecker Jr.
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Its Chairman - Compensation Committee
600 South Wagner Road
Ann Arbor, MI 48106-1448
/s/ Charles Gelman
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CHARLES GELMAN
[home address]
Exhibit A
CONFIDENTIALITY AND PATENT PROTECTION AGREEMENT
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This Agreement entered into as of the date last hereinafter written by
and between the undersigned employee (hereinafter "Employee") and GELMAN
SCIENCES, INC., a Michigan corporation (herein "Employer"), pertaining to
the employment of the Employee by the Employer:
WHEREAS, the Employer requires that all employees, as a condition of
their employment, covenant and agree with the Employer to hold its Trade
Secrets in utmost respect and confidence and not to use or disclose such
information in any way in conflict with the Employer's interest.
NOW, THEREFORE, in consideration of the premises upon which this
Agreement is based and of the engagement of the Employee as an employee of
the Employer, the Employee hereby expressly covenants and agrees as follows:
The Employer is engaged in the manufacture, distribution and sale of
microporous membranes, textiles and microfiltration products, worldwide. In
conducting such business, the Employer has developed, collected, compiled,
organized, analyzed and/or systematized certain information including (but
not necessarily limited to) customer information, market studies and
research, marketing methods and techniques, operating and pricing policies,
product formulae, product designs and technologies, operating and pricing
policies, product formulae, product designs and technologies, manufacturing
processes and technologies, innovative research and development, and certain
computer software, which information is used by the Employer in conducting
its said business, gives the Employer an advantage or the opportunity to
gain an advantage over its competitors and potential competitors who do not
know or use it, and is not public information and is not generally known in
the industry; such information being collectively and individually referred
to herein as "Trade Secrets". The Employer expects to develop, collect,
compile, organize, analyze and/or systematize the same or similar kinds of
information and to conceive and invent new products, devices, manufacturing
processes, software and technologies, continually and in the future, which
information and inventions shall become Trade Secrets belonging to the
Employer and shall be protected by this Agreement.
All Trade Secrets belonging to the Employer and all records pertaining
thereto, including (without limitation) those which may be created or
developed by the Employee, are and shall be and remain the property of the
Employer. The Employee will not ever utilize any Trade Secret belonging to
the Employer or any record pertaining thereto for his benefit or for the
benefit of others, or for any purpose other than in the ordinary course of
and in the furtherance of the Employer's business.
The Employee will not ever publish or disclose, nor permit to be
published or disclosed, any Trade Secrets belonging to the Employer to
anyone not authorized to have access thereto without the prior written
consent of the Employer's Board of Directors ("Board"). Moreover, the
Employee agrees to report forthwith to the Employer's Board any violation of
this or any other policy of the Employer applicable to its Trade Secrets,
known to or which may come to the knowledge of the Employee.
The Employee will have no obligation of confidentiality as to any
information which is or hereafter becomes generally known among the
Employer's competitors or to the public otherwise than by an unauthorized
disclosure by the Employee or by other improper means. Neither shall the
Employee be held to violate this Agreement by receiving any Trade Secret of
the Employer from a third party having the right to transmit the same, but
in such case the obligations or confidentiality, non-use and non-disclosure
set forth in Paragraphs 2 and 3 above shall apply to all such information so
received.
The Employee shall promptly disclose to the Employer's Board all
inventions, discoveries and improvements which the Employee may make, either
solely or jointly with others, while in the employ of the Employer, relating
to products, manufacturing technologies or software used, manufactured or
sold by the Employer during the period of the Employee's employment with the
Employer, or the use, manufacture, development or sale of which was in
contemplation by the Employer during the period of the Employee's employment
with the Employer, and the Employee hereby agrees to assign to the Employer
all of the Employee's interest in and to the same, including the Employee's
interest in and to any domestic and foreign patent rights therein and any
renewals thereof. All expenses of filing any patent applications shall be
borne solely by the Employer, but the Employee shall cooperate in filing and
supporting any such applications.
This Agreement shall survive the termination of employment of the
Employee and shall continue with respect to each and all of the Employer's
Trade Secrets in conception or existence as of the date of termination,
until the same shall have become generally known among the Employer's
competitors and potential competitors or to the public at large, other than
by unauthorized disclosure by the Employee or other improper means. The
Employee agrees that upon the termination of his employment he will
immediately return to the Employer all materials, records and drawings
provided to the Employee by the Employer or any of its customers, or
generated by the Employee relative to the Trade Secrets of the Employer.
In the event of a breach of threatened breach by the Employee of this
Agreement, it is agreed that the Employer would suffer immediate and
irreparable injuries of such a nature and magnitude that money damages would
not adequately compensate the Employer and that injunctive relief would be
essential for its protection. Such relief shall be without prejudice to any
other remedy which the Employer may have or be entitled to receive at law or
in equity. To the extent permitted by law, the Employee waives the
requirement of bond as a precondition to issuance of any such injunction.
If any of the provisions of this Agreement shall be held to be
unenforceable for any reason by any Court having jurisdiction of the same,
such provision shall be deemed amended by giving to it that construction
most consistent with this writing which such Court may find to be
enforceable in the matter before it, and all remaining terms and provisions
of this Agreement shall not fall, but this Agreement shall be deemed amended
by such holding for purposes only of the jurisdiction of such Court, and as
so amended shall remain in full force and effect.
This Agreement is a prerequisite of employment of the Employee, and need
not be signed or otherwise formally accepted by the Employer in order to
become binding upon the Employee, but shall be deemed and held so binding
and enforceable from and after the date the Employee was first engaged as an
employee of the Employer. The Employee acknowledges receipt of a true and
correct copy of this Agreement and acknowledges that he has read and
understands all of the terms and provisions hereof.
Executed this 1st day of August, 1995.
EMPLOYEE: /s/ Charles Gelman
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CHARLES GELMAN
SS Number
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Address
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