EMPLOYMENT AGREEMENT
This EMPLOYMENT AGREEMENT (the "AGREEMENT") is made and entered into as of
January 30, 1996 by and between International Remote Imaging Systems, a
California corporation ("COMPANY"), and Thomas F. Kelley, an individual
("EMPLOYEE").
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, the parties agree as follows:
1. TERM OF EMPLOYMENT. The Company hereby agrees to employ Employee, and
Employee hereby accepts employment with the Company, on the terms set forth in
this Agreement for a period commencing as of January 30, 1996 (the "Effective
Date") and terminating on January 30, 1999 unless terminated sooner in
accordance with the provisions of Section 8 (Termination).
2. TITLE AND DUTIES. Employee shall be a Vice President of the Company and
the general manager of the Company's StatSpin subsidiary and shall report to the
Chairman of the Board. Subject to the supervisory powers of the Chairman of the
Board, Employee shall be responsible for the general supervision, direction and
control of the subsidiary's business and its employees in accordance with the
policies of the Company and perform such other duties as the Chairman of the
Board may determine from time to time. Employee will devote his full working
time to the performance of his duties, primarily located in the Boston area.
3. BASE SALARY. The Company will pay Employee a base salary to be determined
annually by the Compensation Committee of the Board of Directors, and in no
event less than $85,000 with annual increases not less than 4 percent.
4. BONUSES. The Employee shall participate in the Management Incentive Bonus
program as administered by the Compensation Committee, at full participation
(100% pro rata salary basis).
5. STOCK OPTIONS. The Employee shall be eligible to participate in Company's
1994 Stock Option Plan, and will receive an initial grant of 10,000 shares at
the Company's first Board of Directors meeting after the Effective Date at then
fair market value, with 33 1/3 percent vesting in annual increments over three
years.
6. STOCK PURCHASES. The Employee shall be eligible to participate in the
Company's Employee Stock Purchase Plan.
7. BENEFITS. The Company will continue to provide Employee with:
(a) The current insurance benefits he is receiving from StatSpin
Technologies;
(b) Participation in the Company's 401 (k) retirement plan;
(c) A car allowance of $350 per month for a current model American-
made 4-door sedan;
(d) Paid vacation in accordance with the Company's policies, with
credit for Employee's period of employment with StatSpin Technologies;
(e) Paid holidays and sick leave in accordance with the Company's
policies;
(f) Such other benefits as may generally be provided to officers of
the Company.
8. TERMINATION. The Company and Employee acknowledge that the employment
relationship created by this Agreement is "at-will" and may be terminated at any
time by either party without cause. In the event of such termination, the
Company shall pay employee (i) a pro rata portion of any cash bonus for the year
(payable in the ordinary course when such bonus is otherwise due) and (ii) a
lump sum cash amount for all accrued and unused vacation time. If the Company
terminates Employee's employment without cause on or before third anniversary of
the Effective Date, the Company shall also continue to pay Employee his base
salary and all benefits for the remainder of the term of this Agreement. For
purposes of this Agreement, the Company shall be deemed to have terminated
Employee "with cause" if such termination is based primarily upon any of the
following:
(a) Employee's continued failure to follow the reasonable
instructions of the Chairman of the Board;
(b) Employee's breach of any material provision of this Agreement (or
the Employee Acknowledgment, Invention and Secrecy Agreement referred to in
Section 9) after written notice and a reasonable opportunity to cure;
(c) Employee's final conviction (after exhaustion of appeals) of, or
plea of nolo contenders or guilty to, a felony; or
(d) Any criminal theft from the Company.
The Company shall not have any obligation to make any payment or provide
any benefit under this Section 8 unless and until Employee executes a written
agreement, in form and substance reasonably satisfactory to the Company,
releasing Company (and its officers, directors, employees, agents,
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affiliates, successors and assigns) from any and all liability and claims in
connection with the termination of Employee's employment.
9. CONFIDENTIALITY, INVENTIONS AND RELATED MATTERS. Employee will sign
and deliver to the Company a copy of the Company's standard form "Employee
Acknowledgment, Invention and Secrecy Agreement".
10. GENERAL.
10.1 COMPLETE AGREEMENT. This Agreement and any agreements referred
to herein or executed contemporaneously herewith (including the non-competition
agreement between the Company, its StatSpin subsidiary and Employee dated as of
even date herewith) constitute the entire agreement and understanding between
the parties to this Agreement and supersede all prior and contemporaneous
negotiations and understandings between the parties, whether oral or written.
In the event of any inconsistency between this Agreement and the Employee
Acknowledgment, Invention and Secrecy Agreement referred to in Section 9, this
Agreement shall control.
10.2 AMENDMENTS, WAIVERS, ETC. This Agreement may be amended,
modified, superseded, canceled, renewed or extended, and the terms, conditions
or covenants hereof may be waived, only by a written instrument executed by both
parties to this Agreement, or in the case of a waiver, by the party waiving
compliance. The failure of a party at any time or times to require performance
of any provision hereof will in no manner affect its right at a later time to
enforce the same. No waiver by a party of the breach of any term or covenant
contained in the Agreement, whether by conduct or otherwise, in any one or more
instances, will be deemed to be, or construed as, a further or continuing waiver
of any such breach, or a waiver of the breach of any other term or covenant
contained in the Agreement.
10.3 NOTICES. Unless otherwise specifically permitted by this
Agreement, all notices under this Agreement shall be in writing and shall be
delivered by personal service, facsimile, telegram, or certified mail (or, if
certified mail is not available, then by first class mail), postage prepaid, to
such address as may be designated from time to time by the relevant party, and
shall initially be:
(i) To the Company:
International Remote Imaging Systems, Inc.
9162 Eton Avenue
Chatsworth, CA 91311
Attn: F.H. Deindoerfer, Chairman
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(ii) To the Employee:
StatSpin Technologies
85 Morse Street
Norwood, MA 02062
Attn: T.F. Kelley, General Manager
Any notice sent by certified mail shall be deemed to have been given
three (3) days after the date on which it is mailed. All other notices shall be
deemed given when received. No objection may be made to the manner of delivery
of any notice actually received in writing by an authorized agent of a party.
10.4 ASSIGNMENT; SUCCESSORS AND ASSIGNS. Employee may not assign any
of his rights or obligations under this Agreement. The Company may not assign
any of its rights or obligations under this Agreement EXCEPT in connection with
any sale, transfer or other disposition of all or substantially all of its or
StatSpin's business and assets, whether by merger, purchase of stock or assets
or otherwise. This Agreement will be binding upon, and will inure to the
benefit of, the respective successors and permitted assigns of the parties.
10.5 SEVERABILITY. In the event that any provision of this Agreement
should be held to be void, voidable, unlawful or for any reason unenforceable,
the remaining provisions or portions of the Agreement will remain in full force
and effect.
10.6 ADDITIONAL DOCUMENTS AND ACTIONS. Employee and Company agree to
execute any and all further documents and writings and to perform such other
actions which may be or become necessary or expedient to effectuate and carry
out the intent of this Agreement.
10.7 HEADINGS. The headings in this Agreement are included solely
for convenience of reference and are not intended to affect or control the
meaning or interpretation of any of the provisions of the Agreement.
10.8 ARBITRATION AS EXCLUSIVE REMEDY. Any dispute or controversy
arising out of or relating to this Agreement or the employment relationship
between the parties shall be settled by arbitration in Boston, Massachusetts,
but otherwise in accordance with the provisions of the Employee Acknowledgment,
Invention and Secrecy Agreement referred to in Section 9.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, as of the day and year first above written.
"The Company"
By:/s/ Fred H. Deindoerfer
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"Employee"
By:/s/ Thomas F. Kelley
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