EMPLOYMENT AGREEMENT
AGREEMENT effective as of March 1, 1994, between DYNECO CORPORATION, a
Minnesota corporation (the "Company"), and Thomas C. Edwards (the
"Executive").
The Executive is presently employed by DynEco International, Inc. as its
President and Chief Executive Officer. The Company and DynEco International,
Inc. have entered into a stock exchange agreement (the "Exchange Agreement")
whereby it is anticipated that DynEco International, Inc. will become a
wholly-owned subsidiary of the Company on or before February 28, 1994. In
connection with the Exchange Agreement, the Company will, and hereby assumes
the current DynEco International, Inc. employment agreement with the
Executive according to its terms and conditions subject to such changes set
forth herein.
The Board of Directors of the Company (the "Board") recognizes that the
Executive's contribution to the growth and success of DynEco International,
Inc. during the past years has been substantial. The Board desires to
provide for the employment of the Executive by the Company and to make
certain changes in the Executive's employment arrangements with the Company
which the Board has determined will reinforce and encourage the continued
attention and dedication to the Company of the Executive as a member of the
Company's management, in the best interest of the Company and its
shareholders. The Executive is willing to commit himself to continue to
serve the Company, on the terms and conditions herein provided.
In order to effect the foregoing, the Company and the Executive wish to
enter into an employment agreement on the terms and conditions set forth
below. Accordingly, in consideration of the promises and the respective
covenants and agreements of the parties herein contained, and intending to be
legally bound hereby, the parties hereto agree as follows:
1. EMPLOYMENT. The Company hereby agrees to continue to employ the
Executive, and the Executive hereby agrees to continue to serve the Company,
on the terms and conditions set forth herein.
2. TERM. The employment of the Executive by the Company as provided
in Section 1 will commence on the date hereof and end on February 28, 1999,
unless further extended or sooner terminated as hereinafter provided. On
February 28, 1999, and on the last day of February of each year thereafter,
the term of the Executive's employment shall be automatically extended one
(1) additional year unless, prior to such last day of February, the Company
shall have delivered to the Executive or the Executive shall have delivered
to the Company written notice that the term of the Executive's employment
hereunder will not be extended. In no event, however,
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shall the term of the Executive's employment extend beyond the end of the
calendar month in which the Executive's seventieth (70th) birthday occurs.
3. POSITION AND DUTIES. The Executive shall serve as a senior
executive officer of the Company and shall have such responsibilities and
authority as may from time to time be assigned to the Executive by the Board
or the Chief Executive Officer of the Company. The Executive shall devote
substantially all his working time and efforts to the business and affairs of
the Company.
4. PLACE OF PERFORMANCE. In connection with the Executive's
employment by the Company, the Executive shall be based at the engineering
and design offices of the Company located in the State of Florida except for
required travel on the Company's business to an extent substantially
consistent with present business travel obligations. The Company agrees at
all time during the term of this Agreement to maintain adequate engineering
and design offices within the State of Florida for his occupancy.
5. COMPENSATION AND RELATED MATTERS.
(a) SALARY. During the period of the Executive's employment hereunder,
the Company shall pay to the Executive a salary at a rate of not less than
$000,000 per annum in equal installments as nearly as practicable on the
fifteenth and last days of each month in arrears. This salary may be
increased from time to time in accordance with normal business practices of
the Company and, if so increased, shall not thereafter during the term of
this Agreement be decreased. Compensation of the Executive by salary
payments shall not be deemed exclusive and shall not prevent the Executive
from participating in any other compensation or benefit plan of the
Company. The salary payments (including any increased salary payments)
hereunder shall not in any way limit or reduce any other obligation of the
Company hereunder, and no other compensation, benefit or payment hereunder
shall in any way limit or reduce the obligation of the Company to pay the
Executive's salary hereunder.
(b) EXPENSES. During the term of the Executive's employment hereunder,
the Executive shall be entitled to receive prompt reimbursement for all
reasonable expenses incurred by the Executive in performing services
hereunder, including all expenses of travel and living expenses while away
from home on business or at the request of and in the service of the
Company, provided that such expenses are incurred and accounted for in
accordance with the policies and procedures presently established by the
Company.
(c) OTHER BENEFITS. The Company shall maintain in full force and effect,
and the Executive shall be entitled to
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continue to participate in, all of its employee benefit plans and
arrangements in effect on the date hereof in which the Executive
participates or plans or arrangements providing the Executive with at
least equivalent benefits thereunder (including without limitation each
pension and retirement plan and arrangement, supplemental pension and
retirement plan and arrangement, stock option plan, life insurance and
health-and-accident plan and arrangement, medical insurance plan,
disability plan, survivor income plan, relocation plan and vacation
plan); provided, however, that this provision shall not apply to the
Company's Incentive Compensation Plan. The Company shall not make any
changes in such plans or arrangements which would adversely affect the
Executive's rights or benefits thereunder, unless such change occurs
pursuant to a program applicable to all executives of the Company and does
not result in a proportionately greater reduction in the rights of or
benefits to the Executive as compared with any other executive of the
Company. The Executive shall be entitled to participate in or receive
benefits under any employee benefit plan or arrangement made available by
the Company in the future to its executives and key management employees,
subject to and on a basis consistent within the terms, conditions and
overall administration of such plans and arrangements. Nothing paid to the
Executive under any plan or arrangement presently in effect or made
available in the future shall be deemed to be in lieu of the salary payable
to the Executive pursuant to paragraph (a) of this Section. Any payments
or benefits payable to the Executive hereunder in respect of any calendar
year during which the Executive is employed by the Company for less than
the entire such year shall, unless otherwise provided in the applicable
plan or arrangement, be prorated in accordance with the number of days in
such calendar year during which he is so employed.
(d) VACATIONS. The Executive shall be entitled to the number of vacation
days in each calendar year, and to compensation in respect of earned but
unused vacation days, determined in accordance with the Company's vacation
plan. The Executive shall also be entitled to all paid holidays given by
the Company to its executives.
(e) SERVICES FURNISHED. The Company shall furnish the Executive with
office space, stenographic assistance and such other facilities and
services as shall be suitable to the Executive's position and adequate for
the performance of his duties as set forth in Section 3 hereof.
6. OFFICES. The Executive agrees to serve without additional
compensation, if elected or appointed thereto, as a director of the Company
and any of its subsidiaries and in one or more executive offices of any of
the Company's subsidiaries,
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provided that the Executive is indemnified for serving in any and all such
capacities on a basis no less favorable than is currently provided by the
Company's Articles of Incorporation and/or By-laws.
7. IMPROVEMENTS; CONFIDENTIAL INFORMATION. Attached hereto as Annex I
is a form of Employee Agreement being entered into concurrently herewith
between the Executive and the Company, concerning the treatment of
Improvements and Confidential Proprietary Information (as defined therein)
and related matters.
8. TERMINATION. The Executive's employment hereunder may be
terminated without any breach of this Agreement only under the following
circumstances:
(a) Death. The Executive's employment hereunder shall terminate upon his
death.
(b) Disability. If, as a result of the Executive's incapacity due to
physical or mental illness, the Executive shall have been absent from his
duties hereunder on a full-time basis for the entire period of twelve (12)
consecutive months, and within thirty (30) days after written notice of
termination is given (which may occur before or after the end of such
twelve-month period) shall not have returned to the performance of his
duties hereunder on a full-time basis, the Company may terminate the
Executive's employment hereunder.
(c) Cause. The Company may terminate the Executive's employment hereunder
for Cause. For purposes of this Agreement, the Company shall have "Cause"
to terminate the Executive's employment hereunder upon (i) the willful and
continued failure by the Executive to substantially perform his duties
hereunder (other than any such failure resulting from the Executive's
incapacity due to physical or mental illness), after demand for substantial
performance is delivered by the Company that specifically identifies the
manner in which the Company believes the Executive has not substantially
performed his duties, or (ii) the willful engaging by the Executive in
misconduct which is materially injurious to the Company, monetarily or
otherwise, or (iii) the willful violation by the Executive of the
provisions of the Employee Agreement executed concurrently herewith in the
form of Annex I hereto. For purposes of this paragraph, no act, or failure
to act, on the Executive's part shall be considered "willful" unless done,
or omitted to be done, by him not in good faith and without reasonable
belief that his action or omission was in the best interest of the Company.
Notwithstanding the foregoing, the Executive shall not be deemed to have
been terminated for Cause without [1] reasonable notice to the Executive
setting forth the reasons for the Company's intention to terminate for
Cause, [2] an
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opportunity for the Executive, together with his counsel, to be heard
before the Board, and [3] delivery to the Executive of a Notice of
Termination as defined in subsection (e) hereof from the Board finding that
in the good faith opinion of such Board the Executive was guilty of conduct
set forth above in clause (i), (ii), or (iii) of the preceding sentence,
and specifying the particulars thereof in detail.
(d) Termination by the Executive. The Executive may terminate his
employment hereunder (i) for Good Reason or (ii) if his health should
become impaired to an extent that makes his continued performance of his
duties hereunder hazardous to his physical or mental health or his life,
provided that the Executive shall have furnished the Company with a written
statement from a qualified doctor to such effect and provided, further,
that, at the Company's request, the Executive shall submit to an
examination by a doctor selected by the Company and such doctor shall have
concurred in the conclusion of the Executive's doctor.
For purposes of this Agreement, "Good Reason" shall mean (A) a change in
control of the Company (as defined below), (B) a failure by the Company to
comply with any material provision of this Agreement which has not been
cured within ten (10) days after notice of such noncompliance has been
given by the Executive to the Company, or (C) any purported termination of
the Executive's employment which is not effected pursuant to a Notice of
Termination satisfying the requirements of paragraph (e) hereof (and for
purposes of this Agreement no such purported termination shall be
effective).
For purposes of this Agreement, a "change in control of the Company" shall
mean a change in control of a nature that would be required to be reported
in response to Item 5(f) of Schedule 14A of Regulation 14A promulgated
under the Securities Exchange Act of 1934 (the "Exchange Act"); provided
that, without limitation, such a change in control shall be deemed to have
occurred if [1] any "person" (as such term is used in Sections 13(d) and
14(d) of the Exchange Act), other than the Company or any "person" who on
the date hereof is a director or officer of the Company, is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company representing 20% or
more of the combined voting power of the Company's then outstanding
securities, or [2] during any period of two consecutive years during the
term of this Agreement, individuals who at the beginning of such period
constitute the Board cease for any reason to constitute at least a majority
thereof, unless the election of each director who was not a director at the
beginning of such period has been approved in advance by directors
representing at least two-thirds of the directors then in office who were
directors
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at the beginning of the period.
(e) Any termination of the Executive's employment by the Company or by the
Executive (other than termination pursuant to subsection (a) above) shall
be communicated by written Notice of Termination to the other party hereto.
For purposes of this Agreement, a "Notice of Termination" shall mean a
notice which shall indicate the specific termination provision in this
Agreement relied upon and shall set forth in reasonable detail the facts
and circumstances claimed to provide a basis for termination of the
Executive's employment under the provision so indicated.
(f) "Date of Termination" shall mean (i) if the Executive's employment is
terminated by his death, the date of his death, (ii) if the Executive's
employment is terminated pursuant to subsection (b) above, thirty (30) days
after Notice of Termination is given (provided that the Executive shall not
have returned to the performance of his duties on a full-time basis during
such thirty (30) day period), (iii) if the Executive's employment is
terminated pursuant to subsection (e) above, the date specified in the
Notice of Termination, and (iv) if the Executive's employment is terminated
for any other reason, the date, on which a Notice of Termination is given;
provided that if within thirty (30) days after any Notice of Termination is
given the party receiving such Notice of Termination notifies the other
party that a dispute exists concerning the termination, the Date of
Termination shall be the date on which the dispute is finally determined,
either by mutual written agreement of the parties, by a binding and final
arbitration award or by a final judgment, order or decree of a court of
competent jurisdiction (the time for appeal therefrom having expired and no
appeal having been perfected).
9. COMPENSATION UPON TERMINATION OR DURING DISABILITY.
(a) During any period that the Executive fails to perform his duties
hereunder as a result of incapacity due to physical or mental illness
("disability period"), the Executive shall continue to receive his full
salary at the rate then in effect for such period until his employment is
terminated pursuant to Section 8(b) hereof, provided that payments so made
to the Executive during the first 180 days of the disability period shall
be reduced by the sum of the amounts, if any, payable to the Executive at
or prior to the time of any such payment under disability benefit plans of
the Company and which were not previously applied to reduce any such
payment.
(b) If the Executive's employment is terminated by his death, the Company
shall pay to the Executive's spouse, or if he leaves no spouse, to his
estate, commencing on the next
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succeeding day which is the fifteenth day or last day of the month, as
the case may be, and semimonthly thereafter on the fifteenth and last
days of each month, until a total of twenty-four (24) payments has been
made, an amount on each payment date equal to the semimonthly salary
payment payable to the Executive pursuant to Section 5(a) hereof at the
time of his death.
(c) If the Executive's employment shall be terminated for Cause, the
Company shall pay the Executive his full salary through the Date of
Termination at the rate in effect at the time Notice of Termination is
given and the Company shall have no further obligations to the Executive
under this Agreement.
(d) If (i) in breach of this Agreement, the Company shall terminate the
Executive's employment other than pursuant to Section 8(b) or 8(c) hereof
(it being understood that a purported termination pursuant to Section 8(b)
or 8(c) hereof which is disputed and finally determined not to have been
proper shall be a termination by the Company in breach of this Agreement)
or (ii) the Executive shall terminate his employment for Good Reason, then
[1] the Company shall pay the Executive his full salary through the Date
of Termination at the rate in effect at the time Notice of Termination
is given;
[2] in lieu of any further salary payments to the Executive for periods
subsequent to the Date of Termination, the Company shall pay as
severance pay to the Executive an amount equal to the product of [i]
the Executive's annual salary rate in effect as of the Date of
Termination, multiplied by [ii] the greater of the number of years
(including partial years) remaining in the term of employment
hereunder or the number three (3), such payment to be made [a] if
resulting from a termination based on a change of control of the
Company, in a lump sum on or before the fifth day following the Date
of Termination, or [b] if resulting from any other cause, in
substantially equal semimonthly installments on the fifteenth and last
days of each month commencing with the month in which the Date of
Termination occurs and continuing for the number of consecutive
semimonthly payment dates (including the first such date as aforesaid)
equal to the product obtained by multiplying the number of years
(including partial years) applicable under [2][ii] above by
twenty-four (24); and
[3] if termination of the Executive's employment arises out of a breach by
the Company of this Agreement, the Company shall pay all other damages
to which the Executive may be entitled as a result of such breach,
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including damages for any and all loss of benefits to the Executive
under the Company's employee benefit plans (other than the Company's
Incentive Compensation Plan) which the Executive would have received
if the Company had not breached this Agreement and had the Executive's
employment continued for the full term provided in Section 2 hereof
(including specifically but without limitation the benefits which the
Executive would have been entitled to receive had his employment
continued for the full term provided in Section 2 hereof at the rate
of compensation specified herein), and including all legal fees and
expenses incurred by him as a result of such termination.
(e) If the Executive shall terminate his employment under clause (ii) of
Section 8(d) hereof, the Company shall pay the Executive his full salary
through the Date of Termination at the rate in effect at the time Notice of
Termination is given.
(f) Unless the Executive is terminated for Cause, the Company shall
maintain in full force and effect, for the continued benefit of the
Executive for the greater of the number of years (including partial years)
remaining in the term of employment hereunder or the number three (3), all
employee benefit plans and programs in which the Executive was entitled to
participate immediately prior to the Date of Termination provided that the
Executive's continued participation is possible under the general terms and
provisions of such plans and programs. In the event that the Executive's
participation in any such plan or program is barred, the Company shall
arrange to provide the Executive with benefits substantially similar to
those which the Executive would otherwise have been entitled to receive
under such plans and programs from which his continued participation is
barred.
(g) The Executive shall not be required to mitigate the amount of any
payment provided for in this Section 9 by seeking other employment or
otherwise.
10. SUCCESSORS; BINDING AGREEMENT.
(a) The Company will require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all
of the business and/or assets of the Company, by agreement in form and
substance satisfactory to the Executive, to expressly assume and agree to
perform this Agreement in the same manner and to the same extent that the
Company would be required to perform it if no such succession had taken
place. Failure of the Company to obtain such agreement prior to the
effectiveness of any such succession shall be a breach of this Agreement
and shall entitle the
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Executive to compensation from the Company in the same amount and on the
same terms as he would be entitled to hereunder if he terminated his
employment for Good Reason, except that for purposes of implementing the
foregoing, the date on which any such succession becomes effective shall
be deemed the Date of Termination. As used in this Agreement, "Company"
shall mean the Company as hereinbefore defined and any successor to its
business and/or assets as aforesaid which executes and delivers the
agreement provided for in this Section 10 or which otherwise becomes
bound by all the terms and provisions of this Agreement by operation of
law.
(b) This Agreement and all rights of the Executive hereunder shall inure
to the benefit of and be enforceable by the Executive's personal or legal
representatives, executors, administrators, successors, heirs,
distributees, devisees and legatees. If the Executive should die while any
amounts would still be payable to him hereunder if he had continued to
live, all such amounts, unless otherwise provided herein, shall be paid in
accordance with the terms of this Agreement to the Executive's devisee,
legatee, or other designee or, if there be no such designee, to the
Executive's estate.
11. NOTICE. For the purposes of this Agreement, notices, demands and
all other communications provided for in the Agreement shall be in writing
and shall be deemed to have been duly given when delivered or (unless
otherwise specified) mailed by United States registered mail, return receipt
requested, postage prepaid, addressed as follows:
If to the Executive:
Dr. Thomas C. Edwards
_____________________
_____________________
If to the Company:
DynEco Corporation
Suite 105
5151 Edina Industrial Boulevard
Minneapolis, MN 55439
Attn: General Counsel
or to such other address as any party may have furnished to the others in
writing in accordance herewith, except that notices of change of address
shall be effective only upon receipt.
12. MISCELLANEOUS. No provisions of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge is agreed
to in writing signed by the Executive and the Company's Chief Executive
Officer or such other officer as may be
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specifically designated by the Board. No waiver by either party hereto at any
time of any breach by the other party hereto of, or compliance with, any
condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time. No agreements or
representations, oral or otherwise, express or implied, with respect to the
subject matter hereof have been made by either party which are not set forth
expressly in this Agreement and the Employee Agreement executed concurrently
herewith in the form of Annex I hereto. The validity, interpretation,
construction and performance of this Agreement shall be governed by the laws
of the State of Minnesota.
13. VALIDITY. The invalidity or unenforceability of any provision or
provisions of this Agreement shall not affect the validity or enforceability
of any other provision of this Agreement, which shall remain in full force
and effect.
14. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of
which together will constitute one and the same instrument.
15. ARBITRATION. Any dispute or controversy arising under or in
connection with this Agreement shall be settled exclusively by arbitration,
conducted before a panel of three arbitrators, in Jacksonville, Florida, in
accordance with the rules of the American Arbitration Association then in
effect. Judgment may be entered on the arbitrator's award in any court
having jurisdiction; provided, however, that the Company shall be entitled to
seek a restraining order or injunction in any court of competent jurisdiction
to prevent any continuation of any violation of the Employee Agreement
executed concurrently herewith in the form of Annex I hereto, and the
Executive hereby consents that such restraining order or injunction may be
granted without the necessity of the Company posting any bond. The expense
of such arbitration shall be borne by the Company.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date
and year first above written.
DYNECO CORPORATION
By ________________________
Its Authorized Officer
EXECUTIVE
___________________________
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