EXHIBIT 10.12
EMPLOYMENT AGREEMENT
This Agreement, effective as of the 1st day of August, 1999 (the
"Effective Date"), is made by and between CiDRA Corporation, a Delaware
Corporation ("CiDRA"), and Ann Iseley (ISELEY).
WHEREAS, CiDRA desires to engage the services of ISELEY; and
WHEREAS, ISELEY is willing to provide such services to CIDRA;
NOW, THEREFORE, the parties hereto agree as follows:
1. SERVICES OF ISELEY
a. ISELEY will serve as CiDRA's Vice President, Chief Financial Officer,
reporting directly to the President and/or Chief Executive Officer of
CiDRA. ISELEY's employment with CiDRA Corporation shall commence on the
Effective Date (August 1, 1999).
b. This Agreement shall terminate on the earliest to occur of (i) ISELEY's
death or Disability (as defined below), and (ii) the termination of this
Agreement by CiDRA or ISELEY as evidenced by a written notice to that
effect.
2. COMPENSATION
a. So long as ISELEY continues to perform the services specified in Section
1 and this Agreement has not terminated, ISELEY shall receive a salary
at the annual rate of One Hundred Twenty-five Thousand Dollars
($125,000) (the "Annual Compensation").
b. CiDRA shall reimburse ISELEY for her reasonable expenses incurred in
performing her duties to CiDRA hereunder, subject to policies
established by the Board of Directors of CiDRA (the "Board") from time
to time.
c. ISELEY shall receive such other benefits as CiDRA provides to its
executive employees.
d. ISELEY shall receive twenty-five (25) days of Paid Time Off for
sickness, personal business and vacation during each calendar year,
prorated in the first calendar year of ISELEY's employment with CiDRA as
appropriate.
e. CiDRA will provide medical insurance coverage for ISELEY and her family
through a plan maintained by CiDRA for its employees. CiDRA shall have
the right to adopt a medical insurance plan that requires some level of
copayment from employees, including ISELEY.
f. ISELEY shall be eligible for incentive compensation in accordance with
an Incentive Compensation Plan adopted by CiDRA's Board of Directors
for the Company's executive employees. CiDRA shall implement such an
Incentive Compensation Plan within ninety (90) days following the
Effective Date of this Agreement.
3. RELOCATION AND SEPARATION PAYMENT/BONUS REPAYMENT
a. No later than September 1, 1999, ISELEY will relocate to Connecticut,
and work out of CiDRA's Connecticut Office.
b. CiDRA shall reimburse ISELEY for her actual relocation expenses for
moving her residence from New York to Connecticut and for any repayment
of bonuses or relocation expenses to her current employer, up to a
maximum amount of Thirty Five Thousand Dollars ($35,000.00). ISELEY
shall submit copies of invoices and charges for her moving expenses and
payments to her current employer to CiDRA's Director of Human
Resources, and CiDRA shall reimburse ISELEY for such expenses within 15
days of presentation of such invoices.
4. STOCK OPTIONS
a. On the Effective Date, ISELEY shall receive an Incentive Stock Option
under the CiDRA Corporation 1997 Stock Option Plan, as amended, to
purchase One Hundred Thousand (100,000) shares of CiDRA Class A Common
Stock, $.001 par value (the "Shares") at the Fair Market Value of said
Shares on the Effective Date.
b. In the event that following or in connection with a Change-in-Control
(as defined below), ISELEY's employment with CiDRA is (i) terminated by
CiDRA for any reason other than Cause, or (ii) terminated by ISELEY in
the event of a CiDRA Breach, ISELEY's Incentive Stock Options which
would otherwise vest or become exercisable solely with the passage of
time and ISELEY's continued employment with CiDRA, shall immediately
vest and become fully exercisable and all rights relevant to such
Incentive Stock Options shall accrue immediately to ISELEY. "Change-In-
Control" shall mean: (i) any sale, lease, exchange or other transfer
(in one transaction or a series of transactions) of all or
substantially all of the assets of CiDRA; (ii) individuals who, as of
the date hereof, constitute the entire Board of Directors of CiDRA (the
"Incumbent Directors") cease for any reason to constitute at least a
majority of the Board of Directors, provided that any individual
becoming a director subsequent to the date hereof whose election was
approved by a vote of at lease a majority of the then Incumbent
Directors shall be, for the purposes of this provision, considered as
though such individual were an Incumbent Director; (iii) any
consolidation or merger of CiDRA with any other entity where the stock
holders of CiDRA immediately prior to the consolidation or merger,
would not, immediately after the consolidation or merger, beneficially
own, directly or indirectly, shares representing fifty percent (50%) of
the
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combined voting power of all of the outstanding securities of the
entity issuing cash or securities in the consolidation or merger (or
its ultimate parent corporation, if any); (iv) a third person,
including a "person" as defined in Section 13(d)(3) of the Exchange
Act, becomes the beneficial owner (as defined in Rule 13d-3 under the
Exchange Act) directly or indirectly, of securities of CiDRA
representing seventy-five percent (75%) or more of the total number of
votes that may be cast for the election of the directors of CiDRA; or
(vi) the Board of Directors of CiDRA , by vote of a majority of all the
Directors, adopts a resolution to the effect that a "Change-in-Control"
has occurred for purposes of this Agreement.
c. In the event that the executive employees of CiDRA that are employed
with CiDRA as of the Effective Date of this Agreement are offered,
after the Effective Date of this Agreement, a stock option vesting plan
in the event of a Change-in-Control ("Offer"} that is different from
the terms of section 4b. above, CiDRA shall notify ISELEY within thirty
(30) days of such offer, and ISELEY shall have thirty (30) days from
such notice to elect to replace the terms of Section 4b above with the
terms of such Offer.
5. TERMINATION OF EMPLOYMENT
a. If CiDRA terminates ISELEY's employment for Cause (as defined below),
or ISELEY's employment terminates due to her death or Disability (as
defined below), or ISELEY terminates her employment with CiDRA other
than as a result of a CiDRA Breach (as defined below):
i) CiDRA shall not be required to pay any compensation for
termination; and
ii) ISELEY shall not thereafter continue to participate in any benefit
plans of CiDRA.
b. In the event that ISELEY's employment is terminated by CiDRA without
Cause, or by ISELEY within six (6) months following a CiDRA Breach,
CiDRA will provide ISELEY with severance pay equal to six (6) months
Annual Compensation then in effect to be paid following such
termination.
In the event of such a termination, the foregoing shall be ISELEY's sole and
exclusive remedy and ISELEY shall not be entitled to any other or further
payments, compensation or benefits from CiDRA.
c. For purposes of this Agreement:
i) "Cause" shall mean any act of or omission by ISELEY in the conduct
of ISELEY's duties and responsibilities which constitutes gross
negligence or willful misconduct, or any act of or omission by
ISELEY outside the
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course of ISELEY's duties and responsibilities which involves
dishonesty or criminal conduct. In the event the Board believes it
has Cause to terminate ISELEY's employment, it shall give written
notice to ISELEY stating the specific grounds constituting Cause.
In the event that the Cause alleged constitutes any act or
omission in the conduct of ISELEY's duties and responsibilities
which constitutes gross negligence or willful misconduct, ISELEY
shall have an opportunity within five (5) days after receiving
such notice to meet with the Board to discuss such allegations of
Cause.
ii) A "CiDRA Breach" shall mean a material adverse change in the
current responsibilities (including a change in reporting
relationship), compensation, or location of ISELEY, and such
failure continues for a period of ten (10) days following notice
of such failure by ISELEY to the Board. Any such notice shall
specifically state the grounds which ISELEY alleges constitutes a
CiDRA Breach.
iii) "Disability" shall mean ISELEY's incapacity due to physical or
mental illness as certified in writing by a physician selected by
ISELEY and reasonably acceptable to CiDRA (it being understood
that (i) such physician shall be deemed to be reasonably
acceptable to CiDRA if, within a period of fifteen (15) days after
ISELEY notifies CiDRA of the name of such physician, CiDRA does
not object to the use of such physician, and (ii) if ISELEY fails
to select a physician within fifteen (15) days after a written
request from CiDRA to do so, CiDRA shall have the right to select
the physician to examine ISELEY).
6. NONCOMPETITION
a. Except as provided in Section 7.c. below, ISELEY agrees that during the
term of this Agreement and for a period of two (2) years after the
termination of ISELEY's employment hereunder for any reason, ISELEY will
not, acting alone or in conjunction with others, directly or indirectly,
without the consent in writing of the Board:
i) Engage (either as owner, partner or stockholder wherein ISELEY's
interest represents more that 5% of ISELEY net worth, or as
employer, employee, consultant or otherwise) in any Competitive
Business (as defined below);
ii) Induce any customers of CiDRA or any of its affiliates to curtail
or cancel their business with any of them or induce any person or
entity to do business with any competitor of CiDRA or any of its
affiliates in competition with the business of CiDRA or any of its
affiliates;
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iii) Solicit or canvass business in connection with fiber optic sensing
in the oil and gas industry from any person or entity who was a
customer of CiDRA or any of its affiliates during the period in
which ISELEY's services are or were provided to CiDRA or any of
its affiliates; or
iv) Induce, or attempt to influence, any employee of CiDRA or any of
its affiliates to terminate his/her employment.
A Competitive Business shall be any business that is engaged in developing
and producing (and not just using the information from) fiber optic sensors in
the oil and gas industry. The provisions of each of clauses i, ii, iii, and iv
above are separate and distinct commitments independent of each of the other
clauses.
7. PROPRIETARY INFORMATION AND INVENTIONS
a. ISELEY's interest in:
i) Any and all inventions, improvements and ideas (whether or not
patentable or copyrightable) which ISELEY has made or conceived, or
which she may make or conceive, either solely or jointly with
others, at any time during the term of this Agreement; and
ii) Any suggestion, proposal, writing, drawing and the like of any sort
whatsoever, including any interest in any copyright or patent,
which ISELEY creates or assists in creating during her engagement
with or provision of services to CiDRA;
which is a Competitive Business as defined above (including the
businesses of its affiliates) shall be the exclusive property of CiDRA,
its successors, assignees, or nominees.
(The items specified above in this Section 7.a. are hereinafter
collectively called "Proprietary Subject Matter"). ISELEY shall fully
and promptly disclose to CiDRA all Proprietary Subject Matter made or
conceived during the term of ISELEY's employment. ISELEY shall not
knowingly or intentionally assign or otherwise relinquish any rights in
such Proprietary Subject Matter to any third party without the prior
written consent of the Board.
b. At the request and expense of CiDRA, but without further compensation
to ISELEY beyond the provisions of this Agreement, ISELEY shall
promptly consent to such acts and execute, acknowledge and deliver all
such papers, including without limitation patent and copyright
applications, as may be necessary or desirable in the sole discretion
of CiDRA, to obtain, to protect, to maintain, or to vest in CiDRA the
entire right, title and interest in and to Proprietary Subject Matter,
and in and to any patent applications, patents, copyright applications,
copyrights, or other proprietary rights of any kind relating thereto,
in all countries of the world; including rendering such
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assistance as CiDRA may request, at CiDRA's expense, in any future
contemplated or pending litigation, Patent Office proceeding, or other
proceeding.
c. ISELEY will not knowingly or negligently disclose, or cause others to
disclose to CiDRA or any of its affiliates, or induce CiDRA or any of
its affiliates to use, any information or material which is the
property of other individuals or companies and which there is any
reason to believe is of proprietary or confidential nature, except with
the consent of the owners of such information or material.
d. Since the services which ISELEY is rendering to CiDRA will include, and
ISELEY shall have access to, CiDRA's knowledge and information of
private or confidential or secret nature, ISELEY shall not during, or
after, the term of this Agreement, except as reasonably required in the
normal course of CiDRA's business or as authorized in writing by the
Board, publish, disclose or make use of, or authorize anyone else to
publish, to disclose or otherwise make use of, any such knowledge or
information, whether of a technical or of a non-technical nature, which
in any way relates to the design, construction, manufacture or sale of
CiDRA's services or products.
e. All documents, written information and other terms including but not
limited to notes, sketches, manuals, blueprints, notebooks, products,
tools, fixtures, records and information relating to the services or
products of CiDRA or its subsidiaries, made or obtained by ISELEY
through ISELEY's provision of services to, or employment by CiDRA,
shall be the exclusive property of CiDRA and shall be delivered by
ISELEY to CiDRA upon termination of this Agreement (whether such
termination is caused by an act of CiDRA or by ISELEY or by any other
act), or any other time as requested by CiDRA.
8. GOVERNING LAW; ARBITRATION; INJUNCTIVE AND OTHER RELIEF
This Agreement shall be governed by and construed and enforced in
accordance with the laws of the State of Connecticut applicable to agreements
made and to be performed entirely in Connecticut. Each party hereby irrevocably
consents to the exclusive jurisdiction of the federal and state courts located
in Hartford, Connecticut with respect to any actions which may arise in
connection with this Agreement and are not required by this Section 8 to be
arbitrated. Except as provided in this Section 8, any controversy or claim
arising out of or relating to this Agreement, or the breach thereof, shall be
settled by arbitration administered by the American Arbitration Association in
accordance with its Commercial Arbitration Rules, and judgment on the award
rendered by the arbitrators may be entered in any court having jurisdiction
thereof.
Each of the parties to this Agreement acknowledges that a breach of this
Agreement may cause the other party irreparable harm which may not be adequately
compensated by money damages. Therefore, in the event of a breach or threatened
breach
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by a party, injunctive or other equitable relief will be available to the other
party, and any arbitrator acting pursuant to this Agreement shall have the
authority to provide such injunctive or other equitable relief. Remedies
provided herein are not exclusive, except as provided in Section 5.b.
The arbitrator shall have the authority to award such remedies or relief
that a court of the State of Connecticut could order or grant in an action
governed by Connecticut law, including, without limitation, specific performance
of any obligation created under this Agreement, the issuance of an injunction,
or the imposition of sanctions for abuse or frustration of the arbitration
process. The arbitration proceedings shall be conducted in Hartford,
Connecticut.
Notwithstanding the foregoing, any party may bring and pursue an action in
any Federal or State court located in Hartford, Connecticut seeking provisional
relief, including a temporary restraining order or preliminary injunction,
pending an arbitration proceeding. Any provisional relief obtained shall be
discontinued once the arbitrator has assumed jurisdiction and ordered such
discontinuance.
9. MISCELLANEOUS
a. Survival. Notwithstanding anything in this Agreement to the contrary,
Sections 6, 7, and 8 shall survive any termination of this Agreement.
b. Successors and Assigns. The provisions hereof shall inure to the benefit
of, and be binding upon, the successors, assigns, heirs, executors and
administrators of the parties hereto.
c. Entire Agreement; Amendment. This Agreement and the attachment hereto
together constitute the full and entire understanding and agreement
between the parties with regard to the subjects hereto and thereof.
None of this Agreement and the attachment hereto or any term hereof or
thereof may be amended, waived, discharged or terminated, except by a
written instrument signed by both of the parties hereto.
d. Notices, etc. All notices and other communications required or
permitted hereunder shall be in writing and shall be mailed by certified
or registered mail, postage prepaid, delivered either by hand or by
messenger, or transmitted by electronic telecopy (fax) addressed:
If to CiDRA:
CiDRA Corporation
Attn: Law Department
50 Barnes Park North
Wallingford, CT 06492
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With a copy to:
Frank J. Marco, Esquire
Day, Berry & Howard LLP
CityPlace I
Hartford, CT 06103-3499
Fax: (860) 275-0255
If to ISELEY, at:
Ann Iseley
Address on file with the CiDRA
or at such other address as any party shall have furnished to the
others in writing. All such notices and other written communications
shall be effective (i) if mailed, seven (7) days after mailing [if
mailed from outside the United States, such mailing must be by airmail
and said seven (7) days shall be fourteen (14) days], (ii) if
delivered, upon delivery, or (iii) if faxed, one (1) business day after
transmission and acknowledgement of receipt by telephone or fax.
e. Delays or Omissions. No delay or omission to exercise any right, power
or remedy accruing to either party hereto upon any breach or default of
the other party under this Agreement shall impair any such right, power
or remedy of such party nor shall it be construed to be a waiver of any
such breach or default, or an acquiescence therein, or any similar
breach or default thereafter occurring. No waiver of any single breach
or default shall be deemed a waiver of any other breach or default
theretofore or thereafter occurring. Any waiver, permit, consent or
approval of any kind or character on the part of any party hereto of
any breach or default under this Agreement or any waiver on the part of
any party hereto of any provisions or conditions of this Agreement must
be made in writing and shall be effective only to the extent
specifically set forth in such writing. All remedies, either under this
Agreement or by law or otherwise afforded to any party, shall be
cumulative and not alternative.
f. Separability. In case any provision of this Agreement shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired
thereby. ISELEY and CiDRA acknowledge that the restrictive covenants
herein have been negotiated in good faith and they believe that such
restrictive covenants are reasonable and are not more restrictive or
broader than are necessary to protect the interests of the parties
hereto, and would not achieve their intended purpose if they were on
different terms or for periods of time shorter than the periods of time
provided herein or applied in more restrictive geographical areas than
are provided herein. Each party further acknowledges and agrees that
the CiDRA businesses are highly competitive, that CiDRA would not enter
into this Agreement but for the
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covenants contained in Section 4, and that such covenants are essential
to protect the value of the CiDRA businesses. ISELEY and CiDRA
acknowledge and confirm that competition by ISELEY would likely cause
irreparable injury to CiDRA and its affiliates. If, however, it shall
be determined at any time by any arbitrator or court of competent
jurisdiction that this Agreement, as written, is unenforceable because
the restrictions set forth herein are unreasonable, the parties hereto
agree that such portions as shall have been determined to be
unreasonably restrictive shall thereupon be deemed so amended as to
make such restrictions reasonable in the determination of such
arbitrator or court, and the said covenants, as so modified, shall be
enforceable between the parties to the same extent as if such
amendments had been made prior to the date of any alleged breach of
said covenants.
IN WITNESS WHEREOF, each of the parties has executed this Agreement as of
the Effective Date.
CiDRA CORPORATION
/s/ Ann Iseley /s/ F. Kevin Didden
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Ann Iseley By: F. Kevin Didden
President & CEO
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